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$ 600.123 Cost sharing or matching.

(a) All cost sharing or matching contributions, including cash and third party in-kind, shall meet all of the following criteria.

(1) Are verifiable from the recipient's records.

(2) Are not included as contributions for any other federally-assisted project or program.

(3) Are necessary and reasonable for proper and efficient accomplishment of project or program objectives.

(4) Are allowable under the applicable cost principles.

(5) Are not paid by the Federal Government under another award, except where authorized by Federal statute to be used for cost sharing or matching.

(6) Are provided for in the approved budget.

(7) Conform to other provisions of this subpart, as applicable.

(b) Unrecovered indirect costs may be included as part of cost sharing or matching.

(c) Values for recipient contributions of services and property shall be established in accordance with the applicable cost principles. If DOE authorizes recipients to donate buildings or land for construction/facilities acquisition projects or long-term use, the value of the donated property for cost sharing or matching shall be the lesser of either paragraph (c)(1) or (2) of this section.

(1) The certified value of the remaining life of the property recorded in the recipient's accounting records at the time of donation.

(2) The current fair market value. However, when there is sufficient justification, DOE may approve the use of the current fair market value of the donated property, even if it exceeds the certified value at the time of donation to the project.

(d) Volunteer services furnished by professional and technical personnel, consultants, and other skilled and unskilled labor may be counted as cost sharing or matching if the service is an integral and necessary part of an approved project or program. Rates for volunteer services shall be consistent with those paid for similar work in the recipient's organization. In those instances in which the required skills are

not found in the recipient organization, rates shall be consistent with those paid for similar work in the labor market in which the recipient competes for the kind of services involved. In either case, paid fringe benefits that are reasonable, allowable, and allocable may be included in the valuation.

(e) When an employer other than the recipient furnishes the services of an employee, these services shall be valued at the employee's regular rate of pay (plus an amount of fringe benefits that are reasonable, allowable, and allocable, but exclusive of overhead costs), provided these services are in the same skill for which the employee is normally paid.

(1) Donated supplies may include such items as office supplies, laboratory supplies or workshop and classroom supplies. Value assessed to donated supplies included in the cost sharing or matching share shall be reasonable and shall not exceed the fair market value of the property at the time of the donation.

(8) The method used for determining cost sharing or matching for donated equipment, buildings and land for which title passes to the recipient may differ according to the purpose of the award, if either paragraph (8)(1) or (2) of this section apply.

(1) If the purpose of the award is to assist the recipient in the acquisition of equipment, buildings or land, the total value of the donated property may be claimed as cost sharing or matching.

(2) If the purpose of the award is to support activities that require the use of equipment, buildings or land, normally only depreciation or use charges for equipment and buildings may be made. However, the full value of equipment or other capital assets and fair rental charges for land may be allowed, provided that DOE has approved the charges.

(h) The value of donated property shall be determined in accordance with the usual accounting policies of the recipient, with the following qualifications.

(1) The value of donated land and buildings shall not exceed its fair market value at the time of donation to the recipient as established by an inde

pendent appraiser (e.g., certified real nanced in whole or in part with DOE property appraiser or General Services funds. Administration representative) and

(b) Except as provided in paragraph certified by a responsible official of the (h) of this section, program income recipient.

earned during the project period shall (2) The value of donated equipment be retained by the recipient and, in acshall not exceed the fair market value cordance with program regulations or of equipment of the same age and con- the terms and conditions of the award, dition at the time of donation.

shall be used in one or more of the fol(3) The value of donated space shall lowing ways. not exceed the fair rental value of com- (1) Added to funds committed to the parable space as established by an inde- project and used to further eligible pendent appraisal of comparable space project objectives. and facilities in a privately-owned (2) Used to finance the non-DOE building in the same locality.

share of the project. (4) The value of loaned equipment (3) Deducted from the total project shall not exceed its fair rental value. allowable cost in determining the net

(1) The following requirements per- allowable costs on which the share of tain to the recipient's supporting costs is based. records for in-kind contributions from (c) When DOE authorizes the disposithird parties.

tion of program income as described in (1) Volunteer services shall be docu- paragraphs (b)(1) or (b)(2) of this secmented and, to the extent feasible, sup- tion, program income in excess of any ported by the same methods used by limits stipulated shall be used in acthe recipient for its own employees. cordance with paragraph (b)(3) of this

(2) The basis for determining the section. valuation for personal service, mate- (d) In the event that the program rial, equipment, buildings and land regulations or the terms and condishall be documented.

tions of the award do not specify how (j) DOE shall specify in the solicita- program income is to be used, paration or in the program rule, if any, any graph (b)(3) of this section shall apply cost sharing requirement. The award automatically to all projects or prodocument shall be specific as to wheth- grams except research. For awards that er the cost sharing is based on a mini- support research, paragraph (b)(1) of mum amount for the recipient or on a this section shall apply automatically percentage of total costs.

unless the award indicates another al(k) If DOE requires that a recipient ternative in the terms and conditions, provide cost sharing which is not re- the recipient is subject to special quired by statute or which exceeds a award conditions, as indicated in statutory minimum, DOE shall state in $ 600.114, or the recipient is a commerthe program rule or solicitation the

cial organization. reasons for requiring such cost sharing, (e) Unless program regulations or the recommended or required levels of cost terms and conditions of the award prosharing, and the circumstances under vide otherwise, recipients shall have no which the requirement for cost sharing obligation to the Federal Government may be waived or adjusted during any regarding program income earned after negotiation.

the end of the project period. (1) Whenever DOE negotiates the (1) Unless program regulations or the amount of cost sharing, DOE may take terms and conditions of the award prointo account such factors as the use of vide otherwise, costs incident to the program income (see $600.124), patent generation of program income may be rights, and rights in data. Foregone fee deducted from gross income to deteror profit shall not be considered in es- mine program income, provided these tablishing the extent of cost sharing. costs have not been charged to the 8 600.124 Program income.


(g) Proceeds from the sale of property (a) The standards set forth in this shall be handled in accordance with the section shall be used to account for requirements of the Property Standprogram income related to projects fi- ards (See $$ 600.130 through 600.137).

(h) Unless program regulations or the terms and condition of the award provide otherwise, recipients shall have no obligation to the Federal Government with respect to program income earned from license fees and royalties for copyrighted material, patents, patent applications, trademarks, and inventions produced under an award. However, Patent and Trademark Amendments (35 U.S.C. Chapter 18) apply to inventions made under an

experimental, developmental, or research award.

8600.125 Revision of budget and pro

gram plans. (a) The budget plan is the financial expression of the project or program as approved during the award process. It includes the sum of the Federal and non-Federal share when there are cost sharing requirements. It shall be related to performance for program evaluation purposes whenever appropriate.

(b) Recipients are required to report deviations from budget and program plans, and request prior approvals for budget and program plan revisions, in accordance with this section.

(c) For nonconstruction awards, recipients shall request prior approvals from the DOE for one or more of the following program or budget related reasons.

(1) Change in the scope or the objective of the project or program (even if there is no associated budget revision requiring prior written approval).

(2) Change in a key person specified in the application or award document.

(3) The absence for more than three months, or a 25 percent reduction in time devoted to the project, by the approved project director or principal investigator.

(4) The need for additional Federal funding.

(5) If required by program regulations, the transfer of amounts budgeted for indirect costs to absorb increases in direct costs, or vice versa.

(6) The inclusion, unless waived by program regulations or the terms and conditions of award, of costs that require prior approval in accordance with OMB Circular A-21, “Cost Principles for Institutions of Higher Education," OMB Circular A-122, “Cost Principles

for Non-Profit Organizations," or 45 CFR part 74 Appendix E, “Principles for Determining Costs Applicable to Research and Development under Grants and Contracts with Hospitals," or 48 CFR part 31, “Contract Cost Principles and Procedures," as applicable.

(7) The transfer of funds allotted for training allowances (direct payment to trainees) to other categories of expense.

(8) Unless described in the application and funded in the approved awards, the subaward, transfer or contracting out of any work under an award. This provision does not apply to the purchase of supplies, material, equipment or general support services.

(d) No other prior approval requirements for specific items may be imposed unless a deviation has been ap proved in accordance with $600.4.

(e) Except for requirements listed in paragraphs (c)(1) and (c)(4) of this section, program regulations may waive cost-related and administrative prior written approvals required by this subpart and its Appendices. Such waivers may include authorizing recipients to do any one or more of the following.

(1) Incur pre-award costs 90 calendar days prior to award without prior ap proval or more than 90 calendar days with the prior approval of DOE. All pre-award costs are incurred at the recipient's risk (i.e., DOE is under no obligation to reimburse such costs if for any reason the recipient does not receive an award or if the award is less than anticipated and inadequate to cover such costs).

(2) Initiate a one-time extension of the expiration date of the final budget period of the project of up to 12 months unless one or more of the following conditions apply.

(1) The terms and conditions of award prohibit the extension.

(11) The extension requires additional Federal funds.

(iii) The extension involves any change in the approved objectives or scope of the project.

(iv) The extension is being exercised merely for the purpose of using unobligated balances. For one-time extensions, the recipient must notify the DOE in writing with the supporting reasons and revised expiration date at least 10 days before the expiration date specified in the award.

(3) Carry forward unobligated balances to subsequent funding periods.

(4) For awards that support research, unless the terms and conditions of award provide otherwise, the prior approval requirements described in paragraph (e) of this section are automatically waived (i.e., recipients need not obtain such prior approvals) unless one of the conditions included in $ 600.125(e)(2) applies.

(5) For continuation awards within a multiple year project in support of research, prior to receipt of continuation funding, preaward expenditures by recipients are not subject to the limitation or approval requirements of $ 600.125(e)(1). Nevertheless, incurrence by the recipient does not impose any obligation on DOE if a continuation award is not subsequently made, or if an award is made for a lesser amount than the recipient expected.

(1) Program regulations may restrict the transfer of funds among direct cost categories or programs, functions and activities for awards in which DOE'S share of the project exceeds $100,000 and the cumulative amount of such transfers exceeds or is expected to exceed 10 percent of the total budget as last approved by DOE. However, no program regulation shall permit a transfer that would cause any Federal appropriation or part thereof to be used for purposes other than those consistent with the original intent of the appropriation.

(g) All other changes to nonconstruction budgets, except for the changes described in paragraph (j) of this section, do not require prior approval.

(h) For construction awards, recipients shall request prior written approval promptly from the Contracting Officer for budget revisions whenever paragraph (h) (1), (2) or (3) of this section apply.

(1) The revision results from changes in the scope or the objective of the project or program.

(2) The need arises for additional Federal funds to complete the project.

(3) A revision is desired which involves specific costs for which prior written approval requirements may be

imposed consistent with applicable OMB cost principles listed in 8 600.127.

(i) Except in accordance with the deviation procedures in 600.4 or as may be provided for in program regulations, no other prior approval requirements for specific items will be imposed by DOE.

(j) When DOE makes an award that provides support for both construction and nonconstruction work, DOE may require the recipient to request prior approval from DOE before making any fund or budget transfers between the two types of work supported.

(k) For both construction and nonconstruction awards, recipients shall notify DOE in writing promptly whenever the amount of Federal authorized funds is expected to exceed the needs of the recipient for the project period by more than $5000 or five percent of the Federal award, whichever is greater. This notification shall not be required if an application for additional funding is submitted for a continuation award.

(1) Requests for budget revisions may be made by letter.

(m) Within 30 calendar days from the date of receipt of the request for budget revisions, DOE shall review the request and notify the recipient whether the budget revisions have been approved. If the revision is still under consideration at the end of 30 calendar days, DOE shall inform the recipient in writing of the date when the recipient may expect the decision.

(n) DOE approval or disapproval of a request for a budget or project revision shall be in writing and signed by a DOE Contracting Officer.

(O) A request by a subrecipient for prior approval shall be addressed in writing to the recipient. The recipient shall promptly review such request and shall approve or disapprove the request in writing within 30 days from the date of the recipient's request for the revision. A recipient shall not approve any budget or project revision which is inconsistent with the purpose or terms and conditions of the DOE award. If the revision requested by the subrecipient would result in a change to the recipient's approved budget or approved project which requires DOE prior approval, the recipient shall obtain DOE approval before approving such revision.

$ 600.126 Non-Federal audits.

visions of OMB Circular A-122, “Cost (a) Recipients and subrecipients that

Principles for Non-Profit Organizaare institutions of higher education or

tions." The allowability of costs inother non-profit organizations shall be

curred by institutions of higher edusubject to the audit requirements con

cation is determined in accordance tained in OMB Circular A-133, “Audits

with the provisions of OMB Circular Aof Institutions of Higher Education and

21, “Cost Principles for Educational InOther Non-Profit Institutions."

stitutions." The allowability of costs (b) State and local governments shall

incurred by hospitals is determined in be subject to the audit requirements

accordance with the provisions of Apcontained in the Single Audit Act (31

pendix E of 45 CFR part 74, “Principles U.S.C. 7501-7) and Federal awarding

for Determining Costs Applicable to agency regulations implementing OMB

Research and Development Under Circular A-128, “Audits of State and Grants and Contracts with Hospitals.” Local Governments."

The allowability of costs incurred by (c) The Contracting Officer may

commercial organizations and those audit, or cause to be audited, awards to non-profit organizations listed in Athospitals not covered by the audit pro

tachment C to Circular A-122 is detervisions of OMB Circular A-133 when

mined in accordance with the proviever and in the degree of detail he/she sions of the Federal Acquisition Regudeems necessary. The Contracting Offi- lation (FAR) at 48 CFR part 31. cer shall rely on available audit reports

(b) Indirect costs. Unless restricted by in determining the need for and scope Federal statute or program rule, DOE of such audits. The hospital has similar shall provide for the reimbursement of authority in auditing subrecipients. appropriate indirect costs.

(d) The Contracting Officer may (1) DOE shall include an amount for audit, or cause to be audited, awards to indirect costs in an award only if the commercial organizations whenever applicant requests reimbursement of and in the degree of detail he/she deems such costs and necessary. The Contracting Officer (i) Submits evidence that a cognizant shall rely on available audit reports in Federal agency has been assigned to esdetermining the need for and scope of tablish indirect cost rates for the applisuch audits. The commercial organiza- cant and indicates or provides evidence tion has similar authority in auditing thatsubrecipients.

(A) A current agreement containing (e) The Contracting Officer may an applicable approved indirect cost audit, or cause to be audited, awards to rate(s) covering all or part of the budgindividuals whenever and in the degree et period for which DOE may provide of detail he/she deems necessary. The funding has been established; or Contracting Officer shall rely on avail- (B) An indirect cost proposal has able audit reports in determining the been submitted to the cognizant agenneed for and scope of such audits.

cy in order to establish an applicable

approved indirect cost rate(s) covering $ 600.127 Allowable costs.

all or part of the budget period for (a) General. For each kind of recipi- which DOE may provide funding; or ent, there is a set of Federal principles (C) An indirect cost proposal coverfor determining allowable costs. Allow- ing all or part of the budget period and ability of costs shall be determined in applicable to the activities for which accordance with the cost principles ap- DOE may provide funding will be subplicable to the entity incurring the mitted to the cognizant agency for apcosts. Thus, allowability of costs in- proval no later than three months after curred by State, local or federally-rec- the beginning date of the initial budget ognized Indian tribal governments is period of the DOE award or, for subsedetermined in accordance with the pro- quent budget periods, in accordance visions of OMB Circular A-87, “Cost with any schedule established by the Principles for State and Local Govern- cognizant agency; or ments." The allowability of costs in- (ii) If not assigned to a cognizant curred by non-profit organizations is agency, the applicant includes, in the determined in accordance with the pro- application, data that is current, com

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