The purpose of Part 1050 is to set forth the Uniform Federal Standards pursuant to OMB Circular A-110 and FMC 74-7 (A-102) and to provide grantees with CSA's policies and procedures implementing those standards the goal of which is to obtain consistency and uniformity among Federal agencies in the administration of grants to, and other agreements with, units of local and State Government, public and private institutions of higher education, public and private hospitals, and other quasi-public and private non-profit organizations.

$1050.3 Exceptions to the Uniform Federal Standards.

(a) For classes of grantees. Neither CSA nor any other Federal agency can apply more restrictive or differing requirements on a class of grantees unless (1) a statute expressly prescribes policies or specific requirements that differ from the standards or (2) the agency has received approval from the Office of Management and Budget.

(b) For certain grantees. CSA may impose additional requirements on individual grantees if the grantee has a history of poor performance, is not financially stable, or its management system does not meet the standards set forth in Part 1050. In those instances CSA must inform the grantee in writing as to (1) why the additional standards are being imposed and (2) what corrective action is needed. Copies of such notifications must be sent to OMB and other agencies funding the grantee at the same time the grantee is notified.

§ 1050.4 Definitions of terms as used in this part.

(a) The term "grant" means money or property provided in lieu of money paid or furnished by grantees under programs that provide financial assistance or that provide support or stimulation to accomplish a public purpose. The term "other agreements" does not include contracts which are required to be entered into and administered under procurement laws and regulations. Grants and other agreement exclude (1) technical assistance programs, which provide services instead of money, (2) assistance in the form of general revenue sharing, loans, loan guarantees, or insurance, and (3) direct payments of any kind to individuals.

(b) The term "grantee" is used by CSA in lieu of "recipient" and includes the following types of nonprofit organizations that are receiving Federal funds from a Federal agency or through a State or local government:

(1) Public and private institutions of higher education: public and private hospitals; and other quasi-public and private nonprofit organizations such as (but not limited to) community action agencies, research institutes, educational associations, and health centers. In addition, for purposes of this part, it includes private-for-profit organizations funded under Title VII of the EOA. The term does not include foreign or international organizations (such as agencies of the United Nations) and Government-owned contractor-operated facilities or research centers providing continued support

for mission-oriented, large scale programs that are Government-owned, or are designed as federally-funded research and development centers.

(c) The term "delegate agency" is used by CSA in lieu of "subrecipient" and means a public or private agency, institution or organization or a State or other political jurisdiction to which the development, conduct and administration of all or part of a project assisted under the Economic Opportunity Act of 1964, as amended, has been delegated by a grantee or by another agency or organization which has received assistance by or through a grantee, but does not include individuals who ultimately receive benefits under any program or assistance.

§ 1050.5 Implementing schema.

(a) Responsibilities. OMB Circular A-110 and FMC 74-7 (Cir. A-102) require all Federal agencies administering programs that involve grants and other agreements with grantees to issue appropriate implementing regulations.

(b) Publication formats. As with all policy statements CSA is issuing its implementing regulations both in the FEDERAL REGISTER and as part of the CSA directives system. However, a separate Part (1050) has been established in the Code of Federal Regulations within which all Uniform Federal Standards and accompanying CSA policies and procedures will be published. Also, in the CSA directives system the 6800 series will be used exclusively for promulgation of the standards. Each standard will be issued as a separate CSA Instruction within that series with accompanying CSA implementing policies and procedures (if required) to be issued as an Attachment to the appropriate Instruction. As a further means of more easily identifying the standards, CSA will deviate from its normal practice of using yellow stock to identify policy statements and will publish the standards on blue stock.

(c) Cross Reference Index. Following is an index which provides a cross reference to CSA implementing regulations:

§ 1050.12 FDIC insurance coverage.

Any monies advanced to a grantee which are subject to the control or regulation of the United States or any of its officers, agents or employees' (public monies as defined in Treasury Circular No. 176, as amended) must be deposited in a bank with Federal Deposit Insurance Corporation (FDIC) insurance coverage and the balance exceeding the FDIC coverage must be collaterally secured.

§ 1050.13 Minority-owned banks.

Consistent with the national goal of expanding the opportunities for minority business enterprises, grantees and delegate agencies are encouraged to use minority banks (a bank which is owned at least 50 percent by minority group members).

(1) OMB Circular A-110, Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Nonprofit Organizations (Attachment B).

(2) FMC 74-7, Uniform Administrative Requirements for Grants-in-Aid to State and Local Governments (Attachment B).

(3) CSA Instruction 6710-6, Applying for a grant under Title VII of the Community Services Act.

(4) CSA Instruction 6710-8, Preparing a Budget for a Title VII grant under the Community Services Act.

(5) CSA Instruction 6143-1a, Emergency Energy Conservation Program (45 CFR 1061.30).

(b) Construction and facility improvement. The recipient of a CSA grant which requires contracting or facility improvement (including any CSA grant which provides for alterations or renovations of real property) shall follow its own requirements and practices relating to bid guarantees, performance bonds, and payment bonds except for contracts exceeding $100,000. For contracts exceeding

$100,000, CSA may determine that the grantee's bonding provisions adequately protect the Federal Government's interest; otherwise the minimum requirements shall be as follows:

(1) A bid guarantee from each bidder equivalent to five percent of the bid price. The bid guarantee shall consist of a firm commitment such as a bid bond, certified check or other negotiable instrument accompanying a bid as assurance that the bidder will upon acceptance of his bid, execute such contractual documents as may be required within the time specified.

(2) A performance bond on the part of the contractor for 100 percent of the contract price. A performance bond is one executed in connection with a contract to secure fulfillment of all the contractor's obligations under the contract.

(3) A payment bond on the part of the contractor for 100 percent of the contract price. A payment bond is one executed in connection with a contract to assure payment as required by law of all persons supplying labor and material in the execution of the work provided for in the contract.

(c) Loan guarantees. Where in connection with a CSA grant, CSA also guarantees the payment of money borrowed by the grantee, CSA may, at its discretion, require adequate bonding and insurance if the bonding and insurance requirements of the grantee are not deemed adequate to protect the interests of the Federal Government.

(d) Fidelity bonds. If the grantee is a nongovernmental organization, CSA requires adequate fidelity bond coverage.

(e) Source of bonds. Any bonds obtained pursuant to (b)(1) through (3), (c) or (d) of this section shall be obtained from companies holding certifi

cates of authority as acceptable sureties (31 CFR 223).

§ 1050.17 CSA implementing policies and procedures.

(a) Policy. OMB Circular A-110 permits Federal agencies to require fidelity bond coverage of its nongovernmental grantees if the bonding and insurance requirements of the grantee are not deemed adequate to protect the interest of the Federal Government. Therefore, CSA will require evidence of appropriate bonding or assurance that arrangements have been made to obtain such coverage in line with the following policies and procedures.

(1) Bond coverage of officials—(i) Assurance of fidelity bond coverage. (A) Prior to the release of funds to any nongovernmental grantee for the first initial grant CSA must receive written assurance that the grantee has or has made arrangements for appropriate bonding of grantee officials. This assurance will take the form of a letter from a bonding company or agent stating the type of bond, amount and period of coverage, positions covered, and the annual cost of the bond that has been obtained.

(ii) Coverage. In all other situations, nongovernmental grantees must either have secured or must take steps to secure fidelity bond coverage in line with the following guides:

(A) Coverage should be secured in the aggregate amount of $25,000 for persons authorized to sign or countersign checks or to disburse sizeable amounts of cash (such as for payrolls). Persons who handle only petty cash need not be bonded. Nor is it necessary to bond officials who are authorized to sign Payment Vouchers, but who are not authorized to sign or countersign checks or to disburse cash.

(B) Grantees normally should obtain a 3 year bond, payable annually, with an option to cancel in the event the program terminates before three years. Such terms are available from most surety companies.

(iii) Responsibility vis-a-vis delegate agencies. Grantees-both public and private—are responsible for assuring that appropriate officials of nongovernmental delegate agencies are

bonded. Coverage for officials of delegate agencies which are private organizations shall be equal to the average of funds to be expended each month (up to an aggregate amount of $25,000.) If a delegate agency will expend less than $1,000 per month in program funds, on the average, bond coverage is not required.

(b) Procedures. Copies of bonds secured by the grantee and by delegate agencies should be filed by the grantee and need not be submitted to CSA.

(c) Affect of this Subpart on other CSA Policies and Procedures. (1) OEO Instruction 7570-1, pp. 17 and 18, item 11. (3) Bonding: The three paragraphs are superseded and the sentence "See Instruction 6800-3 regarding applicability of bonding requirements and procedures." should be inserted.

(2) OEO Instruction 7570-2, p. 7, item 8.b: The period at the end of the sentence is deleted and the sentence "(See CSA Instruction 6800-3 regarding applicability of bonding requirements and procedures.)" should be inserted.

(1) OMB Circular A-110, Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Nonprofit Organizations (Attachment C).

(2) FMC 74-7, Uniform Administrative Requirements for Grants-in-Aid to State and Local Governments (Attachment C).

(3) CSA Instruction 6800-5, Program Income (Uniform Federal Standard) (45 CFR 1050.40).

(4) CSA Instruction 6800-15, Property Management Standards (Uniform Federal Standard) (45 CFR 1050.130).

(5) OEO Instruction 6801-1, Grantee Fiscal Responsibility and Auditing.

(6) OEO Instruction 6810-1, Grantee Compliance with IRS Requirements for Withheld Federal Income and Social Security Taxes.

(7) CSA Instruction 7050-1, General Conditions Governing CSA Grants Funded Under Titles II, III-B and VII of the EOA of 1964 as amended (45 CFR 1067.5).