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Unlocking Federal Financial Assistance: A Closer Look at the Revised Uniform Guidance

Navigating the complex landscape of federal funding has traditionally been daunting and costly for many jurisdictions. However, the federal Office of Management and Budget (OMB) has introduced transformative changes with its recently published revised guidance to Federal agencies on administering and managing Federal awards in Title 2 of the Code of Federal Regulations (CFR). This guidance aims to streamline, simplify, and enhance the accessibility of federal financial assistance. The revisions highlight the OMB’s commitment to improving the management of federal awards—thus significantly reducing the burden for federal agencies, applicants, and recipients alike. 

Understanding the CFR Uniform Guidance

At its core, the Uniform Guidance is foundational to all federal financial assistance programs. It serves as a comprehensive framework aimed at managing and measuring the effectiveness of federal funds. The recent updates focus on four main themes, each designed to enhance the effectiveness and accessibility of federal funding: 

  • Outcomes-Focused Funding: Shifting from merely disbursing funds to measuring their impact through evidence-based decision-making and replicating successful models nationwide. 
  • Equitable Distribution: Expanding access to funding for non-traditional recipients, thus democratizing the opportunities federal funds such as the Infrastructure Investment and Jobs Act (IIJA), commonly known as the Bipartisan Infrastructure Law (BIL), the Inflation Reduction Act (IRA), and the Creating Helpful Incentives to Produce Semiconductors and Science Act (CHIPS and Science Act) can offer. 
  • Simplified Processes: Implementing plain English standards in grant guidance to make it more comprehensible for all, especially non-traditional grant recipients who may have previously found the process inaccessible. 
  • Reduced Compliance Costs and Burdens: Easing the administrative overhead by raising the requirement threshold for single audits and streamlining reporting requirements. 

These changes are not just administrative tweaks; they are aimed at fundamentally changing how federal assistance is perceived and utilized, focusing strongly on outcomes and efficiency. 

How the Revised Guidance Amplifies Impact for Grant Recipients and Subrecipients

The Unform Guidance revisions are set to bring numerous benefits to grant recipients and subrecipients: 

  • Simplified Management and Reporting: The emphasis on plain language and standardized templates simplifies the process of applying for and managing grants. 
  • Lower Costs of Participation: By raising audit thresholds and simplifying financial and performance reporting, the costs associated with managing grants are reduced. 
  • Broader Accessibility: The focus on including non-traditional recipients ensures a wider array of entities can benefit from federal funds. 
  • Enhanced Transparency and Accountability: With a robust framework focusing on outcomes and evidence-based practices, there is greater clarity on how funds are utilized and the benefits they generate. 
  • Improved Program Impact Tracking: Enhanced tracking mechanisms ensure that recipients can effectively measure and report on the impact of their programs.

Strategic Funding Innovations Enhance Grant Management Sustainability

Recognizing the financial challenges often associated with managing grants, the updated guidance increases the De Minimis Indirect Cost Rate from 10% to 15% and allows indirect costs to be charged to the first $50,000 of each subaward. This increment provides a more sustainable funding mechanism, enabling recipients to better manage and even expand their grant-related activities without overburdening their core financial resources. Furthermore, it allows jurisdictions that have never had a negotiated indirect cost rate with the federal government to begin recouping indirect costs quickly and efficiently. This strategic shift encourages recipients at all levels to establish, grow, and sustain a robust grants management enterprise within their jurisdictions.  

Establishing a sustainable grants management enterprise equips organizations with the readiness to swiftly capitalize on new funding opportunities as they arise, ensuring they are always positioned to meet the eligibility and compliance requirements efficiently. Furthermore, it preserves crucial institutional knowledge about the grants management process—maintaining continuity and expertise that enhance the organization’s capability to secure and manage future grants successfully. 

Prepare Now to Maximize New Funding Efficiencies

As these revisions transition from policy to practice, it is crucial for current and prospective grant recipients to familiarize themselves with the new rules. With the official implementation set for new funding post-October 1, and the possibility for current funds to adopt these changes, entities should actively prepare their grants management systems to leverage these new efficiencies. Grant recipient and subrecipient entities are encouraged to: 

  • Educate themselves: Understanding the new guidance is fundamental. Engaging with seminars, workshops, or consulting experts can provide necessary insight. 
  • Organize their systems: Building or refining grants management systems to align with the new guidance will be crucial in maximizing the benefits of federal funding. 
  • Invest in continuity: Ensuring their grants management operations are not just for immediate needs but are sustainable long-term will position entities to be ready for future funding opportunities. 

The revised CFR Uniform Guidance marks a significant step toward a more efficient federal funding landscape. By reducing complexities and focusing on impactful funding, it presents opportunities for a broader range of participants to contribute to and benefit from federal programs. As these changes take effect, the potential for transformative projects and initiatives across the country looks promising. For recipients, the time to act is now—to reorganize, understand, and adapt to these changes for a better, more efficient future in managing their federal funds. 

Author

Matthew-Hanson_5ec4dda68b6bcab72c5edd90255be92b

Matthew Hanson
Associate Managing Director, Grants & Policy

Matthew brings more than 25 years of progressive experience in government program/grant management, finance, and agency operations at the federal, state, and local levels. He is an industry thought leader focusing on the benefits of centralized approaches to grants management and the use of technology as resource multipliers leveraging his experience from the U.S. Department of Justice along with the State of Arizona, Matt has seen first-hand the efficiencies created through centralizing grants management services. As a result of his experiences during the American Recovery and Reinvestment Act of 2009, Matt lead the establishment of one of the nation's first statewide grants management offices along with the deployment of a statewide enterprise grants management solution.

Jason-Mistlebauer-hs_075513145c176ef5da996b894dff0b52

Jason Mistlebauer
Director, Grants & Policy

Serving as Grants & Policy Director for Witt O’Brien’s Community Services practice, Jason brings more than thirty years of professional experience in the public sector as well as non-profit and philanthropic organizations with expertise in program development, implementation, and management. Additionally, he provides Federal policy updates and analyses that may affect Witt O’Brien’s many clients.

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