Slides from 2010 David Downey webinar on FFATA - SHEEO

American Recovery and
Reinvestment Act of 2009
Open and Honest:
Transparency Act Requirements
What You Need to Know!

Sound Check
Audio is available via the internet
Please be sure your—
speakers are on &
your volume turned up

Agenda
Highlight the Transparency Act
Explain the new reporting requirements
Assess your ability to capture the data
Provide tips for ensuring data quality
Identify submission procedures
Take your questions

Presenter
<strong>David</strong> J. <strong>Downey</strong>
U.S. Department of Education
Office of the Secretary
Risk Management Service

Panelists
U.S. Department of Education
Ayisa Crowe
Office of the Secretary
Pedro Romero
Office of the Secretary
Constance Davis
Office of the Chief Financial Officer

Special Guest
Karen Lee
• Office of Management and Budget
• Lead for Open Government in the
Office of Federal Financial management
• Oversees the implementation of Federal
spending transparency for grant awards
among other areas of financial management

Transparency Act Overview
• Federal Funding Accountability and Transparency Act
• AKA: FFATA
• Signed into law September 6, 2006; amended in ‘08
• Purpose: To empower every American with the ability
to hold the government accountable for each
spending decision. The end result is to reduce
wasteful spending in the government.
http://www.ffata.org/ffata/ffataact.html

Who is Impacted?
The Transparency Act or FFATA legislation
requires information on Federal awards
(Federal financial assistance and expenditures)
be made available to the public via a single,
searchable website.
This impacts the awarding agencies and you
the grantees and subrecipients.

New Reporting Requirements
• Take effect on October 1, <strong>2010</strong>
• Are located in 2 CFR Part 170
• Requires disclosure of entities receiving Federal
funding through Federal awards such as grants and
their sub-grants
• Requires disclosure of executive compensation
• Requires the reported data for each award to
be available on website open to the public
• Agencies assist OMB with implementation

Who is Impacted?
Entities who receive or administer Federal
financial assistance in the form of:
• Contracts
• Grants
• Cooperative agreements
• Loans and loan guarantees
• Subsidies
• Insurance
• Food commodities
• Direct appropriations
• Assessed and voluntary contributions
• “Other”

Our Focus Today

Subaward Definition
• Legal instrument to provide support for the
performance of any portion of the substantive project
or program for which you received this award and that
you as the recipient award to an eligible subrecipient
• Contracts, small purchase agreements, vendor
agreements, and consultant agreements awarded
under an ED grant for supplies, equipment, and
services are not considered subawards for Federal
financial assistance under FATA, and thus, should not
be reported in FSRS by the prime awardee

Who is Exempt?
• Individual or “natural person” outside of a business
or non-profit organization he or she operates
• Compensated executives if in the previous FY the
entity received less than 80% of its annual gross revenue
<strong>from</strong> Federal financial assistance and less than $25 million
<strong>from</strong> Federal financial assistance and procurement
contracts or subcontracts
• Gross income, <strong>from</strong> all sources under $300,000
• Subawards
• Total compensation of the five most highly compensated
executives of any subrecipient

Who Else is Exempt?
• Cooperative research and development
agreements pursuant to the Federal Technology
Transfer Act of 1986 (15 U.S.C.)
• Technical assistance (which provides services in lieu of
money)
• Transfer of title to Federally owned property
provided in lieu of money—even if it is called a grant
• Any award funded in whole or in part with Recovery
Act funds
• Public already has access to compensation info

Classified Information
Classified information remains exempt
<strong>from</strong> the prime and subaward reporting
requirement

Requirements for Awarding Agencies
• Make applicants aware of the reporting requirements
for the Transparency Act in all announcements,
regulations, notices, or other published documents
• Ensure that applicants have the necessary processes
and systems in place to accurately report
• Include the award term in Appendix A
• Agencies report prime award information to
USASpending.gov on 5 th and 20 th of each month
• Assist OMB with implementation and inform awardees

New Requirements for Grantees
• Prime grant awardees of grants $25,000 or
more must report associated grant sub-awards
for Federal financial assistance
• Executive compensation information for awardees
• Be registered with Central Contractor Registration
• See CCR.gov

Timetable
• Reporting for prime and sub-award goes into effect
October 1, <strong>2010</strong>
• Prime awardees must report first tier sub-award
information by the end of the following month <strong>from</strong>
when the award was made or obligated
Example:
An award is made on October 15, <strong>2010</strong>.
The awardee has until November 30, <strong>2010</strong>
to report.

Data Elements
• Reporting system (FSRS) Pre-populates prime awardee and
subawardee information <strong>from</strong> the CCR. Prime awardees
enter following sub-award information if not pre-populated:
–Name of entity receiving award
–DBA name (Grants)
–Amount of award
–Subcontract/Subcontract Number
–Funding agency
–CFDA Number (Grants)
–NAICS (Contracts)
–Treasury Account Symbol
–Award title descriptive

Data Elements
–Location of the entity (including congressional district)
–Place of performance (including congressional district)
–Unique identifier (e.g., DUNS) of the entity and its parent and
DUNS +4 (Grants)
–Total compensation and names of top five executives

Summary
Who? Reports what? How?
Agency Prime award information for awards $25K
or more
FAADS+ for grants, FPDS-NG
for contracts
Prime grant
awardee
Company information
Executive compensation
Grant subaward information for awards
$25K or more
CCR
CCR or FSRS*
FSRS
If executive compensation is not found in CCR it can be supplied through FSRS

Ensuring Quality Data

Assessing Methodology
• Essential step in the project’s development
• Preparation is key
• Anticipate potential problem areas
- Address in the design phase or early as possible
• Ensure consistency across the board
• Communicate clearly with staff collecting and
recording data

Where Methodology Goes Wrong
• Problems by design
• Problems arising <strong>from</strong> human error
Design
Determine just where
they overlap and how
to eliminate, reduce,
negate their effects
on reporting.
Human
Error

Where Methodology Goes Wrong
• Fundamental design flaws
• Data collection mechanisms
• Documentation
• Communication breakdowns

Lost, Inaccurate, or Questionable Data
What do I do if I cannot find my grant in the FSRS.gov
system?
Federal agencies must report all award transactions within 30 days
of the award to USASpending.gov. Typically, the Department of
Education (ED) submits award transactions to USASpending.gov on
the 5 th and 20 th of each month. If your grant was awarded prior to
the 5 th , or between the 5 th and 20 th , check to see if it appears in
USASpending.gov. If it does, you will be able to report in FSRS within
48 hours. If it does not appear in USASpending.gov within 30 days
of your award, contact your program officer for assistance.
When in doubt, contact your program officer!

Questions
Answers
Further Recovery Act questions-
ED contact listed on the Grant Award Notification or,
email RMSCommunications@ed.gov

Thank you for participating!
Please complete an evaluation—
Your feedback is important.
http://www.ed.gov/policy/gen/leg/recovery/rms-webconferences.html

Resource Documents
• FFATA.org
• Central Contractor Registration
• USASpending.gov
• FSRS.gov
• whitehouse.gov/omb/open
• Securities and Exchange Act of 1934
• Federal Technology Transfer Act of 1986
• 1-800-USA-LEARN

Resource Documents
G5 Hotline:
Hours of Operation: 8:00 AM to 6:00 PM, Monday - Friday, EST
Toll-Free: 1-888-336-8930
TTY: 1-866-697-2696
Local: 202-401-6238
Email: edcaps.user@ed.gov

Definitions and Key Terms
1) Entity—means all of the following, as defined in 2 CFR part 25:
i. A Governmental organization, which is a State, local government,
or Indian tribe;
ii. A foreign public entity;
iii. A domestic or foreign nonprofit organization;
iv. A domestic or foreign for-profit organization;
v. A Federal agency, but only as a subrecipient under an award or
subaward to a non-Federal entity.
2) Executive—means officers, managing partners, or any other
employees in management positions.

Definitions and Key Terms
3) Subaward—term to denote a legal instrument to provide support
for the performance of any portion of the substantive project
or program for which you received this award and that you as the
recipient award to an eligible subrecipient.
ii. The term does not include your procurement of property and
services needed to carry out the project or program (for further
explanation, see Sec. ---- .210 of the attachment to OMB Circular
A-133, ``Audits of States, Local Governments, and Non-Profit
Organizations'').
iii. A subaward may be provided through any legal agreement,
including an agreement that you or a subrecipient considers a contract.

Definitions and Key Terms
4) Subrecipient—means an entity that:
i. Receives a subaward <strong>from</strong> you (the recipient) under this award;
ii. Is accountable to you for the use of the Federal funds provided
by the subaward.
5) Total compensation—means the cash and noncash dollar value
earned by the executive during the recipient's or subrecipient's
preceding fiscal year and includes the following (for more information
see 17 CFR 229.402(c)(2)):
i. Salary and bonus.
ii. Awards of stock, stock options, and stock appreciation rights.
Use the dollar amount recognized for financial statement
reporting purposes with respect to the fiscal year in accordance
with the Statement of Financial Accounting Standards No. 123
(Revised 2004) (FAS 123R), Shared Based Payments.

Definitions and Key Terms
5) Total Compensation—
iii. Earnings for services under non-equity incentive plans.
This does not include group life, health, hospitalization or medical
reimbursement plans that do not discriminate in favor of
executives, and are available generally to all salaried employees.
iv. Change in pension value. This is the change in present value
of defined benefit and actuarial pension plans.
v. Above-market earnings on deferred compensation which is
not tax-qualified.vi. Other compensation, if the aggregate value
of all such other compensation (e.g. severance, termination
payments, value of life insurance paid on behalf of the employee,
perquisites or property) for the executive exceeds $10,000.

FAQ #1
Why is reporting under the Federal
Funding Accountability and Transparency
Act (FFATA) required?
First-tier subaward data related to Federal
contracts and grants and executive
compensation data of these awardees must
be reported, as FFATA requires that this
information be made available to the
public.

FAQ #2
When will FFATA be implemented for
Federal grants?
For Federal grants, FFATA reporting
requirements were implemented on
October 1, <strong>2010</strong>.

FAQ # 3
What grant awards are subject to the subaward and
executive compensation reporting requirements of
FFATA?
New Federal, non-Recovery Act funded grant awards with
an award date on or after October 1, <strong>2010</strong>, and resulting
first-tier subawards for Federal financial assistance are
subject to the reporting requirements under FFATA. For
those new Federal grants as of October 1, <strong>2010</strong>, if the
initial award is equal to or over $25,000, reporting of
subaward and executive compensation data is required.

FAQ # 3 (continued)
If the initial award is below $25,000 but
subsequent grant modifications result in a
total award equal to or over $25,000, the
award will be subject to the reporting
requirements, as of the date the award
exceeds $25,000. If the initial award equals
or exceeds $25,000 but funding is
subsequently deobligated such that the total
award amount falls below $25,000, the
award continues to be subject to the
reporting requirements of FFATA.

FAQ # 4
Under a grant, what is considered a first-tier
subaward?
A subaward is an award made by the prime
recipient to an eligible sub-recipient, or an
award made by a sub-recipient at one tier to a
sub-recipient at the next lower tier, for the
purpose of supporting the performance of any
portion of the substantive project or program
for which a grant was awarded.

FAQ # 5
What are required FFATA data reporting elements?
The key FFATA data reporting elements are:
--Name of Entity Receiving Award
--Amount of Award
--Funding Agency
--CFDA Program Number for Grants
--Program Source
--Award Title
--Location of the Entity

FAQ # 6
What encompasses the an entity’s location?
(Including Congressional district) --Place of Performance
(including Congressional district) --Unique Identifier of the
Entity and its Parent Organization --Total Compensation
and Names of Top Five Executives -- Collect the Total
compensation and names of the top five executives if:
More than 80% of annual gross revenues are <strong>from</strong> the
Federal government, and those revenues are greater than
$25M annually, and compensation information is not
already available through reporting to the SEC.

FAQ # 7
Are subawardees required to report data as
required under FFATA?
No. The prime grant awardee must report all
information associated with a Federal grant, i.e.
the prime awardee will report executive
compensation data for the prime awardee and
for its subawardees, as well as any other
information associated with its subawardees.

FAQ # 8
How will prime awardees report data as required under
FFATA?
Prime awardees will report using the FFATA Subaward
Reporting System (FSRS), and thus will be required to
register in FSRS. During registration, the prime awardee’s
information data fields will be pre-populated with
information <strong>from</strong> the Central Contractor Registration
System (CCR). As such, all prime grant awardees and
subrecipients are required to register in CCR.
(FAQ continued)

FAQ # 8 continued
After creating an account and logging into
the system, prime awardees will have
access to a “MyFSRS” page with a set of
actions available to them. This customized
page will give awardees the ability to file
multiple reports, access and update
previously initiated reports, view approved
reports, and create batch uploads of data.

FAQ # 9
When will prime awardees be able to
report in FSRS?
Prime awardees will be able to report in
FSRS on October 29, <strong>2010</strong>.

FAQ # 10
How much time does a prime recipient have to
report executive compensation and/or subaward
information?
For subaward reporting, the prime awardee must
report information related to a subaward by the
end of the month following the month the
subaward or obligation was made.

FAQ # 10 Examples
Example A:
Prime awardee awards subaward on October 1, <strong>2010</strong>
Prime awardee must report subaward data by
November 30, <strong>2010</strong>.
Example B:
Prime awardee awards subaward on October 31, <strong>2010</strong>
Prime awardee must report subaward data by
November 30, <strong>2010</strong>

FAQ # 10 Examples Continued
Similarly, the prime awardee must report the subawardee’s
executive compensation data by the end of the month
following the month the award or obligation was made.
Example C:
Prime awardee awards subaward on October 1, <strong>2010</strong> Prime awardee
must report subawardee’s executive compensation data by November
30, <strong>2010</strong>
Example D:
Prime awardee awards subaward on October 31, <strong>2010</strong> Prime awardee
must report subawardee’s executive compensation data by November
30, <strong>2010</strong>

FAQ # 10 Examples Continued
For the prime awardee’s executive compensation data, the
prime awardee must report by the end of the month
following the month the award or obligation was made.
Example E:
ED awards grant to prime awardee on October 1, <strong>2010</strong> Prime
awardee must report executive compensation data by November 30,
<strong>2010</strong>.
Example F:
ED awards grant to prime awardee on October 31, <strong>2010</strong> Prime
awardee must report executive compensation data by November 30,
<strong>2010</strong>

FAQ # 11
Are there Federal grant awards that are not subject
to reporting under FFATA?
Yes. These grants fall into one of four categories.
1. An initial grant award of less then $25,000, and that is not
supplemented with subsequent funding resulting in an
amount equal to or greater than $25,000; however, if the
award is supplemented resulting in a total award equal to or
over $25,000, the award becomes subject to FFATA
reporting requirements;
2. A grant awarded prior to October 1, <strong>2010</strong> that will receive
continuation funding on or after October 1, <strong>2010</strong>;

FAQ # 11 Continued
3. Grant awards to individuals who apply for, or receive, Federal
awards as natural persons (i.e, unrelated to any business or
non-profit organization he or she may own or operate in his or
her name);
4. Grant awards to entities that had a gross income, <strong>from</strong> all
sources, of less than $300,000 in the entities’ previous tax year;
Grant awards under which the required reporting would
disclose classified information as addressed in FFATA Sections
2(a)(1)(C), 2(e), 3; and Grant awards, whether existing or new
as of October 1, <strong>2010</strong>, that are funded under the Recovery Act,
as these grant awardees will continue to report through
FederalReporting.gov.

FAQ # 12
Where will the FFATA data be displayed
to the public?
Data will be displayed to the public via
USASpending.gov beginning in Fiscal
Year 2011.