2331 - (DAF) Administration of Federal Grant Funds

 

 

 

 

This Policy includes “sub-policies” relating to specific provisions of the Uniform Administrative 
Requirements for Federal Awards issued by the U.S. Office of Budget and Management. Those 
requirements, which are commonly known as Uniform Grant Guidance (“UGG”), are found in Title 
2 of the Code of Federal Regulations (“CFR”) part 200. The sub-policies include:

The Milford School Board accepts federal funds, which are available, provided that there is a 
specific need for them and that the required matching funds are available. The Board intends to 
administer federal grant awards efficiently, effectively and in compliance with all requirements 
imposed by law, the awarding agency and the New Hampshire Department of Education (NHDOE) 
or other applicable pass-through entity.

This policy establishes the minimum standards regarding internal controls and grant management 
to be used by the District in the administration of any funds received by the District through 
Federal grant programs as required by applicable NH and Federal laws or regulations, including, 
without limitation, the UGG.

The Board directs the Superintendent or Designee to develop, monitor, and enforce effective 
administrative procedures and other internal controls over federal awards as necessary in order to 
provide reasonable assurances that the District is managing the awards in compliance with all 
requirements for federal grants and awards. Systems and controls must meet all requirements of 
federal and/or state law and regulation and shall be based on best practices.

 

The Superintendent is directed to assure that all individuals responsible for the administration of a 
federal grant or award shall be provided sufficient training to carry out their duties in accordance 
with all applicable requirements for the federal grant or award and this policy.

To the extent not covered by this Policy, the administrative procedures and internal controls must 
provide for: 

2. Conform to any limitations or exclusions set forth as cost principles in Part 200 or in
the terms and conditions of the Federal award.

 

3. Be consistent with policies and procedures that apply uniformly to both Federally-
financed and other activities of the District.

 

4. Be afforded consistent treatment. A cost cannot be assigned to a Federal award as
a direct cost if any other cost incurred for the same purpose in like circumstances
has been assigned as an indirect cost under another award.

5. Be determined in accordance with generally accepted accounting principles.

6. Be representative of actual cost, net of all applicable credits or offsets.

The term “applicable credits” refers to those receipts or reductions of expenditures
that operate to offset or reduce expense items allocable to the Federal award.
Typical examples of such transactions are: purchase discounts; rebates or
allowances; recoveries or indemnities on losses; and adjustments of overpayments
or erroneous charges. To the extent that such credits accruing to/or received by the
State relate to the Federal award, they shall be credited to the Federal award, either
as a cost reduction or a cash refund, as appropriate.

 

7. Be not included as a match or cost-share, unless the specific Federal program
authorizes Federal costs to be treated as such.

8. Be adequately documented:

B. Selected Items of Cost: The District shall follow the rules for selected items of cost at 2
CFR Part 200, Subpart E when charging these specific expenditures to a Federal grant.
When applicable, District staff shall check costs against the selected items of cost

requirements to ensure the cost is allowable. In addition, State, District and program-
specific rules, including the terms and conditions of the award, may deem a cost as

unallowable and District personnel shall follow those rules as well.

C. Cost Compliance: The Superintendent shall require that grant program funds are
expended and are accounted for consistent with the requirements of the specific program
and as identified in the grant application. Compliance monitoring includes accounting for
direct or indirect costs and reporting them as permitted or required by each grant.

 

D. Determining Whether A Cost is Direct or Indirect

1. “Direct costs” are those costs that can be identified specifically with a particular final
cost objective, such as a Federal award, or other internally or externally funded
activity, or that can be directly assigned to such activities relatively easily with a
high degree of accuracy.

These costs may include: salaries and fringe benefits of employees working directly
on a grant-funded project; purchased services contracted for performance under
the grant; travel of employees working directly on a grant-funded project; materials,
supplies, and equipment purchased for use on a specific grant; and infrastructure
costs directly attributable to the program (such as long distance telephone calls
specific to the program, etc.).

2. “Indirect costs” are those that have been incurred for a common or joint purpose
benefitting more than one (1) cost objective, and not readily assignable to the cost
objectives specifically benefitted, without effort disproportionate to the results
achieved. Costs incurred for the same purpose in like circumstances shall be
treated consistently as either direct or indirect costs.

These costs may include: general data processing, human resources, utility costs,
maintenance, accounting, etc.

Federal education programs with supplement not supplant provisions must use a
restricted indirect cost rate. In a restricted rate, indirect costs are limited to general
management costs. General management costs do not include divisional
administration that is limited to one (1) component of the District, the governing
body of the District, compensation of the Superintendent, compensation of the chief

executive officer of any component of the District, and operation of the immediate
offices of these officers.

The salaries of administrative and clerical staff should normally be treated as
indirect costs. Direct charging of these costs may be appropriate only if all the
following conditions are met:

E. Timely Obligation of Funds: Obligations are orders placed for property and services,
contracts and subawards made, and similar transactions during a given period that require
payment by the recipient or sub-recipient during the same or a future period.

 

The following are examples of when funds are determined to be “obligated” under
applicable regulation of the U.S. Department of Education:

 

When the obligation is for:

F. Period of Performance: All obligations must occur on or between the beginning and
ending dates of the grant project. This period of time is known as the period of
performance. The period of performance is dictated by statute and will be indicated in the
Grant Award Notification (“GAN”). As a general rule, State-administered Federal funds are
available for obligation within the year that Congress appropriates the funds for. However,
given the unique nature of educational institutions, for many Federal education grants, the
period of performance is twenty-seven (27) months. This maximum period includes a
fifteen (15) month period of initial availability, plus a twelve (12) month period of carry over.
For direct grants, the period of performance is generally identified in the GAN.

Pre-award costs are those incurred prior to the effective date of the Federal award or
subaward directly pursuant to the negotiation and in anticipation of the Federal award
where such costs are necessary for efficient and timely performance of the scope of work.
Such costs are allowable only to the extent that they would have been allowable if incurred
after the date of the Federal award and only with the written approval of the initial Federal
awarding agency or of the NHDOE or other pass-through entity.

For both State-administered and direct grants, regardless of the period of availability, the
District shall liquidate all obligations incurred under the award not later than forty-five (45)
days after the end of the funding period unless an extension is authorized. Any funds not
obligated within the period of performance or liquidated within the appropriate timeframe
are said to lapse and shall be returned to the awarding agency. Consistently, the District
shall closely monitor grant spending throughout the grant cycle.

 

Payment methods must be established in writing that minimize the time elapsed between the
drawdown of federal funds and the disbursement of those funds. Standards for funds control and
accountability must be met as required by the Uniform Guidance for advance payments and in
accordance with the requirements of NHDOE or other applicable pass-through-entity.

In order to provide reasonable assurance that all assets, including Federal, State, and local funds,
are safeguarded against waste, loss, unauthorized use, or misappropriation, the Superintendent
shall implement internal controls in the area of cash management.

The District’s payment methods shall minimize the time elapsing between the transfer of funds
from the United States Treasury or the NHDOE (pass-through entity) and disbursement by the
District, regardless of whether the payment is made by electronic fund transfer, or issuance or
redemption of checks, warrants, or payment by other means.

The District shall use forms and procedures required by the NHDOE, grantor agency or other
pass-through entity to request payment. The District shall request grant fund payments in
accordance with the provisions of the grant. Additionally, the District’s financial management
systems shall meet the standards for fund control and accountability as established by the
awarding agency.

The Superintendent or Designee is authorized to submit requests for advance payments and
reimbursements at least monthly when electronic fund transfers are not used, and as often as
deemed appropriate when electronic transfers are used, in accordance with the provisions of the
Electronic Fund Transfer Act (15 U.S.C. 1693-1693r).

 

1. The District receives less than $120,000 in Federal awards per year.
2. The best reasonably available interest-bearing account would not be expected to
   earn interest in excess of $500 per year on Federal cash balances.
3. The depository would require an average or minimum balance so high that it would
   not be feasible within the expected Federal and non-Federal cash resources.
4. A foreign government or banking system prohibits or precludes interest bearing
   accounts.

 

All purchases for property and services made using federal funds must be conducted in
accordance with all applicable Federal, State and local laws and regulations, the Uniform
Guidance, and the District’s written policies and procedures.

Procurement of all supplies, materials equipment, and services paid for from Federal funds or
District matching funds shall be made in accordance with all applicable Federal, State, and local
statutes and/or regulations, the terms and conditions of the Federal grant, District policies, and
procedures.

 

The Superintendent shall maintain a procurement and contract administration system in
accordance with the USDOE requirements (2 CFR 200.317-327) for the administration and
management of Federal grants and Federally-funded programs. The District shall maintain a
contract administration system that requires contractors to perform in accordance with the terms,
conditions, and specifications of their contracts or purchase orders. Except as otherwise noted,
procurement transactions shall also conform to the provisions of the District’s documented general
purchase Policy 2330 (DJ).

The District avoids situations that unnecessarily restrict competition and avoids acquisition of
unnecessary or duplicative items. Individuals or organizations that develop or draft specifications,
requirements, statements of work, and/or invitations for bids, requests for proposals, or invitations
to negotiate are excluded from competing for such purchases. Additionally, consideration shall be
given to consolidating or breaking out procurements to obtain a more economical purchase. And,
where appropriate, an analysis shall be made to lease versus purchase alternatives, and any other
appropriate analysis to determine the most economical approach. These considerations are given
as part of the process to determine the allowability of each purchase made with Federal funds.

Contracts are awarded only to responsible contractors possessing the ability to perform
successfully under the terms and conditions of a proposed procurement. Consideration is given to
such matters as contractor integrity, compliance with public policy, record of past performance,
and financial and technical resources. No contract is awarded to a contractor who is suspended or
debarred from eligibility for participation in federal assistance programs or activities.

Purchasing records are sufficiently maintained to detail the history of all procurements and must
include at least the rationale for the method of procurement, selection of contract type, and
contractor selection or rejection; the basis for the contract price; and verification that the contractor
is not suspended or debarred.

To foster greater economy and efficiency, the District may enter into State and local
intergovernmental agreements where appropriate for procurement or use of common or shared
goods and services.

 

1. unreasonable requirements on firms in order for them to qualify to do business;
2. any arbitrary action in the procurement process.
3. specification of only a “brand name” product instead of allowing for an “or equal”
   product to be offered and describing the performance or other relevant
   requirements of the procurement; and/or
4. organizational conflicts of interest;
5. noncompetitive contracts to consultants that are on retainer contracts;
6. unnecessary experience and excessive bonding requirements;

D. Contracting with Small and Minority Businesses, Women’s Business Enterprises,
and Labor Surplus Area Firms: The District must take necessary affirmative steps to
assure that minority businesses, women’s business enterprises, and labor surplus area

firms, including, without limitation, Veteran-Owned Small Businesses (VOSBs) or Service-
Disabled Veteran-Owned Small Businesses (SDVOSBs) are used when possible ("target

businesses"). Affirmative steps must include:

E. Contract/Price Analysis: The District shall perform a cost or price analysis in connection
with every procurement action in excess of $250,000 (i.e., the Simplified Acquisition/Small
Purchase limit), including contract modifications. (See 2 CFR 200.324). A cost analysis
generally means evaluating the separate cost elements that make up the total price, while
a price analysis means evaluating the total price, without looking at the individual cost
elements.

The method and degree of analysis is dependent on the facts surrounding the particular
procurement situation; however, the District shall come to an independent estimate prior to
receiving bids or proposals.

When performing a cost analysis, the District shall negotiate profit as a separate element of
the price. To establish a fair and reasonable profit, consideration is given to the complexity
of the work to be performed, the risk borne by the contractor, the contractor’s investment,
the amount of subcontracting, the quality of its record of past performance, and industry
profit rates in the surrounding geographical area for similar work.

F. Time and Materials Contracts: The District shall use a time and materials type contract
only (1) after a determination that no other contract is suitable; and (2) if the contract
includes a ceiling price that the contractor exceeds at its own risk. Time and materials type
contract means a contract whose cost to the District is the sum of the actual costs of
materials, and direct labor hours charged at fixed hourly rates that reflect wages, general
and administrative expenses, and profit.

Since this formula generates an open-ended contract price, a time-and-materials contract
provides no positive profit incentive to the contractor for cost control or labor efficiently.
Therefore, the District sets a ceiling price for each contract that the contractor exceeds at
its own risk. Further, the District shall assert a high degree of oversight in order to obtain
reasonable assurance that the contractor is using efficient methods and effective cost
controls, and otherwise performs in accordance with the terms, conditions, and
specifications of their contracts or purchase orders.

G. Suspension and Debarment: The District will award contracts only to responsible
contractors possessing the ability to perform successfully under the terms and conditions of
the proposed procurement. All purchasing decisions shall be made in the best interests of
the District and shall seek to obtain the maximum value for each dollar expended. When

making a purchasing decision, the District shall consider such factors as (1) contractor
integrity; (2) compliance with public policy; (3) record of past performance; and (4) financial
and technical resources.

The Superintendent shall have the authority to suspend or debar a person/corporation, for
cause, from consideration or award of further contracts. The District is subject to and shall
abide by the non-procurement debarment and suspension regulations implementing
Executive Orders 12549 and 12689, 2 CFR Part 180.

Suspension is an action taken by the District that immediately prohibits a person from
participating in covered transactions and transactions covered under the Federal
Acquisition Regulation (48 CFR chapter 1) for a temporary period, pending completion of
an agency investigation and any judicial or administrative proceedings that may ensure. A
person so excluded is suspended. (See 2 CFR Part 180 Subpart G).

Debarment is an action taken by the Superintendent to exclude a person from participating
in covered transactions and transactions covered under the Federal Acquisition Regulation
(48 CFR chapter 1). A person so excluded is debarred. (See 2 CFR Part 180 Subpart H).

The District shall not subcontract with or award sub-grants to any person or company who
is debarred or suspended. For contracts over $25,000 the District shall confirm that the
vendor is not debarred or suspended by either checking the Federal government’s System
for Award Management (“SAM”), which maintains a list of such debarred or suspended
vendors at www.sam.gov (which replaced the former Excluded Parties List System or
EPLS); or collecting a certification from the vendor. (See 2 CFR Part 180 Sub part C).

Documentation that debarment/suspension was queried must be retained for each covered
transaction as part of the documentation required under DAF-3, paragraph J. This
documentation should include the date(s) queried and copy(ies) of the SAM result
report/screen shot, or a copy of the or certification from the vendor. It should be attached
to the payment backup and retained for future audit review.

 

1. Clause for Remedies Arising from Breach: For any contract using Federal funds
   under which the contract amount exceeds the upper limit for Simplified
   Acquisition/Small Purchases (see DAF-3.C.2), the contract must address
   administrative, contractual, or legal remedies in instances where contractors violate
   or breach contract terms, and must provide for sanctions and penalties. (See 2 CFR
   200, Appendix II(A)).
2. Termination clause: For any contract using Federal funds under which the contract
   amount exceeds $10,000, it must address the District’s authority to terminate the
   contract for cause and for convenience, including the manner by which termination
   will be effected and the basis for settlement. (See 2 CFR 200, Appendix II (B)).
3. Anti-pollution clause: For any contract using Federal funds under which the contract
   amount exceeds $150,000, the contract must include clauses addressing the Clean
   Air Act and the Federal Water Pollution Control Act. (See 2 CFR 200, Appendix II
   (G)).
4. Anti-lobbying clause: For any contract using Federal funds under which the contract
   exceeds $100,000, the contract must include an anti-lobbying clause, and require
   bidders to submit Anti-Lobbying Certification as required under 2 CFR 200,
   Appendix II (I).
5. Negotiation of profit: For each contract using Federal funds and for which there is
   no price competition, and for each Federal fund contract in which a cost analysis is
   performed, the District shall negotiate profit as a separate element of the price. To
   establish a fair and reasonable profit, consideration must be given to the complexity
   of the work to be performed, the risk borne by the contractor, the contractor’s
   investment, the amount of subcontracting, the quality of the contractor’s past
   performance, and industry profit rates in the surrounding geographical area for
   similar work. (See 2 CFR 200.324(b)).
6. “Domestic Preference” Requirement: The District must provide a preference for the
   purchase, acquisition, or use of goods, products, or materials produced in the
   United States, to the greatest extent practicable. This requirement applies whether
   the District is purchasing the products directly or when the products are purchased
   by third parties on the District’s behalf (e.g. subcontractor, food service
   management companies, etc.). It also generally applies to all purchases, even
   those below the micro-purchase threshold, unless otherwise stipulated by the
   Federal awarding agency. See also additional “Buy American” provisions in DAF-
   4.C regarding food service procurement.
    
7. Huawei Ban: The District may not use Federal funds to procure, obtain, or enter into
   or renew a contract to procure or obtain equipment, services, or systems which
   substantially use telecommunications equipment or services produced by Huawei
   Technologies Company or ZTE Corporation, or any of their subsidiaries.

The following provisions shall be included in all cost reimbursable contracts for food services
purchases, including contracts with cost reimbursable provisions, and in solicitation documents
prepared to obtain offers for such contracts: (7 CFR Sec. 210.21, 215.14a, 220.16)

 

A. Mandatory Contract Clauses: The following provisions shall be included in all cost
reimbursable contracts for food services purchases, including contracts with cost
reimbursable provisions, and in solicitation documents prepared to obtain offers for such
contracts:

B. Contracts with Food Service Management Companies: Procedures for selecting and
contracting with a food service management company shall comply with guidance provided
by the NHDOE, including standard forms, procedures and timelines for solicitation,
selection and approval of proposals and contracts.

 

1. Exceptions: The two main exceptions to the Buy American requirements are:
   1. The product is not produced or manufactured in the U.S. in sufficient and
      reasonably available quantities of a satisfactory quality; or
   2. Competitive bids reveal the costs of a U.S. product are significantly higher
      than the non-domestic product.
2. Steps to Comply with Buy American Requirements: In order to help assure that the
   District remains in compliance with the Buy American requirement, the
   Superintendent or Designee, shall
   1. Include a Buy American clause in all procurement documents (product
      specifications, bid solicitations, requests for proposals, purchase orders,
      etc.);
   2. Monitor contractor performance;
   3. Require suppliers to certify the origin of the product;
   4. Examine product packaging for identification of the country of origin; and
   5. Require suppliers to provide specific information about the percentage of
      U.S. content in food products.

organization which employs or is about to employ any of the parties indicated herein, (collectively
a "covered individual") has a financial or other interest in or a tangible personal benefit from a firm
considered for a contract.

 

Additionally, no employee, board member or other District officer, or agent may solicit or accept
gratuities, favors, or anything of monetary value from contractors or parties to subcontracts. This
prohibition, however, shall not apply to gratuities of de minimis value, which, for purposes of the
policy, are individual gifts, favors, or other items of monetary value, worth $50 or less and which
have no bearing on the selection, award or administration of a Federal award.

The standards of conduct must provide for disciplinary actions to be applied for violations of such
standards by officers, employees, or agents of the recipient or sub-recipient.

Each covered individual who is engaged in the selection, award or administration of a contract
supported by a federal grant or award and who has a potential conflict of interest must disclose
that conflict in writing to the Superintendent or Designee, who, in turn, shall disclose in writing any
such potential conflict of interest to NHDOE or other applicable pass-through-entity.

Employees who violate this provision are subject to disciplinary consequences up to and including
dismissal. Agents or contractors acting on behalf of the District are subject to contract
termination. School board members or other District officers are subject to such actions as are
within the authority of the School Board or district. Violations will also be reported to law
enforcement in appropriate circumstances.

 

The Superintendent shall timely disclose in writing to NHDOE or other applicable pass-through-
entity, and to the Federal awarding agency whenever the Superintendent has credible evidence

of the commission of a violation of Federal criminal law involving fraud, conflict of interest, bribery,
or gratuity violations found in Title 18 of the United States Code or a violation of the civil False
Claims Act (31 U.S.C. 3729-3733). The notice to the Federal awarding agency shall be directed to
that agency's Office of Inspector General. The Superintendent shall fully address any such
violations promptly and notify the Board with such information as is appropriate under the
circumstances (e.g., taking into account applicable disciplinary processes).

Equipment and supplies acquired (“property” as used in this policy DAF-6) with federal funds will
be used, managed, and disposed of in accordance with applicable state and federal requirements.
Property records and inventory systems shall be sufficiently maintained to account for and track
equipment that has been acquired with federal funds. In furtherance thereof, the following
minimum standards and controls shall apply to any equipment or pilferable items acquired in whole
or in part under a Federal award until such property is disposed in accordance with applicable
laws, regulations and Board policies:

A. “Equipment” and “Pilferable Items” Defined: For purposes of this policy, “equipment”
means tangible personal property (including information technology systems) having a
useful life of more than one year and a per-unit acquisition cost which equals or exceeds
the lesser of $10,000.00, or the capitalization level established by the District for financial
statement purposes. “Pilferable items” are those items, regardless of cost, which may be
easily lost or stolen, such as cell phones, tablets, graphing calculators, software,

1. prevent loss, damage, or theft of the property;
2. any loss, damage, or theft investigated;
3. maintain the property and keep it in good condition; and
4. ensure the highest possible return through proper sales procedures, in those
   instances where the District is authorized to sell the property.

award is used for authorized purposes. The frequency of monitoring review will be
specified in the sub-award and conducted concurrently with all invoice submission.

Subrecipient monitoring procedures include:

1. At the time of proposal, assess the potential of the subrecipient for programmatic,
financial, and administrative suitability.

 

2. Evaluate each subrecipient’s risk of noncompliance prior to executing a sub-
award. In doing so, the District will assess the subrecipient’s:

3. Confirm the statement of work and review any non-standard terms and conditions
of the sub-award during the negotiation process.

4. Monitor financial and programmatic progress and ability of the subrecipient to meet
objectives of the sub-award. To facilitate this review, subrecipients are required to
submit sufficient invoice detail and a progress report. The District project managers
will encourage subrecipients to submit regular invoices.

5. Invoices and progress reports will be date stamped upon receipt if received in hard
copy. A record of the date of receipt will be maintained for those invoices sent
electronically.

6. In conducting regular oversight and monitoring, the District project managers will:

Review progress reports to ensure project is progressing appropriately and
on schedule.

 

7. The Superintendent or Designee, upon recommendation from the project’s
manager, will approve the invoice payment and will initial invoices be confirming
review and approval prior to payment.

8. Payments will be withheld from subrecipients for the following reasons:

9. Verify every subrecipient is audited in accordance with 2 CFR §200 Subpart F –
Audit Requirements.

 

C. Subrecipient Project Files. Subrecipient project files will contain, at a minimum, the
following:

D. Audit Requirements. A Single Audit is required when a subrecipient expends $1,000,000
or more in Federal awards during the fiscal year.

All subrecipients are required to annually submit their audit and Single Audit report to the
District for review to ensure the subrecipient has complied with good accounting practices
and federal regulations.

If a deficiency is identified, the District will:

E. Methodology for Resolving Findings.

The District will work with subrecipients to resolve any findings and deficiencies. To do so,
the District may follow up on deficiencies identified through on-site reviews, provision of
basic technical assistance, and other means of assistance as appropriate.

 

The District will only consider taking enforcement action against non-compliant
subrecipients in accordance with 2 CFR 200.339 when noncompliance cannot be
remedied. Enforcement may include taking any of the following actions as appropriate:

 

 

Adopted: 2/2020
Revised: 1/2026