H.R. 3433: CBO Releases Cost Estimate

The CBO (Congressional Budget Office) released their cost estimate for implementing H.R. 3433: Grant Reform and New Transparency Act of 2011 this week. The CBO estimates that implementing changes to the grant-award system as required under H.R. 3433 would cost less than $1 million annually over the 2012-2017 period, assuming the availability of appropriated funds. Those costs would result primarily from preparing reports and making the required changes to agency Websites. The bill also could affect direct spending by agencies not funded through annual appropriations; therefore, pay-as-you-go procedures apply. CBO estimates, however, that any net increase in spending by those agencies would not be signficant. Enacting H.R. 3433 would not affect revenues.

Under current law, the agencies that award the most grants provide them primarily as formula or block grants or use merit-based procedures. Most of the provisions of  H.R. 3433 would continue those current practices. Based on the information from some of the largest grant-awarding agencies, CBO estimates that implementing the bill would lead to a small increase in administrative costs to oversee some award changes and to prepare additional reports.

So let’s recap H.R. 3433:

Section 7402: Merit-based Selection Procedure Requirements in Awarding Grants

Each Executive agency shall establish and make publicly available specific merit-based selection procedures for each grant program of the agency. The merit-based selection procedure required shall promote the use of competition, and may be tailored to the particular requirements, objectives, and authorities of the agency. The procedures may address matters such as consideration of unsolicited proposals, standards for obtaining a competitive pool of applicants, and exceptions for safety, security, or other circumstances. The merit-based selection procedures require the following:

• Advance notification of the grant opportunity.
• A clear statement of the purpose, duration (including anticipated grant continuations), and eligibility requirements of the grant.
• A description of the manner in which applications or proposals for the grant will be evaluated, ranked, and selected for award, including the weighting of any evaluation factors or criteria that will be considered.

Section 7403: Pre-award Evaluation Requirements

Before awarding a competitive grant, an Executive agency shall conduct an evaluation of the ability of the prospective grantee to successfully carry out the grant. The evaluation required shall include a review of the following:

• Financial Management System – The capability of the financial management system of the applicant to account for funds.
• Internal Controls – The internal financial and administrative control systems of the applicant.
• Compliance with Reporting – The capability of the applicant to comply with Federal reporting requirements for recipients of Federal funds.
• Past Performance and Integrity – The past performance and record of integrity of the applicant.
• Other Qualifications and Competence – The ability of the applicant to successfully carry out the purposes of the grant.

In conducting the evaluation required, an Executive agency shall minimize the burden on any applicant that has previously received a significant volume of Federal grants, and shall consider any existing findings with respect to that applicant under the single audit process.

Section 7404: Website relating to Federal Grants

The Director of the OMB (Office of Management and Budget) shall upgrade any existing or proposed public website for finding Federal grant opportunities and applying for such grants so that such website may serve as a central point of competitive grants. The website shall capture in one site or provide electronic links to other relevant databases.

At the time an Executive agency issues a solicitation or otherwise announces the availability of funds for a competitive grant, the agency shall post on the grants website maintained relevant information about the grant opportunity, including the following information:

• Announcement and Purpose – The grant announcement and purpose of the grant.
• Grant Period – The time period for performance of the grant and whether the agency anticipates that the grant will be continued.
• Amount of Available Funds – The amount of funds available for the grant.
• Eligibility – A statement of eligibility requirements of the grant.
• Agency Point of Contact – Contact information for the Executive agency, including the name, telephone number, and email address of a specific person or person responsible for answering questions about the grant and the application process for the grant.
• Evaluation Factors or Criteria – A clear statement of the evaluation factors or criteria that the agency intends to use to evaluate and rank grant applications or proposals submitted, including the weight to be applied to each factor or criterion.
• Disclosure of the Process and Standards for Safeguarding Against Conflicts – A description of the process and standards to be used by the agency to determine that each grant reviewer does not have a prohibited conflict of interest, as defined by the statute or regulation, with respect to the evaluation or review of a grant application or proposal, or the decision to award a grant.
• Deadline – The deadline for submission of grant applications or proposals.

Grant Award Information

For each competitive grant awarded by an Executive agency, the agency shall post on the grants website maintained and within 15 days after an Executive agency notifies an applicant that the applicant has been selected to receive a grant award the following information:

• Executed Grant Agreement – A copy of the final grant agreement, including the terms and conditions and the time period for the performance of the grant.
• Copy of Proposal, Application, or Plan – A copy of any proposal, application, or plan submitted for the awarded grant, including any amendment to the proposal, application, or plan (whether made before or after the award of the grant).
• Award Decision Documentation and Rankings – Documentation explaining the basis for the selection decision for the grant, the number of proposals received for the grant, and, with respect to the proposal that resulted in the grant award, the numerical ranking of the proposal by grant reviewers, if numerical rankings were assigned.
• Justification for Deviating from Rankings – In any case in which the award of the grant is not consistent with the numerical rankings or any other recommendations made by the grant reviewers, a written justification explaining the rationale for the decision not to follow the rankings or recommendations.
• Disclosure of Peer Reviewers – The name, title, and employer of each individual who served as a peer reviewer for the grant program concerned, during the six-month period preceding the award of the grant.
• Disclosure of Other Grant Reviewers – The name, title, and employer of each individual who served as a reviewer (other than a peer reviewer) of proposals or applications for the grant, regardless of whether the individual is employed by the Federal government or not.

Exception to Posting Requirement – If the head of the agency determines, with respect to a particular grant award, that posting the proposal, application, or plan at the time described would adversely affect an applicant, the agency:

• May post a proposal abstract or executive summary; and
• Shall post the complete proposal, application, or plan by a date to be determined by the head of the agency, in consultation with the applicant, but not later than three years after the date of the grant award.

Grant Performance Information

Unless otherwise prohibited by law, with respect to each grant awarded by an Executive agency, within 60 days after the end of the period for completion of the grant, the agency shall post on the grants website maintained the following information:

• The final report or other final written product required under the terms of the grant.
• Other related data or results of the grant that the agency considers to be of value to future researchers or in the public interest.

To read more about H.R. 3433, click on
http://aprilheywardresearchnews.wordpress.com/2011/11/18/h-r-3433-grant-act/

To watch the Congressional Hearing on H.R. 3433, click on
http://aprilheywardresearchnews.wordpress.com/2011/11/18/oversight-committee-on-h-r-3433/