Recipients are manually added or removed from the SOFL per requests from agencies. If a recipient needs to be added or removed from the SOFL, the agency should contact Grants-OSBM@osbm.nc.gov to make the changes. Each agency is responsible for establishing a central point of contact who is authorized to communicate changes of suspension status to OSBM.
Each agency should establish procedures for collecting outstanding reporting information. If you need guidance setting up your reporting template, please contact our office.
Once the recipient has complied with your reporting requirements, email Grants-OSBM@osbm.nc.gov confirming that all outstanding information has been reported. If the recipient is on the Suspension List for missing reports prior to the 2016 changes in the NCGrants system, OSBM will have to confirm with all its funding agencies that the recipient is in compliance.
If an audit was required, please forward a copy of the audit so it may be provided to the recipient’s other funding agencies. Other information should be retained by the agency and is subject to audit by OSBM or the State Auditor. We will remove the recipient from the SOFL unless there are still outstanding reports to other funding agencies. Each agency is responsible for establishing a central point of contact who is authorized to communicate changes of suspension status to OSBM.
Because programs can vary widely, we do not prescribe a standard format or template. Most programs with federal funds will likely already have documented plans or internal policies and procedures in place that are sufficient to meet this requirement.
For programs that have not previously had reporting requirements, as new reporting plans are developed with expect this to be a process of continuous improvement. As agency plans are submitted, we will build a library of sample plans agencies can reference and resources from other agencies to share best practices.
If you need assistance with reporting, please contact our office.
Email Grants-OSBM@osbm.nc.gov and provide supporting documentation of the identified issue. If the agency discovers evidence of management deficiencies or criminal activity leading to the misuse of funds, the entity will be suspended immediately upon notification. For other issues the recipient should be notified and given 60 days to remedy the issue. In these cases, please also provide documentation of the notification.
Agencies should also establish procedures for notification to ensure timely notification of high-risk issues. Agencies may manage this process centrally or delegate to individual programs. OSBM will establish a list of agency points of contact that are authorized by the agency to make notifications of changes to suspension status.
The grants system is still used for reporting information to the public and the General Assembly on awards and payments to non-state entities. The system is also used to generate a report on recipient reporting levels so that agencies are aware when a recipient has met the threshold for an audit. The system also serves as a data source for the State’s transparency site, OpenBudget.
Agencies are still required to enter awards and track payments in the Grants Management System. We have developed a report titled “Grant Payments by Grantee Fiscal Year” that provides recipient reporting levels and total payments based on the recipient’s fiscal year end. The report will show the total payment amounts and final reporting level for grantees whose fiscal year ended the month prior. For example, a report uploaded in July will include information for grantees whose fiscal year ended June 30. To request this report for your agency, please email grants-OSBM@osbm.nc.gov.
For recipients with existing contracts that reference the NCGrants requirements, agencies may issue an addendum to the contract to modify the requirements based on the revised rules and allow their recipients to report using existing agency forms and procedures.
Alternatively, agencies may require recipients to comply with the old reporting requirements until the end of the contract using electronic copies of the NCGrants forms. In the latter option, agencies will need to notify recipients of where to submit forms since the NCGrants reporting function is now disabled.
Previously, the SOFL was generated automatically by the NCGrants system based on missing reports. As a result, the SOFL listed each recipient multiple times for every award for which the entity had overdue reports. Under the new process, entities are added/removed from the list manually upon notification from an agency of a change in compliance status. The suspension list is now maintained at the entity level, not based on an individual agency or award. For questions regarding the SOFL, please email grants-OSBM@osbm.nc.gov.
Errors can occur when incorrect grant IDs are used or missing, as sometimes occurs when agency subsystems are used for processing payments. Payments cannot be deleted by agencies, but they can be corrected in the system. Please see the Grants System User Guide for further instructions.
OSBM requires IRS documentation of the correct tax ID in order to correct the information in the system. Please provide this documentation to Grants-OSBM@osbm.nc.gov and we will make the correction in the system.
The funding agency should notify us of the change at Grants-OSBM@osbm.nc.gov and we will update the recipient’s fiscal year end.
09 NCAC 03M states the rules around the different reporting thresholds and when an audit is required. Level III recipients are required to complete a single or program-specific audit. Specifically, it states the following:
“A recipient or subrecipient that receives, holds, uses, or expends State financial assistance in an amount equal to or greater than five hundred thousand dollars ($500,000) within its fiscal year.” “Level III recipients and subrecipients shall have a single or program-specific audit prepared and completed in accordance with Generally Accepted Government Auditing Standards, also known as the Yellow Book.”
In addition, G.S. 143C-1-1(d)(25) defines State funds as the following: “Any moneys including federal funds deposited in the State treasury except moneys deposited in a trust fund or agency fund as described in G.S. 143C-1-3.”
If the entity received, held, used, or expended State financial assistance (which includes federal funds passed through the State) of $500,000 or more within its fiscal year, it’s required to complete a single or program-specific audit following the Generally Accepted Government Auditing Standards, also known as the Yellow Book.
The old NCGrants system generated a 5-digit Grant ID, which was used to look up the 4-digit GIC number in NCAS. Under the new system, a 10-digit Grant ID is generated. Users will use this 10-digit number to look up the 4-digit GIC code in NCAS. They should be able to follow the same process as before in NCAS.
OSC has confirmed the two following processes for looking up GIC number in NCAS:
- XPTR/XTND Report titled “NCAS NCG Indicators”
- GBL Lookup screen
See the NCAS Manual. For further questions, please contact OSC’s help line at 919-707-0795.
An organization can be classified into one of two relationship/arrangement categories:
1. Financial Assistance (Grant) Relationship/Arrangement, where the organization is either a:
- Direct funding recipient
- Pass-through funding recipient
2. Vendor (Purchase of Services) Relationship/Arrangement, where the organization has an arrangement for the purchase of goods and/or services.
09 NCAC 03M further clarifies:
(10) "Recipient" means a non-State entity that receives State financial assistance directly from a State agency to carry out part of a State program, but does not include any non-State entity subject to the audit and other reporting requirements of the Local Government Commission. For purposes of this Subchapter, "recipient" also includes a non-State entity that would be considered a "subrecipient" pursuant to 2 CFR 200.93 for Federal funds subawarded by a recipient State agency, but does not include a subrecipient as defined in Item (14) of this Rule.”
(5) "Contractor" means an entity subject to the contractor requirements, as well as any entity that would be subject to the contractor requirements but for a specific statute or rule exempting that entity from the contractor requirements.
(6) "Contractor requirements" means Article 3, 3C, 3D, 3E, 3G, or 8 of Chapter 143 of the General Statutes and related rules
Making the proper determination of the type of relationship that exists is important because activities performed within financial assistance (grant) relationships/arrangements are generally subject to more oversight and regulatory guidance than activities performed within a vendor (purchase of services) relationship/arrangement. In making the determination of whether a financial assistance or vendor relationship exists, the substance of the relationship is more important than the form of the agreement.
A recipient/subrecipient is distinguished from a vendor (purchase of service activity) by the degree of responsibility assumed to meet the requirements of the program.
Financial assistance (grant) arrangement characteristics:
- The recipient/subrecipient receives funding to carry out or administer a program.
- A recipient/subrecipient may be responsible for determining who is eligible for participation in a program by applying pre-determined eligibility requirements.
- A recipient/subrecipient is responsible for making programmatic decisions and its performance is measured against meeting the program objectives.
- There generally is an interest in how program funds are expended.
- Program benefits are being provided to a targeted population identified in the objectives.
- A recipient/subrecipient has the responsibility for adherence to applicable program compliance requirements.
- Recipient/subrecipients may have cost reimbursement contracts/grants; however, it is possible for them to have a fee/rate per unit of service arrangement.
Vendor arrangement (purchase of services/goods) characteristics:
- A vendor is measured against the terms of its contract.
- Goods must meet certain specifications and services are measured against certain quality standards.
- A vendor generally provides the goods and services within its normal business operations and to many different purchasers.
- A vendor operates in a competitive environment and once a pre-determined unit price has been established in a contract, usually there is no interest by the purchaser in how the vendor expends funds in meeting the vendor’s obligations under the terms of the contract.
- In a vendor arrangement, the goods or services provided are auxiliary to the operation of the program.
- A vendor would not be subject to meeting program compliance requirements.
If you need further assistance determining the relationship/arrangement between your agency and an organization, please contact our office. We can provide additional guiding documentation.