Policy Memorandum: Request for Early Disposition of Unexpended Program Income (UPI)

 

 

February 18, 2015

TO: MEP Cooperative Agreement Holders
FROM: NIST Grants Management Division (GMD)

SUBJECT: Request for Early Disposition of Unexpended Program Income (UPI) for Centers Participating in Competitions

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PURPOSE:
The purpose of this memorandum is to provide guidance to MEP award recipients (Centers or Recipients) involved in the MEP Center competitions that wish to request disposition of UPI prior to the close out of an MEP cooperative agreement. 

BACKGROUND:
In accordance with Section 12 of the MEP General Terms and Conditions (February 2014), NIST MEP has allowed Centers to carry forward UPI with the expectation that Centers will reinvest said program income strategically into the project. In general, at the close out of the MEP award, the NIST Grants Officer provides the Recipient with closeout instructions, including instructions regarding disposition of program income. Given the current system wide competition, NIST is providing guidance for Centers for the early disposition of UPI, which may allow Centers competing for a new MEP award to use the non-federal portion of UPI funds earlier in the new grant year, if the Center is the successful applicant for the new MEP award. 

For purposes of determining the amount and character of UPI dispositions, the final cost share ratio under the Center’s current MEP award will be applied to the Center’s UPI balance using the “deductive method” of accounting for program income.  See 15 C.F.R. §§ 14.24(b)(3), 24.25(g)(1) and 2 C.F.R. § 200.307(e)(1).  The final cost share ratio will be determined by NIST based on the aggregate cost share ratio during the Center’s current MEP award, which is usually five years. Accordingly, the portion of the UPI that is attributable to the Federal share of the award will be required to be returned to the Federal Government.  The remaining portion of the UPI that is attributable to the non-Federal share of the award may be retained by the Center as an unrestricted asset, and will no longer need to be accounted for under the MEP award.     

For example, if the aggregate cost share ratio under the Center’s current MEP award is 2/3 non-Federal and 1/3 Federal, and the Center has $300,000 in UPI remaining at the end of its award, the Center is permitted to retain $200,000 ($300,000 total UPI X 2/3 cumulative non-Federal cost share percentage) as an unrestricted asset and would be required to return $100,000 to NIST ($300,000 total UPI X 1/3 cumulative Federal cost share percentage). After disposition, Centers are permitted to apply the newly unrestricted funds to new grant awards.

IMPLEMENTATION:

1. Recipients are required to submit a formal request to the NIST Grants Officer to provide guidance on the early disposition of the UPI. This request must include a certification signed by the Center Director and the Center’s Chief Financial Officer attesting to the accuracy of the Center’s total current UPI balance as of the date of the request.
2. The NIST Grants Officer will review the request and reconcile the UPI balance with the information submitted in the Federal Financial Report SF-425 and the latest approved Operating Plan.
3. The NIST Grants Officer will issue a letter with NIST’s determination and guidance on the disposition of the UPI within 180 calendar days following NIST’s receipt of a complete UPI disposition request (a complete UPI disposition requests includes any follow-up information or documentation requested by the NIST Grants Officer).
4. Based on NIST’s determination, the recipient will be required to return the Federal portion of the UPI to the Federal government through the Center’s assigned ASAP.gov account within 30 calendar days of the receipt of NIST’s determination letter, unless otherwise instructed by the NIST Grants Officer.
5. After the refund is submitted through ASAP.gov and is certified by the NIST Finance Office, the NIST MEP program will initiate the de-obligation process for the Federal share of the UPI.  Within 30 days of the NIST MEP program’s action, the NIST Grants Officer will issue an amendment to collect the Federal portion of the UPI from the Recipient’s ASAP.gov account and GMD will issue a letter to the recipient that the disposition of UPI is complete. 

Questions regarding this guidance should be directed to the recipient’s assigned NIST Grants Specialist.