2CFR200-325, OMB Guidance: "Bonding Requirements"

OMB Guidance

§ 200.325

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comply with the Federal cost principles.
(d) The cost plus a percentage of cost
and percentage of construction cost
methods of contracting must not be
used.
§ 200.324 Federal awarding agency or
pass-through entity review.
(a) The non-Federal entity must
make available, upon request of the
Federal awarding agency or passthrough entity, technical specifications on proposed procurements where
the Federal awarding agency or passthrough entity believes such review is
needed to ensure that the item or service specified is the one being proposed
for acquisition. This review generally
will take place prior to the time the
specification is incorporated into a solicitation document. However, if the
non-Federal entity desires to have the
review accomplished after a solicitation has been developed, the Federal
awarding agency or pass-through entity may still review the specifications,
with such review usually limited to the
technical aspects of the proposed purchase.
(b) The non-Federal entity must
make available upon request, for the
Federal awarding agency or passthrough entity pre-procurement review, procurement documents, such as
requests for proposals or invitations
for bids, or independent cost estimates,
when:
(1) The non-Federal entity’s procurement procedures or operation fails to
comply with the procurement standards in this part;
(2) The procurement is expected to
exceed the Simplified Acquisition
Threshold and is to be awarded without
competition or only one bid or offer is
received in response to a solicitation;
(3) The procurement, which is expected to exceed the Simplified Acquisition Threshold, specifies a ‘‘brand
name’’ product;
(4) The proposed contract is more
than
the
Simplified
Acquisition
Threshold and is to be awarded to
other than the apparent low bidder
under a sealed bid procurement; or
(5) A proposed contract modification
changes the scope of a contract or increases the contract amount by more

than
the
Simplified
Acquisition
Threshold.
(c) The non-Federal entity is exempt
from the pre-procurement review in
paragraph (b) of this section if the Federal awarding agency or pass-through
entity determines that its procurement
systems comply with the standards of
this part.
(1) The non-Federal entity may request that its procurement system be
reviewed by the Federal awarding
agency or pass-through entity to determine whether its system meets these
standards in order for its system to be
certified. Generally, these reviews
must occur where there is continuous
high-dollar funding, and third party
contracts are awarded on a regular
basis;
(2) The non-Federal entity may selfcertify its procurement system. Such
self-certification must not limit the
Federal awarding agency’s right to survey the system. Under a self-certification procedure, the Federal awarding
agency may rely on written assurances
from the non-Federal entity that it is
complying with these standards. The
non-Federal entity must cite specific
policies, procedures, regulations, or
standards as being in compliance with
these requirements and have its system
available for review.
§ 200.325 Bonding requirements.
For construction or facility improvement contracts or subcontracts exceeding the Simplified Acquisition Threshold, the Federal awarding agency or
pass-through entity may accept the
bonding policy and requirements of the
non-Federal entity provided that the
Federal awarding agency or passthrough entity has made a determination that the Federal interest is adequately protected. If such a determination has not been made, the minimum
requirements must be as follows:
(a) A bid guarantee from each bidder
equivalent to five percent of the bid
price. The ‘‘bid guarantee’’ must consist of a firm commitment such as a
bid bond, certified check, or other negotiable instrument accompanying a
bid as assurance that the bidder will,
upon acceptance of the bid, execute
such contractual documents as may be
required within the time specified.

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§ 200.326

2 CFR Ch. II (1–1–19 Edition)

(b) A performance bond on the part of
the contractor for 100 percent of the
contract price. A ‘‘performance bond’’
is one executed in connection with a
contract to secure fulfillment of all the
contractor’s obligations under such
contract.
(c) A payment bond on the part of the
contractor for 100 percent of the contract price. A ‘‘payment bond’’ is one
executed in connection with a contract
to assure payment as required by law
of all persons supplying labor and material in the execution of the work provided for in the contract.
§ 200.326 Contract provisions.
The non-Federal entity’s contracts
must contain the applicable provisions
described in Appendix II to Part 200—
Contract Provisions for non-Federal
Entity
Contracts
Under
Federal
Awards.
PERFORMANCE AND FINANCIAL
MONITORING AND REPORTING

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§ 200.327 Financial reporting.
Unless otherwise approved by OMB,
the Federal awarding agency may solicit only the standard, OMB-approved
governmentwide data elements for collection of financial information (at
time of publication the Federal Financial Report or such future collections
as may be approved by OMB and listed
on the OMB Web site). This information must be collected with the frequency required by the terms and conditions of the Federal award, but no
less frequently than annually nor more
frequently than quarterly except in unusual circumstances, for example
where more frequent reporting is necessary for the effective monitoring of
the Federal award or could significantly affect program outcomes, and
preferably in coordination with performance reporting.
§ 200.328 Monitoring and reporting
program performance.
(a) Monitoring by the non-Federal entity. The non-Federal entity is responsible for oversight of the operations of
the Federal award supported activities.
The non-Federal entity must monitor
its activities under Federal awards to
assure compliance with applicable Fed-

eral requirements and performance expectations are being achieved. Monitoring by the non-Federal entity must
cover each program, function or activity. See also § 200.331 Requirements for
pass-through entities.
(b) Non-construction performance reports. The Federal awarding agency
must use standard, OMB-approved data
elements for collection of performance
information (including performance
progress reports, Research Performance Progress Report, or such future
collections as may be approved by OMB
and listed on the OMB Web site).
(1) The non-Federal entity must submit performance reports at the interval required by the Federal awarding
agency or pass-through entity to best
inform improvements in program outcomes and productivity. Intervals must
be no less frequent than annually nor
more frequent than quarterly except in
unusual circumstances, for example
where more frequent reporting is necessary for the effective monitoring of
the Federal award or could significantly affect program outcomes. Annual reports must be due 90 calendar
days after the reporting period; quarterly or semiannual reports must be
due 30 calendar days after the reporting period. Alternatively, the Federal
awarding agency or pass-through entity may require annual reports before
the anniversary dates of multiple year
Federal awards. The final performance
report will be due 90 calendar days
after the period of performance end
date. If a justified request is submitted
by a non-Federal entity, the Federal
agency may extend the due date for
any performance report.
(2) The non-Federal entity must submit performance reports using OMBapproved governmentwide standard information collections when providing
performance information. As appropriate in accordance with above mentioned information collections, these
reports will contain, for each Federal
award, brief information on the following unless other collections are approved by OMB:
(i) A comparison of actual accomplishments to the objectives of the
Federal award established for the period. Where the accomplishments of
the Federal award can be quantified, a

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