Bill Text: IL HB4689 | 2017-2018 | 100th General Assembly | Enrolled

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Amends the Grant Accountability and Transparency Act. Modifies a Section concerning the adoption of federal rules applicable to grants and provides that specified provisions do not apply to for-profit subrecipients because for-profit subrecipients are not subject to the requirements of a specified provision of the Code of Federal Regulations. Provides that if a Program Audit Guide is not available, the State awarding agency must prepare a Program Audit Guide in accordance with the audit requirements of specified provisions of the Code of Federal Regulations. Requires the Governor's Office of Management and Budget to adopt supplemental rules pertaining to, among other subjects, specific conditions for individual recipients, including (rather than requiring) the use of a fiscal agent and additional corrective conditions. Applies provisions in the Code of Federal Regulations concerning federal agencies that make federal awards to non-federal entities to State grant-making agencies under the Act. Provides that the Grant Accountability and Transparency Unit shall be responsible for providing technical assistance and assuring the Administrative Code proposed by State grant agencies comply with the Act. Repeals the Section specifying a repeal date for the Act. Makes other changes.

Spectrum: Moderate Partisan Bill (Republican 4-1)

Status: (Passed) 2018-08-03 - Public Act . . . . . . . . . 100-0676 [HB4689 Detail]

Download: Illinois-2017-HB4689-Enrolled.html

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AN ACT concerning finance.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Grant Accountability and Transparency Act is
amended by changing Sections 20, 25, 45, and 60 as follows:
(30 ILCS 708/20)
(Section scheduled to be repealed on July 16, 2020)
Sec. 20. Adoption of federal rules applicable to grants.
(a) On or before July 1, 2016, the Governor's Office of
Management and Budget, with the advice and technical assistance
of the Illinois Single Audit Commission, shall adopt rules
which adopt the Uniform Guidance at 2 CFR 200. The rules, which
shall apply to all State and federal pass-through awards
effective on and after July 1, 2016, shall include the
following:
(1) Administrative requirements. In accordance with
Subparts B through D of 2 CFR 200, the rules shall set
forth the uniform administrative requirements for grant
and cooperative agreements, including the requirements for
the management by State awarding agencies of federal grant
programs before State and federal pass-through awards have
been made and requirements that State awarding agencies may
impose on non-federal entities in State and federal

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pass-through awards.
(2) Cost principles. In accordance with Subpart E of 2
CFR 200, the rules shall establish principles for
determining the allowable costs incurred by non-federal
entities under State and federal pass-through awards. The
principles are intended for cost determination, but are not
intended to identify the circumstances or dictate the
extent of State or federal pass-through participation in
financing a particular program or project. The principles
shall provide that State and federal awards bear their fair
share of cost recognized under these principles, except
where restricted or prohibited by State or federal law.
(3) Audit and single audit requirements and audit
follow-up. In accordance with Subpart F of 2 CFR 200 and
the federal Single Audit Act Amendments of 1996, the rules
shall set forth standards to obtain consistency and
uniformity among State and federal pass-through awarding
agencies for the audit of non-federal entities expending
State and federal awards. These provisions shall also set
forth the policies and procedures for State and federal
pass-through entities when using the results of these
audits.
The provisions of this item (3) do not apply to
for-profit subrecipients because for-profit subrecipients
are not subject to the requirements of 2 CFR 200, Subpart F
OMB Circular A-133, Audits of States, Local and Non-Profit

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Organizations. Audits of for-profit subrecipients must be
conducted pursuant to a Program Audit Guide issued by the
Federal awarding agency. If a Program Audit Guide is not
available, the State awarding agency must prepare a Program
Audit Guide in accordance with the 2 CFR 200, Subpart F –
Audit Requirements - OMB Circular A-133 Compliance
Supplement. For-profit entities are subject to all other
general administrative requirements and cost principles
applicable to grants.
(b) This Act addresses only State and federal pass-through
auditing functions and does not address the external audit
function of the Auditor General.
(c) For public institutions of higher education, the
provisions of this Section apply only to awards funded by State
appropriations and federal pass-through awards from a State
agency to public institutions of higher education. Federal
pass-through awards from a State agency to public institutions
of higher education are governed by and must comply with
federal guidelines under 2 CFR 200.
(d) The State grant-making agency is responsible for
establishing requirements, as necessary, to ensure compliance
by for-profit subrecipients. The agreement with the for-profit
subrecipient shall describe the applicable compliance
requirements and the for-profit subrecipient's compliance
responsibility. Methods to ensure compliance for State and
federal pass-through awards made to for-profit subrecipients

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shall include pre-award, audits, monitoring during the
agreement, and post-award audits. The Governor's Office of
Management and Budget shall provide such advice and technical
assistance to the State grant-making agency as is necessary or
indicated.
(Source: P.A. 98-706, eff. 7-16-14; 99-523, eff. 6-30-16.)
(30 ILCS 708/25)
(Section scheduled to be repealed on July 16, 2020)
Sec. 25. Supplemental rules. On or before July 1, 2017, the
Governor's Office of Management and Budget, with the advice and
technical assistance of the Illinois Single Audit Commission,
shall adopt supplemental rules pertaining to the following:
(1) Criteria to define mandatory formula-based grants
and discretionary grants.
(2) The award of one-year grants for new applicants.
(3) The award of competitive grants in 3-year terms
(one-year initial terms with the option to renew for up to
2 additional years) to coincide with the federal award.
(4) The issuance of grants, including:
(A) public notice of announcements of funding
opportunities;
(B) the development of uniform grant applications;
(C) State agency review of merit of proposals and
risk posed by applicants;
(D) specific conditions for individual recipients

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(including requiring the use of a fiscal agent and
additional corrective conditions);
(E) certifications and representations;
(F) pre-award costs;
(G) performance measures and statewide prioritized
goals under Section 50-25 of the State Budget Law of
the Civil Administrative Code of Illinois, commonly
referred to as "Budgeting for Results"; and
(H) for mandatory formula grants, the merit of the
proposal and the risk posed should result in additional
reporting, monitoring, or measures such as
reimbursement-basis only.
(5) The development of uniform budget requirements,
which shall include:
(A) mandatory submission of budgets as part of the
grant application process;
(B) mandatory requirements regarding contents of
the budget including, at a minimum, common detail line
items specified under guidelines issued by the
Governor's Office of Management and Budget;
(C) a requirement that the budget allow
flexibility to add lines describing costs that are
common for the services provided as outlined in the
grant application;
(D) a requirement that the budget include
information necessary for analyzing cost and

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performance for use in Budgeting for Results; and
(E) caps on the amount of salaries that may be
charged to grants based on the limitations imposed by
federal agencies.
(6) The development of pre-qualification requirements
for applicants, including the fiscal condition of the
organization and the provision of the following
information:
(A) organization name;
(B) Federal Employee Identification Number;
(C) Data Universal Numbering System (DUNS) number;
(D) fiscal condition;
(E) whether the applicant is in good standing with
the Secretary of State;
(F) past performance in administering grants;
(G) whether the applicant is or has ever been on
the Debarred and Suspended List maintained by the
Governor's Office of Management and Budget;
(H) whether the applicant is or has ever been on
the federal Excluded Parties List; and
(I) whether the applicant is or has ever been on
the Sanctioned Party List maintained by the Illinois
Department of Healthcare and Family Services.
Nothing in this Act affects the provisions of the Fiscal
Control and Internal Auditing Act nor the requirement that the
management of each State agency is responsible for maintaining

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effective internal controls under that Act.
For public institutions of higher education, the
provisions of this Section apply only to awards funded by State
appropriations and federal pass-through awards from a State
agency to public institutions of higher education.
(Source: P.A. 98-706, eff. 7-16-14; 99-523, eff. 6-30-16.)
(30 ILCS 708/45)
(Section scheduled to be repealed on July 16, 2020)
Sec. 45. Applicability.
(a) The requirements established under this Act apply to
State grant-making agencies that make State and federal
pass-through awards to non-federal entities. These
requirements apply to all costs related to State and federal
pass-through awards. The requirements established under this
Act do not apply to private awards.
(a-5) Nothing in this Act shall prohibit the use of State
funds for purposes of federal match or maintenance of effort.
(b) The terms and conditions of State, federal, and
pass-through awards apply to subawards and subrecipients
unless a particular Section of this Act or the terms and
conditions of the State or federal award specifically indicate
otherwise. Non-federal entities shall comply with requirements
of this Act regardless of whether the non-federal entity is a
recipient or subrecipient of a State or federal pass-through
award. Pass-through entities shall comply with the

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requirements set forth under the rules adopted under subsection
(a) of Section 20 of this Act, but not to any requirements in
this Act directed towards State or federal awarding agencies,
unless the requirements of the State or federal awards indicate
otherwise.
When a non-federal entity is awarded a cost-reimbursement
contract, only 2 CFR 200.330 through 200.332 are incorporated
by reference into the contract. However, when the Cost
Accounting Standards are applicable to the contract, they take
precedence over the requirements of this Act unless they are in
conflict with Subpart F of 2 CFR 200. In addition, costs that
are made unallowable under 10 U.S.C. 2324(e) and 41 U.S.C.
4304(a), as described in the Federal Acquisition Regulations,
subpart 31.2 and subpart 31.603, are always unallowable. For
requirements other than those covered in Subpart D of 2 CFR
200.330 through 200.332, the terms of the contract and the
Federal Acquisition Regulations apply.
With the exception of Subpart F of 2 CFR 200, which is
required by the Single Audit Act, in any circumstances where
the provisions of federal statutes or regulations differ from
the provisions of this Act, the provision of the federal
statutes or regulations govern. This includes, for agreements
with Indian tribes, the provisions of the Indian
Self-Determination and Education and Assistance Act, as
amended, 25 U.S.C. 450-458ddd-2.
(c) State grant-making agencies may apply subparts A

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through E of 2 CFR 200 to for-profit entities, foreign public
entities, or foreign organizations, except where the awarding
agency determines that the application of these subparts would
be inconsistent with the international obligations of the
United States or the statute or regulations of a foreign
government.
(d) 2 CFR 200.101 specifies how 2 CFR 200 is applicable to
different types of awards. The same applicability applies to
this Act. Except for 2 CFR 200.202 and 200.330 through 200.332,
the requirements in Subparts C, D, and E of 2 CFR 200 do not
apply to the following programs:
(1) The block grant awards authorized by the Omnibus
Budget Reconciliation Act of 1981 (including Community
Services; Preventive Health and Health Services; Alcohol,
Drug Abuse, and Mental Health Services; Maternal and Child
Health Services; Social Services; Low-Income Home Energy
Assistance; States' Program of Community Development Block
Grant Awards for Small Cities; and Elementary and Secondary
Education, other than programs administered by the
Secretary of Education under Title V, Subtitle D, Chapter
2, Section 583 - the Secretary's discretionary award
program) and both the Alcohol and Drug Abuse Treatment and
Rehabilitation Block Grant Award (42 U.S.C. 300x-21 to
300x-35 and 42 U.S.C. 300x-51 to 300x-64) and the Mental
Health Service for the Homeless Block Grant Award (42
U.S.C. 300x to 300x-9) under the Public Health Services

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Act.
(2) Federal awards to local education agencies under 20
U.S.C. 7702 through 7703b (portions of the Impact Aid
program).
(3) Payments under the Department of Veterans Affairs'
State Home Per Diem Program (38 U.S.C. 1741).
(4) Federal awards authorized under the Child Care and
Development Block Grant Act of 1990, as amended, including
the following:
(A) Child Care and Development Block Grant (42
U.S.C. 9858).
(B) Child Care Mandatory and Matching Funds of the
Child Care and Development Fund (42 U.S.C. 9858).
(e) (Blank). Except for the 2 CFR 200.202 requirement to
provide public notice of federal financial assistance
programs, the guidance in Subpart C Pre-federal Award
Requirements and Contents of Federal Awards does not apply to
the following programs:
(1) Entitlement federal awards to carry out the
following programs of the Social Security Act:
(A) Temporary Assistance to Needy Families (Title
IV-A of the Social Security Act, 42 U.S.C. 601-619);
(B) Child Support Enforcement and Establishment of
Paternity (Title IV-D of the Social Security Act, 42
U.S.C. 651-669b);
(C) Foster Care and Adoption Assistance (Title

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IV-E of the Act, 42 U.S.C. 670-679c);
(D) Aid to the Aged, Blind, and Disabled (Titles I,
X, XIV, and XVI - AABD of the Act, as amended); and
(E) Medical Assistance (Medicaid) (42 U.S.C.
1396-1396w-5), not including the State Medicaid Fraud
Control program authorized by Section 1903(a)(6)(B) of
the Social Security Act (42 U.S.C. 1396b(a)(6)(B)).
(2) A federal award for an experimental, pilot, or
demonstration project that is also supported by a federal
award listed in paragraph (1) of subsection (e) of this
Section.
(3) Federal awards under subsection 412(e) of the
Immigration and Nationality Act of 1965 and Section 501(a)
of the Refugee Education Assistance Act of 1980 for cash
assistance, medical assistance, and supplemental security
income benefits to refugees and entrants and the
administrative costs of providing the assistance and
benefits under 8 U.S.C. 1522(e).
(4) Entitlement awards under the following programs of
The National School Lunch Act:
(A) National School Lunch Program (42 U.S.C.
1753);
(B) Commodity Assistance (42 U.S.C. 1755);
(C) Special Meal Assistance (42 U.S.C. 1759a);
(D) Summer Food Service Program for Children (42
U.S.C. 1761); and

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(E) Child and Adult Care Food Program (42 U.S.C.
1766).
(5) Entitlement awards under the following programs of
The Child Nutrition Act of 1966:
(A) Special Milk Program (42 U.S.C. 1772);
(B) School Breakfast Program (42 U.S.C. 1773); and
(C) State Administrative Expenses (42 U.S.C.
1776).
(6) Entitlement awards for State Administrative
Expenses under The Food and Nutrition Act of 2008 (7 U.S.C.
2025).
(7) Non-discretionary federal awards under the
following non-entitlement programs:
(A) Special Supplemental Nutrition Program for
Women, Infants and Children under the Child Nutrition
Act of 1966 (42 U.S.C. 1786);
(B) The Emergency Food Assistance Programs
(Emergency Food Assistance Act of 1983) (7 U.S.C.
7501); and
(C) Commodity Supplemental Food Program (7 U.S.C.
612c).
(f) For public institutions of higher education, the
provisions of this Act apply only to awards funded by State
appropriations and federal pass-through awards from a State
agency to public institutions of higher education.
(g) Each grant-making agency shall enhance its processes to

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monitor and address noncompliance with reporting requirements
and with program performance standards. Where applicable, the
process may include a corrective action plan. The monitoring
process shall include a plan for tracking and documenting
performance-based contracting decisions.
(Source: P.A. 98-706, eff. 7-16-14; revised 9-25-17.)
(30 ILCS 708/60)
(Section scheduled to be repealed on July 16, 2020)
Sec. 60. Grant Accountability and Transparency Unit
responsibilities.
(a) The Grant Accountability and Transparency Unit within
the Governor's Office of Management and Budget shall be
responsible for:
(1) The development of minimum requirements applicable
to the staff of grant applicants to manage and execute
grant awards for programmatic and administrative purposes,
including grant management specialists with:
(A) general and technical competencies;
(B) programmatic expertise;
(C) fiscal expertise and systems necessary to
adequately account for the source and application of
grant funds for each program; and
(D) knowledge of compliance requirements.
(2) The development of minimum training requirements,
including annual training requirements.

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(3) Accurate, current, and complete disclosure of the
financial results of each funded award, as set forth in the
financial monitoring and reporting Section of 2 CFR 200.
(4) Development of criteria for requiring the
retention of a fiscal agent and for becoming a fiscal
agent.
(5) Development of disclosure requirements in the
grant application pertaining to:
(A) related-party status between grantees and
grant-making agencies;
(B) past employment of applicant officers and
grant managers;
(C) disclosure of current or past employment of
members of immediate family; and
(D) disclosure of senior management of grantee
organization and their relationships with contracted
vendors.
(6) Implementation of rules prohibiting a grantee from
charging any cost allocable to a particular award or cost
objective to other State or federal awards to overcome fund
deficiencies, to avoid restrictions imposed by law or terms
of the federal awards, or for other reasons.
(7) Implementation of rules prohibiting a non-federal
entity from earning or keeping any profit resulting from
State or federal financial assistance, unless prior
approval has been obtained from the Governor's Office of

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Management and Budget and is expressly authorized by the
terms and conditions of the award.
(8) Maintenance of an Illinois Debarred and Suspended
List that contains the names of those individuals and
entities that are ineligible, either temporarily or
permanently, to receive an award of grant funds from the
State.
(9) Ensuring the adoption of standardized rules for the
implementation of this Act by State grant-making agencies.
The Grant Accountability and Transparency Unit shall
provide such advice and technical assistance to the State
grant-making agencies as is necessary or indicated in order
to ensure compliance with this Act.
(10) Coordination of financial and Single Audit
reviews.
(11) Coordination of on-site reviews of grantees and
subrecipients.
(12) Maintenance of the Catalog of State Financial
Assistance, which shall be posted on an Internet website
maintained by the Governor's Office of Management and
Budget that is available to the public.
(b) The Grant Accountability and Transparency Unit shall
have no power or authority regarding the approval, disapproval,
management, or oversight of grants entered into or awarded by a
State agency or by a public institution of higher education.
The power or authority existing under law to grant or award

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grants by a State agency or by a public institution of higher
education shall remain with that State agency or public
institution of higher education. The Unit shall be responsible
for providing technical assistance to guide reviewing and
approving amendments to the Administrative Code amendments
proposed by State grant-making grant agencies to comply in
connection with the implementation of this Act and shall be
responsible for establishing standardized policies and
procedures for State grant-making agencies in order to ensure
compliance with the Uniform Administrative Requirements, Cost
Principles and Audit Requirements for Federal Awards set forth
in 2 CFR Part 200, all of which must be adhered to by the State
grant-making agencies throughout the life cycle of the grant.
(c) The powers and functions of grant making by State
agencies or public institutions of higher education may not be
transferred to, nor may prior grant approval be transferred to,
any other person, office, or entity within the executive branch
of State government.
(Source: P.A. 98-706, eff. 7-16-14.)
(30 ILCS 708/100 rep.)
Section 10. The Grant Accountability and Transparency Act
is amended by repealing Section 100.