Obama Administration Remains Committed to Recovery Act Oversight

5.5.2010 - Posted in E&B Alerts - Government Contracts

Yesterday, the Office of Management and Budget ("OMB") issued a Memorandum containing detailed guidance for federal agencies' monitoring of ARRA recipients' compliance with the American Recovery and Reinvestment Act's ("ARRA") reporting requirements. While directed to federal agencies, recipients of ARRA funds should take notice of this memorandum as it signals an increase in federal agencies' oversight of recipient reporting under Section 1512 of the ARRA.

As a result of this Memorandum it is likely that ARRA recipients will experience increased contact with federal agencies. The OMB Memorandum calls for agencies to contact:

  • Any recipient that has not filed its report prior to three days before the close of the reporting period;
  • New recipients prior to the beginning of each reporting period to notify the recipient of their obligations under Section 1512; and
  • Any recipients who have not satisfied Section 1512's reporting requirements for past reporting periods in order to ensure compliance in future reporting.

ARRA recipients should be aware of the potentially severe ramifications resulting from non-compliance with Section 1512's reporting requirements. While the purpose of the OMB Memorandum is to facilitate compliance through increased involvement by federal agencies, the Memorandum sets forth numerous consequences for recipients that fail to comply. The consequences for failure to comply with Section 1512's reporting requirements for one reporting period include restricting access to the awarded funds and monetary sanctions. If a recipient fails to comply with the reporting requirements for two consecutive reporting periods, the agency may enter the failure on the recipient's performance record, terminate the federal contract, and may suspend or debar the prime recipient.

Recipients of ARRA funds should be aware that the OMB Memorandum will create increased oversight of ARRA reporting by federal agencies and should take notice of the potentially severe sanctions for noncompliance. If you have questions regarding compliance with ARRA's reporting requirements, contactTim Connelly at [email protected] or (612) 236-0160. The May 4, 2010 Memorandum is available at: http://www.whitehouse.gov/omb/assets/memoranda_2010/m-10-17.pdf.