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IMLS training distills major OMB grant-rule changes; effective for FY2025 awards
Summary
At an IMLS Grants to States training in Milwaukee, program staff summarized OMB's updates to 2 CFR Part 200: higher thresholds for equipment and single-audit, new UEI and subrecipient certifications, cybersecurity noted as an internal-control allowable cost, and an Oct. 1 regulatory effective date that will not change active awards until FY2025 grants are issued.
Terry DeVoe, a grants official with the Institute of Museum and Library Services's Grants to States program, told state library administrators at a Milwaukee training that Office of Management and Budget updates to the uniform guidance (2 CFR Part 200) will take effect Oct. 1 but won't apply to current awards.
"Nothing in your immediate grant realm is going to change, because this will not apply until we issue the 2025 awards," DeVoe said, adding that states should expect the new rules to govern awards made in fiscal 2025.
The session spelled out several concrete numeric changes attendees should plan for: the equipment threshold doubles from $5,000 to $10,000; the single-audit threshold rises from $750,000 to $1,000,000; the modified total direct cost threshold for subawards increases from $25,000 to $50,000; and the de minimis indirect cost rate may rise from 10% to 15%.
DeVoe said prior approval for purchases remains required in many cases despite higher thresholds. "It is false that prior approval for equipment will no longer be required," she said, adding that the raised threshold may simply reduce the number of prior-approval requests.
The guidance also clarifies reporting and compliance steps for pass-through entities. DeVoe told attendees that unique entity identifiers (UEIs) are required for subrecipients only and that pass-through entities carry the responsibility to verify whether a potential subrecipient is excluded from receiving federal funds (for example, by checking SAM.gov).
The new guidance adds explicit requirements and priorities in other areas: cybersecurity is now called out under internal controls and is identified as an allowable cost so grant funds may be used to defray cybersecurity expenses; OMB also highlighted purchasing preferences (to the greatest extent practicable) for reused/refurbished/recycled, bio-based, or energy- and water-efficient products.
DeVoe said IMLS and the agency's legal and grants teams prepared a 30-page handout and plan to hold an open forum on Nov. 7 for more detailed questions. She encouraged attendees to review the handout, consult the eCFR and Federal Register notice, and contact program officers with specific questions before FY2025 awards are issued.
Next steps announced to attendees included an Oct. 4 quarterly accrual-report deadline for finance offices and an IMLS commitment to consider administrative process modifications aimed at easing reporting burdens.
The training emphasized that while OMB's changes are significant, states have time to update policies and procedures before the new rules apply to IMLS awards.
