These pages consist of information, guidance, and materials related to real property and tangible personal property (i.e., equipment and supplies), and intangible property (i.e., copyright, patents or securities). The information contained within these pages are not intended to replace federal regulations. It is the responsibility of the recipient/grantee to ensure that only allowable costs are charged to the grant program.
The Property Guidance pages are intended to make available to ACF recipients/grantees, in a central location, the policies and requirements related to property. Property consists of real property and personal property (tangible and intangible). These pages are not intended to replace statutes, federal regulations, terms and conditions under grant programs.
Unless otherwise stated in Federal statute, program regulations, and terms and conditions, recipients/grantees and pass-through entities are responsible and accountable for, but not limited to, the following:
While acquisition and maintenance of equipment, generally, is an allowable cost, acquisition, construction, and renovation of real property is unallowable in the absence of specific statutory authority and prior approval.
Only a few ACF grant program statutes allow federal funds to be used to acquire, construct, and/or renovate property, please see the Applicable ACF Grant Programs with Real Property Authority and Real Property Guidance. The federal interest in real property purchased, constructed, or renovated with federal funds does not expire but remains in place until formal disposition is approved by ACF. For a list of commonly used terms, please refer to Property Glossary.
Unless otherwise stated in Federal statute, program regulations, and terms and conditions, federal funds may be used to acquire and maintain tangible personal property. For more information, please see Tangible Personal Property Guidance and Property Glossary.
Real Property and Tangible Personal Property also have specific reporting and disposition requirements, please see applicable reporting and disposition sections for more information.
Next: Applicable ACF Grant Programs with Real Property Authority >
Only a few ACF grant programs have real property authority to allow, with prior approval, to use federal funds to acquire, construct, and/or make major renovations on a property. The applicable ACF grant programs and Catalogue of Federal Domestic Assistance (CFDA) are as follows:
Administration on Children, Youth & Families (ACYF) - CFDA varies
Office of Child Care (OCC) – CFDA 93.575 and 93.596
Office of Community Services (OCS) – CFDA varies
Office of Head Start (OHS) – CFDA 93.600; 93.095 and 93.096 (specific to Disaster Relief)
For more information on real property, please visit Real Property Guidance. These pages only apply to ACF grant programs with real property authority. For more information see Applicable ACF Grant Programs with Real Property Authority. The information contained within these pages are not intended to replace federal regulations. It is the responsibility of the recipient/grantee to ensure that only allowable costs are charged to the grant program.
Next: Depreciation Guidance >
Depreciation is the method for allocating the cost of fixed assets owned by the recipient/grantee to periods benefiting from asset use. The recipient/grantee may be compensated for the use of its buildings, capital improvements, equipment, and software projects capitalized in accordance with GAAP, provided that they are used, needed in the recipients/grantees activities, and properly allocated to Federal awards. Such compensation must be made by computing depreciation. Allocation for depreciation must also be made in accordance with appendices III through IX to Part 75.
When an entity owns a building and/or office space and it is claimed or contributed to the award, 45 CFR §75.436 requires that the building and/or office space must be valued using depreciation, whether claimed as an administrative cost or for cost-sharing purposes.
When property is donated, per 45 CFR §75.434(b), the value of the property donated may not be charged to the Federal award either as a direct or indirect (F&A) cost. The value of donated property may be used to meet cost sharing or matching requirements at 45 CFR §75.306. Depreciation on donated assets is permitted in accordance with 45 CFR §75.436, so long as the donated property is not counted towards cost sharing or matching requirements.
In accordance with 45 CFR §75.436, depreciation is computed applying the following rules. The computation of depreciation must be based on the acquisition cost of the assets involved. For an asset donated to the recipient/grantee by a third party, its fair market value at the time of the donation must be considered as the acquisition cost. Such assets may be depreciated or claimed as matching but not both.
For the purpose of computing depreciation, per 45 CFR §75.436(c), the acquisition cost will exclude:
When computing depreciation charges per 45 CFR §75.436(d), the following must be observed:
Charges for depreciation must be supported by adequate property records, and physical inventories must be taken at least once every two years to ensure that the assets exist and are usable, used, and needed. Statistical sampling techniques may be used in taking these inventories. In addition, adequate depreciation records showing the amount of depreciation taken each period must also be maintained.
Depreciation charges must be supported by adequate property record. Physical inventories must be taken at least once every two years to ensure that the assets exist and are usable, used, and needed. Statistical sampling techniques may be used in taking these inventories. Depreciation records showing the amount of depreciation taken each period must be maintained.Next: Rent/Lease Arrangement Guidance >
All programs may charge rental costs if those costs meet the criteria under per 45 CFR §75.465, grant terms and conditions, and/or other applicable federal regulations. However, only those ACF grant programs that have the statutory authority are allowed, with prior approval, to use, federal funds to purchase, construct, or make major renovations to real property. See Applicable ACF Grant Programs with Real Property Authority.
Recipients who own land, building, and/or space claimed and/or contributed towards the award, please refer to the Depreciation Guidance for more information.
45 CFR Part 75 does not define a lease. However, generally a lease is a contract describing the terms under which one party (tenant) agrees to rent property owned by another party (landlord). Such agreements are typically labeled as leases, but may also be called use agreements, memoranda of use or other similar terms. All arrangements are subject to ACF administrative review. The substance of the agreement dictates its characterization as a lease. Under 45 CFR Part 75, leases fall under two main categories: 1) “arm’s-length” or 2) “less-than-arm's-length” arrangements. Recipients may only charge the appropriate costs based on whether the arrangement is “arm's-length” or “less-than-arm's-length."
An “arm’s-length” lease is considered an arrangement with an unrelated third party and follows the general requirements under 45 CFR §75.465(a): “Rental costs are allowable to the extent that the rates are reasonable in light of such factors as: rental costs of comparable property, if any; market conditions in the area; alternatives available; and the type, life expectancy, condition, and value of the property leased. Rental arrangements should be reviewed periodically to determine if circumstances have changed and other options are available.” Recipients/grantees must ensure that rental costs are reasonable and comparable to other like type properties. When requested, ACF may require funded recipients to provide rental cost analysis assessments to verify allowable, necessary, and reasonableness of costs. Examples of unallowable costs under an “arm’s-length” lease are any ownership type expenses such as depreciation, taxes, insurance, and any maintenance costs that are, per 45 CFR §75.452, considered improvements which add to the permanent value, or are intended to prolong the intended life, of the building.
A “less-than-arm's-length” arrangement is outlined under 45 CFR § 75.465(c). Under 45 CFR Part 75, “less-than-arm's-length” arrangements (45 CFR §75.465(c)) are bound by the same restrictions as those on “sale and lease back” arrangements (45 CFR §75.465(b)), under which rental costs are allowable only up to the amount that would have been allowed had the recipient/grantee continued to own (occupy) the property. Generally, per 45 CFR §75.465(b) and (c), the allowable expense items related to property costs include depreciation, maintenance, taxes, and insurance. However:
A capital lease is considered a “less-than-arm's-length” lease. Rental cost under leases that are required to be treated as capital leases under GAAP are allowable only up to the amount (as explained in 45 CFR § 75.465(b)) that would be allowed had the entity purchased the property on the date the lease agreement was executed. The provisions of GAAP must be used to determine whether a lease is a capital lease. Interest costs related to capital leases are generally allowable to the extent they meet the criteria in 45 CFR § 75.449 and if the statutory authority allows such costs (see Applicable ACF Grant Programs with Real Property Authority for programs that have this authority). Unallowable costs include amounts paid for profit, management fees, and taxes that would not have been incurred had the recipient/grantee purchased the property. Programs that do not have statutory authority to purchase a facility, may also not charge the award any capital lease payments and interest costs to purchase a facility.
There are a variety of commercial lease structures (i.e., standard and net lease (single-net, double-net, and triple net)), but each may not always fall in line with federal grant requirements, 45 CFR §75.465. It is the responsibility of the recipient/grantee to ensure only allowable costs are charged to the award. For more information, see the “arm’s-length” and “less-than-arm's-length” sections for general allowability.
45 CFR Part 75 does not define an operating lease. However, generally an operating lease is a contract allowing a renter to use the asset temporarily, and does not convey ownership rights of the asset. While operating leases are generally handled as a standard rental lease, the “arm’s length” and “less-than-arm's-length” lease must be considered.Next: Facility and Lease Documentation >
Any format may be used to document facility and lease proposed, claimed, and/or contributed to the award. The format must be readable, accessible, accurate, current, complete and is sufficiently detailed to assure compliance with Federal statute, regulations, and terms and conditions of the Federal award. For an example, please review Facilities Listing and Related Cost Documentation.Next: Tangible Personal Property Guidance >
For more information on tangible personal property (i.e., equipment and supplies), please visit Tangible Personal Property Guidance. The information contained within these pages are not intended to replace federal regulations. It is the responsibility of the recipient/grantee to ensure that only allowable costs are charged to the grant program.Next: Intangible and Intellectual Property Guidance >
Intangible property, per 45 CFR §75.322, acquired under a Federal award must be used for the originally-authorized purpose and must not be encumbered without ACF approval. ACF has the right to obtain, reproduce, publish, or otherwise use the data produced under a Federal award; and authorize others to receive, reproduce, publish, or otherwise use such data for Federal purposes. When no longer needed, disposition of intangible property must be in accordance with the provisions at 45 CFR §75.320(e). For more information also see 45 CFR §75.308, §75.322, §75.323, §75.448, and HHS Grants Policy Statement II-37, II-68, II-75, II-97, II-117, II-121, II-217, and B-7.
While recipients/grantees may copyright any work that was developed or acquired under an award, HHS reserves a royalty-free, nonexclusive, and irrevocable right to reproduce, publish, or otherwise use the work for federal purposes and authorize others to do so. See 45 CFR §75.448 for allowable and unallowable costs.
Recipients/grantees must follow the applicable regulations governing patents and inventions, including government-wide regulations issued by the Department of Congress at 37 CFR Part 401. See 45 CFR §75.448 for allowable and unallowable costs.
For more information on requirements related to publications, please refer to the Stevens Amendment.Next: Unallowable Property Costs >
This section provides general guidance and examples of unallowable costs related to property.
The absence of a particular item of cost is not intended to imply that it is either allowable or unallowable; rather, a determination as to allowability in each case should be based on the treatment provided for similar or related items of cost, and be in accordance with the applicable Federal statutes, regulations, or the terms and conditions of the Federal award. It is the responsibility of the recipient/grantee to ensure that only allowable costs are charged to the award. However, recipients/grantees may request a review of costs (i.e., prior approval) in advance of incurring costs.
The Office of Grants Management (OGM) must be consulted and confirm the percentage of participation (federal interest) before any payment is remitted on a property per the requirements under real property (45 CFR §75.318 and/or program-specific regulations) and tangible personal property (45 CFR §75.320, 45 CFR §75.321, 45 CFR §75.322, and/or program-specific regulations). Payment must be received and confirmed before ACF can release the federal interest on a property.
In instances where the Administration of Children and Families, as the awarding agency, must be compensated for its percentage of participation on the property, the payment must be remitted in accordance with the instruction by the Department for Health and Human Services. For more information, please visit the Payment Management System, Program Support Center (PSC), Returning Funds/Interest.Next: Property Glossary >
This section contains commonly used ACF property terms: however, it may not be all inclusive. Please be advised that many of these property terms apply only to ACF grant programs that have the authority to allow, with prior approval, the use of federal funds to purchase, construct, and/or renovate property. For more information see the Applicable ACF Grant Programs with Real Property Authority, Real Property Guidance, and Unallowable Property Costs.
Acquisition Cost, per 45 CFR §75.2, means the cost of the asset including the cost to ready the asset for its intended use. Acquisition cost for equipment, for example, means the net invoice price of the equipment, including the cost of any modifications, attachments, accessories, or auxiliary apparatus necessary to make it usable for the purpose for which it is acquired. Acquisition costs for software includes those development costs capitalized in accordance with generally accepted accounting principles (GAAP). Ancillary charges, such as taxes, duty, protective in transit insurance, freight, and installation may be included in or excluded from the acquisition cost in accordance with the non-Federal entity's regular accounting practices.
Alteration. See glossary term Alteration and Renovation (A&R).
Alteration and Renovation (A&R) is, generally, considered work that changes the interior arrangements or other physical characteristics of an existing facility or installed equipment so that it can be used more effectively for its currently designed purpose or adapted to an alternative use to meet a programmatic requirement. A&R may involve: changes to interior dimensions, surfaces, or finishes; changes to the internal environment; changes to utility services (plumbing, electricity, gas, etc.); installation of fixed equipment (including casework, fume hoods, etc.); replacement, removal, or reconfiguration of walls, doors, frames, or windows in order to place equipment in a permanent location; making unfinished shell space suitable for purposes other than human or animal occupancy, such as storage; or, alterations to meet requirements for accessibility by individuals with physical disabilities. This type of work also may be referred to as improvements, conversion, rearrangements, reconversion, rehabilitation, remodeling, restoration, or modernization. It excludes: construction; large-scale permanent improvements (major renovation); “routine” maintenance and repair; and, costs categorized as equipment costs per the recipient’s accounting system. HHS characterizes A&R projects as “minor” or “major”, depending on the type of activity proposed, the cost of the project, and whether it meets or exceeds the major renovation threshold (if applicable). Note: there may be areas of overlap, e.g., a rebudgeting action that causes a minor A&R project to become a major A&R project, which is unallowable under ACF programs that do not have real property authority. For more information see 45 CFR §75.308, 45 CFR §75.407, 45 CFR §75.436, 45 CFR §75.439, 45 CFR §75.462, Applicable ACF Grant Programs with Real Property Authority, HHS Grants Policy Statement (GPS) II-30, II-49, II-97 to II 99, and B-2. See also glossary terms Maintenance, Maintenance and Repair Costs, Major Renovation, Major Renovation Threshold, Minor Renovation, Real Property, and Repair for more information.
Capital Assets, per 45 CFR §75.2, means tangible or intangible assets used in operations having a useful life of more than one year which are capitalized in accordance with generally accepted accounting principles (GAAP). Capital assets include:
Capital Expenditure, as defined by 45 CFR §75.2, means expenditures to acquire capital assets or expenditures to make additions, improvements, modifications, replacements, rearrangements, reinstallations, renovations, or alterations to capital assets that materially increase their value or useful life. For more information see 45 CFR §75.308, 45 CFR §75.436, 45 CFR §75.439, 45 CFR §75.407, ACF Property Guidance, generally accepted accounting principles (GAAP), HHS Grants Policy Statement (GPS) at II-31 and II-35, and glossary terms Construction, Major Renovation and Major Renovation Threshold, and Real Property.
Computing Devices, as defined by 45 CFR §75.2, means machines used to acquire, store, analyze, process, and publish data and other information electronically, including accessories (or “peripherals”) for printing, transmitting and receiving, or storing electronic information. See under 45 CFR §75.2 for Supplies and Information Technology Systems.
Construction means a new facility, building, or structure. This excludes renovation, alterations, additions, or work of any kind to existing buildings. Only ACF grant programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose. For more information see HHS Grants Policy Statement at II-31 and II-35. See 45 CFR §75.308, 45 CFR §75.407, 45 CFR §1305.2, 45 CFR §98.2 and HHS Grants Policy Statement at II-32. See Applicable ACF Grant Programs with Real Property Authority and Real Property Guidance.
Contract, per 45 CFR §75.2, means a legal instrument by which a non-Federal entity purchases property or services needed to carry out the project or program under a Federal award. The term as used in this part does not include a legal instrument, even if the non-Federal entity considers it a contract, when the substance of the transaction meets the definition of a Federal award or subaward.
Cost sharing or matching (also known as non-Federal share), as defined by 45 CFR §75.2, means the portion of project costs not paid by Federal funds (unless otherwise authorized by Federal statute). This may include the value of allowable third party in-kind contributions, as well as expenditures by the recipient/grantee. See also 45 CFR §75.306. For OHS grantees and delegates, according to 45 CFR 1303.44(c) “Non-federal match. Any non-federal match associated with facilities activities becomes part of the federal share of the facility.” See also glossary term Federal Interest. For all other ACF grant recipients and subrecipients there is no change to the standard definition.
Depreciation is the method for allocating the cost of fixed assets to periods benefiting from asset use. See 45 CFR §75.436, 45 CFR §75.439, 45 CFR §75.443, 45 CFR §75.446, 45 CFR §75.465, program regulations, and non-Federal entities accounting procedures.
Disallowed costs, as defined by 45 CFR §75.2, means those charges to a Federal award that the Federal awarding agency or pass-through entity determines to be unallowable, in accordance with the applicable Federal statutes, regulations, or the terms and conditions of the Federal award. See also 45 CFR §75.410 regarding the collection of unallowable costs.
Equipment, as defined by 45 CFR §75.2, means tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. See under 45 CFR §75.2 for Capital Assets, Computing Devices, General Purpose Equipment, Information Technology Systems, and Supplies. See Tangible Personal Property Guidance.
Federal Interest, per 45 CFR §75.2, means, for purposes of 45 CFR §75.343 or when used in connection with the acquisition or improvement of real property, equipment, or supplies under a Federal award, the dollar amount that is the product of the: (1) Federal share of total project costs; and (2) Current fair market value of the property, improvements, or both, to the extent the costs of acquiring or improving the property were included as project costs. [Please note that current fair market value is based on an appraisal (no more than three (3) years old) conducted by an independent certified appraiser.] For OHS grantees and delegates, Federal interest is defined as, per 45 CFR §1305.2, a property right which secures the right of the federal awarding agency to recover the current fair market value of its percentage of participation in the cost of the facility in the event the facility is no longer used for Head Start purposes by the grantee or upon the disposition of the property. When a grantee uses Head Start funds to purchase, construct or renovate a facility, or make mortgage payments, it creates a federal interest. The federal interest includes any portion of the cost of purchase, construction, or renovation contributed by or for the entity, or a related donor organization, to satisfy a matching requirement.
Federal Share, defined by 45 CFR §75.2, means the portion of total project costs that are paid by Federal funds. For OHS grantees and delegates, according to 45 CFR 1303.44(c) “Non-federal match. Any non-federal match associated with facilities activities becomes part of the federal share of the facility.” For all other ACF grant recipients and subrecipients there is no change to the standard definition.
General Purpose Equipment, per 45 CFR §75.2, means equipment which is not limited to research, medical, scientific or other technical activities. Examples include office equipment and furnishings, modular offices, telephone networks, information technology equipment and systems, air conditioning equipment, reproduction and printing equipment, and motor vehicles. See glossary term Equipment.
Information Technology Systems, as defined by 45 CFR §75.2, means computing devices, ancillary equipment, software, firmware, and similar procedures, services (including support services), and related resources. See under 45 CFR §75.2 for Computing Devices and Equipment.
Intangible Property, per 45 CFR §75.2, means property having no physical existence, such as trademarks, copyrights, patents and patent applications and property, such as loans, notes and other debt instruments, lease agreements, stock and other instruments of property ownership (whether the property is tangible or intangible).
Land Improvements are capital expenditures. These may include, but are not limited to, installation of paved areas (e.g., parking lots, sidewalks, etc.), permanent fences, utility conduits, and similar improvements.
Less-Than-Arm’s-Length Leases is when one party of an agreement is able to control or substantially influence the actions of the other. See 45 CFR §75.465. A few examples include, but are not limited to:
Maintenance. See glossary term Maintenance and Repair Costs.
Maintenance and Repair Costs are not defined under the definitions (45 CFR §75.2) like many other terms; however, it is identified as a selected item of cost under the cost principles (Subpart E – Cost Principles). According to the general provisions (45 CFR §75.420), this section applies principles in determining costs and are in addition to the basic consideration requirements (45 CFR 75.402-75.411) such as allowable cost factors, reasonable costs, allocable costs, and prior written approval. These principles apply whether or not a particular item of costs is properly treated as direct or indirect (Facilities & Administration) cost. With that in mind, the maintenance and repair costs (45 CFR §75.452) requirement contains three principles:
For more information, please see 45 CFR §75.308, 45 CFR §75.407, 45 CFR §75.436, 45 CFR §75.439, 45 CFR §75.462, ACF Property Guidance, generally accepted accounting principles (GAAP), and glossary terms Construction, Major Renovation, Major Renovation Threshold, and Real Property. *Insurance, security, and services have additional separate administrative or cost principle requirements that must be considered too. Note: “routine” maintenance and repair costs are allowable as an indirect cost, HHS GPS II-30.
Major Renovation is considered a structural change (e.g., to the foundation, roof, floor, or exterior or load-bearing walls of a facility, or an extension to an existing facility) to achieve the following: increase the floor area; and/or change function and purpose of the facility. For additional information regarding major renovation, please see CCDF-ACF-PI-2016-05, grant terms and conditions, HHS Grants Policy Statement II-98, Applicable ACF Grant Programs with Real Property Authority and Real Property Guidance.
Major Renovation Threshold, unless otherwise stated in federal statute, program regulations, and terms of a grant, is the amount used to distinguish between minor and major “Alteration & Renovation” for the entire project period. This threshold applies to each land parcel, as described by the jurisdiction in which the property is located..
Micro-purchase, per 45 CFR §75.2, means a purchase of supplies or services using simplified acquisition procedures, the aggregate amount of which does not exceed the micro-purchase threshold. Micro-purchase procedures comprise a subset of a non-Federal entity's small purchase procedures. The non-Federal entity uses such procedures in order to expedite the completion of its lowest-dollar small purchase transactions and minimize the associated administrative burden and cost. The micro-purchase threshold is set by the Federal Acquisition Regulation at 48 CFR Subpart 2.1 (Definitions). For more information see Award Term for Micro-Purchase and Simplified Acquisition Thresholds Exception and 48 CFR Part 2.1.
Minor Renovation means improvements to real property, which do not meet the definition of major renovation. HHS Grants Policy Statement at II-99.
Modular (e.g., a trailer or modular unit) is a structure (usually pre-fabricated) made at another location and moved to a site for use by a recipient/grantee of an ACF grant program. It may be classified as equipment or real property. Categorization of the property depends on the determination of whether the unit is intended to be used as equipment or to be fixed to the land in such a way that it becomes a permanent structure. Equipment intended to be “fixed” rather than “moveable”, must be classified as real property. See 45 CFR §75.2 for real property and equipment definitions, 45 CFR §98.2, 45 CFR §1305.2, HHS Grants Policy Statement at II-42, CCDF-ACF-PI-2016-05, and the non-Federal entities accounting procedures. Depending on the classification, please see the relevant reporting and disposition guidance.
Mortgage is considered a debt instrument that the borrower is obligated to pay back with a predetermined set of payments. This document is an encumbrance, which requires prior approval and a deviation. Only ACF grant programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose. See 45 CFR §75.308, 45 CFR §75.308(c)(1)(xi), 45 CFR §75.318(b), CCDF-ACF-PI-2016-05, See Applicable ACF Grants Programs with Real Property Authority and Real Property Guidance.
Parcel is considered a quantity of land identified for taxation purposes. Parcels are identified by methods specific to the taxing authority. A single parcel may contain multiple buildings with separate street and/or mailing addresses. Related terms include parcel number, legal description, and lot. A parcel number identifies the property as shown on the tax map. A legal description describes a specific parcel of real estate complete enough for an independent surveyor to locate and identify it. The description is by subdivision name, lot and block in a platted subdivision, by certified survey map and lot number, or in unplatted lands, and it is identified according to the township, section, range associated with the Public Land Survey System or Private Claims or Government Lots. A lot is a measured parcel of land having fixed boundaries.
Personal Property, per 45 CFR §75.2, means property of any kind except real property. It may be tangible, having physical existence, or intangible, such as copyrights, patents, or securities.
Prior Approval, per 45 CFR §75.2, means written approval by an authorized HHS official evidencing prior consent before a recipient/grantee undertakes certain activities or incurs specific costs. According to 45 CFR §75.407(a), under any given federal award, the reasonableness, allocability, and allowability of certain costs may be difficult to determine. Therefore, a recipient/grantee may seek prior written approval. See 45 CFR §75.308, 45 CFR §75.318, 45 CFR §75.320, 45 CFR §75.407, 45 CFR §75.439 and Real Property Guidance.
Project Costs, per 45 CFR §75.2, means total allowable costs incurred under a Federal award and all required cost sharing and voluntary committed cost sharing, including third-party contributions.
Promissory Note (also called notes) is a debt instrument that contains a written promise by one party to pay another party a definite sum of money, either on demand or at a specified future date. A promissory note typically contains, but is not limited to, the principal amount, interest rate, maturity date, and date. This is not a stand-alone agreement. This document is a part of encumbrance, which requires prior approval. Only ACF grant programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose. See Applicable ACF Grants Programs with Real Property Authority and Real Property Guidance.
Property, as defined by 45 CFR §75.2, means real property and personal property.
Purchase means to buy a property. For OHS grantees and delegates, per 45 CFR §1305.2, this also means purchasing an existing facility, including an outright purchase, down payment or through payments made in satisfaction of a mortgage or other loan agreement, whether principal, interest or an allocated portion principal and/or interest. The use of grant funds to make a payment under a capital lease agreement, as defined in the cost principles, is a purchase subject to these provisions. Purchase also refers to an approved use of Head Start funds to continue paying the cost of purchasing facilities or refinance an existing loan or mortgage beginning in 1987. For CCDF Tribal, recipients may not use federal funds to purchase an existing building or facility, see 45 CFR §98.84, 42 U.S.C. §9858d(b)(1) and §9858m(c)(6). See Applicable ACF Grants Programs with Real Property Authority and Real Property Guidance.
Real Property, as defined by 45 CFR §75.2,45 CFR §1305.2, and 45 CFR §98.2, means “land, including land improvements, structures and appurtenances [affixed equipment] thereto, but excludes moveable machinery and equipment.” Real property acquisition (HHS GPS II-35), construction (HHS GPS II-32 and II-35), and major alteration and renovation (HHS GPS II-30) are unallowable in the absence of specific statutory authority and prior approval. For more information see 45 CFR §75.308, 45 CFR §75.407, 45 CFR §75.439, 45 CFR §75.462, Applicable ACF Grant Programs with Real Property Authority, generally accepted accounting principles (GAAP), and glossary terms Major Renovation and Major Renovation Threshold.
Renovation. See glossary term Alteration and Renovation (A&R).
Repair. See glossary term Maintenance and Repair Costs.
Services are intangible and may result in a good or product. It is also generally considered a professional or consultant service rendered by persons who are members of a particular profession or possess a special skill and who may not be officers or employees of the non-Federal entity. Services include, but are not limited to, cleaning and maintenance of facilities or equipment. For more information see 45 CFR §75.459.
Simplified acquisition threshold, per 45 CFR §75.2, means the dollar amount below which a non-Federal entity may purchase property or services using small purchase methods. Non-Federal entities adopt small purchase procedures in order to expedite the purchase of items costing less than the simplified acquisition threshold. The simplified acquisition threshold is set by the Federal Acquisition Regulation at 48 CFR subpart 2.1 and in accordance with 41 U.S.C. 1908. The simplified acquisition threshold is currently set at $250,000, but this threshold is periodically adjusted for inflation. For more information see Award Term for Micro-Purchase and Simplified Acquisition Thresholds Exception and 48 CFR Part 2.1. The simplified acquisition threshold has no bearing on the major renovation threshold.
Supplies, per 45 CFR §75.2, means all tangible personal property other than those described in Equipment. A computing device is a supply if the acquisition cost is less than the lesser of the capitalization level established by the non-Federal entity for financial statement purposes or $5,000, regardless of the length of its useful life. See under 45 CFR §75.2 for Computing Devices and Equipment. See Tangible Personal Property Guidance.
Tangible Property includes equipment, supplies, and any other property (including information technology systems) other than that which is defined as an intangible property. See 45 CFR §75.2 for Capital Assets, Capital Expenditures, Equipment, Intangible Property, Personal Property, and Supplies. See Tangible Personal Property Guidance.