Bill Text: IL HB5325 | 2021-2022 | 102nd General Assembly | Introduced

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Bill Title: Amends the Grant Accountability and Transparency Act. Provides that grants shall not restrict the amount of money used to pay for fringe benefits. Provides that grants shall not restrict administrative costs to less than 20% of the grant award. Defines "fringe benefits".

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2022-02-18 - Rule 19(a) / Re-referred to Rules Committee [HB5325 Detail]

Download: Illinois-2021-HB5325-Introduced.html

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102ND GENERAL ASSEMBLY State of Illinois 2021 and 2022 HB5325 Introduced , by Rep. Maurice A. West, II SYNOPSIS AS INTRODUCED:
30 ILCS 708/15
30 ILCS 708/135 new
Amends the Grant Accountability and Transparency Act. Provides that grants shall not restrict the amount of money used to pay for fringe benefits. Provides that grants shall not restrict administrative costs to less than 20% of the grant award. Defines "fringe benefits".
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A BILL FOR
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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 Section 15 and by adding Section 135 as
follows:
(30 ILCS 708/15)
Sec. 15. Definitions. As used in this Act:
"Allowable cost" means a cost allowable to a project if:
(1) the costs are reasonable and necessary for the
performance of the award;
(2) the costs are allocable to the specific project;
(3) the costs are treated consistently in like
circumstances to both federally-financed and other
activities of the non-federal entity;
(4) the costs conform to any limitations of the cost
principles or the sponsored agreement;
(5) the costs are accorded consistent treatment; a
cost may not be assigned to a State or federal award as a
direct cost if any other cost incurred for the same
purpose in like circumstances has been allocated to the
award as an indirect cost;
(6) the costs are determined to be in accordance with

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generally accepted accounting principles;
(7) the costs are not included as a cost or used to
meet federal cost-sharing or matching requirements of any
other program in either the current or prior period;
(8) the costs of one State or federal grant are not
used to meet the match requirements of another State or
federal grant; and
(9) the costs are adequately documented.
"Auditee" means any non-federal entity that expends State
or federal awards that must be audited.
"Auditor" means an auditor who is a public accountant or a
federal, State, or local government audit organization that
meets the general standards specified in generally-accepted
government auditing standards. "Auditor" does not include
internal auditors of nonprofit organizations.
"Auditor General" means the Auditor General of the State
of Illinois.
"Award" means financial assistance that provides support
or stimulation to accomplish a public purpose. "Awards"
include grants and other agreements in the form of money, or
property in lieu of money, by the State or federal government
to an eligible recipient. "Award" does not include: technical
assistance that provides services instead of money; other
assistance in the form of loans, loan guarantees, interest
subsidies, or insurance; direct payments of any kind to
individuals; or contracts that must be entered into and

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administered under State or federal procurement laws and
regulations.
"Budget" means the financial plan for the project or
program that the awarding agency or pass-through entity
approves during the award process or in subsequent amendments
to the award. It may include the State or federal and
non-federal share or only the State or federal share, as
determined by the awarding agency or pass-through entity.
"Catalog of Federal Domestic Assistance" or "CFDA" means a
database that helps the federal government track all programs
it has domestically funded.
"Catalog of Federal Domestic Assistance number" or "CFDA
number" means the number assigned to a federal program in the
CFDA.
"Catalog of State Financial Assistance" means the single,
authoritative, statewide, comprehensive source document of
State financial assistance program information maintained by
the Governor's Office of Management and Budget.
"Catalog of State Financial Assistance Number" means the
number assigned to a State program in the Catalog of State
Financial Assistance. The first 3 digits represent the State
agency number and the last 4 digits represent the program.
"Cluster of programs" means a grouping of closely related
programs that share common compliance requirements. The types
of clusters of programs are research and development, student
financial aid, and other clusters. A "cluster of programs"

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shall be considered as one program for determining major
programs and, with the exception of research and development,
whether a program-specific audit may be elected.
"Cognizant agency for audit" means the federal agency
designated to carry out the responsibilities described in 2
CFR 200.513(a).
"Contract" means a legal instrument by which a non-federal
entity purchases property or services needed to carry out the
project or program under an award. "Contract" 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 an award or subaward.
"Contractor" means an entity that receives a contract.
"Cooperative agreement" means a legal instrument of
financial assistance between an awarding agency or
pass-through entity and a non-federal entity that:
(1) is used to enter into a relationship with the
principal purpose of transferring anything of value from
the awarding agency or pass-through entity to the
non-federal entity to carry out a public purpose
authorized by law, but is not used to acquire property or
services for the awarding agency's or pass-through
entity's direct benefit or use; and
(2) is distinguished from a grant in that it provides
for substantial involvement between the awarding agency or
pass-through entity and the non-federal entity in carrying

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out the activity contemplated by the award.
"Cooperative agreement" does not include a cooperative
research and development agreement, nor an agreement that
provides only direct cash assistance to an individual, a
subsidy, a loan, a loan guarantee, or insurance.
"Corrective action" means action taken by the auditee that
(i) corrects identified deficiencies, (ii) produces
recommended improvements, or (iii) demonstrates that audit
findings are either invalid or do not warrant auditee action.
"Cost objective" means a program, function, activity,
award, organizational subdivision, contract, or work unit for
which cost data is desired and for which provision is made to
accumulate and measure the cost of processes, products, jobs,
and capital projects. A "cost objective" may be a major
function of the non-federal entity, a particular service or
project, an award, or an indirect cost activity.
"Cost sharing" means the portion of project costs not paid
by State or federal funds, unless otherwise authorized by
statute.
"Development" is the systematic use of knowledge and
understanding gained from research directed toward the
production of useful materials, devices, systems, or methods,
including design and development of prototypes and processes.
"Data Universal Numbering System number" means the 9-digit
number established and assigned by Dun and Bradstreet, Inc. to
uniquely identify entities and, under federal law, is required

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for non-federal entities to apply for, receive, and report on
a federal award.
"Direct costs" means costs that can be identified
specifically with a particular final cost objective, such as a
State or federal or federal pass-through award or a particular
sponsored project, an instructional activity, or any other
institutional activity, or that can be directly assigned to
such activities relatively easily with a high degree of
accuracy.
"Equipment" means tangible personal property (including
information technology systems) having a useful life of more
than one year and a per-unit acquisition cost that equals or
exceeds the lesser of the capitalization level established by
the non-federal entity for financial statement purposes, or
$5,000.
"Executive branch" means that branch of State government
that is under the jurisdiction of the Governor.
"Federal agency" has the meaning provided for "agency"
under 5 U.S.C. 551(1) together with the meaning provided for
"agency" by 5 U.S.C. 552(f).
"Federal award" means:
(1) the federal financial assistance that a
non-federal entity receives directly from a federal
awarding agency or indirectly from a pass-through entity;
(2) the cost-reimbursement contract under the Federal
Acquisition Regulations that a non-federal entity receives

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directly from a federal awarding agency or indirectly from
a pass-through entity; or
(3) the instrument setting forth the terms and
conditions when the instrument is the grant agreement,
cooperative agreement, other agreement for assistance
covered in paragraph (b) of 20 CFR 200.40, or the
cost-reimbursement contract awarded under the Federal
Acquisition Regulations.
"Federal award" does not include other contracts that a
federal agency uses to buy goods or services from a contractor
or a contract to operate federal government owned,
contractor-operated facilities.
"Federal awarding agency" means the federal agency that
provides a federal award directly to a non-federal entity.
"Federal interest" means, for purposes of 2 CFR 200.329 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 federal share of
total project costs and 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.
"Federal program" means any of the following:
(1) All federal awards which are assigned a single
number in the CFDA.
(2) When no CFDA number is assigned, all federal

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awards to non-federal entities from the same agency made
for the same purpose should be combined and considered one
program.
(3) Notwithstanding paragraphs (1) and (2) of this
definition, a cluster of programs. The types of clusters
of programs are:
(A) research and development;
(B) student financial aid; and
(C) "other clusters", as described in the
definition of "cluster of programs".
"Federal share" means the portion of the total project
costs that are paid by federal funds.
"Final cost objective" means a cost objective which has
allocated to it both direct and indirect costs and, in the
non-federal entity's accumulation system, is one of the final
accumulation points, such as a particular award, internal
project, or other direct activity of a non-federal entity.
"Financial assistance" means the following:
(1) For grants and cooperative agreements, "financial
assistance" means assistance that non-federal entities
receive or administer in the form of:
(A) grants;
(B) cooperative agreements;
(C) non-cash contributions or donations of
property, including donated surplus property;
(D) direct appropriations;

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(E) food commodities; and
(F) other financial assistance, except assistance
listed in paragraph (2) of this definition.
(2) "Financial assistance" includes assistance that
non-federal entities receive or administer in the form of
loans, loan guarantees, interest subsidies, and insurance.
(3) "Financial assistance" does not include amounts
received as reimbursement for services rendered to
individuals.
"Fixed amount awards" means a type of grant agreement
under which the awarding agency or pass-through entity
provides a specific level of support without regard to actual
costs incurred under the award. "Fixed amount awards" reduce
some of the administrative burden and record-keeping
requirements for both the non-federal entity and awarding
agency or pass-through entity. Accountability is based
primarily on performance and results.
"Foreign public entity" means:
(1) a foreign government or foreign governmental
entity;
(2) a public international organization that is
entitled to enjoy privileges, exemptions, and immunities
as an international organization under the International
Organizations Immunities Act (22 U.S.C. 288-288f);
(3) an entity owned, in whole or in part, or
controlled by a foreign government; or

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(4) any other entity consisting wholly or partially of
one or more foreign governments or foreign governmental
entities.
"Foreign organization" means an entity that is:
(1) a public or private organization located in a
country other than the United States and its territories
that are subject to the laws of the country in which it is
located, irrespective of the citizenship of project staff
or place of performance;
(2) a private nongovernmental organization located in
a country other than the United States that solicits and
receives cash contributions from the general public;
(3) a charitable organization located in a country
other than the United States that is nonprofit and tax
exempt under the laws of its country of domicile and
operation, but is not a university, college, accredited
degree-granting institution of education, private
foundation, hospital, organization engaged exclusively in
research or scientific activities, church, synagogue,
mosque, or other similar entity organized primarily for
religious purposes; or
(4) an organization located in a country other than
the United States not recognized as a Foreign Public
Entity.
"Fringe benefits" means allowances and services provided
by employers to their employees as compensation in addition to

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regular salaries and wages. "Fringe benefits" include, but are
not limited to, the costs of leave (vacation, family-related,
sick, or military), employee insurance, pensions, and
unemployment benefit plans.
"Generally Accepted Accounting Principles" has the meaning
provided in accounting standards issued by the Government
Accounting Standards Board and the Financial Accounting
Standards Board.
"Generally Accepted Government Auditing Standards" means
generally accepted government auditing standards issued by the
Comptroller General of the United States that are applicable
to financial audits.
"Grant agreement" means a legal instrument of financial
assistance between an awarding agency or pass-through entity
and a non-federal entity that:
(1) is used to enter into a relationship, the
principal purpose of which is to transfer anything of
value from the awarding agency or pass-through entity to
the non-federal entity to carry out a public purpose
authorized by law and not to acquire property or services
for the awarding agency or pass-through entity's direct
benefit or use; and
(2) is distinguished from a cooperative agreement in
that it does not provide for substantial involvement
between the awarding agency or pass-through entity and the
non-federal entity in carrying out the activity

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contemplated by the award.
"Grant agreement" does not include an agreement that
provides only direct cash assistance to an individual, a
subsidy, a loan, a loan guarantee, or insurance.
"Grant application" means a specified form that is
completed by a non-federal entity in connection with a request
for a specific funding opportunity or a request for financial
support of a project or activity.
"Hospital" means a facility licensed as a hospital under
the law of any state or a facility operated as a hospital by
the United States, a state, or a subdivision of a state.
"Illinois Debarred and Suspended List" means the list
maintained by the Governor's Office of Management and Budget
that contains the names of those individuals and entities that
are ineligible, either temporarily or permanently, from
receiving an award of grant funds from the State.
"Indirect cost" means those costs incurred for a common or
joint purpose benefitting more than one cost objective and not
readily assignable to the cost objectives specifically
benefitted without effort disproportionate to the results
achieved.
"Inspector General" means the Office of the Executive
Inspector General for Executive branch agencies.
"Loan" means a State or federal loan or loan guarantee
received or administered by a non-federal entity. "Loan" does
not include a "program income" as defined in 2 CFR 200.80.

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"Loan guarantee" means any State or federal government
guarantee, insurance, or other pledge with respect to the
payment of all or a part of the principal or interest on any
debt obligation of a non-federal borrower to a non-federal
lender, but does not include the insurance of deposits,
shares, or other withdrawable accounts in financial
institutions.
"Local government" has the meaning provided for the term
"units of local government" under Section 1 of Article VII of
the Illinois Constitution and includes school districts.
"Major program" means a federal program determined by the
auditor to be a major program in accordance with 2 CFR 200.518
or a program identified as a major program by a federal
awarding agency or pass-through entity in accordance with 2
CFR 200.503(e).
"Non-federal entity" means a state, local government,
Indian tribe, institution of higher education, or
organization, whether nonprofit or for-profit, that carries
out a State or federal award as a recipient or subrecipient.
"Nonprofit organization" means any corporation, trust,
association, cooperative, or other organization, not including
institutions of higher education, that:
(1) is operated primarily for scientific, educational,
service, charitable, or similar purposes in the public
interest;
(2) is not organized primarily for profit; and

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(3) uses net proceeds to maintain, improve, or expand
the operations of the organization.
"Obligations", when used in connection with a non-federal
entity's utilization of funds under an award, means orders
placed for property and services, contracts and subawards
made, and similar transactions during a given period that
require payment by the non-federal entity during the same or a
future period.
"Office of Management and Budget" means the Office of
Management and Budget of the Executive Office of the
President.
"Other clusters" has the meaning provided by the federal
Office of Management and Budget in the compliance supplement
or has the meaning as it is designated by a state for federal
awards the state provides to its subrecipients that meet the
definition of a cluster of programs. When designating an
"other cluster", a state must identify the federal awards
included in the cluster and advise the subrecipients of
compliance requirements applicable to the cluster.
"Oversight agency for audit" means the federal awarding
agency that provides the predominant amount of funding
directly to a non-federal entity not assigned a cognizant
agency for audit. When there is no direct funding, the
awarding agency that is the predominant source of pass-through
funding must assume the oversight responsibilities. The duties
of the oversight agency for audit and the process for any

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reassignments are described in 2 CFR 200.513(b).
"Pass-through entity" means a non-federal entity that
provides a subaward to a subrecipient to carry out part of a
program.
"Private award" means an award from a person or entity
other than a State or federal entity. Private awards are not
subject to the provisions of this Act.
"Property" means real property or personal property.
"Project cost" means total allowable costs incurred under
an award and all required cost sharing and voluntary committed
cost sharing, including third-party contributions.
"Public institutions of higher education" has the meaning
provided in Section 1 of the Board of Higher Education Act.
"Recipient" means a non-federal entity that receives an
award directly from an awarding agency to carry out an
activity under a program. "Recipient" does not include
subrecipients.
"Research and Development" means all research activities,
both basic and applied, and all development activities that
are performed by non-federal entities.
"Single Audit Act" means the federal Single Audit Act
Amendments of 1996 (31 U.S.C. 7501-7507).
"State agency" means an Executive branch agency. For
purposes of this Act, "State agency" does not include public
institutions of higher education.
"State award" means the financial assistance that a

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non-federal entity receives from the State and that is funded
with either State funds or federal funds; in the latter case,
the State is acting as a pass-through entity.
"State awarding agency" means a State agency that provides
an award to a non-federal entity.
"State grant-making agency" has the same meaning as "State
awarding agency".
"State interest" means the acquisition or improvement of
real property, equipment, or supplies under a State award, the
dollar amount that is the product of the State share of the
total project costs and 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.
"State program" means any of the following:
(1) All State awards which are assigned a single
number in the Catalog of State Financial Assistance.
(2) When no Catalog of State Financial Assistance
number is assigned, all State awards to non-federal
entities from the same agency made for the same purpose
are considered one program.
(3) A cluster of programs as defined in this Section.
"State share" means the portion of the total project costs
that are paid by State funds.
"Stop payment order" means a communication from a State
grant-making agency to the Office of the Comptroller,

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following procedures set out by the Office of the Comptroller,
causing the cessation of payments to a recipient or
subrecipient as a result of the recipient's or subrecipient's
failure to comply with one or more terms of the grant or
subaward.
"Stop payment procedure" means the procedure created by
the Office of the Comptroller which effects a stop payment
order and the lifting of a stop payment order upon the request
of the State grant-making agency.
"Student Financial Aid" means federal awards under those
programs of general student assistance, such as those
authorized by Title IV of the Higher Education Act of 1965, as
amended (20 U.S.C. 1070-1099d), that are administered by the
United States Department of Education and similar programs
provided by other federal agencies. "Student Financial Aid"
does not include federal awards under programs that provide
fellowships or similar federal awards to students on a
competitive basis or for specified studies or research.
"Subaward" means a State or federal award provided by a
pass-through entity to a subrecipient for the subrecipient to
carry out part of a federal award received by the pass-through
entity. "Subaward" does not include payments to a contractor
or payments to an individual that is a beneficiary of a federal
program. A "subaward" may be provided through any form of
legal agreement, including an agreement that the pass-through
entity considers a contract.

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"Subrecipient" means a non-federal entity that receives a
State or federal subaward from a pass-through entity to carry
out part of a federal program. "Subrecipient" does not include
an individual that is a beneficiary of such program. A
"subrecipient" may also be a recipient of other State or
federal awards directly from a State or federal awarding
agency.
"Suspension" means a post-award action by the State or
federal agency or pass-through entity that temporarily
withdraws the State or federal agency's or pass-through
entity's financial assistance sponsorship under an award,
pending corrective action by the recipient or subrecipient or
pending a decision to terminate the award.
"Uniform Administrative Requirements, Costs Principles,
and Audit Requirements for Federal Awards" means those rules
applicable to grants contained in 2 CFR 200.
"Voluntary committed cost sharing" means cost sharing
specifically pledged on a voluntary basis in the proposal's
budget or the award on the part of the non-federal entity and
that becomes a binding requirement of the award.
(Source: P.A. 100-997, eff. 8-20-18.)
(30 ILCS 708/135 new)
Sec. 135. Contract limitations.
(a) Grants shall not restrict the amount of money used to
pay for fringe benefits.

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(b) Grants shall not restrict administrative costs to less
than 20% of the grant award.