721-Procurement Policy Continued

E. Travel Costs

Under 2 Code of Federal Regulations, section 200.475, travel costs include the transportation, lodging, subsistence, and related items incurred by employees who are in travel status on official business of the school district. 

Travel costs may be charged on an actual cost basis, on a per diem or mileage basis, or on a combination of the two, provided the method used is applied to an entire trip and not to selected days of the trip., The method used must be consistent with those normally allowed in like circumstances in the school district’s other activities and in accordance with the school district’s established written policies.

Costs incurred by employees and officers for travel, including costs of lodging, other subsistence, and incidental expenses, must be considered reasonable and otherwise allowable only to the extent such costs do not exceed charges normally allowed by the school district in its regular operations as a result of according to the school district’s written policy.  

In addition, when costs are charged directly to the federal award, documentation must justify that:  

1. Participation of the individual is necessary to the federal award; and 

2.  The costs are reasonable and consistent with the school district’s established written policy.

Temporary dependent care costs above and beyond regular dependent care are allowable provided that these costs are: 

1. A direct result of the individual’s travel for the federal award; 

2. Consistent with the school district’s established written policy for all school district travel; and 

3. Only temporary during the travel period.

9) Subrecipient Monitoring

A.  The school district will:

1.  Verify that the subrecipient is not excluded or disqualified in accordance with 2 Code of Federal Regulations, section 180.300. Verification methods are provided in section 180.300, which include confirming in SAM.gov that a potential subrecipient is not suspended, debarred, or otherwise excluded from receiving federal funds. 

2.  Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the information provided below. A pass-through entity must provide the best available information when some of the information below is unavailable. A pass-through entity must provide the unavailable information when it is obtained. 

a.  Required information includes: 

(1) Federal award identification 

i. Subrecipient's name (must match the name associated with its unique entity identifier); 

ii. Subrecipient's unique entity identifier; 

iii. Federal Award Identification Number (FAIN); 

iv. Federal Award Date; 

v. Subaward Period of Performance Start and End Date; 

vi. Subaward Budget Period Start and End Date; 

vii. Amount of Federal Funds Obligated in the subaward; 

viii. Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation;

ix. Total Amount of the Federal Award committed to the subrecipient by the pass-through entity;

x. Federal award project description, as required by the Federal Funding Accountability and Transparency Act (FFATA);

 xi.  Name of the Federal agency, pass-through entity, and contact information for awarding official of the pass-through entity; 

xii. Assistance Listings title and number; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at the time of disbursement;

 xiii. Identification of whether the federal award is for research and development; and

xiv. Indirect cost rate for the federal award (including if the de minimis rate is used in accordance with 2 Code of Federal Regulations, section 200.414). 

(2)  All requirements of the subaward, including requirements imposed by Federal statutes, regulations, and the terms and conditions of the Federal award; 

(3)  Any additional requirements that the pass-through entity imposes on the subrecipient for the pass-through entity to meet its responsibilities under the Federal award. This includes information and certifications (see 2 Code of Federal Regulations, section 200.415) required for submitting financial and performance reports that the pass-through entity must provide to the federal agency; 

(4)  Indirect cost rate: 

(5)  A requirement that the subrecipient permit the pass-through entity and auditors to access the subrecipient's records and financial statements for the pass-through entity to fulfill its monitoring requirements; and 

(6)  Appropriate terms and conditions concerning the closeout of the subaward.

3. Evaluate each subrecipient's fraud risk and risk of noncompliance with a subaward to determine the appropriate subrecipient monitoring described in 2 Code of Federal Regulations, section 200.332, paragraph (f). When evaluating a subrecipient's risk, a pass-through entity should consider the following: 

a. The subrecipient's prior experience with the same or similar subawards; 

b. The results of previous audits. This includes considering whether or not the subrecipient receives a Single Audit in accordance with 2 Code of Federal Regulations, part 200, subpart F and the extent to which the same or similar subawards have been audited as a major program; 

c. Whether the subrecipient has new personnel or new or substantially changed systems; and 

d. The extent and results of any federal agency monitoring (for example, if the subrecipient also receives federal awards directly from the federal agency). 

4. If appropriate, consider implementing specific conditions in a subaward as described in 2 Code of Federal Regulations, section 200.208 and notify the Federal agency of the specific conditions. 

5. Monitor the activities of a subrecipient as necessary to ensure that the subrecipient complies with Federal statutes, regulations, and the terms and conditions of the subaward. The pass-through entity is responsible for monitoring the overall performance of a subrecipient to ensure that the goals and objectives of the subaward are achieved. In monitoring a subrecipient, a pass-through entity must:

a. Review financial and performance reports. 

b. Ensure that the subrecipient takes corrective action on all significant developments that negatively affect the subaward. Significant developments include Single Audit findings related to the subaward, other audit findings, site visits, and written notifications from a subrecipient of adverse conditions which will impact their ability to meet the milestones or the objectives of a subaward. When significant developments negatively impact the subaward, a subrecipient must provide the pass-through entity with information on their plan for corrective action and any assistance needed to resolve the situation. 

c. Issue a management decision for audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by 2 Code of Federal Regulations, section 200.521. 

d. Resolve audit findings specifically related to the subaward. However, the pass-through entity is not responsible for resolving cross-cutting audit findings that apply to the subaward and other Federal awards or subawards. If a subrecipient has a current Single Audit report and has not been excluded from receiving Federal funding (meaning, has not been debarred or suspended), the pass-through entity may rely on the subrecipient's cognizant agency for audit or oversight agency for audit to perform audit follow-up and make management decisions related to cross-cutting audit findings in accordance with 2 Code of Federal Regulations, section 200.513(a)(4)(viii). Such reliance does not eliminate the responsibility of the pass-through entity to issue subawards that conform to agency and award-specific requirements, to manage risk through ongoing subaward monitoring, and to monitor the status of the findings that are specifically related to the subaward.

6. Depending upon the pass-through entity's assessment of the risk posed by the subrecipient (as described in 2 Code of Federal Regulations, section 200.332, paragraph (c)), the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals: 

a. Providing subrecipients with training and technical assistance on program-related matters; 

b. Performing site visits to review the subrecipient's program operations; and 

c.  Arranging for agreed-upon-procedures engagements as described in 2 Code of Federal Regulations, section 200.425. 

7. Verify that a subrecipient is audited as required by 2 Code of Federal Regulations, part 200, subpart F. 

8. Consider whether the results of a subrecipient's audit, site visits, or other monitoring necessitate adjustments to the pass-through entity's records.

9. Consider taking enforcement action against noncompliant subrecipients as described in 2 Code of Federal Regulations, section 200.339 and in program regulations.

10. Conflict of Interest 

A. Standards of Conduct 
The school district will maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award and administration of contracts.

B. Employee Conflict of Interest.  

No employee, officer, agent, or board member may participate in the selection, award, or administration of a contract supported by a federal award if he or she has a real or apparent conflict of interest.  Such a conflict of interest would arise when the employee, officer, agent or board member, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in or a tangible personal benefit from a firm considered for a contract.  The employees, officers, agents and board members of the school district may neither solicit nor accept gratuities, favors, or anything of monetary value from contractors or parties to subcontracts.  However, the school district may set standards for situations in which the financial interest is not substantial or the gift is an unsolicited item of nominal value.  The standards of conduct must provide for disciplinary actions to be applied for violations of such standards by employees, officers, agents or board members of the school district. Disciplinary actions may be undertaken pursuant to the school district’s Discipline, Suspension, and Dismissal of School Employees policy.

The school district’s Conflict of Interest policies and procedures provide additional measures regarding conflicts of interest.  

C. Organizational Conflicts of Interest.  
If the school district has a parent, affiliate, or subsidiary organization that is not a state, local government, or Indian tribe, the school district must maintain written standards concerning organizational conflicts of interest. Organizational conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary organization, The school district is unable or appears to be unable to be impartial in conducting a procurement action involving the related organization because of relationships with a parent company, affiliate, or subsidiary organization.

D. Disclosing Conflicts of Interest

The school district will disclose in writing any potential conflict of interest to MDE in accordance with established federal awarding agency policies. 

Adoption an Revision History	Incorporated Policies
Policy E-097 UNIFORM GRANT GUIDANCE POLICY REGARDING FEDERAL REVENUE SOURCES This Policy Adopted:  May 23, 2017	MSBA 721
721 UNIFORM GRANT GUIDANCE POLICY REGARDING FEDERAL REVENUE SOURCES This Policy Revised: May 21, 2019; December 17, 2019; November 15, 2022,   April 29, 2025
721 PROCUREMENT POLICY This policy renamed:  May 19, 2026

Administrative Rule, Regulation and Procedure: E-097P

Legal References:

Minn. Stat. § 15.054 (Sale or Purchase of State Property; Penalty)

Minn. Stat. § 16C.28 (Contracts; Awards)

Minn. Stat. § 118A.01-.06 (Deposit and Investment of Local Public Funds)

Minn. Stat. § 123B.52 (Contracts)

Minn. Stat. § 471.345 (Uniform Municipal Contracting Law)

Minn. Stat. § 471.38 (Claims)

Minn. Stat. § 471.391 (Declaration Form)

Minn. Stat. § 471.392 (Penalty)

Minn. Stat. § 471.425 (Prompt Payment of Local Government Bills)

18 U.S.C. (Crimes and Criminal Procedures)

31 U.S.C. §§ 3729–3733 (False Claims)

2 C.F.R. § 180.215 (Which Nonprocurement Transactions are Not Covered Transactions)

2 C.F.R. § 180.300 (What Must I Do before I Enter Into a Covered Transaction with Another Person at the Next Lower Tier?)

2 C.F.R. 200 Subpart E (Cost Principles)

2 C.F.R. 200 Subpart F (Audit Requirements)

2 C.F.R. § 200.1 (Definitions: Capital Assets)

2 C.F.R. § 200.101 (Applicability)

2 C.F.R. § 200.112 (Conflict of Interest)

2 C.F.R. § 200.113 (Mandatory Disclosures)

2 C.F.R. § 200.205(d) (Federal Awarding Agency Review of Merit of Proposals)

2 C.F.R. § 200.208 (Specific Conditions)

2 C.F.R. § 200.214 (Suspension and Debarment)

2 C.F.R. § 200.300(b) (Statutory and National Policy Requirements)

2 C.F.R. § 200.302 (Financial Management)

2 C.F.R. § 200.303 (Internal Controls)

2 C.F.R. § 200.305(b)(1) (Federal Payment)

2 C.F.R. § 200.310 (Insurance Coverage)

2 C.F.R. § 200.311 (Real Property)

2 C.F.R. § 200.312 (Federally-owned and Exempt Property)

2 C.F.R. § 200.313(d) (Equipment)

2 C.F.R. § 200.314 (Supplies)

2 C.F.R. § 200.315 (Intangible Property)

2 C.F.R. § 200.318 (General Procurement Standards)

2 C.F.R. § 200.319 (Competition)

2 C.F.R. § 200.320 (Methods of Procurement to be Followed)

2 C.F.R. § 200.321 (Contracting with Small and Minority Businesses, Women’s Business Enterprises, and Labor Surplus Area Firms)

2 C.F.R. § 200.328 (Financial Reporting)

2 C.F.R. § 200.332 (Requirements for Pass-Through Entities)

2 C.F.R. § 200.3399 (Remedies for Noncompliance)

2 C.F.R. § 200.403(c) (Factors Affecting Allowability of Costs)

2 C.F.R. § 200.413 (Direct Costs)

2 C.F.R. § 200.414 (Indirect Costs)

2 C.F.R. § 200.415 (Required Certifications)

2 C.F.R. § 200.425 (Audit Services)

2 C.F.R. § 200.430 (Compensation – Personal Services)

2 C.F.R. § 200.431 (Compensation – Fringe Benefits)

2 C.F.R. § 200.447 (Insurance and Indemnification)

2 C.F.R. § 200.463 (Recruiting Costs)

2 C.F.R. § 200.464 (Relocation Costs of Employees)

2 C.F.R. § 200.474 (Transportation Costs)

2 C.F.R. § 200.475 (Travel Costs)

2 C.F.R. § 200.513 (Responsibilities)

2 C.F.R. § 200.521 (Management Decisions)

45 C.F.R. § 75.2 (Definitions)

45 C.F.R. § 75.317 (Insurance Coverage)

45 C.F.R. § 75.320 (Equipment)

48 C.F.R. Subpart 2.1 (Definitions)

 

Cross References:

MSBA/MASA Model Policy 208 (Development, Adoption, and Implementation of Policies)

MSBA/MASA Model Policy 210 (Conflict of Interest – School Board Members)

MSBA/MASA Model Policy 412 (Expense Reimbursement)

MSBA/MASA Model Policy 701 (Establishment and Adoption of School District Budget)

MSBA/MASA Model Policy 701.1 (Modification of School District Budget)

MSBA/MASA Model Policy 702 (Accounting)

MSBA/MASA Model Policy 703 (Annual Audit)

 

Resources:

MSBA/MASA Model Policy 208 (Development, Adoption, and Implementation of Policies)

MSBA/MASA Model Policy 210 (Conflict of Interest – School Board Members)

Minnesota Department of Education (MDE): Procurement Handbook [January 8, 2025] (accessed 01/07/26)

MDE: Competitive Proposal Method [April 2020] (accessed 01/07/26)

Office of Management and Budget: OMB Guidance for Federal Financial Assistance (Uniform Guidance) (accessed 02/20/26)

U.S. DOE: Education Department General Administrative Regulations (EDGAR) and Other Applicable Grant Regulations (accessed 01/09/26)

U.S. DOE: Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (accessed 01/09/26)