PREFACE

The award and administration of financial assistance are subject to applicable laws, regulations, and policies. This publication presents a compilation of the salient features of policies and various policy issues that have been raised in the past regarding the administration of Public Health Service (PHS) grant awards.

The key aspects of this document are:

• It updates policies contained in the 1990 Grants Policy Statement and 1991 updated pages.

• It reflects changes or clarification in policy in the following areas:
  
  
  • Public Health System Reporting Requirements
    
    
  • Allowability of fee under Small Business Innovation Research grants
    
    
  • Establishes new PHS policy encouraging smoke-free workplace
    
    
  • Outpatient Drug Provisions under the Veterans Health Care Act of 1992
    
    
  • Expanded treatment of program income
    
    
  • Insurance requirements for real property constructed or acquired with PHS grant funds
    
    
  • Use of State-certified or licensed real estate appraisers where appraisals are needed on real property
    
    
  • Seismic safety standards for federally assisted construction
    
    
  • The establishment of the Substance Abuse and Mental Health Services Administration (SAMHSA)
    
    
  • Guidance on expenditures for lobbying activities

This policy statement is effective for all grants with budget periods beginning on or after April 1, 1994. It also reflects policies with earlier effective dates. This document supersedes the PHS Grants Policy Statement dated October 1, 1990 as updated September 1, 1991 (DHHS Publication No. (OASH) 90-50,000 (Rev).

The information in this publication is subject to change due to laws, regulations, or policies adopted subsequent to the issuance date of this document. To assure that they are aware of any new changes as soon as they are issued and to administer awards effectively, recipients need to have access to the following documents:

• Code of Federal Regulations (CFR) (Titles 42 and 45)-Title 42 sets forth programmatic grant regulations. Title 45 contains, among other regulations, administrative regulations applicable to grants and cooperative agreements. These titles are available in booklet form from the U.S. Government Printing Office.

• Federal Register-This publication contains proposed and final PHS rules and regulations as well as program announcements and statements of funding priorities. It also includes rules and regulations issued by the Department of Health and Human Services (HHS) and the Office of Management and Budget that may be pertinent to PHS financial assistance. The Federal Register is available on a subscription basis from the U.S. Government Printing Office.

PHS grantees are not required to have or maintain the HHS and PHS Grants Administration Manuals.

Except where PHS has been delegated responsibility to act for all HHS components in certain specific areas, such as the protection of human subjects, the information set forth in this document provides guidance only for awards made by constituent agencies, Office of the Assistant Secretary for Health offices, and regional offices of PHS and not for those made by other components of HHS.

This policy statement is not applicable to PHS block grant awards.

Public Law 95-224, the Federal Grant and Cooperative Agreement Act of 1977, defines the cooperative agreement as an alternative assistance instrument to be used in lieu of a grant whenever substantial Federal involvement with the recipient during performance is anticipated. The difference between grants and cooperative agreements is the degree of Federal programmatic involvement rather than the type of administrative requirements imposed. Therefore, laws, regulations, policies, and the information contained in this publication that are applicable to grants also apply to recipients of cooperative agreements, unless the agreement itself provides otherwise. When the term "grant" is used in this document, it includes cooperative agreements.

The information contained in this publication applies principally to the primary recipients of PHS funds. Where subgrants are authorized by the awarding office through regulations, program announcements, or through the approval of the grant application, the information contained in this publication also applies to subgrantees. PHS expects grantees to use an objective system for making subawards that is at least as rigorous as the recipient's procurement system in order to help ensure proper accountability of funds and satisfactory performance under the subaward. The information would also apply to cost-type contractors under grants. A recipient must assure that a contract contains the clauses necessary to ensure that all requirements under the grant will be satisfied, since neither 45 CFR Parts 74 and 92 nor other documents referred to in this publication are directly binding on a contractor.