Attention Grantees and State Agencies in Illinois: What is GATA and How Does It Affect You?

An overview of the Grant Accountability and Transparency Act (GATA)

The Grant Accountability and Transparency Act (GATA) was established with goals of eliminating duplicative grant requirements and lessening administrative burdens, while at the same time, improving accountability and transparency. As part of the overarching goals, GATA also recognizes the need for training and technical assistance for grantees and grant administrators in Illinois. If you are a grantee (i.e., grant recipient) or state agency in Illinois, this act does affect you.

How it Impacts You

GATA adopted uniform budget, periodic reporting, and performance reporting templates. The budget and reporting templates are updated annually to include more detailed line items to assist grantees and subrecipients in negotiating an indirect cost rate and help facilitate budget approval and monitoring. Grantees can access their information through the grantee portal.

Requirements

GATA requires an annual election of the indirect cost rate, including the federally negotiated rate, the state negotiated rate, the 10 percent de minimis rate (no rate), and waive charging indirect costs. If an organization receives direct federal funding and has a federally approved Negotiated Indirect Cost Rate Agreement (NICRA), state agencies are required to accept and utilize the NICRA for indirect cost reimbursements. Whereas, organizations with only federal pass-through/state funding can negotiate a state indirect cost rate. Organizations that have never negotiated an indirect cost rate at the state or federal level can choose the 10 percent de minimis rate. Charges can be waived and grantees can recover indirect costs from other sources, such as program revenue, donations, and fundraising, as well.

Beyond this, there are also requirements unique to local governments. Federal Uniform Guidance requirements are the same for all grantees, except indirect cost requirements that have a ripple effect on other items, such as registration and prequalification, fiscal and administrative risk assessment, parent/child relationships, and Illinois stop pay list enforcement. However, local governments can elect to negotiate indirect cost rates on an entity-wide basis or by individual department or division.

Audits

All grantees awarded a state grant (whether or not funds have been expended) or expending a federal grant are subject to reporting requirements, and for-profit grantees are required to have a program audit. An audit performed in accordance with Generally Accepted Government Auditing Standards (GAGAS) are required of grantees, including for-profit entities, not subject to a single audit that expend $500,000 or more in state restricted purpose funds, direct federal, and/or federal pass-through funds. Generally Accepted Auditing Standards (GAAS) audits are mandatory for grantees, including for-profit entities not subject to either a single audit or a GAGAS audit but expending $300,000 or more in state restricted purpose funds, direct federal, and/or federal pass-through funds.

If an audit is required by any regulatory authority it must be submitted by publicly traded for-profit companies, Law Enforcement Agencies, and municipalities that operate a public utility. If an audit is not required but is completed, it must be submitted as voluntary audits conducted as part of good financial management.

Results of GATA Implementation

GATA ultimately intends to reduce the risk of fraud, waste, and abuse, while simultaneously saving state agencies and grantees money. For more information on GATA and how it can impact you, please contact a Sikich representative.

Referenced throughout this insight.