Lesson 2: Agency Responsibilities for Federal Awards

Disbursing Agency Responsibilities for Interagency Pass-through Activity

When federal interagency pass-through occurs, the disbursing agency (the agency with federal pass-through expenditures) is required to inform the recipient agency (the agency that will record federal pass-through revenue) that federal funds are being sent.

The disbursing agency must provide the following to the recipient agency in writing:

• Details about the federal funds disbursed to the recipient agency, including the
  • Dollar amount
  • AL title
  • ALN
• Whether the federal funds to the recipient agency represent interagency pass-through or contractor payments for goods or services.
  • See Lesson 1: Direct Federal Funds vs. Federal Pass-through Funds
  • See Lesson 2: Contractor (Vendor) vs. Subrecipient Determination Responsibilities
• The portion of the award to allocate to federal and to state funds.

Example:
Sample Agency XXX receives the following federal award directly from the federal agency ZZZ:

• Award amount: $100,000
• Program title: ZZZ Federal Grant
• ALN: 12.345
• State funding match requirement: 10% of federal funds

During the fiscal year, Sample Agency XXX distributes 100% of this federal award plus the 10% state match requirement to its subrecipient, Sample Agency YYY. Sample Agency XXX must provide to Sample Agency YYY in writing that:

• Sample Agency XXX is transferring $110,000 to Sample Agency YYY.
• The $110,000 includes:
  • $100,000 federal pass-through funds
  • $10,000 state pass-through funds
• Sample Agency YYY is Sample Agency XXX’s subrecipient for the federal program
• The federal program title is ZZZ Federal Grant
• The federal program ALN is 12.345

Next: Receiving Agency Responsibilities for Interagency Pass-through Activity