| (a) Prior to the disbursement of Grant Award funds,
the Grant Recipient of a Cancer Research Grant Award shall demonstrate
that the Grant Recipient has an amount of Encumbered Funds equal to
one-half of the Grant Award available and not yet expended that are
dedicated to the research that is the subject of the Grant Award.
The Grant Recipient's written certification of Matching Funds, as
described in this section, shall be included in the Grant Contract.
A Grant Recipient of a multiyear Grant Award may certify Matching
Funds on a year-by-year basis for the amount of Award Funds to be
distributed for the Project Year based upon the Approved Budget. A
Grant Recipient receiving multiple Grant Awards may provide certification
at the institutional level.
(b) For purposes of the certification required by subsection
(a) of this section, a Grant Recipient that is a public or private
institution of higher education, as defined by §61.003, Texas
Education Code, may credit toward the Grant Recipient's Matching Funds
obligation the dollar amount equivalent to the difference between
the indirect cost rate authorized by the federal government for research
grants awarded to the Grant Recipient and the five percent (5%) Indirect
Cost limit imposed by §102.203(c), Texas Health and Safety Code,
subject to the following requirements:
(1) The Grant Recipient shall file certification with
the Institute documenting the federal indirect cost rate authorized
for research grants awarded to the Grant Recipient; and
(2) To the extent that the Grant Recipient's Matching
Funds credit does not equal or exceed one-half of the Grant Award
funds to be distributed for the Project Year, then the Grant Recipient's
Matching Funds certification shall demonstrate that a combination
of the dollar amount equivalent credit and the funds to be dedicated
to the Grant Award project as described in subsection (c) of this
section is available and sufficient to meet or exceed the Matching
Fund requirement.
(c) For purposes of the certification required by subsection
(a) of this section, Encumbered Funds may include:
(1) Federal funds, including, but not limited to American
Recovery and Reinvestment Act of 2009 funds, and the fair market value
of drug development support provided to the recipient by the National
Cancer Institute or other similar programs;
(2) State of Texas funds;
(3) funds of other states;
(4) Non-governmental funds, (including private funds,
foundation grants, gifts and donations; and
(5) Unrecovered Indirect Costs not to exceed ten percent
(10%) of the Grant Award amount, subject to the following conditions:
(A) These costs are not otherwise charged against the
Grant Award as the five percent (5%) indirect funds amount allowed
under §703.12(c) of this chapter (relating to Limitation on Use
of Funds);
(B) The Grant Recipient must have a documented federal
indirect cost rate or an indirect cost rate certified by an independent
accounting firm;
(C) The allowance for unrecovered Indirect Costs must
be specifically approved by the Chief Executive Officer; and
(D) The Grant Recipient is not a public or private
institution of higher education as defined by §61.003 of the
Texas Education Code.
(d) For purposes of the certification required by subsection
(a) of this section, the following items do not qualify as Encumbered
Funds:
(1) In-kind costs;
(2) Volunteer services furnished to the Grant Recipient;
(3) Noncash contributions;
(4) Income earned by the Grant Recipient that is not
available at the time of Grant Award;
(5) Pre-existing real estate of the Grant Recipient
including building, facilities and land;
(6) Deferred giving such as a charitable remainder
annuity trust, a charitable remainder unitrust, or a pooled income
fund; or
(7) Other items as may be determined by the Oversight
Committee.
(e) To the extent that a Grant Recipient of a multiyear
Grant Award elects to certify Matching Funds on a yearly basis, the
failure to provide certification of Encumbered Funds at the appropriate
time for each Project Year shall serve as grounds for terminating
the Grant Contract.
(f) In no event shall Grant Award funds for a Project
Year be advanced or reimbursed, as may be appropriate for the Grant
Award and specified in the Grant Contract, until the certification
required by subsection (a) of this section is filed and approved by
the Institute.
(g) No later than 60 days from the anniversary of the
Effective Date of the Grant Contract, the Grant Recipient shall file
a form with the Institute reporting the amount of Matching Funds spent
for the preceding Project Year.
(h) If the Grant Recipient failed to expend Matching
Funds equal to one-half of the actual amount of Grant Award funds
distributed to the Grant Recipient for the same period, the Institute
shall:
(1) Carry forward and add to the Matching Fund requirement
for the next Project Year the dollar amount equal to the deficiency
between the actual amount of Grant Award funds distributed and the
actual Matching Funds expended, so long as the deficiency is equal
to or less than twenty percent (20%) of the total Matching Funds required
for the same period and the Grant Recipient has not previously had
a Matching Funds deficiency for the project;
(2) Suspend distributing Grant Award funds for the
project to the Grant Recipient if the deficiency between the actual
amount of Grant Funds distributed and the Matching Funds expended
is greater than twenty percent (20%) but less than fifty percent (50%)
of the total Matching Funds required for the period.
(A) The Grant Recipient will have no less than eight
months from the anniversary of the Grant Contract's effective date
to demonstrate that it has expended Encumbered Funds sufficient to
fulfill the Matching Funds deficiency for the project.
(B) If the Grant Recipient fails to fulfill the Matching
Funds deficiency within the specified period, then the Grant Contract
shall be considered in default and the Institute may proceed with
terminating the Grant Award pursuant to the process established in
the Grant Contract;
(3) Declare the Grant Contract in default if the deficiency
between the actual amount of Grant Award funds distributed and the
Matching Funds expended is greater than fifty percent (50%) of the
total Matching Funds required for the period. The Institute may proceed
with terminating the Grant Award pursuant to the process established
in the Grant Contract; or
(4) Take appropriate action, including withholding
reimbursement, requiring repayment of the deficiency, or terminating
the Grant Contract if a deficiency exists between the actual amount
of Grant Award funds distributed and the Matching Funds expended and
it is the last year of the Grant Contract;
(i) Nothing herein shall preclude the Institute from
taking action other than described in subsection (h) of this section
based upon the specific reasons for the deficiency. To the extent
that other action not described herein is taken by the Institute,
such action shall be documented in writing and included in Grant Contract
records. The options described in subsection (h)(1) and (2) of this
section may be used by the Grant Recipient only one time for the particular
project. A second deficiency of any amount shall be considered an
event of default and the Institute may proceed with terminating the
Grant Award pursuant to the process established in the Grant Contract.
(j) The Grant Recipient shall maintain adequate documentation
supporting the source and use of the Matching Funds reported in the
certification required by subsection (a) of this section. The Institute
shall conduct an annual review of the documentation supporting the
source and use of Matching Funds reported in the required certification
for a risk-identified sample of Grant Recipients. Based upon the results
of the sample, the Institute may elect to expand the review of supporting
documentation to other Grant Recipients. Nothing herein restricts
the authority of the Institute to review supporting documentation
for one or more Grant Recipients or to conduct a review of Matching
Funds documentation more frequently.
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