Pass-Through Grants: Objectives, Key Players, and Application Process

The pass-through grants are the amounts provided by a federal agency to a state, local, or intermediary organisation. These organisations, in turn, disperse the funds to subrecipients like non-profit organisations, schools, or community programs. The primary receiver handles the compliance, reporting, and monitoring. Subrecipients allow attention to the implementation of the awarded projects or services. This type of funding is commonly used in the areas of education, social services, infrastructure, and health. It also makes sure that resources are allocated to organisations best placed to meet local needs and provide programs where they are most needed.

What Are the Objectives of Pass-Through Grants?

Below are four main objectives of pass-through grants:

1. Distribute Federal Aid Equitably: These sources of funds ensure that different communities receive federal funds equitably, both urban and rural. They assist in decreasing funding levels, along with providing equal development opportunities.
2. Promote Regional Priorities: States or other intermediary agencies make funds available to projects that reflect local priorities. This methodology makes programs appropriate to the specific needs of each region.
3. Support Capacity Building: Grants build capacity in local organisations by supplying resources to enhance skills, infrastructure and operational efficiency.
4. Enable Efficient Program Delivery: Pass-through grants enable programs to be executed more quickly through existing local networks and structures.

Who Are the Key Players in Pass-Through Grants?

Below are the three key players in pass-through grants:

1. Federal Grantor Agency: This is the primary source of funding. It gives the grant to a first beneficiary who is usually a state or a large organisation.
2. Primary Recipient (Pass-Through Entity): This is the recipient of the federal funds that are further given to other organisations. Also, it is used for tracking performance and compliance.
3. Subrecipients: These are local governments, nonprofits, or agencies that utilise the funds to develop certain programs or projects to benefit the community.

What Is the Application Process for Subrecipients?

The following are the eight primary steps of the application process to subrecipients.

1. Opportunity Announcement: The pass-through organisation provides a formal announcement about the opportunity or request for a proposal (RFP). This document specifies the purpose of the program, the amount of funds available, eligibility, the deadline and the documents required.
2. Proposal Preparation: Qualified organisations develop a proposal narrative including a project budget. They also define timelines, measurable goals and expected results. It can include past performance or the ability of the organisation.
3. Application Submission: The full proposal is submitted using an online portal, by email or hard copy. All supporting documents need to be complete, correct and timely.
4. Evaluation and Selection: The applications are shown to Reviewers who evaluate them on the basis of predetermined standards. They take into consideration the relevance, feasibility, cost-effectiveness, or fit objectives of the program.
5. Subaward Agreement: The chosen subrecipients enter a contractually binding agreement. The scope of work, project duration, reporting requirements and the allowable costs are outlined in this contract.
6. Pre-Award Requirements: Subrecipients can be required to go through federal registration, provision of insurance, or risk assessment before funds are received.
7. Fund Disbursement: They release the funds in forms, in a lump sum or in a series of payments. The condition of disbursement is based on milestones or reporting.
8. Implementation Kickoff: The project is officially launched once it has been approved. Progress is monitored by tracking systems, which determine compliance.

How Are Pass-Through Grants Monitored?

These are the four primary approaches to monitoring pass-through grants:

1. Federal Oversight: The agency that grants federal funds checks on allocation and spending. They help the pass-through entity to be in compliance with regulations, stay accountable and achieve program requirements.
2. Subrecipient Monitoring: The pass-through entities maintain the performance of the subrecipient via site visits, progress reports, and frequent communications. The system allows for the early detection of problems before they become critical and maintains compliance.
3. Audits and Evaluations: Independent or internal audits review financial records and ensure that costs do not exceed the grant conditions. The program outcomes and their overall effectiveness are measured with evaluations.
4. Reporting Requirements: The subrecipients and pass-throughs report on the financial and performance status regularly. These reports can show activities and their expenditures, and measurable outcomes.

What Are the Responsibilities of Pass-Through Entities?

The following are the four most important pass-through entity responsibilities.

1. Ensure Compliance: Pass-through entities make sure the subrecipient follows federal, state, and program regulations. They ensure that people do not misuse funds by monitoring activities.
2. Distribute Funds Transparently: They distribute grant funds to subrecipients with fairness and in a timely and documented way, making them accountable for all transactions.
3. Provide Technical Assistance: They provide advice, training and resources that can assist subrecipients in ensuring that grant specifications are met and that program performance is enhanced.
4. Conduct Risk Assessments: They identify possible areas of non-compliance or financial risk and can lead to timely management and mitigation actions.