OMB Issues New Reporting Requirements for Contractors Doing State and Local Work

In yet another example of direct-federal contracts rules being applied to federally-assisted work, two new rules came out of the Office of Management that affect contractors who perform work on projects that are federally-assisted (i.e. projects funded in whole or in part through grants, loans, or financial assistance from the federal government such as the EPA's State Revolving Loan Fund, or the DOT's Highway Trust Fund). Under the first new rule, recipients of these grants, loans, or financial assistance (such as State and local governments) must now report every first-tier subaward (such as a prime contract) over $25,000 to usaspending.gov. As part of this reporting, subaward recipients (i.e. contractors) who meet certain triggers will have to report the total compensation of their top five executives. These triggers are:

• The contractor must have received 80 percent or more of its annual gross revenue in the preceding fiscal year from federal money (grants, loans, financial assistance, or direct-federal contracts)
• The contractor must have received $25,000,000 or more in annual gross revenues in the preceding fiscal year from federal money (grants, loans, financial assistance, or direct-federal contracts)
• The contractor does not already have to report compensation information through period reports filed under the Securities Exchange Act or the Internal Revenue Code

All three conditions must be met to trigger the total compensation reporting requirement. If your company does trigger the requirement, it will have to report to the State or local entity recipient the total compensation of its top five officers, managing partners, or any other employees in management positions. A second rule requires contractors to obtain a Data Universal Numbering System (DUNS) number. This nine-digit number can be obtained from Dun & Bradstreet, Inc. at no cost either by telephone (866-705-5711) or online (by clicking here). While earlier versions of this guidance would have required a contractor to also maintain a current registration in the Central Contractor Registration (CCR) database, OMB has decided not to enact that requirement at this time. If a contractor fails to provide a valid DUNS number, the contractor could be determined to be not qualified to receive a contract award. Read the rule requiring reporting of executive compensation here. Read the rule requiring use of a DUNS Number here. For more information, contact Scott Berry at (703) 837-5321 or berrys@agc.org