Federal Grant and Cooperative Agreement Act of 1977

Federal Grant and Cooperative Agreement Act of 1977
Name	Federal Grant and Cooperative Agreement Act of 1977
Enacted by	95th United States Congress
Effective date	1978
Public law	Public Law 95–224
Introduced in	United States House of Representatives
Signed by	Jimmy Carter
Signed date	1977
Citation	31 U.S.C. § 6301 et seq.

Contents

Federal Grant and Cooperative Agreement Act of 1977 is a United States statute that clarified distinctions between financial assistance instruments used by executive branch agencies, particularly between grants and cooperative agreements, and delineated procurement-like contracts under federal statutes. The Act sought to standardize award types across agencies such as the Department of Health and Human Services, the Department of Defense, the National Science Foundation, and the National Aeronautics and Space Administration. It influenced practices at the Office of Management and Budget, the General Services Administration, and the Government Accountability Office.

Background and legislative history

Congressional concern during the 1970s over inconsistent use of award instruments connecting the Department of the Interior, the Department of Agriculture, the Department of Energy, and the Environmental Protection Agency prompted hearings in the United States House Committee on Government Operations and the United States Senate Committee on Governmental Affairs. Testimony from officials representing National Institutes of Health, National Endowment for the Arts, Small Business Administration, and Economic Development Administration highlighted disputes between contracting officers and program offices over statutory authorities under the Federal Property and Administrative Services Act of 1949 and the Budget and Accounting Act of 1921. Sponsors consulted policy offices at the White House and legal advisers from the Department of Justice before transmitting the bill to the floor of the United States Senate where it was debated alongside reauthorization measures for the Office of Management and Budget and oversight provisions from the Congressional Budget Office.

The Act established statutory criteria for when agencies must use a grant or a cooperative agreement versus a contract. It defined "purpose" consistent with program objectives used by the National Institutes of Health, the National Science Foundation, and the National Endowment for the Humanities. The statute distinguished forms of assistance by degrees of "substantial involvement" on the part of agency personnel, a concept applied by the Department of Defense in research solicitations, by National Aeronautics and Space Administration program managers, and by Department of Education administrators. The Act authorized agencies including the Department of Commerce, the Department of Transportation, the Department of Labor, the Department of Housing and Urban Development, the Department of Veterans Affairs, and the Internal Revenue Service to issue awards under these categories subject to Congressional Budget Office scoring and Office of Management and Budget guidance. It also clarified applicability relative to statutes like the Competition in Contracting Act of 1984 and the Antideficiency Act.

Implementation required rulemaking at agencies such as the Department of Health and Human Services, the Department of Defense, the National Science Foundation, and the National Endowment for the Arts; coordination occurred through the Office of Federal Procurement Policy and the Government Accountability Office. The Act assigned responsibilities to agency heads and delegated contracting officers, program officers, and legal counsels at the Department of Justice's Office of Legal Counsel to ensure consistent application. Agencies developed internal guidance, training at Federal Acquisition Institute, and coordination with General Services Administration policy offices to reconcile award formats with procurement regulations like the Federal Acquisition Regulation. Interagency working groups including participants from the White House Office of Policy Development and the Council on Environmental Quality addressed cross-cutting issues involving the Environmental Protection Agency and the National Oceanic and Atmospheric Administration.

The Act influenced the use of grants and cooperative agreements across National Institutes of Health, National Science Foundation, Centers for Disease Control and Prevention, Department of Education, and National Endowment for the Arts programs, reducing litigation over misclassification and clarifying audit responsibilities shared with the Comptroller General of the United States. It affected award practices for state of New York, state of California, City of Chicago, and other subfederal recipients when they received assistance from Federal Emergency Management Agency or Department of Housing and Urban Development programs. The statute also shaped research and development funding at Massachusetts Institute of Technology, Stanford University, Harvard University, and other institutions receiving federal support, and informed audits by the Office of Inspector General offices across agencies.

Judicial review of instrument classification invoked decisions from the United States Court of Appeals for the Federal Circuit, the United States Court of Federal Claims, the United States District Court for the District of Columbia, and the United States Supreme Court on administrative law issues. Cases considered the meaning of "substantial involvement" and the boundary between assistance and procurement, referencing doctrines from Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. and standards articulated in Federal Crop Insurance Corporation litigation. Opinions from the United States Court of Appeals for the Ninth Circuit, the United States Court of Appeals for the Federal Circuit, and district courts in circuits including the Second Circuit and the D.C. Circuit shaped agency interpretations and prompted Office of Management and Budget circulars and Government Accountability Office decisions addressing protest procedures.

Subsequent statutes and policy guidance intersecting with the Act include the Competition in Contracting Act of 1984, the Grants and Cooperative Agreements Act's implementing regulations within the Federal Acquisition Regulation, amendments in the Omnibus Budget Reconciliation Act, and revisions in the United States Code codified at 31 U.S.C. Reauthorizations and program statutes such as the Higher Education Act of 1965, the Public Health Service Act, the Clean Air Act, the Social Security Act, and appropriations riders periodically updated award authorities. Administrative updates came via the Office of Management and Budget's circulars, the General Services Administration's procurement advisories, and oversight responses from the Government Accountability Office and the Congressional Research Service.