Advice on Federal Grants. A rapid-fire discussion on communicating with federal agencies and grantors, the importance of monthly grant spending reviews, and the benefits of negotiating federally approved indirect cost rates, with Denzel Blount, a CPA and manager at the nonprofit accounting firm “Your Part Time Controller” (YPTC). He shares his expertise on federal grants and awards.
Denzel emphasizes the significance of establishing communication with federal grant agencies as soon as an award is received. He suggests building rapport with the grant officer to create a more supportive and collaborative environment, stressing that agencies are willing to help nonprofits navigate compliance issues and provide specific answers to grant-related questions.
The hosts inquire about the hesitancy some organizations have in contacting federal agencies. Denzel believes this reluctance may stem from the misconception that the federal government is an overwhelming compliance entity that penalizes mistakes. However, he reiterates that agencies aim to support nonprofits in their community programs and encourage open communication.
The conversation also covers the topic of monthly grant spending reviews, where Denzel advises organizations to regularly track financial and non-financial requirements, emphasizing the importance of staying informed about spending to avoid compliance issues. Denzel suggests involving accounting, finance, operations, and program teams in the review process to ensure comprehensive understanding and collaboration.
The discussion moves to negotiating federally approved indirect cost rates. Denzel explains that the federal government assumes a 10% indirect rate on all grants but encourages nonprofits to negotiate their rates to recoup more indirect costs. By submitting a negotiated indirect cost rate agreement (NICRA), organizations can present their rate calculation to the agency and potentially receive approval for a higher reimbursement rate. Having a NICRA also enhances negotiating power with other agencies.
Denzel’s expertise on federal grants and his emphasis on effective communication will provide you with valuable guidance for your organization as you seek financial support and compliance toward your mission.