NWS FMC Directors
NWS Administrative and Budget Officers

Irwin T. David
Chief Financial Officer/
Chief Administrative Officer

The National Weather Service (NWS) currently engages in about 500 agreements with other organizations. These agreements enable the NWS to obtain and provide goods and services, as well as to coordinate complementary activities with other organizations in support of the agency's mission. As such, agreements must be carefully drafted and implemented to ensure the effective, efficient and legal use of NWS resources.

Responsibility for the effective, efficient and legal use of an agreement rests primarily with the Financial Management Center(s) (FMCs) which execute the agreement. To assist the FMCs in meeting this responsibility, the NWS Chief Financial Office (CFO) is developing comprehensive guidance for implementing agreements. Because this comprehensive guidance will not be completed until early next year, we are providing the attached overview at this time. This overview provides information regarding the process and requirements applicable to any agreement. These requirements include specific terms and conditions which must be included in an agreement, as well as clearances to be obtained from the NOAA Office of General Counsel (OGC) and, if funding over $1 million is involved, the NWS CFO. Other requirements may apply to a specific agreement, depending on the nature of the agreement and the statute under which the agreement is authorized. Specific information on these additional requirements will be included in the forthcoming comprehensive guidance. At this time, however, please review your current and planned agreements to ensure they meet the requirements discussed in the attached overview.

The NWS CFO also maintains a database and file of all NWS agreements, as recommended by the Inspector General. If any current or planned agreements in your FMC have not been reported to my office previously, please contact Violet Foster (Violet.Foster@noaa.gov; 301-713-1015 x124).

Your efforts to ensure the effective, efficient and legal use of agreements will help to achieve the NWS mission and, thereby, help save lives and protect property. I sincerely appreciate your contribution toward these goals. If you have any questions or would like assistance in ensuring your agreements meet all applicable requirements, please contact Tyndall Traversa (Tyndall.Traversa@noaa.gov; 301-713-9051 x154).

Attachment

cc:
Glenn E. Tallia, OGC
Karen Dacres, OGC
W/CFOx1 - M. Brown
W/CFO1 - S. Gallagher
W/CFO2 - V. Foster
W/CFO2 - A. Brown
W/CFO2 - T. Traversa

Attachment

Guidance for Effective Agreements:
An Overview

 

Uses for an Agreement:

An agreement, also termed a Memorandum of Agreement, Interagency Agreement or Memorandum of Understanding, is used to specify the terms under which the NWS obtains/provides goods/services from/to other federal agencies and organizations. An agreement also is used to specify the terms under which the NWS interacts with non-federal organizations on matters of mutual interest where the principal purpose of the interaction is neither the acquisition of goods or services for the benefit of the NWS, nor the provision of financial assistance by the NWS. In addition, an agreement is used to specify the terms under which the NWS engages in collaborative undertakings in which the parties have a mutual interest.

Process for Implementing an Agreement:

Developing and establishing an agreement can be a somewhat lengthy process. Sufficient advance planning, preliminary negotiations, careful drafting and adequate review are essential to effect an agreement that results in the effective, efficient and legal use of NWS resources to achieve the agency's mission. The following table summarizes a typical process time line:

Typical Process Time Line

Activity	Estimated Time Required
Advance Planning	1-4 weeks
Preliminary Negotiations	1-3 weeks
Draft Agreement Preparation	1-2 weeks
Initial Agency Review (e.g., FMC, OGC, CFO)	1-2 weeks
Draft Agreement Revision	1 week
Final Negotiations	1-2 weeks
Final Agency Clearance (e.g., FMC, OGC, CFO)	3-4 weeks
Agreement Signature/Certification	1 week

 

The entire process typically can take between 10 and 19 weeks, depending on the complexity of the agreement. Of course, some very simple agreements can be executed within a few weeks. To speed the process as much as possible, the agreement manager should consult with the relevant Financial Management Center (FMC) Director and administrative/budget staff, the NOAA Office of General Counsel and the NWS Chief Financial Office early in the initial agreement planning.

Critical Agreement Requirements:

All agreements must meet the following basic requirements to ensure the effective, efficient and legal use of NWS resources:

• Agency Mission: An agreement must be consistent with the accomplishment of (i.e. must directly or indirectly support) the NWS mission.

• Statutory Authority: The activities conducted under an agreement must be authorized by statute. Moreover, the statute under which the agreement is authorized may stipulate specific requirements that must be addressed by the agreement.

• Resources: An agreement must make effective and efficient use of NWS resources, based on appropriately estimated full, life-cycle costs of the activity. If needed, adequate resources must be available and committed/obligated for the agreement. No work may be performed prior to the final agreement signature/certification.

• Compliance with Laws, Regulations, Directives and Other Agency Policies: An agreement must comply with all applicable laws, regulations, directives and agency policies (e.g., the agreement's authorizing statute, Office of Management and Budget (OMB) Circular A-25, Department of Commerce (DOC) Accounting Handbook, National Oceanic and Atmospheric Administration (NOAA) Budget Handbook).

• Approving Signatures and Clearances: To ensure compliance with the above requirements, an agreement must be reviewed and approved by the FMC Director (or his delegated representative). In general, an agreement also must be reviewed and approved by the FMC administrative and budget official(s). In addition, if funding of more than $1 million is involved, an agreement must be signed by the NWS CFO. For agreements involving more than $5 million, the NWS Assistant Administrator must sign. Agreements also must be reviewed and approved by the NOAA OGC and, depending on the nature of the agreement, the DOC OGC. Moreover, all agreements must be transmitted to the NWS CFO Comptroller's Division to be included in the NWS Agreement Database, as recommended by the DOC Inspector General.

Common Agreement Types and Characteristics:

The following table summarizes the uses, characteristics and key requirements for the most common types of agreements. Further information on the detailed requirements specific to particular agreement types and authorities will be available in the forthcoming NWS agreement guide and also may be obtained from the NOAA Office of General Counsel or from the NWS Chief Financial Office.

Common Agreement Types and Characteristics

Type and Authority Purpose Eligible Other Parties Financial Requirements Other Major Requirements Economy Act Agreement (Economy Act of 1932, 31 U.S.C. Section 1535) Provide or obtain goods or services from other federal organizations. Any federal agency or component outside the NWS. Full costs must be recovered to fund the work. Must be in the best interest of the government. Goods/services can not be provided by contract from a commercial enterprise as conveniently or as cheaply. Activity is not authorized more specifically under any other statute. Joint Project Agreement (31 U.S.C. Section 1525, second paragraph) Engage equitably in a joint project on matters of mutual interest. Any non-profit, research or any public organization, including other federal organizations Project costs must be shared equitably. Financial or other NWS resources may be committed. Joint project must focus on matters of mutual interest to all parties to the project. Project could not be done at all or as effectively without the participation of all parties. Project is essential to the furtherance of DOC's programs. Intergovernmental Cooperation Agreement (Intergovernmental Cooperation Act, U.S.C. Section 6505) Provide specialized or technical services to state and local governments. Any state or local U.S. government. Full costs must be recovered to fund the work. Services may not be available as reasonably and quickly through ordinary business channels. A written request must be made for the services. Cooperative Research and Development Agreement (Federal Technology Transfer Act of 1986, 15 U.S.C. Section 3710(a)) Advance the NWS mission and promote U.S. competitiveness through the conduct of coordinated research and development activities and technology transfer. Any individual(s) or organization(s). No NWS funds may be contributed to a non-federal collaborator. Financial or other NWS resources may be committed. Research and development activities must support the NWS mission. Detailed provisions regarding rights to intellectual property, commercialization licensing and other issues must be followed. Information Technology Acquisition Agreement (Clinger-Cohen Act, Sections 5002 and 5112(e)) Effectively and efficiently obtain information technology goods or services. Commerce Information Technology Solutions Program Office (COMMITS). NWS financial resources may be committed for COMMITS acquisition services and the acquired information technology goods/services. Acquisition must be accomplished using COMMIT's acquisition services to obtain information technology goods/services under an indefinite delivery/indefinite quantity multiple award task order contract with small, disadvantaged, 8(a) and women-owned businesses. Special DOC Study Agreement (15 U.S.C. Section 1525) Provide special studies or services. Any person, firm or public or private organization. Full cost must recovered to fund the work. Studies or services must be on matters within the authority of DOC. Agency services must be requested. Other NOAA/NWS-Specific Agreements (various authorities, e.g., 33 U.S.C. Section 883 a-e) Provide or obtain goods/services or engage in other efforts in support of the NOAA/NWS mission. (Specific purpose varies with the authority.) Varies with the authority. Varies with the authority. Varies with the authority. Agreement Format and Content: The format and content of an agreement depend on a variety of factors, such as the specific authority for the agreement and the products or services to be provide or obtained. In addition, another party to an agreement may require a specific format. Therefore, no specific format is required by the NWS. However, model formats are available from the Chief Financial Office. Nonetheless, all agreements must include the following elements, terms and conditions, as appropriate: • NWS/NOAA/DOC Agreement Identification Number: A unique identification number for each agreement should be obtained from the NWS Agreement Coordinator in the NWS Chief Financial Office and specified in the agreement. • Project Title: An agreement should include a title which briefly summarizes or describes the work to be performed under the agreement and/or the subject of the agreement. • Citation of Agreement Program and Legal Authority: The statute(s) which authorize the work/activities to be performed and the type of agreement (e.g., Economy Act agreement) must be specified in order to ensure the legality of the agreement and to clearly identify any requirements specific to that authority. • Identify of All Parties: All parties to the agreement must be identified clearly, including the name and address of each organization, as well as a single contact person for each organization and his/her title, phone number, fax number and e-mail address. The agreement should specify that any changes to the contact person, his/her title or contact information will be made promptly by written notification to each party. • Purpose and Scope: The overall purpose or objective of the agreement must be stated clearly and concisely. The basic functions to be performed by each party to the agreement should be summarized. • Responsibilities of Each Party: The agreement must provide a detailed description of the work to be conducted under the agreement to ensure a clear understanding of the parties' respective responsibilities. As appropriate, the responsibilities of each party should include goals, performance measures, products and a schedule of strategic milestones. • Period of Performance: An agreement should specify the anticipated start and completion dates for the agreement, as well as any other critical dates. • Resource Requirements: The agreement must clearly stipulate the financial resources expected and/or required to be used by each party, including citations of accounting codes, as well as payment terms and methods. The agreement also must specify the total estimated costs for the life of the agreement. For agreements involving contributions by more than one party, the agreement must include a budget listing for each party. If full costs are to be recovered, the agreement must contain a statement that full cost recovery will be achieved. If the agreement will require additional federal funding at a later date, the agreement must contain a contingency provision for future funding (e.g., "Any future funding will be contingent upon the availability of funds."). In addition, the following resource-related terms should be specified in an agreement to ensure effective financial management: - Payment Methods: Reimbursable agreements with non-federal organizations, under which the NWS agrees to provide goods or services in exchange for remuneration, must specify advance payment. Agreements with federal organizations may provide for payment either in advance or on a reimbursable basis (i.e. as the costs are incurred); however, advances are the preferred method. To ensure prompt payments, agreements should specify the use of the Department of Treasury's On-Line Payment and Collection (OPAC) system, unless a party is unable to use this system. For agreements containing progress payments or other intermediate payments, the payment terms should be consistent with and proportionate to performance. - Non-monetary Resources: If no monetary resources are involved, the agreement should state that no funds will be obligated by any party. While the specific non-monetary resources required by the agreement may or may not be specified, the availability of these resources nonetheless may be critical to the success of the project. Therefore, the agreement should specify that all parties should be notified promptly of any budgetary or other problems that may affect the activities to be carried out under the agreement. • Other Terms and Conditions: The agreement must specify other terms and conditions, depending on the nature of the agreement and the statutory authority under which the activities are conducted. Such items may include: - Terms and Conditions Required by the Agreement's Authorizing Statute (e.g., a joint project agreement must be in the mutual interests of the parties and the costs must be equitably apportioned). - Delegations of Authority. - Channels and Protocols for working relationships and liaisons. - Relevant Administrative Regulations, Policies and Procedures applicable to the work to be conducted under the agreement (e.g., travel or property management requirements, the Paperwork Reduction Act, the Freedom of Information Act). - Guidelines for Release of Technical and Public Information regarding the project, including rights for data access and use. - Liability Limitations against personal or property losses (e.g., damage or loss of hardware on agency-operated aircraft, copyright violations, patent infringement, the use or release of trade secrets). - Method for Dispute Settlement. - Termination/Cancellation Clause, whereby each party may terminate the agreement within a specified time, if written prior notice is provided to all parties, and whereby any penalties or other effects of termination/cancellation are specified. - Future Changes Clause, whereby the conditions under which future modifications or amendments to the agreement may be made. - Performance Standards and Review Procedures, including provision for review of the agreement at least every three years to assess continuing needs and any potential revisions, renewals or cancellations. - Any Additional Special Conditions pertinent to the particular agreement. • Citation of Other Relevant Documents: The agreement also should cite any other pertinent documents, such as previous agreements and correspondence, memoranda or directives that relate to the agreement's authority, terms or conditions. • Approving Signatures and Clearances: - FMC Review: Responsibility for the effective, efficient and legal use of agreements rests primarily with the FMC Director. The Director (or his delegated representative) must sign all agreements. In addition, agreements also should be reviewed and approved by the FMC administrative and budget official(s). - NWS/NOAA/DOC Review: The NOAA OGC and, depending on the nature of the agreement, the DOC OGC must review and approve all agreements. Agreements also must be transmitted to the NWS CFO Comptroller's Division to be included in the NWS Agreement Database, as recommended by the DOC Inspector General. Moreover, if funding of more than $1 million is involved, an agreement also must be signed by the NWS CFO. For agreements involving more than $5 million, the NWS Assistant Administrator also must sign. - Documentation: Documentation of any necessary clearances is required. Managing An Agreement: Monitoring/Review: The activities conducted under an agreement, as well as compliance with all the terms and conditions of an agreement, must be monitored throughout the term of the agreement to ensure its purpose/objective is achieved. As necessary, changes may be made to the agreement to accommodate changing or unanticipated conditions. An agreement must be reviewed at least every three years to ensure the terms and conditions of the agreement continue to provide for the effective, efficient and legal use of NWS resources. Documentation/Files: A copy of the final signed agreement, as well as any required clearances, must be provided to the NWS Chief Financial Office. In addition, documentation/files sufficient to support the effective management of the agreement, including resolving any disputes and providing necessary audit information, must be maintained by the agreement manager throughout the agreement's duration and for a minimum of three years thereafter. Such documentation must include at a minimum: one copy of the agreement, including original signatures; and, documentation of any required clearances. Other documents (e.g., cost/fee calculation method, Determination and Finding of Compliance with OMB Circular A-76, the Reimbursable Task Plan) also are required to be kept on file, depending on the agreement's nature and authorizing statute. Other relevant documents, such as previous agreements, correspondence, memoranda, notes, presentation materials and project reports, also should be kept on file. Further Guidance: NWS Chief Financial Office: For assistance in developing and implementing an agreement, particularly with regard to financial management issues, contact Tyndall Traversa (Tyndall.Traversa@noaa.gov; 301-713-9051 x154). To provide information regarding an agreement for inclusion in the NWS Agreement Database, as well as to obtain a unique identification number, contact Violet Foster (Violet.Foster@noaa.gov; 301-713-1015 x109). NOAA Office of General Counsel: For assistance in developing and implementing an agreement, particularly with regard to legal authorities, requirements and related issues, as well as to obtain OGC review and approval, contact Glenn E. Tallia (Glenn.E.Tallia@noaa.gov; 301-713-1221) or Karen Dacres (Karen.Dacres@noaa.gov; 301-713-1329). Using Agreements: A Guide for Program and Financial Managers: A comprehensive guide to the effective, efficient and legal use of agreements will be available from the NWS Chief Financial Office early in 2001.