January 11, 1988
Subject: Standard Form 334 - Minority Business Enterprise/Women Business Enterprise Utilization Under Federal Grants, Cooperative Agreements and Other Federal Financial Assistance
Enclosed is a copy of Standard Form 334, Minority Business Enterprise (MBE)/Women Business Enterprise (WBE) Utilization Under Federal Grants, Cooperative Agreements and Other Federal Financial Assistance. This form was developed by an interagency task force led by the Department of Commerce whose task was to draft a uniform Federal-wide reporting requirement concerning MBE/WBE awards under grants. The OMB Office of Information and Regulatory Affairs has issued clearance numbers 9999-0001 and 0640-0017 for this form which expires April 30, 1990.
SF-334 was developed in order to have one standard form for reporting minority and women business utilization in procurements under Federal financial assistance awards. Several Federal agencies and departments have received OMB approval of their own report forms for collecting this data. OMB has asked all agencies to use SF-334 instead of their own report forms. However it is not mandatory and they can-continue using their own report forms until their OMB number expires. Department of Commerce Form CD-442, Grantee Contract Awards Report and Department of Interior Form DI-1925, Minority Business Enterprise Utilization Report are two examples of agency specific report forms that UC campuses are currently submitting which require the collection of this type of data. The applicability criteria for the use of these two reports differ as well as the frequency of submission. SF-334 standardizes these features.
Purpose and Use
The purpose of SF-334 is to meet reporting requirements imposed on the Federal agencies and departments by the Executive Orders discussed in the section below. There is no existing OMB Circular or federal regulation requiring reporting by grantee institutions. The form is called for when the grant or cooperative agreement is over $500,000 and involves the procurement of supplies, equipment, construction or services. The $500,000 dollar level is consistent with the threshold established for reporting on all subcontracting activity under federal contracts by P.L. 95-507 and the Federal Acquisition Regulations (FAR). Recipients are required to report quarterly on procurements in excess of $10,000 including such particulars as name, address, dollar value and type of product or service. Negative reports may be required. As footnoted on the form, WBE reporting is optional at the direction of the awarding agency and recipients of EPA financial assistance must report under all grants and cooperative agreements regardless of the size of the award.
The justification for the use of SF-334 is based on Executive Orders 12432 and 12138. Executive Order (E.O.) 12432 directs each Federal agency that has substantial grantmaking authority to develop and implement a plan which will encourage minority business development. The plans shall also include methods for encouraging financial assistance recipients. to utilize minority business enterprises. Annual reports from the agencies regarding the implementation of minority business development programs are required as well as other reports which the Secretary of Commerce may so designate. E.O. 12138 recognizes the need to stimulate women's business enterprise and orders Federal agencies and departments to take affirmative action to that end. Agencies and departments are required to provide "current data" helpful in promoting these efforts.
Implications for UC
Small Business Coordinators on the campuses will need to segregate purchase orders issued against grants requiring this information in order to track minority and women-owned business subcontracting activity, then calculate and submit quarterly reports to the requesting agency. This could potentially be a significant additional burden on purchasing departments. However, since UC has so few grant awards requiring the collection of this type of data the impact is at present minimal. However, SF-334 could be very burdensome if agencies who previously did not collect this information now decide to include SF-334 as a condition of awards over $500,000.
Contract and Grant Memos 86-6 and 85-26 and Contract and Grant Information Letter of January 25, 1985 discuss why the collection of minority and women subcontract data under federal research grants at the Departments of Interior and Transportation and the Environmental Protection Agency, respectively, is viewed as agency regulatory excess. These arguments remain valid and applicable to SF-334. Campuses should continue to protest the imposition of this recordkeeping requirement, whether it is in regard to an agency specific report form or SF-334, on the following grounds:
--The requested information does not meet the statutory requirements of the Paperwork Reduction Act. This Act requires that requested information be necessary for the proper performance of agency functions, and that information will have practical utility. Grants to educational institutions are primarily for research and involve intellectual products. The amount of subcontracts involved is insignificant compared. to grants to commercial firms and State and local governments. We do not believe the collection of these data from educational institutions is necessary to the performance of the agency nor has practical utility.
--There is no statute or Executive Order mandating the collection of this information, as required by OMB Circular No. A-110, Attachment O, Procurement Standards. While Executive Orders 12432 and 12138 recognize the need to stimulate minority and women business enterprise and orders Federal departments and agencies to take affirmative action to that end, it does not impose that requirement on Federal recipients.
In general the University views this reporting requirement as excessive, particularly with respect to the frequency of reporting, and unproductive. contrary to the concept of reducing the paperwork burden.
The Department of Transportation and the Environmental Protection Agency have accepted the University's position. They have not in the past required UC to report on minority or women-owned business subcontracting activity. The Departments of Interior and Commerce have not accepted our position and, as stated in the Background section, campuses have been forced to submit reports to these agencies. Department of Commerce Form CD-442, Grantee Contracts Awards Report is especially onerous because award recipients are required to report on all minority business subcontracts under any award over $25,000. In this case the campus should strongly protest the use of Form CD-442. It should be requested that SF-334 be used in lieu of any agency or department specific report form. This is an ongoing matter and we would appreciate being periodically informed of the situation on your campus.
Refer: Susan Tarran ATSS 8-582-1638
Subject Index: 16
Organization Index: F-020
David F. Mears
University Contracts and Grants Coordinator
Laboratory Contract & Grant Officers