[Federal Register Volume 70, Number 16 (Wednesday, January 26, 2005)]
[Rules and Regulations]
[Pages 3629-3632]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-1371]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 30 and 31

[FRL-7863-3]


Notice of Availability of Class Deviation; Assistance Agreement 
Competition-Related Disputes Resolution Procedures

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of availability.

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SUMMARY: This document provides notice of the availability of a Class 
Deviation from EPA's assistance agreement dispute procedures and also 
sets forth the procedures that will apply to the resolution of 
competition-related disputes and disagreements that may arise in 
connection with the competition of EPA assistance agreements. 
Currently, assistance agreement competition-related disputes and 
disagreements are resolved in accordance with EPA assistance agreement 
dispute procedures that apply to financial assistance to institutions 
of higher education, hospitals, non-profit organizations, States, 
tribes, local governments and other eligible entities. EPA has 
determined, however, through a Class Deviation, that these procedures 
are not practicable to use for competition-related disputes and 
disagreements and that it is appropriate to replace those procedures 
with the procedures contained in this document. These new dispute 
resolution procedures will apply to competitive awards that are subject 
to applicable EPA assistance agreement procedures unless there are 
program specific statutory or regulatory dispute procedures that apply 
to such awards. The Class Deviation and this action only affect the 
dispute resolution procedures for assistance agreement competition-
related disputes and disagreements.

DATES: These procedures are effective upon January 26, 2005.

FOR FURTHER INFORMATION CONTACT: Bruce Binder, Associate Director for 
Grants Competition, Office of Grants and Debarment, 1200 Pennsylvania 
Avenue, NW., Mail Code 3901R, Washington, DC 20460. The telephone 
number is (202) 564-4935; facsimile number (202) 565-2469; and e-mail 
address is [email protected]. Copies of the Class Deviation are 
available by contacting Bruce Binder as indicated above.

SUPPLEMENTARY INFORMATION: This action sets forth the dispute 
resolution procedures based on the Class Deviation that are to be used 
in lieu of the dispute procedures contained in 40 CFR 30.63 and 40 CFR 
part 31, subpart F, 40 CFR 31.70 for the resolution of EPA assistance 
agreement competition-related disputes and disagreements. These 
procedures will ensure that applicants are provided with a meaningful 
and effective dispute resolution process for assistance agreement 
competition-related disputes and disagreements. The procedures provide 
that unsuccessful applicants will receive timely notification that EPA 
determined that their application or proposal was either ineligible for 
an award or was not selected for an award. Applicants may then, upon 
request, obtain a timely debriefing on the basis for the Agency's 
decision. Debriefings may be oral or written but are mandatory if the 
applicant intends to file a dispute in order to minimize 
misunderstandings between the Agency and the applicant and provide an 
opportunity to expeditiously resolve differences without the need to 
file a formal dispute. The applicant may file a formal dispute within 
15 calendar days after the debriefing.
    In addition to establishing a nationally consistent assistance 
agreement competition disputes process, the procedures in this document 
clarify roles and responsibilities and specify the circumstances in 
which applicants may dispute EPA decisions. Agency Officials must 
appoint a Grants Competition Disputes Decision Official (GCDDO) to 
resolve the dispute; the GCDDO cannot be involved in the decision that 
is the subject of the dispute. The GCDDO determines whether the issues 
raised in the dispute warrant delaying the competitive process until 
the dispute is resolved. These procedures also generally limit disputes 
to eligibility-type determinations made by EPA and generally do not 
allow an applicant to challenge a scoring or ranking determination, 
unless there is a compelling reason or an issue of national 
significance which would warrant EPA review of the dispute. The 
procedures also establish that the GCDDO's decision will constitute 
final agency action for the purposes of judicial review with no right 
to any further EPA review.
    In addition, EPA headquarters and regional program offices may, 
with the approval of the EPA Grants Competition Advocate, adopt dispute 
resolution procedures that are ``substantially the same'' as the 
procedures contained in this document. Each EPA announcement for a 
competitive assistance agreement will either include or reference the 
applicable disputes procedure for that particular competition (if 
referenced, the announcement will indicate how applicants can obtain a 
copy of the dispute procedures).
    Regulated Entities: The assistance agreement competition-related 
disputes procedures covered by this action apply to all entities which 
compete for competitive assistance agreement awards that are subject to 
the applicable EPA assistance agreement procedures found at 40 CFR 
parts 30, 31, and 35 unless the part 35 regulations contain specific 
dispute procedures that apply to such awards.
    Background: The regulatory disputes resolution coverage currently 
found at 40 CFR 31.70 was initially codified in the CFR on September 
30, 1983 at 40 CFR 30.303(b) and 40 CFR part 30, subpart L (1983). 48 
FR 4506 (September 30, 1983). At that time, EPA changed the assistance 
agreement disputes process from an adversarial, trial type process 
before the EPA Board of Assistance Appeals, to a more informal system 
administered by Agency program managers. The preamble to the final rule 
described the 1983 changes to the disputes process as follows:
    The new process will:
    1. Encourage cooperation between the Agency's officials and those 
applying for and receiving assistance.
    2. Develop a good administrative record to support the Agency's 
final decisions.
    3. Provide applicants and recipients high-level review of Agency 
decisions and a forum for resolving disputes informally, expeditiously, 
and inexpensively.
    4. Provide applicants and recipients a written decision explaining 
the basis for the position.

[[Page 3630]]

    Fair and consistent dispute resolution remains a central principle 
of administering EPA's assistance programs. The procedures in subpart L 
continue to give recipients and applicants the right to request a high 
level review of decisions concerning issues arising under the EPA 
assistance programs. 48 FR at 45060.
    These same disputes provisions and processes were included in EPA 
regulations found at 40 CFR parts 30 and 31 implementing the ``common 
rules'' for OMB Circular A-102 in 1988 and OMB Circular A-110 in 1996. 
53 FR 8034, 8076 (March 11, 1988); 61 FR 6066, 6081 (February 15, 
1996). The dispute provisions were moved from 40 CFR part 30, subpart L 
to 40 CFR part 31, subpart F, 40 CFR 31.70, when EPA implemented OMB 
Circular A-102 through 40 CFR part 31. The Agency's rule implementing 
OMB Circular A-110 incorporates the 40 CFR 31.70 disputes procedures at 
40 CFR 30.63. However, neither OMB Circular A-102 nor A-110 contains 
government-wide assistance agreement dispute provisions.
    Based on the language in the preamble discussed above referencing 
the applicability of the disputes process to applicants, EPA concluded 
that the assistance agreement disputes process would apply if an 
applicant for a competitively awarded agreement chose to dispute a 
decision that it was either ineligible to compete for the agreement or 
that its application was not selected for funding based on the merits 
of the proposal. Consequently, EPA's September 2002 Policy for 
Competition in Assistance Agreements provided that the Agency would 
follow the 40 CFR 31.70 process for disputes and disagreements related 
to EPA assistance agreement competitions.
    Notwithstanding the statements in the 1983 preamble regarding 
assistance agreement applicants, the 40 CFR 31.70 disputes provisions 
are geared to effectively resolve cost allowability or assistance 
agreement administration disputes rather than competition-related 
disputes and disagreements that may arise in connection with the award 
of assistance agreements. This disputes process does not specify any 
time frame for an applicant to dispute a decision or for EPA to issue a 
final decision. It does not provide Agency selection and award 
officials with nationally consistent policies and procedures for the 
resolution of assistance agreement competition-related disputes or for 
determining whether the application/proposal evaluation and award 
process needs to be delayed when an applicant files a dispute. The 
process is time consuming, particularly since it includes two 
administrative appeal levels, and resource intensive for both EPA and 
aggrieved applicants and is not suitable for the resolution of 
competition-related disputes and disagreements.
    In order to address these issues for assistance agreement 
competition-related disputes and disagreements, this action sets forth 
dispute resolution procedures that will provide applicants with a 
meaningful dispute resolution process that is better suited for 
competition-related disputes and disagreements than the 40 CFR part 30 
and 40 CFR part 31, subpart F dispute procedures. Accordingly, pursuant 
to 40 CFR 31.6(d), the Director of the EPA Grants Administration 
Division has issued a Class Deviation approving the use of these 
procedures.
    Statutory and Executive Order Reviews: Under Executive Order 12866 
(58 FR 51735, October 4, 1993), this action is not a ``significant 
regulatory action'' and is therefore not subject to OMB review. Because 
this grant action is not subject to notice and comment requirements 
under the Administrative Procedures Act or any other statute, it is not 
subject to the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) or 
sections 202 and 205 of the Unfunded Mandates Reform Act of 1999 (UMRA) 
(Public Law 104-4). In addition, this action does not significantly or 
uniquely affect small governments. This action does not have tribal 
implications, as specified in Executive Order 13175 (63 FR 67249, 
November 9, 2000). This action will not have federalism implications, 
as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). 
This action is not subject to Executive Order 13211, ``Actions 
Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355, May 22, 2001), because it is not a 
significant regulatory action under Executive Order 12866. This action 
does not involve technical standards; thus, the requirements of section 
12(d) of the National Technology Transfer and Advancement Act of 1995 
(15 U.S.C. 272 note) do not apply. This action does not impose an 
information collection burden under the provisions of the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501 et seq.). The Congressional 
Review Act, 5 U.S.C. 801 et seq., generally provides that before 
certain actions may take affect, the agency promulgating the action 
must submit a report, which includes a copy of the action, to each 
House of the Congress and to the Comptroller General of the United 
States. Since this final grant action contains legally binding 
requirements, it is subject to the Congressional Review Act, and EPA 
will submit this action in its report to Congress under the Act.

List of Subjects in 40 CFR Parts 30 and 31

    Environmental protection, Administrative practice and procedure, 
Reporting and recordkeeping requirements.

    Dated: January 12, 2005.
David J. O'Connor,
Acting Assistant Administrator for the Office of Administration and 
Resources Management.

    EPA establishes assistance agreement competition-related dispute 
resolution procedures as follows:
    1. The authority citation for the assistance agreement competition-
related disputes resolution procedures in this document is the Federal 
Grant and Cooperative Agreement Act, 31 U.S.C. 6301(3).
    2. The disputes resolution procedures that will apply to EPA 
assistance agreement competition-related disputes and disagreements 
will be referenced or included in competitive announcements and are as 
follows:

Dispute Resolution Procedures

    a. Whenever practicable, disputes and disagreements relating to 
assistance agreement competition-related decisions and actions must be 
resolved at the lowest level possible.
    b. The procedures and time frames specified below are designed to 
provide for an efficient, effective, and meaningful dispute resolution 
process. EPA Program Offices may use ``substantially the same'' dispute 
procedures as those specified herein if they are approved by the EPA 
Grants Competition Advocate (GCA) and provide applicants with a 
meaningful dispute resolution process. A meaningful dispute resolution 
process is one that affords unsuccessful applicants the opportunity for 
an effective remedy if they succeed on their dispute.
    c. Notification: (1) The Program Office conducting the competition 
must provide applicants with timely written or e-mail notification that 
they were (i) determined to be ineligible for award consideration as a 
result of the threshold eligibility review of their application/
proposal (e.g., the application/proposal failed to meet the threshold 
eligibility criteria in the announcement), or (ii) not selected for 
award based on their ranking/scoring after an evaluation of their 
application/ proposal against the ranking and

[[Page 3631]]

selection factors in section V of the announcement.
    (2) Notification of ineligibility must be provided by the Program 
Office to the applicant within fifteen calendar days of the decision 
finding that the applicant was not eligible for award consideration 
because of a failure to meet the threshold eligibility criteria in the 
announcement; notification to applicants that they were not selected 
for award based on the ranking/scoring of their proposal/application 
must be provided by the Program Office to the applicant within fifteen 
calendar days of the final selections for award.
    (3) The notification letter or e-mail must indicate, as 
appropriate, that the applicant and/or its application/proposal was not 
eligible for award consideration based on the threshold eligibility 
review, or not selected for award based on the ranking/scoring of its 
application/proposal, and generally explain the reasons why. It must 
also advise the applicant that it may request a fuller debriefing (and 
notify the applicant that it must make its debriefing request within 
fifteen calendar days of receiving the notification letter or e-mail) 
of the basis for the ineligibility determination or selection decision. 
Debriefings, however, are not required when an applicant's proposal/
application is rejected solely because it failed to meet a submission 
deadline date specified in section IV of the announcement (e.g., it was 
received, postmarked, etc., after the deadline established in the 
announcement making it a late proposal/application).
    d. Debriefings: (1) Debriefings may be done orally (e.g., face to 
face, telephonically) or in writing at the discretion of the Program 
Office, although oral debriefings are strongly preferred because they 
provide a better opportunity to resolve questions and issues in an 
expedited manner. For oral debriefings, the Program Office will conduct 
the debriefing of the unsuccessful applicant at a mutually agreeable 
time and place as soon as practicable after receiving the debriefing 
request; for written debriefings, the Program Office will provide the 
unsuccessful applicant with a written debriefing as soon as practicable 
after receiving the debriefing request. All debriefings, but 
particularly those for applicants that were deemed ineligible for award 
consideration for failure to meet the threshold eligibility factors in 
the announcement, must be conducted in a timely manner so that the 
applicant has the opportunity to obtain a meaningful remedy if they 
successfully challenge the ineligibility determination.
    (2) Upon receiving a debriefing request from an unsuccessful 
applicant, the Program Office must promptly notify the Director, Office 
of Grants and Debarment, or regional award official, as appropriate, so 
that a Grants Competition Dispute Decision Official (GCDDO) can be 
designated.
    (3) The oral or written debriefing will be limited to explaining 
why the applicant was found ineligible for award consideration or why 
it was not selected for award and must not disclose any information 
protected from disclosure by applicable law or regulation (e.g., the 
Freedom of Information Act, Privacy Act), including trade secrets, 
privileged or confidential commercial, financial or other information 
exempt from disclosure under the Freedom of Information Act, or the 
identity of review panel members or other reviewers. The Program Office 
should consult with Office of General Counsel/Office of Regional 
Counsel (OGC/ORC) attorneys before any oral debriefing and allow them 
to review any written debriefing response before it is sent. Further, 
any questions relating to what type of information may be disclosed at 
a debriefing must be directed to OGC/ORC attorneys or the Grants 
Competition Advocate.
    (4) The debriefing explanation will, as appropriate:
    (A) Identify the threshold eligibility criteria that the applicant 
failed to meet and specify the basis for the Agency's determination 
that the proposal/application or applicant was not eligible for award 
consideration because of failure to meet the threshold eligibility 
criteria.
    (B) Provide the applicant with the numerical (e.g., points) or 
other basis for scoring/ranking its proposal/application under the 
evaluation criteria used in the competition.
    (C) Provide the applicant with information on the strengths and 
weaknesses of its proposal/application in terms of the specific 
evaluation criteria used in the competition.
    (D) Provide responses to relevant questions regarding whether the 
evaluation and selection procedures contained in the announcement were 
followed and why the applicant was not selected for award. However, the 
debriefing must not include point by point comparisons of the 
applicant's proposal/application to other proposals/applications.
    (E) Identify the GCDDO.
    e. Filing of a Dispute: (1) After receiving a debriefing, an 
unsuccessful applicant or their representative may file a written 
dispute with the appropriate GCDDO. When there was an oral debriefing, 
the written dispute must be received by the GCDDO within fifteen 
calendar days of the debriefing date; when there was a written 
debriefing, the written dispute must be received by the GCDDO within 
fifteen calendar days of when the applicant received the written 
debriefing letter. The written dispute must include a detailed 
statement of the legal and/or factual basis for the dispute, the remedy 
that the applicant is seeking, information on how to communicate with 
the applicant or its representative (e.g., phone and fax numbers, e-
mail address), and any documentation relevant to the dispute. Disputes 
may only be filed with the GCDDO after a debriefing; disputes filed 
before, or in the absence of, a debriefing will be dismissed. 
Furthermore, the GCDDO is only required to consider disputes on the 
following grounds:
    (A) Where an applicant challenges the EPA determination that it 
and/or its proposed project is ineligible for funding based on the 
applicable statute, regulation, or announcement requirements; or
    (B) Where the applicant challenges the decision that it is not 
eligible for award consideration because EPA determined that its 
proposal/application did not meet the threshold eligibility 
requirements contained in the announcement.
    (2) Unsuccessful applicants whose proposal/application was rejected 
solely because it was received late, or who were not selected for award 
based on the ranking/scoring of its proposal/application after a full 
evaluation by EPA based on the ranking and selection criteria in 
section V of the announcement (e.g., challenges to the Agency's 
technical evaluation or ranking/scoring of the applicant based on the 
ranking and selection factors in section V of the announcement), are 
not entitled to file disputes with the GCDDO. Such disputes will be 
dismissed by the GCDDO except as may be provided for in paragraph (3) 
below. In addition, the GCDDO may dismiss any dispute that is clearly 
untimely filed, raises issues that the GCDDO will not consider, or that 
fails to set forth a detailed statement of the legal and/or factual 
basis for the dispute.
    (3) The GCDDO, for good cause shown and where there are compelling 
reasons, or where he/she determines that a dispute raises significant 
issues of widespread interest to the assistance agreement community, 
may consider an untimely filed dispute or any other dispute filed by an 
unsuccessful

[[Page 3632]]

applicant. The GCDDO will invoke this discretion sparingly.
    f. If a dispute is filed, the GCDDO must consult with the Program 
Office, OGC/ORC, and the GCA, and then determine whether it is in the 
Agency's best interest to delay the award process pending resolution of 
the dispute, particularly for disputes involving threshold eligibility 
issues.
    g. Unsuccessful applicants must be provided with reasonable access 
to Agency records relevant to the dispute in a manner consistent with 
the standards contained in the Freedom of Information Act. EPA will not 
disclose materials exempt from disclosure under the Freedom of 
Information Act.
    h. Upon receiving a dispute, the GCDDO will establish a process and 
schedule for resolving the dispute and communicate this to the 
applicant and affected Program Office. At his or her discretion, the 
GCDDO may (i) request additional information from the applicant or 
Program Office and/or (ii) meet by phone or in person with the 
unsuccessful applicant and/or Program Office.
    i. After reviewing all of the information relevant to the dispute, 
the GCDDO, after consultation with the GCA, and with the concurrence of 
the OGC/ORC, will timely issue a final written decision regarding the 
dispute. The GCDDO's decision will constitute final agency action and 
is not subject to further review within the Agency.

[FR Doc. 05-1371 Filed 1-25-05; 8:45 am]
BILLING CODE 6560-50-P