Grant Manual

Issues regarding standards of conduct for city officials and employees are governed by a number of statutes and ordinances, including, but not limited to, Sec. 19.59 Wisconsin Statues, Codes of ethics for local government officials, employees and candidates. Chapter 946.13, Wisconsin Statues, Crimes against Government, and Sec. 3.35, City of Madison Administrative Procedure Memorandum No. 2-33, Standard Expectations and Rules of Conduct and Madison General Ordinances No 3.35, Code of Ethics. 

Gifts

City officers, employees, agents, or board members may neither solicit nor accept gifts, gratuities, favors, or anything of monetary value from contractors, potential contractors, or parties to subcontracts. Acceptance of gifts at any time, other than advertising novelties, is prohibited. Acceptance of entertainment also is prohibited. Employees must not become obligated to any suppliers and shall not conclude any City transaction from which they may personally benefit.

Grant Fraud, Waste, and Abuse (FWA)

Grant fraud, waste, abuse, or any serious deviation from acceptable grant practices when proposing, carrying out, or reporting activities or results that involve grant funding is considered grant misconduct and must be disclosed in a timely manner to the City of Madison Finance Department, the City Attorney's Office and the awarding agency or pass-through entity. Failure to prevent, detect, or report FWA can result in questioned or disallowed costs, repayment of grant funds, suspension or termination of awards, and debarment or suspension from future federal funding.

2 C.F.R. Part 200.113 "Mandatory Disclosures" specifically requires that “an applicant, recipient, or subrecipient of a Federal award must promptly disclose whenever, in connection with the Federal award (including any activities or subawards thereunder), it has credible evidence of the commission of a violation of Federal criminal law involving fraud, conflict of interest, bribery, or gratuity violations." Grant recipients are expected to verify that contractors, subrecipients, and other participants are not excluded from federal programs before entering into covered transactions. Please refer to sam.gov for vendor verification requirements. Failure to make required disclosures can result in any of the remedies described in § 200.339 Remedies for Noncompliance, including suspension or debarment. (See also 2 C.F.R. Part 180 and 31 U.S.C. 3321).

Conflicts of Interest

The State of Wisconsin defines a “conflict of interest" as “any official action substantially affecting a matter in which the official, a member of his or her immediate family, or an organization with which the official is associated has a substantial financial interest;" or the use of “his or her office or position in a way that produces or assists in the production of a substantial benefit, direct or indirect, for the official, one or more members of the official's immediate family either separately or together, or an organization with which the official is associated." Wis. Stat. Ann. § 19.46. 

No City employee, officer, agent, or board member; their immediate family members and partners; or organizations employing or about to employ any such individuals may participate in the selection, award, or administration of a contract supported with grant assistance if a conflict of interest, real or apparent, would be involved. Such individuals utilizing grant funding are required to use funds in the best interest of the grant program and ensure decisions related to the use of the funds are free of personal and organizational conflicts of interest or the appearance of such.

2 C.F.R. 200.112 requires recipients and subrecipients of federal funds to disclose in writing to the awarding agency any potential conflicts of interest. Undisclosed conflicts of interest can, in some cases, constitute criminal fraud because they are "material omissions."

Supplanting  

Supplanting occurs when a State, local, or tribal government reduces previously allocated or appropriated funds for an activity, specifically because federal funds are available (or expected to be available) to fund that same activity. Federal funds must be used to supplement existing State, local or tribal funds for program activities, if any, and may not replace State, local, or tribal funds that have been appropriated or allocated for the same purpose. Additionally, federal funding may not replace State or local funding that is required by law. For example, while grant proposals generally may not request salary funding for current employees who will be working on a grant project, overtime for current employees is often allowable, as well as requests for salary funding for a new employee whose hire is contingent on the grant award, if the grant solicitation states these activities are eligible.

Departments will not participate in supplanting funds unless expressly permitted by statute, the granting agency's grants financial guide, or program announcement ("solicitation").

Whistleblower Protection

An employee of the State of Wisconsin, including an employee of the City of Madison as defined in Wis. Stat. § 230.80(3), may not be retaliated against for disclosing information regarding a violation of any state or federal law, rule or regulation, mismanagement or abuse of authority in state or local government, substantial waste of public funds or a danger to public health or safety.

An employee with knowledge of such information, the disclosure of which is not expressly prohibited by state or federal law, rule or regulation, may disclose that information to any other person. However, to obtain protection under Wis. Stat. §230.83, before disclosing that information to anyone other than an attorney, collective bargaining representative or member of the legislature, the employee must do one of the following:

• Disclose the information in writing to the employee's supervisor, or
• Disclose the information in writing to an appropriate governmental unit designated by the Equal Rights Division, a division of the State of Wisconsin Department of Workforce Development.

Nothing in Wis. Stat. §230.81 prohibits an employee from disclosing information to an appropriate law enforcement agency, a state or federal district attorney in whose jurisdiction the crime is alleged to have occurred, a state or federal grand jury or a judge in a proceeding commenced under Wis. Stat. §968.26 or disclosing information pursuant to any subpoena issued by any person authorized to issue subpoenas under §Wis. Stat. §885.01. Any such disclosure of information is a lawful disclosure under this section and is protected under Wis. Stat. §230.83. Nothing in this section restricts the right of an employer to take appropriate disciplinary action against an employee who knowingly makes an untrue statement or discloses information the disclosure of which is expressly prohibited by state or federal law, rule or regulation.

An employee who believes that a supervisor or appointing authority has initiated or administered, or threatened to initiate or administer, a retaliatory action against that employee in violation of Wis. Stat. §230.83 may file a written complaint with the Division of Equal Rights, specifying the nature of the retaliatory action or threat thereof and requesting relief, within 60 days after the retaliatory action allegedly occurred or was threatened or after the employee learned of the retaliatory action of threat thereof, whichever occurs last.

Consequences for Non-Compliance

The Whistleblower Protection Act prohibits the City from taking any retaliatory action against an employee who has made a protected disclosure. If an employee believes they have been the subject of retaliation, they may file a written complaint with the Equal Rights Division of the State of Wisconsin Department of Workforce Development.

Pre-Application

• Departments determine a specific need (i.e. new unfunded program, equipment purchase, etc.) or identify a specific upcoming grant opportunity.
• Departments perform pre-application assessment and review. Identified initiatives should align with established City and agency priorities and have matching funds available (if required).
• Departments submit Notice of Grant Application Form.

Application Preparation & Submission

• It is recommended to seek Common Council Approval to apply for the grant. 
• Departments prepare and submit application with Grant Writer assistance, if requested on the Notice of Grant Application Form.
• Grant Writer or department grant staff creates grant record in Enterprise ERP (Grant Master in MUNIS).

Post Award

• Department introduces resolution to accept the grant, enter into a grant agreement, and amend the budget as needed. Department staff can work with their Budget Analyst to determine whether there is existing budget authority for the project or if an amendment is required. 
• Grant Writer updates Enterprise ERP grant record with the fully executed grant agreement. 
• Agency creates Project Master record linked to Grant Master in Enterprise ERP system.
• Departments assume responsibility for accurately managing grant funds in accordance with the grant contract.
• Departments assume responsibly for all grant reporting and drawdown/payment requests.

Grant Closeout and Auditing

• Close-out documentation, including final financial and programmatic reports, are submitted to the grantor.
• Departments reconcile the final financial report and submit it to the Grant Supervisor in addition to the funder.
• Departments ensure there are no unliquidated obligations and that all required match was captured.
• Departments ensure all grant activity and any changes to the grant are documented to facilitate an audit.
• Grant documents are retained for the period outlined in the grant contract or the City's required seven years, whichever period is longer.
• Once all grant activities have concluded, Accounting closes the Project Master and the Project Strings, and the Grant Supervisor closes the Grant Master record in Enterprise ERP.

Grant Planning and Research

Departments are encouraged to seek and apply for grant opportunities that will allow the department to expand its overall capacity without placing greater burden on the City's Operating and Capital budgets. It is suggested that each department maintain a prioritized list of needs that can potentially be met through grant funding. The identified projects, purchases and initiatives should align with established City priorities and have matching funds available (if required). The department should also take into consideration the continuation of the project or program after the grant period ends. Departments may request assistance with searching for funding opportunities by contacting their grant staff or the Finance Department Grant Writer by submitting the Grant Search Assistance Request Form.

Please note: All intended grant proposals must be tracked by the Grant Writer. The Finance Department must be informed of prospective grant applications at the pre-application stage, regardless of format or grant type. As part of the pre application process, a Notice of Grant Application Form must be prepared and submitted by the department preparing a grant application on behalf of the City to the Finance Department Grant Writer. Within this form, departments can also request collaboration with the Grant Writer on reviewing and developing application materials, including seeking Common Council approval for the grant application.

Relevant submission forms and up-to-date contact information can be found on the Finance Department intranet page.

The following sources can be used to locate grant opportunities for City projects:

1. Federal Grants
   1. Grants.gov: Grants.gov is the clearinghouse for all federal grant opportunities, and allows organizations to electronically find, apply for and manage federal grant funds online through a common website.
   2. System of Award Management
   3. Federal Register
2. Regional/Local Grant Opportunities (state, county, etc.)
3. Foundations
4. Legislative Appropriations (submitted through the legislative policy process) 
5. Agency Websites and Listservs

Pre-application Assessment and Review

In order to coordinate the City's grant activities effectively and support the City's strategic priorities, City staff should consider the following grant application components. 

Due Date

It is imperative for a successful grant application that there is sufficient time to complete a competitive, high-quality application. Most Federal grant applications require several weeks to complete all of the necessary steps, including City processes such as Common Council application approval.  State grants require slightly less time to complete, and private foundation applications can vary. In reviewing a grant proposal, agencies should consider whether they have the capacity to execute or collaborate with the Grant Writer on executing the grant application in the given time.

Eligibility 

The department should determine if the City is eligible to apply for the grant before applying. The legal, official grant applicant is always the City of Madison, not an individual agency. City governments are often described as a “municipal entity" or “local government entity" on the list of eligible applicants on a grant funding opportunity notification. 

Topic and Focus 

The department should determine if the topic or focus of the grant falls under the City's purview, and how the grant addresses goals, objectives or strategic priorities that are part of the City of Madison Performance Excellence, Comprehensive Plan, and/or the vision or mission of a City Department.  If the topic or focus of the grant is not directly within City government purview, but it is a topic of interest to the City or has an impact on City residents, the department should consider pursuing a joint application with other community stakeholders.

Need

A need for the service, program or other resources that will be provided using potential grant funds should be identified through a City process, report, or other source of needs analysis. Data available through the Neighborhood Indicators project or another data source can provide justification for the need addressed by a grant opportunity.

Financial Implications

The department should identify the total anticipated financial implications of the grant.  This should include the total cost of the project, the match or cost sharing requirements and sources, and any additional staffing requirements, which could include salary, and benefit increases for multi-year grants.

Match or Cost Share Requirements 

Matching or cost sharing means the portion of project costs not paid by Federal funds (unless otherwise authorized by Federal statute). Match is a percentage of the total project cost for an award and has the same restriction on the use of funds as the rest of the Federal award.  Applicants need to thoroughly read through grant program announcements and understand what portion of the project cost they are expected to provide. Matching requirements vary across grant programs.

Shared costs or matching funds and all contributions must meet all of the following criteria to be accepted by the funder as part of the recipient's or subrecipient's cost share or match:

1. Are verifiable from the recipient's or subrecipient's records;
2. Are not included as contributions for any other Federal award; 
3. Are necessary and reasonable for the accomplishment of project or program objectives;
4. Are allowable under 2 C.F.R. 200.400
5. Are not paid by the Federal government under another Federal award, except where authorized by Federal statute;
6. Are provided for in the approved budget when required by the Federal awarding agency; and
7.  Conform to other provisions of 2 C.F.R. Part 200.420 through 200.47

There are two kinds of match, a cash match and a third-party in-kind match.  A cash match includes cash spent for project-related costs. A third-party in-kind match includes, but is not limited to, the valuation of non-cash contributions provided by third parties. This type of match may be in the form of current employee straight time and benefits, services, supplies, real property, and equipment, depending on the solicitation.  Documentation supporting the value of in-kind match must be maintained in the award recipient's or subrecipient's records. 

The award recipient has primary responsibility for meeting the match requirement and for ensuring subrecipient compliance with the match requirements. 

Partner Organizations 

There may be circumstances in which the City of Madison will partner with an outside organization, such as local non-profits and other departments, to serve as the lead applicant for grant opportunities that are only open to municipalities. As the lead applicant, the City assumes all the responsibilities for the grant and must contract with the secondary organization. The City must have a written agreement or memorandum of understanding between all parties, and such documentation is often required by funders. At the time when legislation is presented, such agreements should also be included in the accompanying resolution when application timelines allow.

If the City is not eligible to be the lead applicant, it may be possible to partner with other community stakeholders to complete the application. It can be helpful to convene a meeting with relevant organizations to discuss the grant opportunity and come to consensus as to which entity would be the most competitive and capable of completing the application. Sometimes another entity is already working on or exploring the same grant opportunity. If the focus of their application aligns with City interests, City staff could offer assistance and/or partnership on the application. It can also be helpful to include other city departments in the discussion as potential stakeholders or partners. Often, funders look favorably upon collaborative applications with multiple key stakeholders from various organizations, as these types of applications are often seen as the most competitive and feasible. 

Continuation Plan 

Departments should develop continuation plans prior to applying for grants. The plan should address strategies for sustaining grant-funded programs if funding is reduced or terminated. In these instances, departments are responsible for either termination or reduction of the program, or they can seek alternative sources of funding. Departments must understand that where grants are temporary, additional costs cannot be assumed to be absorbed by the City's future operating budget. 

It is the initiating department's responsibility to prepare and submit the grant proposal application. However, the Finance Department Grant Writer is available as a resource and can provide input and feedback; offer writing and editing assistance as time permits; review potential applications to ensure they meet grantor expectations and requirements; assist with securing letters of support; and offer guidance on best practices for developing budgets, logic models, and other commonly required application components. 

It is important for the applying agency to read all grant guidelines and notices of funding opportunities thoroughly. Grant application guidelines identify what to include in the respective grant proposal. It is critical to understand the funder's requirements and to follow grant application instructions explicitly. The key elements to consider when writing a grant application include: thoughtful application structure, attention to specifications, conciseness, and persuasive writing.  It is also important to include a reasonable budget with a detailed justification narrative.

It is strongly recommended to seek Common Council approval and submit the Notice of Grant Application Form and any requests for assistance from the Grant Writer before preparing to apply for a grant. In some cases, such as tight deadlines, it may be possible to seek approval after the application is submitted but before accepting the grant award. Creating a resolution that authorizes the application and acceptance of the grant award simultaneously is encouraged. Application materials may be prepared (but not submitted) while the resolution is being processed. Departments should notify the Finance Department of their intended application through the Notice of Grant Application Form prior to applying. If the grant application requires a signature, consult the City Attorney before signing to ensure the application is not obligating the City to any terms or conditions. For guidance on drafting resolutions, please refer to the Resolution Toolkit available on the Finance Department intranet page. 

Electronic proposal preparation and submission is becoming the standard for grant administration. The Finance Department Grant Supervisor can assist in coordinating roles designated for all external web-based grant portals, as each portal defines roles differently, which may involve City staff. Contact the Finance Department Grant Supervisor with sufficient time from the proposal's due date to make certain that the City is properly registered in a particular system. It is important that the appropriate programmatic and fiscal personnel are established within these systems for access and award application and management. 

The applying department should create a Grant Master record for all completed grant applications in Enterprise ERP, unless assistance from the Grant Writer with this step has been requested via the Notice of Grant Application Form.

The process of assembling a grant application can vary greatly, as can the time commitment necessary to complete a competitive application. Departmental staff are primarily responsible for completing the application process and providing the necessary technical and operational expertise and knowledge. However, the experienced staff of the City Grants Community of Practice are available for assistance, guidance and feedback to help prepare a successful proposal.

System of Awards Management (SAM)

The System for Award Management is a Federal Government owned and operated free  website that is used to register entities to do business with the U.S. Government, to update, renew, or check the status of an entity registration, search for entity registration and exclusion records, search for assistance listings (formerly CFDA.gov), wage determinations (formerly WDOL.gov), contract opportunities (formerly FBO.gov), contract data reports (formerly part of FPDS.gov), view and submit BioPreferred and Service Contract Reports, or access publicly available award data via data extracts and system accounts.

Both current and potential government vendors are required to register in SAM in order to be awarded contracts by the Government.  The Finance Department's Grant Supervisor is the Entity Administrator for SAM.gov and maintains the City's SAM registration. Registration must be updated annually and is always free. There should never be a fee associated with renewing or updating a SAM registration. 

The City of Madison's System of Awards Management (SAM) Unique Entity ID (UEI) is FS3AZ3FV8JG8. The CAGE/NCAGE code is 3BHP1.

ID.me

To access and submit grant applications through Grants.gov, the applying department may need to create an account with ID.me. ID.me is a trusted partner for many government agencies, including the Treasury Department and HHS, and is used to verify identity for secure access to some grant portals and services. Applying departments may need to create an ID.me account or sign in to an existing one if required by the specific grant application process. Once an ID.me account has been created, the applicant will be required to undergo identity verification with ID.me when prompted by the grant application portal. This is a digital process requiring the uploading of identity-verifying documents such as a driver's license. After successful verification, applicants should be able to access the grant portal and begin the application process.

Grant Proposal Narrative Components

While each grant opportunity will have specific requirements, the items below are typical to all grant pursuits.

Synopsis

The synopsis (also called abstract or executive summary) is a brief summary of what the funder will find in the full grant application. Brevity is important, as this section will have a page or word limit per proposal requirements. Always follow the funder's guidelines regarding synopsis length and structure. It is recommended to write the synopsis after the entire grant application narrative is written.

Budget

The budget typically contains two parts, a budget (dollar amounts) and a budget narrative. The budget will include a list of all line items and the specific dollar amounts, as well as a total cost for all expenditures. The budget narrative is the more detailed, written explanation of how the monies will be spent if the project is funded. This section will explain and justify the calculations used to arrive at the budget figures.

Letters of Support

A letter of support comes from a partner organization and states that the partner is committed to providing leveraging assets to your grant-funded program when funded. Partner organizations can commit to providing cash, facilities, technical assistance, equipment, supplies and materials, or loaned staff. Ask for letters of support from affiliates early in the planning process (Note: the number of support letters required will vary). In addition, letters of support can be written by local elected officials or organizations that underline their favorable opinion of the projects without specifically committing resources or funding to the proposal.

Logic Model

A logic model (often included in the narrative as part of the project implementation plan) is a graphic blueprint of the key elements of a proposed program. It looks at inputs, activities, outputs, outcomes, and impacts. Many funders require a Logic Model in the program design of the grant application narrative. It often takes the form of a bulleted list, a table, or a flowchart. Refer to specific grant guidelines regarding logic models.

Lobbying 

Federal funds may not be used by the recipient, or any subrecipient at any tier, either directly or indirectly, to support or oppose the enactment, repeal, modification or adoption of any law, regulation, or policy, at any level of government except with explicit statutory authorization. Departments seeking federal funds for projects must agree to comply with the Anti-Lobbying Act and disclose lobbying activities. 

Internally Competing Applications

It is imperative that the potential for multiple submissions to the same grant during the same funding round is discussed and resolved among the involved agencies prior to the application submittal. The City shall not submit multiple grant applications for anyone funding announcement or program during the same funding round unless explicitly allowed by the funder. 

Application Rejection 

In the event the grant application is rejected by the funder, the applying department should notify the Finance Department Grant Writer, with a copy of the rejection notification attached. The department or the Grant Writer (whomever created the record) will close the application record in Enterprise ERP.

Grant Award Acceptance

APM 1-1 requires Common Council approval to accept grants on behalf of the City. Approval can be authorized through a resolution or the City's adopted budget. If accepting an award requires signing a grant contract or agreement, this contract must be authorized by Common Council. Once grant funding is awarded and accepted, departments assume responsibility for expending grant funds in accordance with the budget, as well as implementing the scope of work for the project. There are unique financial and implementation requirements for every grant, which will be laid out in the award documents. 

Budget Requirements

To accept a grant award, the department must determine if it has budget authority to accept and eventually spend the award.  If the award is included in the Adopted Budget, a budget amendment is not needed to accept a grant. If the award is not included in the Adopted Budget, the department must draft a budget amendment resolution. If a department is not sure whether funding is included in the budget, staff should contact their Budget Analyst. A list of Budget Analysts and their corresponding agencies is available on the Finance Department intranet page.   

Legislative Process

Common Council approval is recommended but not required to apply for a grant. Council approval is required to accept a grant, enter into a grant contract, and amend the budget (if required). These actions may be combined into a single resolution. Agencies are responsible for drafting grant resolutions, which will be introduced by a sponsor to the Common Council and subsequently referred to the relevant committees. The sponsor can be the Mayor or an Alder. Grants-related resolutions should always be referred to the Finance Committee. Resolutions that amend the budget require a super-majority (15) vote from Council. For examples, please refer to the Resolution Toolkit available on the Finance Department intranet page.

Grant Agreement 

Signed grant agreements are sent automatically to the Finance Department SharePoint in Accela, though this process may vary in the event the funding agency is the final signer. Each department is responsible for sending the executed and signed grant documentation to the funder, if required. Upon receipt, the funder will sign the final award document (executed award) and send it back to the department. 

Changes to the Grant Agreement 

Notify the Finance Department of any budget or programmatic changes to the grant. Funders must approve any significant budget or programmatic changes made through a written request, including award extensions. The grant agreement is a formal contract, so any changes must be agreed on by both parties. E.g. if an item costs significantly more or less than what was entered in the budget, if there is a change of staff, or a change in project scope, departments will need the funder's permission to implement changes. If a modification request is not submitted, it is likely that grant funds will need to be returned to the funder or the department will not be reimbursed.

Grant agreements must be in compliance with the City of Madison Administrative Procedure Memorandum No 1-1. All contracts, including grant contracts, must be made in the name of the City of Madison. All contracts must be properly authorized by the Common Council or through an official procedure before being signed. The Mayor and City Clerk must be delegated authority before signing, which can be achieved through the Common Council resolution. Department and division heads, City employees, boards, committees, and commissions do NOT have authority to sign a contract, unless specifically authorized by the Common Council.

Resolution RES-25-00428 (File No. 89226) was adopted at the August 5, 2025 council meeting to authorize the Mayor to be the single signer of grant agreements that have to be signed in DocuSign (or one of the other online grants portals). This resolution was prompted because the State of Wisconsin now requires all their grant agreements to be signed in DocuSign. Per the Attorney's Office, the point of this resolution is to clarify that when an electronic signature is required by a granting entity (state or feds), and there's only room for one signer, the mayor can be that signer. 

This being said, RES-25-00428 doesn't change the rules for who is allowed to sign grant applications, or how to get authorization to sign a grant contract. The grant contract / agreement must still be individually authorized in a separate resolution (per APM 1-1) and grant applications must be authorized to the extent required by APM 1-9 for grants.

All grant agreements must be routed for signature in Accela (the contract signature routing application), not just sent directly to the mayor to sign. This way the agreement is still reviewed by everyone who needs to see it before the mayor signs.  Please see APM 1-1 for more detailed instructions in contracts.

Grant Management

Proper stewardship of grant resources is an essential responsibility of award recipients. It is their duty to ensure funding and resources are used efficiently and effectively to achieve the desired objectives.  Award recipients should have management processes and controls in place that reasonably ensure that funded programs achieve their intended results; resources are used in a manner consistent with the funding agency's mission; programs and resources are protected from waste, fraud, abuse and mismanagement; and laws and regulations are followed.

Federal award recipients must also, as described in 2 C.F.R. 200.303, establish and maintain effective internal control over the federal award that provides reasonable assurance that the recipient is managing the federal award in compliance with federal statutes, regulations, and award terms and conditions.  The recipient must also take prompt action when instances of noncompliance are identified, including non-compliance identified in audit findings, and take reasonable measures to safeguard protected personally identifiable information and other information the federal awarding agency or pass-through entity designates as sensitive regarding privacy and obligations of confidentiality. 

Purchasing and Procurement 

The Finance Department's Purchasing unit oversees the purchasing and procurement process, which is governed by Sec. 4.26 of Madison General Ordinances and the Purchasing Guidelines established by the Finance Department. Goods and services purchased with grant funds are not exempt from the City's purchasing and procurement policies and guidelines. For more information on the purchasing process, please refer to the Contracts and Purchasing Toolkit.

For procurement transactions using Federal award funds, the City must have documented procurement procedures consistent with applicable State, local, and tribal laws and regulations, and the Procurement Standards set out at 2 C.F.R. 200.317 through 200.326. Procurement procedures must be formally documented and periodically reviewed to ensure compliance with applicable laws and regulations.

In order to be approved, a contract to purchase goods or services must use the appropriate procurement method to select a vendor or contractor. Those methods include:

1. Procurement by micro-purchase (the federal government's standard micro-purchase threshold is $15,000 as of October 1, 2025); 
2. Procurement by sealed bids; 
3. Procurement by small purchase procedures; 
4. Procurement by competitive proposal; and
5. Procurement by noncompetitive proposal or Sole Source Procurement.

See further details on when these methods apply below.

Sole Source Procurement 

Award recipients may solicit non-competitive proposals (or "sole source" procurement) when one or more of the following circumstances apply; 

• The item or service is available only from a single source; 
• Public exigency or emergency will not permit a delay resulting from competitive solicitation; 
• No acceptable bids were received after the competitive proposal process;
• Professional services are provided by attorneys;
• Services are rendered by university, college, or other educational institution;
• Service fees established by law/professional code;
• The particular consultant has provided services to the City on a similar/continuing project, or it is economical for the City to retain same consultant;
• Contract for $75,000 or less; or
• Otherwise authorized by law, rule, resolution, or regulation.

Sole source procurement should be used only when use of competitive solicitation procedures like sealed bids or competitive proposals are not applicable to the requirement or are impracticable.  If a department would like to utilize sole source procurement, they should submit a “Non-Competitive Selection Request" to the Finance Department's Purchasing unit for review and approval.

The Contracts Quick Chart can be used to help determine what procurement method and documents are needed to comply with local City of Madison purchasing rules.

Competitive Proposals 

Requests for Proposals (RFP), Requests for Bids (RFB) and Requests for Quotations (RFQ) are all forms of procurement by competitive selection.  Once the department develops a scope of work, the Finance Department's Purchasing unit will assist with completing the procurement process. 

Contractors

It is the department's responsibility to ensure that contractors perform in accordance with the terms, conditions, and specifications of their awards. In addition, departments are responsible, in accordance with good administrative practice and sound business judgment, for the settlement of all contractual and administrative issues arising out of the procurement. Contractors and subrecipients must receive a copy of the grant terms and conditions. Refer to the Contracts Quick Chart or the appendix for more details.

If federal grant funds are being used, the department must search the SAM website to ensure a selected contractor or vendor is not debarred or suspended.   

Subrecipients and Subawards 

A subaward is an award made by a pass-through entity to a subrecipient for the purpose of carrying out a portion of the work funded by the pass-through entity's Federal award. The pass-through entity may use any form of legal agreement for making a subaward, including a contract, however, not all contracts made by a pass-through entity are subawards. 2 C.F.R.200.331 – 2 C.F.R.200-333 discusses subrecipient monitoring and management in further detail. More information regarding subrecipients and subawards is in the appendix.

Grant Expenditures 

All costs claimed by the City under a grant must be allowable, allocable, and reasonable, with adequate documentation to support charges must be maintained. All expenditures must go through the City's regular approval process and can be viewed using the project expense inquiry in the Enterprise ERP record. Records must be maintained for individual expenditures, purchase orders, and encumbrances. Documentation of eligible expenses may include copies of invoices, receipts, payroll or labor reports, or other proof that complies with federal and state audit standards. Proof of payment may include a copy of a receipt, ACH transfer document, cancelled checks, bank statements, or other proof that complies with federal and state audit standards. A supplemental accounting record may be needed to accompany receipts and cancelled checks.

Grant Reporting

Grants awarded to the City typically require that programmatic, financial, and progress reports be submitted to the funder. Accurate and timely reporting is critical to maintaining a good relationship with the funder. Late or inaccurate reports may negatively impact current or future funding. The grant agreement will delineate the grant reporting requirements. Funded departments are expected to comply with the reporting requirements as stated in the grant agreements.

Drawdown and Payment Request

Departments must request payment from the funder if funding is not received up front. The specific payment method will be disclosed in the executed grant document. 

If the funding is advanced, contact the City Finance Department to set up a charge code. The City Treasurer must be informed at TreasurerWiresACH@cityofmadison.com so that they can expect a deposit, and the department needs to provide them with the amount of the deposit and the charge code being used. Once received, Treasury staff will apply the amount to the grant project. 

If the project is not receiving advance funding, the department must request a drawdown from the granting agency. A drawdown refers to payments made by the funder to the recipient which reduces the remaining balance of funds available. Once authorized, grantees may draw down or receive payments of their grant funding through the active grant period.

When requesting a drawdown from the funder, the department must also request that the Finance Department's Grant Supervisor run a revenue allocation.  The revenue allocation process does two things: it creates a general billing invoice for the grant-funded expense which will be used to receive the funding when it comes to the City electronically, and it will create a journal entry that connects the local match expense to the local match project funding source. This is typically the City's general fund, and the revenue allocation process will allocate those funds into the grant project. Once the allocation is complete, inform the City Treasurer, at TreasurerWiresACH@cityofmadison.com, that they can expect a deposit, the amount, and the general billing invoice number. When the deposit is received, the Treasurer will apply the amount to the grant project.

Program Income

Occasionally, a grant program will generate income. Program income may be used only for allowable program costs and must be spent prior to requesting additional award funds (draw down) per 2 CFR 200.305(5).  Unless otherwise stipulated in the award terms and conditions, any program income earned during the period of performance but not used for the project must be reverted to the awarding agency.

Grant Closeout

Closeout is the process by which the awarding agency or pass-through entity determines that all applicable administrative actions and all required work of the award have been completed and takes certain actions to close the grant, as described in 2 C.F.R. 200.344.  The final progress report should also be prepared in accordance with instructions provided by the awarding agency's program office.  Typically, documentation will include a final financial and programmatic narrative report. 

When the project comes to an end, the department or the Grant Writer should reconcile the final financial report to the Enterprise ERP record, ensuring there are no unliquidated obligations and all required match has been captured, and close the project.

If a Cooperation Agreement is included in the grant paperwork, the department must ensure that all paperwork from the partner organization has been submitted. 

Auditing

The purpose of an audit is to review the auditee's accountability of funds and required non-federal contributions (cost sharing or match) to determine whether the auditee has established an accounting system with adequate internal controls that provide full accountability for revenues, expenditures, assets, and liabilities. An audit also confirms that financial statements are presented fairly and in accordance with generally accepted accounting principles, that financial reports contain accurate and reliable financial data and are presented in accordance with the award terms and conditions, and that expended funds are in accordance with the award terms and conditions and those provisions of Federal law (statutes or regulations) that could have a material effect on the financial statements or on the awards tested. 

It is important that all grant activity and any changes to the grant are well documented to facilitate any audit. Audit findings (significant deviations from grants contractual agreements) made during the audit are provided to the funder, which could prompt an additional audit by the funder.

Independent Reviews 

An independent review of grant-related records in the form of program audits, desk reviews, quality reviews, special audits or site visits can take place at any time. Departments should contact the Finance Department immediately in the case of an audit or site visit. The goal of an audit or site visit is to ensure that the City has fully complied with all requirements of a given grant agreement and to verify the accuracy of all associated financial records. 

Single Audit 

Non-federal entities expending $1,000,000 or more in a year in federal awards are required to have a single or program-specific audit conducted for that year, performed by an outside auditor. Federal audit and annual reporting requirements regarding the single audit are contained in 2 CFR Part 200 Subpart F (200.5 Compliance and Audit Requirements). 

The single audit is completed annually and overseen by the Finance Department. However, it is the responsibility of each department to provide expenditure, and receipt of payment and subrecipient information for all relevant grants. A single audit template is sent to each department in January preloaded with the prior year's data and will include any updates or changes.  The competed template is due back to the Finance Department at the beginning of March. Up-to-date instructions and the single audit workbook can be found in the City Grants Community of Practice group.

 The external auditor performs the site visit in April and prepares the audit report by June. Audit reports are due no later than nine months after the close of each fiscal year. Completed audit reports must be submitted electronically to the Federal Audit Clearinghouse.

Document Retention

Grant documentation must be kept a minimum of seven years following the closure of its most recent audit report per Wis. Stat. §19.21. If any litigation, claim, negotiation, audit, or other action involving grant records has been started before the expiration of the seven-year period, the records must be retained until completion of the action and resolution of all issues which arise from it, or until the end of the regular seven-year period, whichever is later.

If funders require a retention period of fewer than seven years, the grantee should still keep records for the seven-year period defined by Wisconsin state law. Funders may also require retention periods in excess of the state-required seven years.

Subrecipients and Subawards 

Subawards

A subaward is an award made by a pass-through entity to a subrecipient for the purpose of carrying out a portion of the work funded by the pass-through entity's Federal award. The pass-through entity may use any form of legal agreement for making a subaward, including a contract, however, not all contracts made by a pass-through entity are subawards. 2 C.F.R.200.331 – 2 C.F.R.200-333 discusses subrecipient monitoring and management in further detail.

All subawards ("subgrants") must have specific federal authorization, which may take several forms. In some cases, a federal statute (such as a program statute) may specifically authorize particular subawards (or particular categories of subawards), commonly seen for a formula grant (or under a block grant) program.  In other cases, a particular subaward may be authorized because the award recipient included a sufficiently-detailed description and justification of the proposed subaward in the application as approved by the awarding agency. 

A pass-through entity must clearly identify the subaward to the subrecipient by way of documentation (a subaward "agreement") that provides the subrecipient all of the information it would need to comply with the Federal award terms and conditions and other applicable legal requirements. This subaward documentation also should include any information the subrecipient would need in order to help ensure that the pass-through entity can meet its own responsibilities under the Federal award. The City Attorney's office must be consulted when drafting a subaward agreement.

Subrecipient and Contractor Determinations

According to 2 C.F.R. § 200.331, Subrecipient and Contractor Determinations, “the non-Federal entity may concurrently receive Federal awards as a recipient, a subrecipient, and a contractor, depending on the substance of its agreements with Federal awarding agencies and pass-through entities. Therefore, a pass-through entity must make case-by-case determinations whether each agreement it makes for the disbursement of Federal program funds casts the party receiving the funds in the role of a subrecipient or a contractor." 

The following are characteristics of a subaward: 

1. The subrecipient determines who is eligible to receive what Federal assistance; 
2. The subrecipient's performance is measured in relation to whether objectives of the Federal program were met; 
3. The subrecipient has responsibility for programmatic decision making;
4. The subrecipient has responsibility for adhering to applicable program requirements under the Federal award; and 
5. The subrecipient uses the Federal funds to carry out a program for a public purpose specified in authorizing statute, as opposed to providing goods or services for the benefit of the pass-through entity. 

Use the “Subrecipient Checklist" to determine if a department is entering into a subrecipient or vendor/contractor relationship. This checklist should be completed and maintained with the grant records.  It should also be submitted along with the Single Audit Workbook to the Finance department as part of the annual single audit preparation. 

Subrecipient internal controls

Pass-through entities must establish and maintain effective internal control over subawards and have written procedures that ensure proper implementation of payment requirements and for the determination cost allowability.

Best practices for internal controls can be found in the “Standards for Internal Control in the Federal Government" issued by the Comptroller General (Green Book) or the “Internal Control Integrated Framework" issued by the Committee of Sponsoring Organization of the Treadway Commission (COSO).

Failure to establish and maintain an effective internal control environment will result in an audit finding. 

Subrecipient monitoring 

All pass-through entities must monitor their subrecipients throughout the period of performance under a subaward. The purpose of subrecipient monitoring is to ensure that the subaward is used for authorized purposes, is implemented in compliance with applicable Federal law and the terms and conditions of the subaward, and achieves subaward performance goals. Subrecipient monitoring by the pass-through entity must include reviewing financial and performance reports submitted by the subrecipient, following-up and ensuring the subrecipient takes action to address deficiencies found through audits, onsite reviews, and other means, and issuing a management decision for audit findings pertaining to the award. 

To effectively monitor a subrecipient, a pass-through entity must: ensure that Federal award information and compliance requirements are identified to the subrecipient at the time of the award, and that subrecipient activities are monitored throughout the period of performance of the subaward. In addition, the pass-through entity must develop systems, policies, and procedures to ensure that subrecipient reviews are conducted in accordance with applicable Federal laws and with the terms and conditions of the subaward. Procedures need to be in place to ensure that the subrecipient obtains the required audits, and that audit findings identified in any subrecipient audit reports are resolved in a timely manner.

Subrecipient risk assessment 

To determine the appropriate level of monitoring, pass-through entities must evaluate each subrecipient's risk of non-compliance with Federal statutes, regulations and terms and conditions of the subaward. Generally, a subrecipient that lacks experience in implementing Federal awards or with implementing similar subawards may require closer monitoring. Additional monitoring might also be warranted based on results noted during monitoring and subrecipient audits. The “Subrecipient Risk Assessment Worksheet" should be completed and maintained with the grant records.  It should also be submitted along with the Single Audit Workbook to the Finance Department as part of the annual single audit preparation.

Subrecipient Reporting and Audit

Awards of $30,000 or more to subrecipients must be reported per the Federal Funding Accountability and Transparency Act of 2006 in SAM.  This takes place at the end of the month following the month in which the direct recipient awards any sub-grant greater than or equal to $30,000.

Subrecipients expending $750,000 or more in Federal awards during the subrecipient's fiscal year, consistent with Subpart F—Audit Requirements of 2 C.F.R. Part 200, must provide the pass-through entity with the required audit within 9 months after their year-end, or one month after the issuance of their audit. Upon receipt of the subrecipient audit, the pass-through entity needs to evaluate the impact of subrecipient activities on the pass-through-entity's ability to comply with applicable Federal law (statutes and regulations) and award terms and conditions, issue a management decision on audit findings within 6 months after receipt of the subrecipient's audit report, and, ensure that the subrecipient takes timely and appropriate corrective action on all audit findings.

Departments must look to the award terms and conditions to determine any additional audit requirements that must be met under the award. 

Subrecipient noncompliance

If a subrecipient fails to comply with Federal statutes, regulations, or the terms and conditions of a federal award, the pass-through entity may impose additional conditions. However, if it is determined that noncompliance can't be remedied by imposing additional conditions, your organization may take further action. 2 C.F.R. Part 200.339 allows for the withholding of disbursements or further awards, disallowing costs, suspending 

Documents:

Subrecipient Checklist

Subrecipient Risk Assessment Worksheet

Contracts Quick Chart