§ 80.91 — What Is A Federal Obligation Of Funds, And How Does It Occur?

An obligation of funds is a legal liability to disburse funds immediately or later based on a series of actions. All these actions must occur to obligate funds for the formula-based grant programs authorized by the Acts:

(a) The Service sends to a State fish and wildlife agency an annual certificate of apportionment, which tells the agency how much funding is available according to formulas in the Acts.

(b) The agency sends the Regional Director an application for Federal assistance to use the funds available to the agency under the Acts and commits to provide the required cost sharing to carry out projects that are substantial in character and design.

(c) The Regional Director notifies the agency that the application for Federal assistance is approved and states the terms and conditions of the award.

(d) The agency accepts the terms and conditions of the award in one of the following ways:

(1) Starts work on the grant-funded project by placing an order, entering into a contract, entering into a subaward, receiving goods or services, or otherwise incurring allowable costs during the period of performance that will require payment immediately or in the future;

(2) Draws down funds for an allowable activity under the award; or

(3) Accepts the award via electronic means.