E. Collaborating Entities

5. Can a for-profit entity receive a subaward, or otherwise be a program participant?

Yes, in certain very limited circumstances. For example, as Appendix A to EPA’s Subaward Policy (incorporated into Section III B. of the NOFO) notes, a for-profit firm can receive a subaward for a project to install pollution-control equipment at its facilities, since the firm in that case is not providing goods or services to the recipient on commercial terms.

Similarly, an investor-owned utility could receive a subaward to provide energy efficient HVAC equipment to residents of low-income communities via subsidies or actual installation of equipment. The utility would not be providing the recipient with the services (energy transmission or other services/products the utility “sells” to ratepayers or others) that generate profits for its investors. Forprofit firms may receive rebates or subsidies for purchases of pollution control equipment including electric vehicles and related charging infrastructure as program participants under 2 CFR 1500.1(b) and the EPA Guidance on Participant Support Costs, which is referenced in Appendix G of the NOFO.

4. Can for-profit/private companies be Collaborating Entities?

No. As stated in Section III.B of the NOFO, for-profit private companies cannot be Collaborating Entities that receive subawards. When a for-profit firm is providing commercial services to the recipient as a vendor, then the recipient cannot circumvent competitive procurement requirements by providing the firm a subaward even if the firm agrees not to “profit” from the transaction.

3. Can subawards only be granted to Collaborating Entities named in the application?

Applicants need to identify and describe existing relationships with Collaborating Entities in the application based on the NOFO requirements and as indicated in Appendix G for the budget template. However, grant recipients may find it necessary to issue subawards to entities not originally named in the application. Replacing a previously named Collaborating Entity requires prior approval by an authorized EPA official pursuant to 2 CFR 200.308(e)(6). 

Collaborating Entities will receive subawards as explained in the NOFO, including in Section III.B and Appendix G, but the NOFO also acknowledges in Section III.B that there may be “other subrecipients” in addition to those recognized as Collaborating Entities. Subawards may be made to Statutory Partners (CBOs, Federally recognized Tribes, local governments, and institutions of higher education), as well as entities that cannot legally be Statutory Partners (e.g., states, territorial governments, Alaska Native Corporations, and international organizations).

2. Can a Collaborating Entity be an organization located outside of the United States?

In limited circumstances, projects to benefit U.S. disadvantaged communities near an international border may require some international work to be performed within 100 kilometers of that border (e.g., within 100 km south of the U.S.-Mexico border or north of the U.S.-Canada border). See Section II.B of the NOFO. In these cases, there may be some limited instances where a Collaborating Entity may be located outside of the United States. This may also apply to projects benefitting U.S. Territories.

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