[Federal Register Volume 64, Number 195 (Friday, October 8, 1999)]
[Notices]
[Pages 54926-54930]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 99-26264]


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OFFICE OF MANAGEMENT AND BUDGET


OMB Circular A-110, ``Uniform Administrative Requirements for 
Grants and Agreements With Institutions of Higher Education, Hospitals, 
and Other Non-Profit Organizations''

AGENCY: Office of Management and Budget, Executive Office of the 
President

ACTION: Final Revision

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SUMMARY: This notice finalizes the revision to OMB Circular A-110, 
required by a provision of OMB's appropriation for fiscal year (FY) 
1999, contained in Public Law 105-277. The provision directs OMB to 
amend Section __.36, Intangible property, of the Circular ``to require 
Federal awarding agencies to ensure that all data produced under an 
award will be made available to the public through the procedures 
established under the Freedom of Information Act'' (FOIA). Pursuant to 
the direction of the provision contained in Public Law 105-277, OMB 
published a Notice of Proposed Revision on February 4, 1999 (64 FR 
5684), and a request for comments on clarifying changes to the proposed 
revision on August 11, 1999 (64 FR 43786). We received over 9,000 
comments on the proposed revision and over 3,000 comments on the 
clarifying changes.
    After a review of the comments on the clarifying changes, as well 
as the comments on the proposed revision, OMB is issuing this final 
revision to the Circular, as required by the provision contained in 
Public Law 105-277.

DATES: The revised Circular is effective November 8, 1999.

ADDRESSES: You may obtain the full text of the Circular, the text of 
this notice, and the text of the February 4th and August 11th notices 
on OMB's home page (http://www.whitehouse.gov/OMB), under the heading 
``Grants Management.'' You many obtain copies of Public Law 105-277 on 
the Library of Congress's home page (http://thomas.loc.gov).

FOR FURTHER INFORMATION CONTACT: F. James Charney, Policy Analyst, 
Office of Management and Budget, at (202) 395-3993. Please direct press 
inquiries to OMB's Communications Office, at (202) 395-7254.

SUPPLEMENTARY INFORMATION:

I. Background

A. The Statutory Direction to Amend Circular A-110

    Congress included a two-sentence provision in OMB's appropriation 
for FY 1999, contained in Public Law 105-277, directing OMB to amend 
Section __.36 of the Circular ``to require Federal awarding agencies to 
ensure that all data produced under an award will be made available to 
the public through the procedures established under the Freedom of 
Information Act.'' The provision also provides for a reasonable fee to 
cover the costs incurred in responding to a request. The Circular 
applies to grants and other financial assistance provided to 
institutions of higher education, hospitals, and non-profit 
institutions, from all Federal agencies.
    In directing OMB to revise the Circular, Congress entrusted OMB 
with the authority to resolve statutory ambiguities, the obligation to 
address implementation issues the statute did not address, and the 
discretion to balance the need for public access to research data with 
protections of the research process. In developing this revision to the 
Circular, OMB seeks to implement the statutory language fairly, in the 
context of its legislative history. This requires a balanced approach 
that (1) furthers the interest of the public in obtaining the 
information needed to validate Federally-funded research findings, (2) 
ensures that research can continue to be conducted in accordance with 
the traditional scientific process, and (3) implements a public access 
process that will be workable in practice.
    OMB recognizes the importance of ensuring that the revised Circular 
does not interfere with the traditional scientific process. Science and 
technology are the principal agents of change and progress, with over 
half of the Nation's labor productivity growth in the last 50 years 
attributable to technological innovation and the science that supports 
it. Although the private sector makes many investments in technology 
development, the Federal Government has an important role to play--
particularly when risks appear too great or the return to companies too 
speculative. Its support of cutting-edge science contributes to new 
knowledge and greater understanding, ranging from the edge of the 
universe to the smallest

[[Page 54927]]

imaginable particles. When the Federal Government changes the 
requirements that apply to researchers whom it funds, it needs to 
ensure that the changes do not interfere with cutting-edge science and 
the benefits that such science provides to the American people.
    During the revision process, many commenters expressed concern that 
the statute would compel Federally-funded researchers to work in a 
``fishbowl'' in which they would be required to reveal the results of 
their research, and their research methods, prematurely. They argued 
that this could prevent researchers from operating under the 
traditional scientific process. As in many other fields of endeavor, 
scientists need to deliberate over, develop, and pursue alternative 
approaches in their research before making results public. When a 
scientist is sufficiently confident of their results, they publish them 
for the scrutiny of other scientists and the community at large. 
Accordingly, in light of this traditional scientific process, we have 
not construed the statute as requiring scientists to make research data 
publicly available while the research is still ongoing.

B. OMB's Two Requests for Public Comment on the Proposed Revision

    To address implementation issues, OMB published two notices in the 
Federal Register requesting public comment on the proposed revision to 
the Circular. Interested parties can consult these notices, which 
provide extensive background information, for a more complete 
understanding of the final revision. The original proposal appeared on 
February 4, 1999 (64 FR 5684). It would have revised Section __.36 of 
the Circular to read as follows:
    (c) The Federal Government has the right to (1) obtain, 
reproduce, publish or otherwise use the data first produced under an 
award, and (2) authorize others to receive, reproduce, publish, or 
otherwise use such data for Federal purposes. In addition, in 
response to a Freedom of Information Act (FOIA) request for data 
relating to published research findings produced under an award that 
were used by the Federal Government in developing policy or rules, 
the Federal awarding agency shall, within a reasonable time, obtain 
the requested data so that they can be made available to the public 
through the procedures established under the FOIA. If the Federal 
awarding agency obtains the data solely in response to a FOIA 
request, the agency may charge the requester a reasonable fee 
equaling the full incremental cost of obtaining the data. This fee 
should reflect costs incurred by the agency, the recipient, and 
applicable subrecipients. This fee is in addition to any fees the 
agency may assess under the FOIA (5 U.S.C. 552(a)(4)(A)).

OMB received over 9,000 comments in response to the proposed revision. 
Commenters offered strongly differing views on the provision contained 
in Public Law 105-277. Those who supported the statutory provision 
stated that the public has a right to obtain research data that have 
been funded with tax dollars, particularly when the research findings 
were used by the Federal Government in developing policy or rules. 
These commenters also expressed the view that making this data 
available for public review and validation would improve the scientific 
process. Commenters who opposed the provision contained in Public Law 
105-277 stated that they support the concepts of full disclosure and 
open access to information. They acknowledged that the traditional 
scientific process operates by requiring researchers to subject their 
findings to the scrutiny of the scientific community and the general 
public, so that those findings may be validated, corrected, or 
rejected. However, they expressed concern that the approach required by 
Public Law 105-277 would significantly impair scientific research. In 
their view, individuals and businesses would be reluctant to agree to 
participate in research, since the participants' personal privacy and 
proprietary information could not be assured of confidential treatment.
    Many commenters on the original proposal asked OMB to clarify four 
concepts found in the proposed revision: ``data,'' ``published,'' 
``used by the Federal Government in developing policy or rules,'' and 
cost reimbursement. OMB agreed that clarification was needed for these 
concepts. On August 11, 1999, OMB published a second notice (64 FR 
43786), requesting public comment on clarifications to the proposed 
revision:

    (c) The Federal Government has the right to: (1) Obtain, 
reproduce, publish or otherwise use the data first produced under an 
award; and (2) authorize others to receive, reproduce, publish, or 
otherwise use such data for Federal purposes.
    (d)(1) In addition, in response to a Freedom of Information Act 
(FOIA) request for research data relating to published research 
findings produced under an award that were used by the Federal 
Government in developing a regulation, the Federal awarding agency 
shall request, and the recipient shall provide, within a reasonable 
time, the research data so that they can be made available to the 
public through the procedures established under the FOIA. If the 
Federal awarding agency obtains the research data solely in response 
to a FOIA request, the agency may charge the requester a reasonable 
fee equaling the full incremental cost of obtaining the research 
data. This fee should reflect costs incurred by the agency, the 
recipient, and applicable subrecipients. This fee is in addition to 
any fees the agency may assess under the FOIA (5 U.S.C. 
552(a)(4)(A)).
    (2) The following definitions are to be used for purposes of 
paragraph (d) of this section:
    (i) Research data is defined as the recorded factual material 
commonly accepted in the scientific community as necessary to 
validate researching findings, but not any of the following: 
Preliminary analyses, drafts of scientific papers, plans for future 
research, peer reviews, or communications with colleagues. This 
``recorded'' material excludes physical objects (e.g., laboratory 
samples). Research data also do not include: (A) Trade secrets, 
commercial information, materials necessary to be held confidential 
by a researcher until publication of their results in a peer-
reviewed journal, or information which may be copyrighted or 
patented; and (B) personnel and medical files and similar files the 
disclosure of which would constitute a clearly unwarranted invasion 
of personal privacy, such as information that could be used to 
identify a particular person in a research study.
    (ii) Published is defined as either when: (A) Research findings 
are published in a peer-reviewed scientific or technical journal; or 
(B) a Federal agency publicly and officially cites to the research 
findings in support of a regulation.
    (iii) Used by the Federal Government in developing a regulation 
is defined as when an agency publicly and officially cites to the 
research findings in support of a regulation (for which notice and 
comment is required under 5 U.S.C. 553).

The August 11th notice explained these clarifications were intended to 
implement the statute in a manner that (1) furthers the interest of the 
public in obtaining the information needed to validate Federally-funded 
research findings, (2) ensures that research can continue to be 
conducted in accordance with the traditional scientific process, and 
(3) implements a public access process that will be workable in 
practice. OMB received over 3,000 comments in response to the 
clarifying changes.
    After considering the views and concerns of all the commenters, OMB 
now issues a final revision to the Circular. Although the final 
revision resembles the clarifying changes proposed on August 11, 1999, 
it reflects additional changes in response to the public comments.
    Issuance of this final revision meets the statutory requirement 
imposed by OMB's appropriation for FY 1999 within the time in which it 
has legal effect. As OMB and the agencies develop experience with the 
revised Circular, changes to the data access process may be considered. 
These could range from technical and clarifying changes to substantive 
revision or rescission. OMB also endeavors to

[[Page 54928]]

review each of its Circulars every three years.

II. Comments on the Clarifying Changes to the Proposed Revision

A. Research Data

    A number of commenters objected that the proposed definition of 
``research data'' would transfer authority to determine which records 
are exempt from mandatory disclosure under FOIA from Federal agencies 
to recipients. It was not OMB's intent to transfer the agency's FOIA 
exemption authority to recipients. Rather, we were providing a 
definition for what constitutes research ``data,'' a term that is not 
defined in the provision contained in Public Law 105-277. We have 
always understood that it would be the recipient, not Federal agency 
staff, who would identify the research data in the recipient's files 
which are responsive to a FOIA request. In the over 12,000 comments OMB 
received on the proposed revision, we are not aware of any suggestion 
that Federal agency staff should perform the search of a recipient's 
offices to identify responsive research data. The fact that the 
recipient is responsible for searching for, and identifying, the 
research data does not mean the Circular has transferred the agencies' 
responsibility to recipients. When the recipient searches files for 
responsive research data, pursuant to section .__36(d), and in so doing 
applies the definition of ``research data,'' the recipient is not 
exercising the agencies'' authority under FOIA to determine exemptions. 
Rather, the recipient is simply identifying the research data that must 
be provided to the agency. The Federal awarding agency would retain its 
right to ask the recipient for additional information, if it believed 
the recipient's submission was not complete.
    Several commenters expressed concern because the proposed 
definition of ``research data'' excluded ``information which may be 
copyrighted or patented.'' These commenters believed the proposed 
language was too broad. They argued that, under copyright law, a wide 
range of materials ``may be'' copyrighted, and therefore that such a 
test could have unintended consequences for the scope of the public 
access process. In reviewing this language, we note that the 
protections available in the other parts of the definition (in 
particular, those protecting ``trade secrets'' and ``commercial 
information'') broadly protect the intellectual property rights of 
researchers. The proposed definition was not intended to create 
additional protections for intellectual property, but rather to ensure 
that existing protections continue to be respected. To avoid unintended 
consequences, and to avoid having to sort out the complexities of 
copyright law (and how it might apply in various areas of Federally-
funded research), the final revision substitutes ``similar information 
which is protected under law'' for ``information which may be 
copyrighted or patented.'' This language is intended to ensure that the 
public access process will not upset intellectual property rights that 
are elsewhere recognized and protected under the law.
    Many commenters suggested a change to the definition of ``research 
data'' to ensure that appropriate data were protected from disclosure, 
no matter what the format. Their suggestion was to replace the word 
``files'' with the word ``information'' in the phrase ``[p]ersonnel and 
medical files and similar files the disclosure of which would 
constitute a clearly unwarranted invasion of personal privacy.'' 
Examples of research data that might not be considered to be in the 
form of a ``file'' include video or audio tapes of research subjects. 
We agree with this technical change and have included it in the final 
revision to the Circular.
    Several commenters noted that the definition of ``research data'' 
excluded ``materials necessary to be held confidential until 
publication of their results in a peer-reviewed journal.'' However, 
since this language is not exactly the same as that used in the 
definition of ``published,'' (``either when: (A) Research findings are 
published in a peer-reviewed scientific or technical journal; or (B) A 
Federal agency publicly and officially cites the research findings in 
support of an agency action that has the force and effect of law'') it 
appeared that the two might be in conflict. We have revised the 
definition of ``research data'' to avoid any conflict between the two 
definitions.
    Finally, several commenters asked for a clarification to the 
revision pertaining to research data already available to the public. 
They suggested that if a request is made for research data the 
recipient has already made available to the public, through a data 
archive or other means, further action should not be necessary. Since 
this principle is used when a Federal agency responds to FOIA requests, 
it makes sense to apply it in this case as well. However, the Federal 
awarding agency should respond to the FOIA request with directions on 
how the requester can access the publicly available research data.

B. Used by the Federal Government in Developing a Regulation

    A number of commenters objected to the definition which applied the 
revision to research data that are used by the Federal Government in 
developing a ``regulation.'' These commenters had generally been 
satisfied with the language found in the proposed revision (``used by 
the Federal Government in developing policy or rules''), because it had 
been used by congressional sponsors during the legislative 
consideration of Public Law 105-277. However, these commenters believed 
that the clarifying changes significantly narrowed the scope of the 
revision.
    As we explained in the August 11th notice, its clarification was 
intended ``to ensure that members of the public can obtain the 
information needed to validate those Federally-funded research findings 
on which Federal agencies rely when they take actions that have the 
force and effect of law, while at the same time ensuring that the 
provision contained in Public Law 105-277 can be administered in a 
manner that is workable for members of the public, Federal agencies and 
their recipients'' (64 FR 43791). We sought to refer to agency actions 
that have ``the force and effect of law'' when it included ``a 
regulation (for which notice and comment is required under 5 U.S.C. 
553)'' in the proposed definitions. While it is true that agencies also 
take actions that have ``the force and effect of law'' when they issue 
administrative orders (e.g., decisions issued by administrative law 
judges), we think that agencies rarely rely on Federally-funded 
research in the context of their administrative orders. Nevertheless, 
in response to the comments, we have changed the revision to refer to 
``an agency action that has the force and effect of law'' rather than 
to ``a regulation.''
    We believe this change addresses the concerns of most commenters. 
We note that a comment letter from Senators Shelby, Lott, Campbell, and 
Gramm stated that the revision should not be limited to regulations, 
but should apply generally to ``federal actions that can dramatically 
impact the public.'' Agency actions that have ``the force and effect of 
law'' certainly represent ``federal actions that can dramatically 
impact the public.'' Indeed, it is through actions that have the force 
and effect of law that an agency (in the words of one business 
association) ``imposes costs, mandates, restrictions, obligations and 
responsibilities on the regulated community.'' However, as stated in 
the August 11th notice, we have decided

[[Page 54929]]

not to extend the scope of the revision to agency guidance documents 
and other issuances that do not have the force and effect of law. We 
continue to believe that the public interest in such access is less 
than where the agency is taking action that has the force and effect of 
law, and that the revision would not be workable in those 
circumstances. Some commenters, who argued for a broader application, 
nevertheless were sympathetic to OMB's desire that the public access 
provision be workable. For example, one commenter stated that ``the 
reproposal may be a workable first step in implementation. OMB could 
start with its August position and see how the system works.''
    A number of commenters raised a concern about whether requesters 
would be able to obtain the research data sufficiently in advance of 
when public comments are due on proposed regulations. These commenters 
offered various suggestions for how the Circular might be revised to 
address this concern. In the prior two notices, OMB has proposed a 
``reasonable time'' standard for the response to a request for research 
data. Since OMB and the agencies do not yet have experience with 
implementing the public access process, we believe the ``reasonable 
time'' standard, which allows consideration of the circumstances of a 
particular case, is appropriate. As OMB and the agencies gain 
experience with the public access process, we may be able to develop 
further clarification on this point.
    Finally, in the August 11th notice, OMB also requested comment ``on 
whether limiting the scope of the proposed revision to regulations that 
meet (a) $100 million [impact] threshold would be appropriate'' (64 FR 
43791). Such a limitation received strong support, as well as strong 
opposition from commenters. For now, we have decided not to limit the 
scope of the revision to agency actions that have an impact in excess 
of $100 million. As OMB and the agencies develop experience from 
implementing the revision, we may revisit this issue.

C. Published

    Commenters generally supported the proposed definition of 
``published.'' Some in the research community were more supportive of 
the first part of the definition (when ``(r)esearch findings are 
published in a peer-reviewed scientific or technical journal'') rather 
than the second part (when ``(a) Federal agency publicly and officially 
cites the research findings in support of'' an agency action). However, 
those who support the provision in Public Law 105-277 argued that the 
second part is necessary to ensure that the public can have access to 
the data that underlies Federally-funded research findings on which 
agencies rely to support their actions. We continue to believe that 
both parts of the definition are important to successful implementation 
of a data access provision that furthers the interest of the public in 
obtaining information while ensuring that research can continue to be 
conducted in accordance with the traditional scientific process. The 
only change that has been made to the definition of ``published'' is to 
make conforming revisions to reflect the previously-discussed change 
from ``used by the Federal Government in developing a regulation'' to 
``used by the Federal Government in developing an agency action that 
has the force and effect of law.''

D. Cost Reimbursement

    Many commenters, particularly recipients of Federally-funded 
research awards, expressed concern about the reimbursement mechanisms 
available under the proposed revision. In cases where the award's 
funding period expires before a request is made, neither the direct nor 
indirect methods of charging would allow reimbursement. Comments 
generally focused on the need for a separate agreement between the 
Federal awarding agency and the recipient, which would cover the full 
incremental cost of responding to the request. The process for such an 
agreement could work as follows:
    When a request is received by the Federal awarding agency, it would 
pass the request on to the recipient for an assessment of the costs of 
complying. Once the recipient has estimated an amount, the Federal 
awarding agency can apply its existing standards for requesting 
appropriate prepayments from the requester, as with the FOIA fee. When 
the recipient transmits the responsive research data to the agency, it 
should include an accounting for the associated costs. The Federal 
awarding agency will then seek reimbursement from the FOIA requester 
and reimburse the recipient.
    If we determine that this mechanism is not adequate, we will 
consider revising OMB Circular A-21, ``Cost Principles for Educational 
Institutions,'' as necessary to ensure that recipient institutions are 
reimbursed for the incremental costs of complying with the provision 
contained in Public Law 105-277.

E. Record Retention

    Some commenters questioned whether the final revision would impose 
additional record retention requirements on recipients. The final 
revision only affects Section .__36, which does not discuss 
recordkeeping responsibilities. Section .__53, Retention and access 
requirements for records, requires that ``(f)inancial records, 
supporting documents, statistical records, and all other records 
pertinent to an award shall be retained for a period of three years 
from the date of submission of the final expenditure report.'' In 
addition, ``(t)he Federal awarding agency * * * ha(s) the right of 
timely and unrestricted access to any books, documents, papers, or 
other records of recipients that are pertinent to the awards * * *. The 
rights of access in this paragraph are not limited to the required 
retention period, but shall last as long as records are retained.'' 
Therefore, if a recipient chooses to keep records longer than three 
years, the recipient must make them available for review in response to 
requests from the Federal awarding agency.

F. Effective Date

    Many commenters sought clarification on the effective date for the 
final revision. As stated above, the revised Circular is effective 
thirty days after it appears in the Federal Register. The revised 
Circular is effective for awards issued after the effective date and 
those continuing awards which are renewed after the effective date.

G. Projects Funded From Multiple Sources

    Some commenters asked whether the final revision would apply in 
situations where research was funded not only by the Federal Government 
but also by other entities. As noted in the proposed revision, the 
legislative history to the provision contained in Public Law 105-277 
indicates that ``the amended Circular shall apply to all Federally-
funded research, regardless of the level of funding or whether the 
award recipient is also using non-Federal funds.'' 144 Cong. Rec. 
S12134 (October 9, 1998) (Statement of Sen. Campbell). This statement 
is consistent with OMB's longstanding interpretation of the Circular 
which holds that it is applicable to all recipients, regardless of 
whether they also receive non-Federal funds.

H. Procurement Contracts

    Some commenters asked whether the final revision would apply to 
research that is funded by a Federal agency

[[Page 54930]]

through a procurement contract. However, the Circular does not apply to 
procurement contracts. Section .__2(e) of the Circular defines 
``award,'' and specifically excludes ``contracts which are required to 
be entered into and administered under procurement laws and 
regulations.''

    Issued in Washington, DC, September 30, 1999.
Jacob J. Lew,
Director.

    As directed by OMB's appropriation for FY 1999, contained in Public 
Law 105-277, OMB hereby amends Section __.36 of OMB Circular A-110 by 
revising paragraph (c), redesignating paragraph (d) as paragraph (e), 
and adding a new paragraph (d) to read as follows:
    __ .36 Intangible property.
* * * * *
    (c) The Federal Government has the right to:
    (1) Obtain, reproduce, publish or otherwise use the data first 
produced under an award; and
    (2) Authorize others to receive, reproduce, publish, or otherwise 
use such data for Federal purposes.
    (d)(1) In addition, in response to a Freedom of Information Act 
(FOIA) request for research data relating to published research 
findings produced under an award that were used by the Federal 
Government in developing an agency action that has the force and effect 
of law, the Federal awarding agency shall request, and the recipient 
shall provide, within a reasonable time, the research data so that they 
can be made available to the public through the procedures established 
under the FOIA. If the Federal awarding agency obtains the research 
data solely in response to a FOIA request, the agency may charge the 
requester a reasonable fee equaling the full incremental cost of 
obtaining the research data. This fee should reflect costs incurred by 
the agency, the recipient, and applicable subrecipients. This fee is in 
addition to any fees the agency may assess under the FOIA (5 U.S.C. 
552(a)(4)(A)).
    (2) The following definitions apply for purposes of paragraph (d) 
of this section:
    (i) Research data is defined as the recorded factual material 
commonly accepted in the scientific community as necessary to validate 
research findings, but not any of the following: preliminary analyses, 
drafts of scientific papers, plans for future research, peer reviews, 
or communications with colleagues. This ``recorded'' material excludes 
physical objects (e.g., laboratory samples). Research data also do not 
include:
    (A) Trade secrets, commercial information, materials necessary to 
be held confidential by a researcher until they are published, or 
similar information which is protected under law; and
    (B) Personnel and medical information and similar information the 
disclosure of which would constitute a clearly unwarranted invasion of 
personal privacy, such as information that could be used to identify a 
particular person in a research study.
    (ii) Published is defined as either when:
    (A) Research findings are published in a peer-reviewed scientific 
or technical journal; or
    (B) A Federal agency publicly and officially cites the research 
findings in support of an agency action that has the force and effect 
of law.
    (iii) Used by the Federal Government in developing an agency action 
that has the force and effect of law is defined as when an agency 
publicly and officially cites the research findings in support of an 
agency action that has the force and effect of law.

[FR Doc. 99-26264 Filed 10-7-99; 8:45 am]
BILLING CODE 3110-01-P