The landmark federal investment of the Infrastructure Investment and Jobs Act passed in November 2021 is playing a significant role in addressing the issue of orphaned wells in the United States. Our article, “Orphaned Wells Federal Grants Part 1 – Grants Compliance Requirements,” details some of the grant compliance requirements that recipients will need to consider. This second article emphasizes the reporting requirements that grantees need to complete periodically to maintain compliance. Below is the list of reports and data collection and reporting guidelines that federal grant awardees should be aware of under this program:
- A. Quarterly Reports: Consistent with 2 CFR Section 200.328, states must submit quarterly financial and performance reports to the U.S. Department of the Interior (DOI) within 30 days of the close of each federal fiscal quarter. In quarterly reports, states will report on activities that occurred within the past federal fiscal quarter.
- Federal Financial Report (SF-425): The Standard Form 425 (SF-425) is the Federal Financial Report form that the Office of Management and Budget approved for use by recipients of federal awards governmentwide with a standard format for reporting the financial status of their awards. Financial reports must be completed using the SF-425 form. A fillable SF 425 is available online along with the instructions to complete the form.
- Federal Technical Performance Report:
- Must include narrative containing the grant number, in accordance with 2 CFR §200.329, Monitoring and Reporting Program Performance
- Must cover the period of performance and the period the report covers
- Must list and describe progress made in achieving all performance objectives and milestones contained in the approved work plan and award announcement
- Must contain a comparison of actual accomplishments compared to the performance goals and milestones of the award as proposed in the workplan
- Must state reasons why goals and performance milestones were not achieved, if any
- Reports must include additional relevant information regarding the project, as appropriate, including instructions on where to submit the Technical Performance Reports, which will be located in the Notice of Award
- Must include with report the submission of the data1
- B. Personal Property Report: States are required to submit an annual Tangible Personal Property Report (using form SF-428) if grant funds are used to purchase equipment.
- C. Significant Developments (2 CFR §200.329): Events may occur between the scheduled performance reporting dates that have a significant impact upon the supported activity. In such cases, the state must inform the DOI as soon as the following types of conditions become known:
- Problems, delays, or adverse conditions that will materially impair the ability to meet the objective of the federal award. This disclosure must include a statement of the action taken, or contemplated, and any assistance needed to resolve the situation.
- Favorable developments that enable meeting time schedules and objectives sooner or at less cost than anticipated or producing more or different beneficial results than originally planned.
- Consistent with 2 CFR §200.308, “Revisions of Budget and Program Plans,” changes in the scope of effort, project leader, and project partner must receive the prior written approval of the appropriate DOI official.
- D. Final Financial and Performance Reports: Consistent with 2 CFR §200.329, states must submit final financial and performance reports to the DOI within 120 days of the period of performance end date.
- For Final Technical Performance Reports: The narrative Final Performance Report must provide a detailed summary of all project goals and accomplishments for the entire period of performance of the grant.
- Reports must be submitted by the deadline listed on the Notice of Award.
- Requests for extensions to submit reports must be received in writing at least five business days prior to the deadline. Requests must contain a comparison of actual accomplishments compared to the performance goals of the award.
- Reports must include additional relevant information regarding the project, as appropriate. States are encouraged to include relevant best practices and lessons learned over the course of the period of performance of the grant in each report. Instructions on where to submit the Final Technical Performance Reports will be located in the Notice of Award.2
- E. Data Collection and Reporting
- i. To standardize reporting requirements and help ensure that federal resources are well spent and meet statutory objectives, states must track and report (pursuant to A and D mentioned earlier) the data outlined below for all actions taken using orphaned well grant funding. As appropriate, data tracking may be accomplished through existing systems such as the Ground Water Protection Council’s Risk-Based Data Management System (RBDMS):
- (a) well location information, e.g., latitude/longitude;
- (b) well type, e.g., orphaned production or disposal well;
- (c) pre-plugging methane emission measurement (unless initial screening was non-detect);
- (d) post-plugging methane emission measurement (or non-detect screening), if applicable
- (e) surface water contamination identified, if applicable;
- (f) surface water contamination remediated, if applicable;
- (g) groundwater contamination identified, if applicable;
- (h) groundwater contamination remediated, if applicable;
- (i) revegetation performance standard monitoring start date, if applicable;
- (j) revegetation performance standard attainment date (project complete), if applicable;
- (k) Actual total cost per well of plugging and surface reclamation, or an estimate of per-well costs if plugging services were procured at a multi-well project level; and
- (l) identification of projects located in a community of color, low-income community, or tribal and indigenous community, if applicable.
- i. To standardize reporting requirements and help ensure that federal resources are well spent and meet statutory objectives, states must track and report (pursuant to A and D mentioned earlier) the data outlined below for all actions taken using orphaned well grant funding. As appropriate, data tracking may be accomplished through existing systems such as the Ground Water Protection Council’s Risk-Based Data Management System (RBDMS):
- This list highlights important quarterly as well as annual reporting parameters by the DOI to Congress. This is a subset of the larger data set the states must report as part of the performance reports and detailed in the Orphaned Wells Data Reporting Template available on the State Orphaned Wells Program webpage. States must update the Data Reporting Template information in conjunction with the quarterly and final reporting required.
- ii. Corrections to any errors that are subsequently identified in data that has been submitted in conjunction with the quarterly reporting required shall be corrected and reported to the DOI in conjunction with the first quarterly report that is submitted after the error is identified. If the correction relates to the final quarterly report submitted under the grant, the correction should be incorporated into the final reporting.
- iii. States that apply for a Formula grant should note that non-sensitive information regarding the activities under such grants are required to be posted on a public website under §40601(c)(4)(B)(i)(III).
While this article lists the reporting requirements that orphaned or abandoned wells federal grantees need to follow, there are additional standards for plugging, workforce, and remediation that awardees would need to adhere to. Additional requirements can be found in the DOI’s July 2023 guidance document. The implications of not following the DOI’s grant compliance and reporting requirements could cause states or subrecipients to repay federal grant funds, suffering a clawback of funding that negatively impacts recipients and subrecipients. State recipients of federal funding for orphaned and abandoned wells should consider how relevant data from subrecipients and subcontractors will be collected prior to awarding and signing contracts. Meeting compliance and reporting requirements on the front end can save major headaches down the road administratively and financially.
FORVIS Can Help
When planning for federal awards, there are certain things you will need to prepare for and be ready to implement. Our dedicated Grants Management Services team at FORVIS has experience with grants and helping clients navigate the full grant life cycle. If you have questions or need assistance, please reach out to a professional at FORVIS.
- 1Data as described under Data Collection and Reporting must be submitted with the Federal Technical Performance Report.
- 2A Notice of Funding Opportunity for the Orphaned Wells Program can be found on the DOI site: Biden-Harris Administration Invests $660 Million for States to Plug Orphaned Oil and Gas Wells through President’s Investing in America Agenda.