January 29, 2024
- November 14, 2024 - Updated Guidance on Salary Limitation for Grants and Cooperative Agreements. See Notice NOT-OD-25-025
- April 30, 2024 - Notice of Legislative Mandates in Effect for FY 2024. See Notice NOT-OD-24-110
- April 30, 2024 - Notice of Fiscal Policies in Effect for FY 2024. See Notice NOT-OD-24-109
- December 14, 2023 - NIH Operates Under a Continuing Resolution. See Notice NOT-OD-24-039.
- October 4, 2023 - NIH Operates Under a Continuing Resolution. See Notice NOT-OD-24-007.
NATIONAL INSTITUTES OF HEALTH (NIH)
This Notice provides information regarding the salary limitation for NIH grant and cooperative agreement awards and extramural research and development contract awards.
Since 1990, Congress has legislatively mandated a limitation on direct salary for individuals under NIH grant and cooperative agreement awards (referred to here as a grant). The mandate appears in the annual appropriation act that provides authority for NIH to incur obligations for a given Fiscal Year (FY). At this time, NIH has not received an FY 2024 appropriation and is operating under a Continuing Resolution, the "Further Continuing Appropriations and Other Extensions Act, 2024 (Public Law 118-22)”, that applies the terms and conditions of the Consolidated Appropriations Act, 2023.
The Consolidated Appropriations Act, 2023 restricts the amount of direct salary to Executive Level II of the Federal Executive pay scale. The Office of Personnel Management recently released new salary levels for the Executive Pay Scale. Effective January 1, 2024, the salary limitation for Executive Level II is $221,900.
For active awards, including awards that have been issued in FY 2024 (continuation and new) that were restricted to Executive Level II, if adequate funds are available, and if the salary cap increase is consistent with the institutional base salary, recipients may rebudget funds to accommodate the current Executive Level II salary level.
Once the Department of Health and Human Services Appropriation for FY 2024 is enacted, NIH will publish the annual Notice of legislative mandates to provide information on any statutory provisions that limit the use of NIH grant funds in FY 2024.
The following are examples of Salary Application Requests, Salary Cap Calculations, and Adjustments:
For all examples:
- the Institutional Full-Time base salary (IBS) is $240,000
- the requested Fringe Benefits rate is 25% of the direct salary
- the (F&A) indirect cost rate is 45%
- the salary cap for grant awards/contracts issued on or after January 1, 2024, is $221,900
Example 1. Individual with Full-Time Appointment
Research effort requested in application/proposal – 12 months (50% effort)
| a. | Individual's institutional base salary for a FULL-TIME calendar year appointment | $ 240,000.00 | (IBS) |
| b. | Direct Salary with research effort (50%) | $ 120,000.00 | (a x .50) |
| c. | Fringe Benefits requested at 25% of salary | $ 30,000.00 | (b x .25) |
| d. | SUBTOTAL | $ 150,000.00 | (b + c) |
| e. | Requested F&A (indirect) costs at 45% of subtotal | $ 67,500.00 | (d x .45) |
| f. | Total amount to be requested | $ 217,500.00 | (d + e) |
The salary cap for the above individual will be calculated as follows:
| g. | Salary Cap – FY 2024 | $ 221,900.00 | |
| h. | Salary Cap with research effort (50%) | $ 110,950.00 | (g x .50) |
| i. | Fringe Benefits calculated at 25% of allowable salary | $ 27,737.50 | (h x .25) |
| j. | SUBTOTAL | $ 138,687.50 | (h + i) |
| k. | Associated F&A (indirect) costs at 45% of subtotal | $ 62,409.38 | (j x .45) |
| l. | Total amount to be awarded due to salary limitation | $ 201,096.88 | (j + k) |
Therefore, the amount of reduction due to federal salary limitation is:
m. | Total adjustment | $ (16,403.12) | (l - f) |
For all examples:
- the Institutional Full-Time base salary (IBS) is $240,000
- the requested Fringe Benefits rate is 25% of the direct salary
- the (F&A) indirect cost rate is 45%.
- the salary cap for grant awards/contracts issued on or after January 1, 2024, is $221,900
Example 2. Individual with Half-Time Appointment
Research effort requested in application/proposal – 6 months (30% effort)
| a. | Individual's institutional base salary for a HALF-TIME calendar year appointment | $ 120,000.00 | (IBS x (6/12)) |
| b. | Direct Salary with research effort (30%) | $ 36,000.00 | (a x .30) |
| c. | Fringe Benefit Requested at 25% of salary | $ 9,000.00 | (b x .25) |
| d. | SUBTOTAL | $ 45,000.00 | (b + c) |
| e. | Requested F&A (indirect) costs at 45% of subtotal | $ 20,250.00 | (d x .45) |
| f. | Total amount requested | $ 65,250.00 | (d + e) |
The salary cap for the above individual will be calculated as follows:
g. |
Salary Cap FY 2024 |
$ 221,900.00 |
|
h. |
Salary Cap FY 2024 (6-month rate) |
$ 110,950.00 |
(g x (6/12)) |
i. |
Salary Cap with Research effort (30%) |
$ 33,285.00 |
(h x .30) |
j. |
Fringe Benefits calculated at 25% of allowable salary |
$ 8,321.25 |
(i x .25) |
k. |
SUBTOTAL |
$ 41,606.25 |
(i + j) |
l. |
Associated F&A (indirect) costs at 45% of subtotal |
$ 18,722,81 |
(k x .45) |
m. |
Total amount to be awarded due to salary limitation |
$ 60,329.06 |
(k + l) |
Therefore, the amount of reduction due to federal salary limitation is:
n. | Total Adjustment | $ (4,920.94) | (m-f) |
For all examples:
- the Institutional Full-Time base salary (IBS) is $240,000
- the requested Fringe Benefits rate is 25% of the direct salary
- the (F&A) indirect cost rate is 45%.
- the salary cap for grant awards/contracts issued on or after January 1, 2024, is $221,900
Example 3. Individual with a Nine-Month Appointment
Research effort requested in application/proposal – 9 months (30% effort)
| a. | Individual's institutional base salary for a nine-month calendar year appointment | $ 180,000.00 | (IBS x (9/12)) |
| b. | Direct salary requested | $ 54,000.00 | (a x .30) |
| c. | Fringe Benefit Requested at 25% of salary | $ 13,500.00 | (b x .25) |
| d. | SUBTOTAL | $ 67,500.00 | (b + c) |
| e. | Requested F&A (indirect) costs at 45% of subtotal | $ 30,375.00 | (d x .45) |
| f. | Total amount requested | $ 97,875.00 | (d + e) |
The salary cap for the above individual will be calculated as follows:
| g. | Salary Cap – FY 2024 | $ 221,900.00 | |
| h. | Salary Cap – FY 2024 (9-month rate) | $ 166,425.00 | (g x (9/12)) |
| i. | Salary Cap with Research effort (30%) | $ 49,927.50 | (h x .30) |
| j. | Fringe Benefits calculated at 25% of allowable salary | $ 12,481.88 | (i x .25) |
| k. | SUBTOTAL | $ 62,409.38 | (i + j) |
| l. | Associated F&A (indirect) costs at 45% of subtotal | $ 28,084.22 | (k x .45) |
| m. | Total amount to be awarded due to salary limitation | $ 90,493.60 | (k + l) |
Therefore, the amount of reduction due to federal salary limitation is:
n. | Total Adjustment | $ (7,381.40) | (m-f) |
Please direct all inquiries to:
Questions about specific awards may be directed to the Grants Management Specialist identified on the Notice of Award.
Questions related to the NIH salary cap policy may be directed to the Division of Grants Policy at: [email protected].
and Human Services (HHS)
