standard terms of award, expanded authority, authorities, carryover of unobligated balances from one budget period to any subsequent budget period, cost-related prior approvals, extension of final budget period of a previously approved project period without additional NIH funds, Direct charging salaries of administrative and clerical staff, supplemental compensation under written institutional policy for IHEs, and intra-IHE faculty consulting that exceed a faculty member's base salary under certain conditions.

8.1.1 NIH Standard Terms of Award

Federal administrative requirements allow agencies to waive certain cost-related and administrative prior approvals; these are known as expanded authorities. In 2001, NIH extended expanded authorities to all NIH awards except for the provision to automatically carry over unobligated balances. Certain award instruments, grant programs, and types of recipients are routinely excluded from the authority to automatically carry over unobligated balances. This includes centers (P50, P60, P30, and others); cooperative agreements (U); Kirschstein-NRSA institutional research training grants (T); non-Fast Track Phase 1 SBIR and STTR awards (R43 and R41); clinical trials (regardless of activity code); and awards to individuals.

One or more of these authorities may be overridden by a specific term or condition of the award. Recipients must review the NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system. to determine if a particular authority is withheld for a specific grant.

Recipients must exercise proper stewardship over Federal funds and ensure that costs charged to awards are allowable, allocable, reasonable, necessary, and consistently applied regardless of the source of funds. NIH may disallow the costs if it determines, through audit or otherwise, that the costs do not meet the tests of allowability, allocability, reasonableness, necessity, and consistency.

Several authorities have specific deadlines for submission of reports or for timely notification to the NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award.. Recipients should be aware that any consistent pattern of failure to adhere to those deadlines for reporting or notification will be grounds for excluding that recipient from a specific authority.

Exhibit 6. Summary of NIH Standard Terms of Award

Recipient Authorities as NIH Standard Terms of Award Exceptions
Carryover of unobligated balances from one budget period to any subsequent period Centers (P50, P60, P30 and others), cooperative agreements (U), Kirschstein-NRSA institutional research training grants (T), non-Fast Track Phase I SBIR and STTR awards (R43 and R41), clinical trials, and awards to individuals, or if the NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system. indicates otherwise.
Cost-related prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). changes, including research patient care costs and equipment The cost would result in a change of scope.
Extension of final budget period of a project period without additional NIH funds (no-cost extension) The recipient has already exercised its one-time authority to extend the award for up to 12 months; the NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award. has previously extended the project period; and/or a project is multi-year for 5 years (i.e., the entire 5-year project period is funded by a single award).
Transfer of performance of substantive programmatic work to a third party (by consortium agreement A formalized agreement whereby a research project is carried out by the recipient and one or more other organizations that are separate legal entities. Under the agreement, the recipient must perform a substantive role in the conduct of the planned research and not merely serve as a conduit of funds to another party or parties. These agreements typically involve a specific level of effort from the consortium organization's PD/PI and a categorical breakdown of costs, such as personnel, supplies, and other allowable expenses, including F&A costs. The relationship between the recipient and the collaborating organizations is considered a subaward relationship. (See Consortium Agreements chapter in IIB).) The transfer would be to a foreign component or it would result in a change in scope.
Direct charge the salaries of administrative and clerical staff if conditions in 2 CFR Part 200.413 are met and the charges also meet the criteria for allowable costs described in 2 CFR Part 200.403.  
Direct charge payments of Incidental activities for which supplemental compensation is allowable under written institutional policy (at a rate not to exceed the institutional base salary The annual compensation paid by an organization for an employee's appointment, whether that individual's time is spent on research, teaching, patient care, or other activities. Base salary excludes any income that an individual may be permitted to earn outside of duties for the applicant/recipient organization. Base salary may not be increased as a result of replacing organizational salary funds with NIH grant funds. (See Cost Considerations-Allowability of Costs/Activities-Selected Items of Cost-Salaries and Wages).) 2 CFR Part 200.430. Such activities must be specifically provided for in the Federal award budget.  
Include charges for Intra-IHE faculty consulting on sponsored agreements that exceed a faculty member's base salary, but only in unusual cases where: (a) consultation is across departmental lines or involves a separate or remote operation; and (b) the consulting work is in addition to the faculty member's regular departmental load.  

8.1.1.1 Carryover of Unobligated Balances from One Budget Period to Any Subsequent Budget Period

Recipients should be aware that there is a difference between unliquidated obligations and unobligated balances. Unliquidated obligations are commitments of the recipient and are considered to be obligations and, therefore, should not be reported as unobligated balances.

The NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system. will include a term and condition to indicate the disposition of unobligated balances. The term and condition will state whether the recipient has automatic carryover authority, or if prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). is required by the NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award.. Note the authority to automatically carry over unobligated balances includes the authority to carryover from one competitive segment to another.

Automatic carryover of unobligated balances applies to all awards except centers (P50, P60, P30, other), cooperative agreements (U), Kirschstein-NRSA institutional research training grants (T), non-Fast Track Phase I SBIR and STTR awards (R43 and R41), clinical trials (regardless of activity code), and awards to individuals. For these grants, carryover of unobligated balances requires NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award. prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). unless otherwise noted in the NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system.. Other awards may be excluded from this authority through a specific term or condition in the NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system..

For awards under SNAP (see Administrative Requirements-Monitoring-Reporting-Streamlined Non-Competing Award Process for applicability), funds are automatically carried over to the subsequent budget period. However, the recipient will be required to indicate, as part of the grant's progress report, whether any estimated unobligated balance (including prior-year carryover) is expected to be greater than 25 percent of the current year's total approved budget. The total approved budget amount includes current year and any carryover from prior years of the project period. If the unobligated balance is greater than 25 percent of the total approved budget, the recipient must provide an explanation and indicate plans for expenditure of those funds within the current budget year.

For awards that require an annual FFR, the amount to be carried over must be specified under item 12, "Remarks."

For both SNAP and non-SNAP, when a recipient reports a balance of unobligated funds in excess of 25 percent of the total amount awarded for the budget period, plus any approved carryover of funds from a prior year(s), the GMO will review the circumstances resulting in the balance to ensure that these funds are necessary to complete the project, and may request additional information from the recipient, including a revised budget, as part of the review.

If the GMO determines that some or all of the unobligated funds are not necessary to complete the project, the GMO may restrict the recipient's authority to automatically carry over unobligated balances in the future, use the balance to reduce or offset NIH funding for a subsequent budget period, or use a combination of these actions. The GMO also may indicate whether the balance may be carried forward to a budget period other than the succeeding one. The GMO's decision about the disposition of the reported unobligated balance will be reflected in the terms and conditions of the NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system..

All Federal agencies are required by 31 U.S.C. §1552(a) to close fixed year appropriation accounts and cancel any remaining balances by September 30 of the fifth fiscal year after the year of availability, unless otherwise authorized by Congress. In order for NIH to meet its obligation to close these accounts and cancel any remaining balances by September 30th, recipients must report disbursements on the FFR no later than August 31st of the fifth fiscal year after the year of availability. At the end of five years, the funds are cancelled and returned to the Treasury. This provision may limit the availability of funds for carryover.

8.1.1.2 Cost-Related Prior Approvals

NIH prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). is not required to rebudget funds for any direct cost Costs that can be identified specifically with a particular sponsored project, an instructional activity, or any other institutional activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. item that the applicable cost principles The government-wide principles, issued by OMB (or, in the case of commercial organizations, the Federal Acquisition Regulation [48 CFR 21], or, in the case of hospitals, 45 CFR 75, Appendix IX, "Principles For Determining Costs Applicable to Research and Development Under Grants and Contracts with Hospitals"), on allowability and unallowability of costs under federally sponsored agreements. See Cost Considerations-The Cost Principles for additional details. identify as requiring the Federal awarding agency's prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements)., unless the incurrence of costs is associated with or is considered to be a change in scope.

8.1.1.3 Extension of Final Budget Period of a Previously Approved Project Period without Additional NIH Funds

The recipient may extend the final budget period of the previously approved project period one time for a period of up to 12 months beyond the original completion date shown in the NoA Notice of Award: The official, legally binding document, signed (or the electronic equivalent of signature) by a Grants Management Officer that: (1) notifies the recipient of the award of a grant; (2) contains or references all the terms and conditions of the grant and Federal funding limits and obligations; and, (3) provides the documentary basis for recording the obligation of Federal funds in the NIH accounting system. if:

Such an action affirms that additional work remains to be completed on the project and that resources are available to continue to support the project, or that additional time is needed to provide for an orderly closeout. The fact that funds remain at the completion date of the grant is not, in itself, sufficient justification for an extension without additional funds.

With the exception of grant programs that have an effort requirement, or where terms and conditions prohibit such reductions, NIH will not require prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). for the reduction in effort for Senior/Key personnel named in the NOA. The recipient is reminded that active awards must have a measurable level of effort.

Recipients must use the eRA Commons No-Cost Extension feature to electronically notify NIH that they are exercising their one-time authority to extend without funds the completion date of an award. This extension feature becomes available to the recipient 90 days before the project period end date. Extensions may be up to 12 months beyond the final budget period end date. In the eRA Commons, this notification can be made up to the last day of the current project end date. An e-mail notification is automatically sent to the GMO. No further action by the recipient is required.

Notifications may not be submitted via e-mail or fax. If a no-cost extension notification is submitted late, the eRA Commons No-Cost Extension feature cannot be used. Instead, the extension notification becomes a request and that requires the approval of the IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award. GMO. Recipients who miss the window (or opportunity) to extend the grant in eRA Commons must submit a written prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). request to the NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award. for consideration. (See Administrative Requirements-Prior Approval Requirements for extension requiring additional funds.)

In extending the final budget period of the project period through this process, the recipient agrees to update all required certifications and assurances, including but not limited to those pertaining to human subjects and vertebrate animals, in accordance with applicable regulations and policies. Recipients are reminded that all terms and conditions of the award apply during the extension period.

Recipients may not extend project periods that were previously extended by the NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award.. Any additional project period extension requires NIH prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements).. (See Administrative Requirements-Prior Approval Requirements for extensions requiring additional funds.)

All Federal agencies are required by 31 U.S.C. §1552(a) to close fixed year appropriation accounts and cancel any remaining balances by September 30 of the fifth fiscal year after the year of availability. In order for NIH to meet its obligation to close these accounts and cancel any remaining balances by September 30, recipients must report disbursements on the quarterly cash transaction report (using the FFR) no later than August 31st of the fifth fiscal year after the year of availability. At the end of five years, the funds are cancelled and returned to the Treasury. This provision may limit or eliminate this authority to extend the final budget period when an entire project period is funded by a single award (e.g., multiyear funded awards).

The provisions in this subsection do not apply to fellowship awards.

8.1.1.4 Transfer of the Performance of Substantive Programmatic Work to a Third Party by Means of a Consortium Agreement

Prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). by the NIH awarding IC The NIH organizational component responsible for a particular grant program or set of activities. The terms "NIH IC," or "awarding IC" are used throughout this document to designate a point of contact for advice and interpretation of grant requirements and to establish the focal point for requesting necessary prior approvals or changes in the terms and conditions of award. is not required to transfer the performance of already peer reviewed programmatic work unless the activity constitutes a change in scope or results in the transfer of substantive programmatic work to a foreign component.

8.1.1.5 Direct Charging Salaries of Administrative and Clerical Staff

The salaries of administrative and clerical staff should normally be treated as indirect (F&A) costs. Direct charging of these costs may be appropriate only if all of the following conditions are met:

  1. Administrative or clerical services are integral to a project or activity;
  2. Individuals involved can be specifically identified with the project or activity;
  3. Such costs are explicitly included in the budget; and
  4. The costs are not also recovered as indirect costs Necessary costs incurred by a recipient for a common or joint purpose benefitting more than one cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. To facilitate equitable distribution of indirect expenses to the cost objectives served, it may be necessary to establish a number of pools of F&A (indirect) costs. F&A (indirect) cost pools must be distributed to benefitted cost objectives on bases that will produce an equitable result in consideration of relative benefits derived..

Such charges must also meet the criteria for allowable costs described in 2 CFR Part 200.403.

NIH prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). is not required to rebudget funds for this direct cost Costs that can be identified specifically with a particular sponsored project, an instructional activity, or any other institutional activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. item post-award. Prior approval Written approval by an authorized HHS official, e.g., a designated IC GMO, evidencing prior consent before a recipient undertakes certain activities or incurs specific costs (see Administrative Requirements-Changes in Project and Budget-Prior Approval Requirements). is only required when additional funds are being requested for such a position.

8.1.1.6 Supplemental Compensation under Written Institutional Policy for IHEs

IHEs may direct charge payments of incidental activities for which supplemental compensation is allowable under written institutional policy (at a rate not to exceed the institutional base salary The annual compensation paid by an organization for an employee's appointment, whether that individual's time is spent on research, teaching, patient care, or other activities. Base salary excludes any income that an individual may be permitted to earn outside of duties for the applicant/recipient organization. Base salary may not be increased as a result of replacing organizational salary funds with NIH grant funds. (See Cost Considerations-Allowability of Costs/Activities-Selected Items of Cost-Salaries and Wages).) and not include them in the records described in 2 CFR Part 200.430. Such activities must be specifically provided for in the Federal award budget.

8.1.1.7 Intra-IHE Faculty Consulting that Exceed a Faculty Member's Base Salary, Under Certain Conditions.

IHEs may include charges for Intra-IHE faculty consulting on sponsored agreements that exceed a faculty member's base salary, but only in unusual cases where: (a) consultation is across departmental lines or involves a separate or remote operation; and (b) the consulting work is in addition to the faculty member's regular departmental load.