Guidelines for Grant and Contract Management
405A. NIH Expanded Authorities
In the NIH Guide of December 23, 1994 (volume 23, number 45), the NIH published a revision to its implementation of expanded authorities. This revision is based on changes made to OMB Circular A-110 and DHHS regulations appearing in 45 CFR Part 74, the Administration of Grants. Grants awarded with expanded authorities are subject to NIH Institute or Center (IC) staff review under specific conditions. NIH modified two of these conditions (unobligated balances; significant rebudgeting) in a subsequent edition of the NIH Guide (January 20, 1995; volume 24, number 2). A copy of the NIH revision to expanded authorities of December 1994 (and modifications to the two items above in January 1995) appear below. Also see NIH Administrative Requirements. – February 1996
Waiver of Prior Approval
Effective October 1, 1994, the National Institutes of Health (NIH) has revised its implementation of Expanded Authorities (PHS Grants Policy Statement Section 8 pages 5-8) based on recent revisions to OMB Circular A-110 and Department of Health and Human Services Regulations at 45 CFR Part 74.
Prior approval requirements (expanded authorities) for awards that support research, unless otherwise noted in the award notice or in the agency's regulations, are waived to:
(1) Incur preaward costs 90 calendar days prior to award. Preaward costs more than 90 calendar days prior to award require the prior approval of the Federal awarding agency. All preaward costs are incurred at the recipient's risk (i.e., the Federal awarding agency is under no obligation to reimburse such costs if for any reason the recipient does not receive an award or if the award is less than anticipated and inadequate to cover such costs).
(2) Initiate a one-time extension of the expiration date of the award of up to 12 months unless one or more of the following conditions apply. For one-time extensions, the recipient must notify the Federal awarding agency in writing with the supporting reasons and revised expiration date at least 10 days before the expiration date (project period end date) specified in the award. This one-time extension may not be exercised merely for the purpose of using unobligated balances, nor may grantees extend project periods previously extended by the NIH awarding office. Such extensions are not permitted where:
(i) The terms and conditions of award prohibit the extension.
(ii) The extension requires additional Federal funds.
(iii) The extension involves any change in the approved objectives or scope of the project.
(3) Carry forward unobligated balances to subsequent funding periods.
(4) Waive cost-related (rebudgeting) and administrative prior written approvals required by OMB Circulars A-21 and A-122.
(5) Authorize program income earned during the project period to be added to funds committed to the project by the Federal awarding agency and recipient and used to further eligible project or program objectives.
The application of expanded authorities is intended to eliminate unnecessary
administrative burdens of sponsored research for both grantee and awarding
office staff. Consistent with the revised Circular and HHS Regulations, the
new NIH implementation expands the routine coverage of grants awarded under
expanded authorities to include Program Project grants (P01s), Research Career
Awards (Ks), Minority High School Student Research Apprentice Program
awards (S03s), and all Research Project grants (Rs), except Phase I Small
Business Innovation Research (R43) and Small Business Technology Transfer
(R41) awards.
Prior Approvals Required
Individual awards may be excluded from the routine inclusion under expanded authorities based on the following criteria:
Grants that require close project monitoring or technical assistance, e.g., clinical trials, exceptional grantees, or certain large multi-project grants, may be excluded.
Grantees that have a consistent pattern of failure to adhere to appropriate reporting or notification deadlines may be excluded.
In accordance with 45 CFR Part 74, except for awards issued under the Small Business Innovation Research or Small Business Technology Transfer programs, awards to for-profit organizations are excluded from the additional cost alternative for general program income (item 5 above). On individual awards to non-profit institutions, awarding office discretion may be used to specify an alternative disposition for general program income, i.e., the deductive or combination alternative.
Although the Circular authorizes all NIH grant activities as eligible for expanded authorities, NIH staff have determined that certain grant activities, e.g., centers and training grants, should not automatically receive expanded authorities, in whole or in part, due to the routine requirement for close project monitoring or technical assistance. In addition, because of substantial programmatic involvement, cooperative agreements will also be routinely excluded from expanded authorities. However, awarding office discretion may be used to authorize expanded authorities for these grant activities and cooperative agreements on an individual or group award basis.
With recent revisions to the PHS Grants Policy Statement (April 1, 1994) and OMB Circular A-110, grants awarded with the expanded authorities described above will be subject to NIH Institute or Center (IC) staff review under the following conditions:
Review of Unobligated Balances
PHS policy (PHS Grants Policy Statement page 8-6) requires that when a grantee reports on the annual Financial Status Report a balance of unobligated funds in excess of 25 percent of the total amount awarded, or $250,000, whichever is less, the Grants Management Officer (GMO) shall review the circumstances resulting in the large balance to assure that these funds are necessary to complete the project. The GMO may request additional information including a revised budget, withdraw the unobligated funds, authorize the grantee to spend the unobligated funds, or leave the unobligated funds in the grant account in the payment system for utilization as determined by the PHS awarding office. [Note: this section has been modified pursuant to the NIH Guide, January 20, 1995, volume 24, number 2, p. 2).
Significant Rebudgeting
PHS policy (PHS Grants Policy Statement pages 8-1 and 8-7) requires that when significant rebudgeting (which continues to be an indicator for a possible change in scope) occurs, the grantee shall consult with the Grants Management Officer for a decision as to whether the rebudgeting constitutes a change of scope. As a guideline, significant rebudgeting as defined by PHS occurs when the cumulative amount of transfers among direct cost categories for the current budget period exceeds 25 percent of the total amount awarded, or $250,000, whichever is less. [Note: this section has been modified pursuant to the NIH Guide, January 20, 1995, volume 24, number 2, p. 2).
Rebudgeting of Time
OMB Circular A-110 requires grantees to seek prior approval from the awarding agency when anticipating a 25 percent reduction in time (e.g., percent effort reduction from 40 to 30 percent) devoted to the project by the approved project director or principal investigator.
Each Notice of Grant Award issued with budget period begin dates after October 1, 1994, will carry a term and condition to indicate whether or not the award is subject to expanded authorities. Questions concerning the new NIH implementation should be addressed to the NIH IC grants management staff identified on the Notice of Grant Award.
