Hi Marcel,

 

I don’t have direct experience with this (what a good problem to have!), but here’s what I’m thinking based on the UG:

 

According to 2 CFR 200.307, “For Federal awards made to IHEs and nonprofit research institutions, if the Federal awarding agency does not specify in its regulations or the terms and conditions of the Federal award how program income is to be used, paragraph (e)(2) of this section must apply.” That is, the additive method under (e)(2) for handling program income applies. Under the additive method, “program income may be added to the Federal award by the Federal agency and the non-Federal entity. The program income must be used for the purposes and under the conditions of the Federal award.” Thus, income in excess can be used to benefit the a) original purpose of the Federal award, b) with all the usual cost principles considered including period of performance, as long as c) the award’s research terms and conditions allow it.

 

Harvard’s institutional guidance describes the additive method this way: “Program income funds are added to the sponsored award commitment and used to further eligible project or program objectives.  Funds may be retained and used to further eligible project or program objectives during the term of the award.  Generally, if the award is silent on the treatment of program income, the additive method is the default approach used for applying program income to sponsored awards.

 

Example: The sponsored award amount was $100,000.  $10,000 of program income is generated.  The total allowed project costs are now $110,000 ($100,000 expensed on the original award amount and $10,000 expensed on the program income earned)” [my emphasis; source].

 

Best,

Kelly

 

_____________

 

Kelly Searsmith, PhD , Illini Certified Research Administrator (she, her, hers)

Technical Research Writer, Department of Physics, The Grainger College of Engineering

     (research administration, faculty writing services, writing and literacy curriculum and instruction)

Member, National Council of University Research Administrators (NCURA)

Instructional Staff (Advanced Composition), Nuclear Weapons and Arms Control (PHYS/GLBL 280)

M.Ed. Candidate, Dept. of Education Policy, Organization, and Leadership--Higher Education   

     Concentration, College of Education

 

University of Illinois at Urbana-Champaign

290Y Loomis Laboratory of Physics, 1110 W Green St., MC 704

Urbana, IL 61801-3003

(217) 300-5336

 

Physics Illinois / LinkedIn

 

From: Research Administration List <xxxxxx@LISTS.HEALTHRESEARCH.ORG> On Behalf Of Villalobos, Marcel A - (marcel)
Sent: Wednesday, November 13, 2019 3:32 PM
To: xxxxxx@LISTS.HEALTHRESEARCH.ORG
Subject: [RESADM-L] Program Income in excess of project expenditures

 

Good day all,

 

We have a subaward that is through a prime HRSA agreement, and the project is generating a substantial amount of program income (additive treatment). The generation of income is large enough that we foresee a possibility where the program income alone will exceed the total project expenditures, leaving us with a surplus of program income without any more project expenses to net against it. We have not been able to find guidance in UG, DHHS, or HRSA documentation of what do with this excess program income in these circumstances. The closest clause deals with excess program income generated after the project, but not during.

 

Anybody run into this scenario?

 

Thanks,

Marcel

 

Marcel Villalobos
Assistant Director, Postaward Services
Sponsored Projects & Contracting Services

The University of Arizona
(520) 626-6311

 

 


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