ARCHIVED - NIH Grants Policy Statement (10/03)
NIH Grants Policy Statement
Part II: Terms and Conditions of NIH Grant Awards
Subpart A: General -- File 2 of 5
Requirements Affecting the Rights and
Welfare of Individuals as
Research Subjects, Patients, or Recipients of Services
Ban on Human Embryo Research and
NIH funds may not be used to support human embryo research
under any extramural award instrument. NIH funds may not be used for the
creation of a human embryo for research purposes or for research in which a
human embryo is destroyed, discarded, or knowingly subjected to risk of injury
or death greater than that allowed for research on fetuses in utero under
45 CFR 46.204 and 46.207 and subsection 498(b) of the PHS Act. The term
“human embryo” includes any organism not protected as a human subject under
45 CFR 46, as of the date of enactment of the governing appropriations
act, that is derived by fertilization, parthenogenesis, cloning, or any other
means from one or more human gametes or human diploid cells.
In addition to the statutory restrictions on human fetal
research under subsection 498((b) of the PHS Act, by Presidential memorandum of
March 4, 1997, NIH is prohibited from using Federal funds for cloning of human
Research on Human Fetal Tissue
Human fetal tissue is defined as tissue or cells obtained
from a dead human embryo or fetus after a spontaneous or induced abortion or
stillbirth. This definition does not include established human fetal cell
lines. Research involving the transplantation of human fetal tissue must be
conducted in accordance with applicable State and local laws as well as the
following NIH guidance.
NIH guidance for grantees
conducting research on human fetal tissue and other information on the
governing Federal statute, sections 498A and 498B of the PHS Act, 42 U.S.C.
289g-1 and 298g-2, is available on the NIH website at http://grants.nih.gov/grants/guide/notice-files/not93-235.html.
The scientific and ethical challenges associated with
research utilizing human fetal tissue make it imperative that researchers and
their organizations be fully aware of and in compliance with the Federal
requirements, particularly section 498B. When an application involving human
fetal tissue research is submitted to NIH, the AOO’s signature certifies that
researchers using these tissues are in compliance with section 498B of the PHS
Act. The statute specifically prohibits any person from knowingly acquiring,
receiving, or transferring any human fetal tissue for valuable consideration.
The term “valuable consideration” is a concept similar to profit and does not
include reasonable payment for costs associated with the collection,
processing, preservation, storage, quality control, or transportation of these
tissues. Violation of this statute carries criminal penalties that apply to
both those that supply and those that acquire human fetal tissue.
Sections 498A and 498B contain
additional legal requirements for research on the transplantation of human
fetal tissue for therapeutic purposes conducted or supported by NIH. Under
section 498A, the official who signs the application is certifying that the
research on transplantation of human fetal tissue will adhere to the following
The woman who donates the fetal tissue must sign a statement
declaring that the donation is being made
for therapeutic transplantation research,
without any restriction regarding the identity of individuals who
may receive the transplantation, and
without the donor knowing the identity of the recipient.
The attending physician must sign a statement that he/she has
obtained the tissue in accordance with the donor’s signed
fully disclosed to the donor his or her intent, if any, to use
the tissue in research and any known medical risks to the donor or risks to her
privacy associated with the donation that are in addition to risks associated
with the woman’s medical care.
In the case of tissue obtained
pursuant to an induced abortion, the physician’s statement also must state that
obtained the woman’s consent for the abortion before requesting
or obtaining consent for the tissue to be used;
did not alter the timing, method, or procedures used to terminate
the pregnancy solely for the purpose of obtaining the tissue for research; and
performed the abortion in accordance with applicable State and
PI must sign a statement certifying that he/she is aware that the tissue is
human fetal tissue obtained in a spontaneous or induced abortion, or pursuant
to a stillbirth and that the tissue was donated for research purposes. The PI
also must certify that this information has been shared with others who have
responsibilities regarding the research and, before eliciting informed consent
from the transplantation recipient, will obtain written acknowledgment that the
patient is aware of the aforementioned information.
PI must certify in writing that he/she has had no part in any decisions as to
the timing, method, or procedures used to terminate the pregnancy.
The AOO also is certifying that the physician’s statement,
the PI’s statement, and the acknowledgment of the transplantation recipient
will be available for audit by the HHS Secretary or designee.
In submitting an application to NIH, the AOO that signs the
application is certifying that, if research on the transplantation of human
fetal tissue is conducted under the grant-supported project, the organization
will make available for audit by the HHS Secretary or designee, the physician
statements and informed consents required by subsections 498A(b)(2) and (c) of
the PHS Act or will ensure HHS access to those records, if maintained by an
entity other than the grantee. This requirement is in addition to the
requirements concerning human subjects in research.
In addition, FDA issued a letter on November 30, 2000,
indicating that it has jurisdiction over fetal cells and tissues intended for
use in humans. FDA is requesting that investigators contact them to determine
whether any planned or ongoing clinical research would require submission of an
IND application. Additional information and FDA contact information is
available at http://www.fda.gov/cber/ltr/fetal113000.htm.
NIH expects grantees and others involved in NIH
grant-supported research to take appropriate actions to protect the
confidentiality of information about and the privacy of individuals
participating in the research. Investigators, DSMBs, IRBs, and other
appropriate entities should ensure that policies and procedures are in place to
protect identifying information and must oversee compliance with those policies
Certificates of Confidentiality
Section 301(d) of the PHS Act provides that the Secretary
may authorize people engaged in biomedical, behavioral, clinical, or other
research activities to protect the privacy of research subjects by withholding
the names and other identifying characteristics of those subjects from
individuals not engaged in the research. Individuals that have authorization
may not be compelled to disclose subjects’ identities in any Federal, State, or
local civil, criminal, administrative, legislative or other proceeding. CoCs
may be granted for studies collecting information that, if disclosed, could
have adverse consequences for subjects or damage their financial standing,
employability, insurability, or reputation. By protecting researchers from
being compelled to disclose information that would identify research subjects,
CoCs contribute to achieving research objectives and promote participation in
studies by helping to ensure confidentiality and privacy to participants.
Information on CoCs is available on the NIH website at the CoC Kiosk at http://grants.nih.gov/grants/policy/coc/index.htm.
Requests for CoCs should be submitted to the GMO, and, subject to awarding
office review and approval, a certificate may be issued pursuant to section
Section 543 of the PHS Act requires that records of
substance abuse patients be kept confidential except under specified
circumstances and purposes. The covered records are those that include the
identity, diagnosis, prognosis, or treatment of any patient maintained in
connection with any program or activity relating to substance abuse education,
prevention, training, treatment, rehabilitation, or research that is conducted,
regulated, or directly or indirectly assisted by any department or agency of
the United States. This requirement is implemented in 42 CFR Part 2.
for Privacy of Individually Identifiable Health Information
HHS issued the final version of the “Standards for Privacy
of Individually Identifiable Health Information”—the Privacy Rule—on August 14,
2002. The Privacy Rule is a Federal regulation under the Health Insurance
Portability and Accountability Act (HIPAA) of 1996 that governs the protection
of individually identifiable health information. It is administered and
enforced by OCR, HHS. Those entities required to comply with the Privacy Rule
(classified under the rule as “covered entities”) had until April 14, 2003 to
do so (with the exception of small health plans which have an extra year to
Decisions about applicability and implementation of the
Privacy Rule reside with the researcher and the grantee organization. The OCR
provides information on the Privacy Rule, including the complete text of the
regulation and a set of decision tools for determining whether a particular
entity is subject to the rule. An educational booklet, Protecting Heath
Information in Research: Understanding the HIPAA Privacy Rule, is available
through OCR’s website and also at http://privacyruleandresearch.nih.gov/. That website also
includes other educational materials sanctioned by OCR and the Office of the
General Counsel, HHS. Additional information on the impact of the Privacy Rule
on NIH processes involving the review, funding, and performance monitoring of
grants can be found at http://grants.nih.gov/grants/guide/notice-files/NOT-OD-03-025.html.
If controlled substances are proposed to be administered as
part of a research protocol or if research is to be conducted on the drugs
themselves, applicants/grantees must ensure that the DEA requirements,
including registration, inspection, and certification, as applicable, are met.
Regional DEA offices can supply forms and information concerning the type of
registration required for a particular substance for research use. The main
registration office in Washington, DC may be reached at 800-882-9539.
Information also is available from the National Institute on Drug Abuse at
HHS regulations for the protection of human subjects, in
45 CFR Part 46, implement section 491(a) of the PHS Act and provide a
systematic means, based on established, internationally recognized ethical
principles, to safeguard the rights and welfare of individuals who participate
as subjects in research activities supported or conducted by NIH or other HHS
The Federal regulations require that each institution,
domestic or foreign, “engaged” in human subjects research provide OHRP with a
satisfactory Assurance of compliance with the regulations, unless the research
is exempt under 45 CFR 46.101(b). An institution becomes “engaged” in human
subjects research when its employees or agents
(1) intervene or interact with living individuals for research purposes, or (2)
obtain individually identifiable private information for research purposes (45
CFR 46.102(d) and (f)).
The HHS regulations require that departments and agencies
(e.g., NIH) will conduct or support research covered by this policy only if the
institution has an assurance approved by OHRP, and only if the institution has
certified to NIH that the research has been reviewed and approved by an IRB
provided for in the assurance and will be subject to continuing review by the
IRB. Under no condition shall research covered by the regulations be supported
prior to receipt of the certification that the research has been reviewed and
approved by the IRB (45 CFR 46.103(b) and (f)).
If, at the time of award, a grantee does not have an
assurance approved by OHRP and certification of IRB review and approval, NIH
will place a restriction on the award so that no human subjects research can be
conducted or supported at that site until the assurance and certification of
IRB review and approval have been obtained and accepted by NIH. The awardee
institution bears ultimate responsibility for protecting human subjects under
the award, including human subjects at all participating and consortium sites,
and for ensuring that an Assurance approved by OHRP and certification of IRB
review and approval have been obtained before human subjects research can be
conducted at each collaborating site.
For this requirement, the
definitions in 45 CFR 46.102 apply as follows:
subject. A living individual about whom an investigator (whether
professional or student) conducting research obtains (1) data through
intervention or interaction with the individual or (2) identifiable private
A systematic investigation, including research, development, test, and
evaluation, designed to develop or contribute to generalizable knowledge.
Activities which meet this definition constitute research for purposes of this
policy, whether or not they are conducted or supported under a program which is
considered research for other purposes. For example, some demonstration and
service programs include research activities.
The use of autopsy materials is governed by applicable State
and local law and is not directly regulated by 45 CFR 46.
OHRP negotiates assurances covering all of an organization’s
federally supported research activities involving human subjects.  Applicant
organizations proposing to involve human subjects in nonexempt research must
file (or have previously filed) a written assurance (FWA) with OHRP setting
forth the commitment of the organization to establish appropriate policies and
procedures for the protection of human subjects. For organizations proposing
nonexempt research involving human subjects and not currently holding an
approved assurance, OHRP will negotiate an FWA.
Each legally separate entity must file its own FWA even if
the organization does not operate its own IRB and designates another IRB
(registered with OHRP and agreeing to the designation) for that purpose.
Affiliated organizations or organizations that will serve as additional
performance sites for the grant-supported research also must file an FWA. No
individual may receive NIH grant funds for nonexempt research involving human
subjects unless the individual is affiliated with or sponsored by an
organization that assumes responsibility for the research under an FWA or the
individual makes other arrangements with OHRP.
Detailed information concerning FWAs, including the OHRP
Assurance Training Module, is available on the OHRP website (http://www.hhs.gov/ohrp/).
In addition to the requirement for an assurance, NIH will
not award a grant for nonexempt research in which human subjects are involved
unless the grantee provides a certification to NIH that the research has been
approved by an appropriate IRB, consistent with 45 CFR Part 46, within 12
months before the budget period start date. IRB approval is not required before
NIH peer review of an application. Rather, following peer review and
notification of priority score/percentile, applicant organizations should
proceed with IRB review for those applications that have not yet received IRB
approval and that appear to be in a fundable range. Regardless of when the IRB
review occurs, the IRB should ensure that the research described in the
application is consistent with any corresponding protocols reviewed and
approved by the IRB.
It is the grantee organization’s responsibility to ensure
that all sites engaged in research involving human subjects have an appropriate
OHRP-approved assurance and IRB approval of the research consistent with
45 CFR Part 46. It also is the grantee’s responsibility to comply with NIH
prior-approval requirements related to the addition of sites not included in
the approved application (see “Administrative
Requirements—Changes in Project and Budget—Prior-Approval Requirements”).
The list of organizations with approved assurances is available at the OHRP
website (http://www.hhs.gov/ohrp). Grantees may not draw
funds from the payment system, request funds from the paying office, or make
obligations against Federal funds for research involving human subjects at any
site engaged in nonexempt research for any period not covered by both an
OHRP-approved assurance and IRB approval consistent with 45 CFR Part 46. Costs
associated with IRB review of human research protocols are not allowable as
direct charges to NIH-funded research unless such costs are not covered by the
organization’s F&A rate.
As specified in 45 CFR
46.111, the IRB review must include a determination that, for research covered
by the regulations, the following conditions are met:
procedures to be used will minimize risks to subjects.
to subjects are reasonable in relation to expected benefits, if any, to
subjects and the importance of the knowledge that may reasonably be expected to
of subjects is equitable.
consent is sought from each prospective subject or the subject’s legally
authorized representative and is appropriately documented in accordance with,
and to the extent required by, the regulation.
appropriate, the research plan makes adequate provision for monitoring the data
collected to ensure the safety of subjects, the protection of privacy, and the
confidentiality of data.
some or all of the subjects are likely to be vulnerable to coercion or undue
influence, such as children, prisoners, pregnant women, people with acute or
severe physical or mental illness, or people who are economically or
educationally disadvantaged, appropriate additional safeguards are included in
the study to protect the rights and welfare of these subjects.
If an IRB considers the impact of potential financial (or
other) conflicts of interest on the research and the protection of human
subjects, it should refer to the organization’s policies and procedures for
identifying and monitoring conflicts of interest (see “Public Policy Requirements and
Objectives—Ethical and Safe Conduct in Science and Organizational
Operations—Standards of Conduct—Financial Conflict of Interest”).
The regulations specify additional protections for research
involving human fetuses, pregnant women, and neonates (Subpart B); prisoners
(Subpart C); and children (Subpart D).
OHRP also has responsibility for oversight of grantee
compliance with the HHS human subjects regulations. In carrying out this
responsibility, OHRP evaluates all written allegations or indications of
non-compliance with the HHS regulations it receives from any source. All
compliance oversight evaluations are predicated on the HHS regulations and the
organization’s assurance of compliance. Any corrective actions imposed as a
result of compliance oversight evaluations are intended to remedy identified
non-compliance and prevent reoccurrence. Because each case is different, OHRP
tailors corrective actions to foster the best interest of human research
subjects and, to the extent possible, of the organization, research community,
and HHS. Most compliance oversight evaluations and resultant corrective actions
are resolved at the OHRP level. However, OHRP may recommend actions to be taken
by other HHS officials.
Information about FWA preparation and negotiation and about
OHRP activities related to oversight and compliance, as well as copies of the
human subjects regulations, may be obtained from OHRP at the address shown in
Part III or from its home page at http://www.hhs.gov/ohrp. OHRP also has produced a publication, available
through the GPO,
and an instructional videotape.
Before funds are awarded for competing applications
involving human subjects, applicants must submit documentation that all key
personnel have received training in the protection of human subjects. Key
personnel include all individuals responsible for the design or conduct of the
study, including key personnel of consortium participants or alternate
performance sites if they are participating in research that involves human
subjects. This documentation should be part of a cover letter signed by the AOO
that accompanies the description of other support, IRB and IACUC approval, and
other information submitted prior to funding in accordance with just-in-time
procedures. For non-competing continuation awards, the description of education
for new key personnel should be part of the progress report submitted as a
prerequisite to award. Additional information about this education requirement
is available on the NIH website at: http://grants.nih.gov/grants/policy/hs_educ_faq.htm.
Data and Safety Monitoring
For all federally funded research involving human subjects,
the regulations for the protection of human subjects (45 CFR 46) specify
criteria for IRB approval of research and require, at 45 CFR 46.111(a)(6), that
“[W]hen appropriate, the research plan makes adequate provision for monitoring
the data collected to ensure the safety of subjects.”
NIH provides the following more specific requirements for
data and safety monitoring. NIH requires oversight and monitoring of all human
intervention studies (clinical trials) to ensure the safety of participants and
the validity and integrity of the data. The NIH policies on data and safety
monitoring specify that the level of monitoring should be commensurate with the
risks and the size and complexity of the clinical trial, and are in addition to
any monitoring requirements imposed by FDA or the NIH Guidelines for
Research Involving Recombinant DNA Molecules. The frequency of monitoring
will depend on potential risks, complexity, and the nature of the trial;
therefore, a number of options for monitoring trials are available. These can
include, but are not limited to, monitoring by a/an
committee or board with explicit guidelines,
(required for multi-site trials), and
For competing research applications including clinical
trials, the applicant must include a general description of the data and safety
monitoring for review by the SRG. A general description of a monitoring plan
establishes the overall framework for data and safety monitoring. It should
describe the entity that will be responsible for monitoring and how adverse
events will be reported to the IRB) and, if appropriate, OBA, and FDA in
accordance with IND or IDE regulations. In specific cases where the NIH
awarding office is the sponsor of the test agent, i.e., the holder of the IND application, investigators must submit individual adverse event reports to the awarding
office in accordance with FDA regulations.
A detailed monitoring plan must be included as part of the
research protocol, be submitted to the local IRB, and be reviewed and approved
by the NIH awarding office prior to the accrual of human subjects. The awarding
office may specify the reporting requirements for adverse events, which are in
addition to the annual report to the IRB. The clinical trial monitoring
function is above and beyond that traditionally provided by IRBs; however, the
IRB must be cognizant of the procedures used by clinical trial monitoring
entities and the monitor must provide periodic reports to investigators for
transmittal to the local IRB.
NIH specifically requires the establishment of DSMBs for
multi-site clinical trials involving interventions that entail potential risk
to the participants, and generally for Phase III clinical trials. Although
Phase I and Phase II clinical trials also may use DSMBs, smaller clinical trials
may not require this oversight format, and alternative monitoring plans may be
For multi-site Phase I and II trials, investigators should
organize a central reporting entity that will be responsible for preparing
timely summary reports of adverse events for distribution among sites and the
IRBs of participating sites. The frequency of summary reports will depend on
the nature of the trial. Organizations with a large number of clinical trials
may develop standard monitoring plans for Phase I and II clinical trials.
However, such plans should always be evaluated for appropriateness for the
For multi-site Phase I and II trials, investigators should
organize a central reporting entity that will be responsible for preparing
timely summary reports of adverse events for distribution among sites and the
IRBs of participating sites. The frequency of summary reports will depend on
the nature of the trial. Organizations with a large number of clinical trials
may develop standard monitoring plans for Phase I and II clinical trials.
However, such plans always should be evaluated for appropriateness for the
All multi-site trials with DSMBs are expected to forward
summary reports of adverse events to individual IRBs so they can address
reports related to the site for which they have responsibility. Grantees should
address questions on this subject to the NIH PO.
Further information concerning these requirements is
contained in several NIH Guide for Grants and Contracts notices (http://grants.nih.gov/grants/guide/notice-files/not99-107.html,
and the PHS 398 instructions (http://grants.nih.gov/grants/funding/phs398/instructions2/p1_specific_instructions.htm#e_Human_Subjects_Research).
To be eligible for NIH funding, all clinical research
involving INDs, drugs approved for a different indication, or experimental
combinations of drugs must meet FDA’s IND regulations, FDA’s human subjects’
protection requirements, and HHS’s human subjects’ requirements. As provided in
the FDA regulations, an IND or IDE also may apply to biologics or devices. The
FDA regulations are published in 21 CFR Parts 50 and 312.
The official sponsor of the IND/IDE, whether NIH, a grantee,
or a third party, is legally responsible for meeting the FDA requirements. If
the IND/IDE sponsor is a third party, such as a pharmaceutical company or
research organization under contract to a grantee or to a pharmaceutical
company, the legal responsibility for monitoring the clinical trial and
reporting to FDA rests with the sponsor rather than the grantee. This generally
will be the case for larger, multi-site clinical trials. If the grantee is the
IND/IDE holder, commonly referred to as an “investigator-initiated IND/IDE,”
the grantee or the investigator serves as the sponsor and assumes the legal
responsibility. In any case, the grantee is ultimately responsible to NIH for
ensuring compliance with the requirements for protection of human subjects,
including compliance with FDA’s requirements.
Following the filing of an IND, FDA has a 30-day period in
which to review it. FDA may allow the IND to proceed or may defer approval of
the IND until changes it deems acceptable are made. FDA also may order a
clinical trial to be suspended or terminated, at any time, based on information
it receives about that clinical trial.
When NIH funds all, or part
of, a clinical study involving an IND or an IDE, NIH must be knowledgeable
about any significant communications with FDA concerning the study. The grantee
organization must report certain types of FDA communications to the NIH
awarding office within 72 hours of receiving a copy of or upon being informed
of the FDA communication (through the PI or another person acting on behalf of
the grantee), whichever occurs first. This notification requirement applies to
any of the following communications from FDA with the sponsor of the IND or IDE:
letters (whether sent to the grantee or to the commercial sponsor)
of Initiation of Disqualification Proceedings and Opportunity to Explain
of Opportunity for Hearing
hold letters that pertain to breaches of good manufacturing practices, good
clinical practices, or other major issue requiring significant changes in the
The notification should be made in writing, but also may be
done by telephone if a written notice would delay the notification. It should
include a statement of the action taken or contemplated and the assistance
needed to resolve the situation. These requirements apply to the grantee even
if the grantee or the NIH-funded PI is the sponsor. Failure to comply with this
requirement may result in NIH imposing a corrective and/or enforcement action
(see “Administrative Requirements—Enforcement
Actions”). FDA communications are considered grant-related records for
purposes of retention and access (see “Administrative
Requirements—Monitoring—Record Retention and Access”).
Public Law 103-227, Title X, Part C, Environmental Tobacco
Smoke, also known as the Pro-Children Act of 1994, imposes restrictions on
smoking in facilities where federally funded children’s services are provided.
NIH grants are subject to these requirements only if they meet the Act’s
specified coverage. The Act specifies that smoking is prohibited in any indoor
facility (owned, leased, or contracted for) used for the routine or regular
provision of kindergarten, elementary, or secondary education or library
services to children under the age of 18. In addition, smoking is prohibited in
any indoor facility or portion of a facility (owned, leased, or contracted for)
used for the routine or regular provision of federally funded health care, day
care, or early childhood development (Head Start) services to children under
the age of 18. The statutory prohibition also applies if such facilities are
constructed, operated, or maintained with Federal funds. The statute does not
apply to children’s services provided in private residences, facilities funded
solely by Medicare or Medicaid funds, portions of facilities used for inpatient
drug or alcohol treatment, or facilities where Women, Infants and Children
(WIC) coupons are redeemed. Failure to comply with the provisions of the law
may result in the imposition of a civil monetary penalty of up to $1,000 per
violation and/or the imposition of an administrative compliance order on the
Because of the nature of NIH programs and funding,
individual transactions, rather than entire programs, may be subject to these
requirements. The signature of the AOO will indicate the intent to comply. Any
questions concerning the applicability of these provisions to an NIH grant
should be directed to the GMO.
The PHS Policy on Humane Care and Use of Laboratory
Animals (the Policy) requires applicants proposing to use vertebrate
animals in NIH-supported activities to file a written Animal Welfare Assurance
with OLAW. The Policy defines “animal” as any live, vertebrate animal used or
intended for use in research, research training, experimentation, biological
testing, or related purposes. Under the Policy, the applicant/grantee is
responsible for the humane care and treatment of animals in NIH grant-supported
activities. The Policy implements and supplements the U.S. Government
Principles for the Care and Utilization of Vertebrate Animals used in Testing,
Research, and Training. The Policy also requires the applicant to establish appropriate
policies and procedures for the humane care and use of animals, based on the
Guide for the Care and Use of Laboratory Animals, and to comply with the Animal
Welfare Act and its implementing regulations. This includes appointing an IACUC
with specified responsibilities.
NIH will not make an award for research involving live
vertebrate animals unless the applicant organization and all performance sites
are operating in accordance with an approved Animal Welfare Assurance and
provide verification that the IACUC has reviewed and approved those sections of
the application that involve use of vertebrate animals, in accordance with the
requirements of the Policy. NIH will not make an award for research involving
live vertebrate animals to an individual unless that individual is affiliated
with an organization that accepts responsibility for compliance with the Policy
and has filed the necessary assurance with OLAW.
Applications from organizations with approved Animal Welfare
Assurances will be considered incomplete if they do not contain the information
concerning the use of vertebrate animals required as part of the application’s
research plan (see instructions for completing the PHS 398 and PHS 416-1 for
the specific points that need to be addressed). In the case of apparent or
potential violation of the Policy, NIH may refer an application back to the
applicant for further IACUC review.
Verification of the IACUC review may be filed at any time
before award unless required earlier by the IC. Therefore, following peer
review and notification of priority score/percentile, applicant organizations
with approved Assurances should proceed with IACUC review for those
applications that have not yet received IACUC approval and that appear to be in
a fundable range. Regardless of when the review occurs, the IACUC should ensure
that the research described in the application is consistent with any
corresponding protocols reviewed and approved by the IACUC. If an application
is selected for award and the verification of IACUC review has not been
submitted, the awarding office will contact the organization with instructions
for negotiating an assurance or submitting the IACUC verification.
When organizations collaborate and multiple recognized
IACUCs may be involved, only one of those IACUCs is required to review the
research project or evaluate a program facility. In such cases, organizations
must define their respective responsibilities to ensure compliance with the
Policy. If both institutions have full Animal Welfare Assurances, they may
exercise discretion in determining which IACUC will review the research
protocol(s) and under which organization’s program the research will be
OLAW may negotiate an inter-organizational Animal Welfare
Assurance when an awardee organization without an animal care and use program
or IACUC will rely on the program of an organization with an assurance. Assured
institutions also have the option to amend their Animal Welfare Assurances to
cover performance sites without such assurances.
Foreign organizations proposing activities involving
vertebrate animals are required to comply with the Policy or provide evidence
that acceptable standards for the humane care and use of animals will be met.
The Policy does not affect applicable State or local laws or
regulations that impose more stringent standards for the care and use of
laboratory animals. In addition, all organizations are required to comply, as
applicable, with the Animal Welfare Act, as amended, 7 U.S.C. 2131 et seq., and
other Federal statutes and regulations relating to animals.
Information about preparing and submitting Animal Welfare
Assurances and copies of the Policy and other relevant materials are available
from OLAW (see Part III for contact information).
Requirements for Inclusiveness
in Research Design
NIH requires grant-supported research projects to be as
inclusive in design as possible to extend the validity of research findings and
allow for enhancement of the health status of all population groups.
Clinical research involving human subjects of any age must
comply with the NIH Policy and Guidelines on the Inclusion of Women and
Minorities as Subjects in Clinical Research (http://grants.nih.gov/grants/funding/women_min/guidelines_amended_10_2001.htm),
implementing section 492B of the PHS Act. These guidelines require that women
and members of minority groups and their subpopulations (http://grants.nih.gov/grants/guide/notice-files/NOT-OD-01-053.html)
be included in any NIH-supported biomedical and behavioral clinical research
project involving human subjects, unless a clear and compelling rationale and
justification establishes, to the satisfaction of the IC Director, that
inclusion is inappropriate with respect to the health of the subjects, the
purpose of the research, or other circumstances. Cost is not an acceptable
reason for exclusion, except when the research would duplicate data already
available from other sources. Women of childbearing potential should not be
routinely excluded from participation in clinical research. The guidelines
should be reviewed for policy concerning inclusion of these groups in all
NIH-supported clinical trials. This policy applies to subjects of all ages.
One of the requirements of those guidelines is collecting
information on racial/ethnic group in accordance with government-wide
requirements to allow comparisons to other Federal databases, especially the
census and national health databases. OMB Directive No. 15 (http://www.whitehouse.gov/omb/fedreg/race-ethnicity.html)
defines minimum standards for maintaining, collecting, and presenting data on
race and ethnicity for all Federal reporting. The categories in this
classification are social-political constructs and should not be interpreted as
being scientific or anthropological in nature. The standards include five
racial categories: American Indian or Alaska Native, Asian, Black or African
American, Native Hawaiian or Other Pacific Islander, and White. There are two
categories for ethnicity: “Hispanic or Latino,” and “Not Hispanic or Latino.”
Reports of data on race and ethnicity shall use these categories. These
categories are defined in OMB Directive 15.
Peer reviewers will evaluate proposed plans for inclusion of
members of minority groups and both genders, the design of clinical trials, and
recruitment and outreach as part of the scientific assessment. Failure to
comply with this policy may result in NIH not making an award. Grantees are
required to report annually on the enrollment of individuals by gender and
racial or ethnic minority group as part of the grant progress report, including
SNAP reporting (see “Administrative
Requirements—Monitoring—Reporting—Non-Competing Grant Progress Reports”).
Inclusion of Children as Subjects in Clinical
NIH has a separate policy on inclusion of children as
subjects in clinical research that is similar to the policy regarding inclusion
of women and minorities (http://grants.nih.gov/grants/funding/children/children.htm).
All new research projects involving human subjects research must include
children in the research design unless there are scientific or ethical reasons
not to include them. If children will be excluded from the research, the
application must present an acceptable justification for the exclusion. For the
purpose of addressing the NIH policy requirement for inclusion, a child is
defined as an individual under the age of 21 years.
The inclusion of children as subjects in research must
comply with all applicable provisions of pertinent Federal laws and
regulations, including 45 CFR Part 46. Regulatory requirements in 45 CFR 46
Subpart D address HHS protections for children who participate in research.
These requirements must be addressed when “children” (persons who, under the
applicable law of the jurisdiction in which the research will be conducted,
have not attained the legal age for consent to treatments or procedures
involved in the research) are involved as subjects in research.
This policy applies to both exempt and nonexempt research
activities (see “Human Subjects” in this
section); however, if the applicant claims that the proposed study meets the
criteria for exemption 4 under 45 CFR Part 46, no justification for the
exclusion of children is required.
Before NIH may make an award to a domestic organization, the
AOO must certify, by means of the signature on the application, that the
organization has on file with OCR an Assurance of Compliance with the statutes
described in this subsection. The Assurance, Form HHS 690, is filed for the
organization and is not required for each application. If the application has
been recommended for funding and the applicant organization does not have an
Assurance of Compliance on file, it will receive, from the awarding office, the
required form and instructions for completion and submission. The HHS 690 also
is available from GrantsInfo@nih.gov or by telephone at 301-435-0714.
Domestic organizations that receive funding from grantees
(including consortium participants and contractors under grants) rather than
directly from NIH also are required to file an HHS 690. The applicant/grantee
is responsible for determining whether those organizations have the required
Assurance on file and, if not, ensuring that it is filed with OCR.
The Age Discrimination Act of 1975 prohibits discrimination
on the basis of age in any program or activity receiving Federal financial
assistance. The HHS implementing regulations are codified at 45 CFR Part 91.
Title VI of the Civil Rights Act of 1964 provides that no
person in the United States shall, on the grounds of race, color, or national
origin, be excluded from participation in, be denied the benefits of, or be
subjected to discrimination under any program or activity receiving Federal
financial assistance. The HHS implementing regulations are codified at 45 CFR
Title IX of the Education Amendments of 1972 provides that
no person in the United States shall, on the basis of sex, be excluded from
participation in, be denied the benefits of, or be subjected to discrimination
under any educational program or activity receiving Federal financial
assistance. The HHS implementing regulations are codified at 45 CFR Part 86.
Rehabilitation Act of 1973
Section 504 of the Rehabilitation Act of 1973, as amended,
provides that no otherwise qualified handicapped individual in the United States shall, solely by reason of the handicap, be excluded from participation in,
be denied the benefits of, or be subjected to discrimination under any program
or activity receiving Federal financial assistance. These requirements pertain
to the provision of benefits or services as well as to employment. The HHS
implementing regulations are codified at 45 CFR Parts 84 and 85.
EO 13166, August 11, 2000, requires grantees receiving
Federal financial assistance to take steps to ensure that people with limited
English proficiency can meaningfully access health and social services. A
program of language assistance should provide for effective communication
between the service provider and the person with limited English proficiency to
facilitate participation in, and meaningful access to, services. The
obligations of grantees are explained on the OCR website at http://www.hhs.gov/ocr/lep/revisedlep.html.
Public policy requirements that apply to construction
activities are described in “Construction
Grants—Public Policy Requirements and Objectives.” Those requirements also
may apply to A&R activities. A grantee undertaking an A&R project under
a nonconstruction award should consult the GMO concerning potential
applicability of these requirements.
Except for certain types of information that may be
considered proprietary or private information that cannot be released, most
grant-related information submitted to NIH by the applicant or grantee in the
application or in the post-award phase is considered public information and,
once an award is made, is subject to possible release to individuals or
organizations outside NIH. The statutes and policies that require this
information to be made public are intended to foster an open system of
government and accountability for governmental programs and expenditures and,
in the case of research, to provide information about federally funded
NIH routinely places information about awarded grants,
including project title, the name of the PI, and the project description, in
the CRISP system. For funded research grant applications, NIH also sends the
project description provided by an applicant to the DoC’s NTIS. NTIS
disseminates scientific information for classification and program analysis.
The public may obtain the project descriptions from CRISP (available from the OER home page)
or request them from NTIS. Other information may be released case by case as
described in this subsection.
Several policies require acknowledgment of support and a
disclaimer for publications, inventions, and other research products, as
provided in “Administrative
Requirements—Availability of Research Results: Publications, Intellectual
Property Rights, and Sharing Research Resources” and elsewhere in the
Acknowledgment of Federal Funding
As required by HHS appropriations acts, all HHS grantees
must acknowledge Federal funding when issuing statements, press releases,
requests for proposals, bid invitations, and other documents describing
projects or programs funded in whole or in part with Federal money. Grantees
are required to state (1) the percentage and dollar amounts of the total
program or project costs financed with Federal money and (2) the percentage and
dollar amount of the total costs financed by nongovernmental sources.
The Freedom of Information Act
The Freedom of Information Act, 5 U.S.C. 552, and
implementing HHS regulations (45 CFR Part 5) require NIH to release
certain grant documents and records requested by members of the public,
regardless of the intended use of the information. These policies and
regulations apply to information in the possession of NIH and generally do not
require grantees or contractors under grants to permit public access to their
records. An exception related to certain research data is described in this
NIH generally will release
the following types of records pursuant to a FOIA request:
applications and funded progress reports, including award data
reports that have been transmitted to the grantee organization of any audit,
survey, review, or evaluation of grantee performance.
NIH generally will withhold
the following types of records or information in response to a FOIA request:
competing grant applications
new and competing continuations and competing supplemental applications
information pertaining to project personnel, such as institutional base salary
pertaining to an individual, the disclosure of which would constitute a clearly
unwarranted invasion of personal privacy
opinions in interagency or intraagency memorandums or letters expressed by
Federal government officers, employees, or consultants
portions of site visit reports and peer review summary statements, including
secrets and commercial, financial, and otherwise intrinsically valuable items
of information that are obtained from a person or organization and are privileged
which, if released, would adversely affect the competitive position of the
person or organization
or other valuable commercial rights of the person or organization.
If, after receiving a FOIA request, NIH has substantial
reason to believe that information in its records could reasonably be
considered exempt from release, the appropriate NIH FOI office will notify the
applicant or grantee, through the PI, before the information is released. The
PI will be given an opportunity to identify potentially patentable or
commercially valuable information that the PI believes should not be disclosed.
After NIH consideration of the response, the PI and grantee will be informed if
NIH does not agree with the PI’s position. If a document contains both
disclosable and nondisclosable information, the nondisclosable information will
be deleted and the balance of the document will be disclosed.
The HHS regulations implementing FOIA provide that only the
NIH FOI Officer may deny requests for information. Requests for information,
the release of which is believed to be exempt under FOIA, are referred to the
NIH FOI Officer along with written documentation of the rationale for
nondisclosure. If the NIH FOI Officer determines that the requested information
is exempt from release under FOIA, the requester may appeal that determination
to the Deputy Assistant Secretary for Public Affairs (Media), HHS. Additional
information on the FOIA process is available at the NIH FOI Office website (http://www.nih.gov/icd/od/foia).
Access to Research Data
NIH handles requests for the release of research data by
certain types of recipients as FOIA requests. The term “research data” is
defined as the recorded factual material commonly accepted in the scientific
community as necessary to validate research findings. It does not include
preliminary analyses; drafts of scientific papers; plans for future research;
peer reviews; communications with colleagues; physical objects (e.g.,
laboratory samples, audio or video tapes); trade secrets; commercial
information; materials necessary to be held confidential by a researcher until
publication in a peer-reviewed journal; information that is protected under the
law (e.g., intellectual property); personnel and medical files and similar
files, the disclosure of which would constitute an unwarranted invasion of
personal privacy; or information that could be used to identify a particular
person in a research study.
As required by 45 CFR 74.36, grantees that are institutions
of higher education, hospitals, or non-profit organizations must release
research data first produced in a project supported in whole or in part with
Federal funds that are cited publicly and officially by a Federal agency in
support of an action that has the force and effect of law (i.e., regulations
and administrative orders). If the data are publicly available, NIH directs the
requester to the public source. Otherwise, the IC FOI coordinator handles the
request, consulting with the affected grantee and the PI. This requirement also
provides for assessment of a reasonable fee to cover grantee costs and
(separately) the NIH costs of responding.
This requirement to release research data does not apply to
commercial organizations or to research data produced by State or local
governments. However, if a State or local governmental grantee contracts with
an educational institution, hospital, or non-profit organization, and the
contract results in covered research data, those data are subject to the
Additional information is available on the NIH website at http://grants.nih.gov/grants/policy/data_sharing/index.htm.
(Also see “Administrative
Requirements—Availability of Research Results: Publications, Intellectual
Property Rights, and Sharing Research Resources.”)
The Privacy Act of 1974, 5
U.S.C. 552a, and its implementing regulations (45 CFR Part 5b) provide
certain safeguards for information about individuals maintained in a system of
records (i.e., information may be retrieved by the individual’s name or other
identifying information). These safeguards include the rights of individuals to
determine what information about them is maintained in Federal agencies’ files
(hard copy or electronic) and how it is used, to have access to such records,
and to correct, amend, or request deletion of information in their records that
is inaccurate, irrelevant, or outdated.
maintained by NIH with respect to grant applications, grant awards, and the
administration of grants are subject to the provisions of the Privacy Act. NIH
has two Privacy Act systems of records that cover NIH grant records:
Extramural Awards and Chartered Advisory Committees: IMPAC
(Grant/Contract/Cooperative Agreement Information/Chartered Advisory Committee
Information), HHS/NIH/OER and HHS/NIH/CMO
Grants and Cooperative Agreements: Research, Research Training, Fellowship and
Construction Applications and Related Awards, HHS/NIH/OD.
These two systems provide
guidance on requirements for the management of applicable grant records in
NIH’s possession and include appropriate routine uses of such information. They
also include requirements for safeguarding the records and for record retention
Parties other than PIs may
request the release of Privacy Act records. Such requests are processed in the
same manner as FOIA requests. For example, information requested by
co-investigators in grant applications is released to them only when required
under FOIA because they have no right of access under the Privacy Act. When
releasing information about an individual to a party other than that
individual, NIH will balance the individual’s right to privacy with the
public’s right to know as provided by the FOIA.
Records maintained by grantees
ordinarily are not subject to the requirements of 45 CFR Part 5b.
Consistent with EO 12770 (July
25, 1991), Metric Usage in Federal Government Programs, measurement values in
applications and grantee-prepared reports, publications, and other
grant-related documents should be in metric. See “Construction Grants” in Subpart B of this part
for requirements for metric usage in construction activities.
NIH is subject to section 588
of the National Defense Authorization Act of 1995, as implemented in 32 CFR
Part 216, that precludes grant awards to institutions of higher education that
DoD determines have an anti-Reserve Officer Training Corps (ROTC) policy or
practice (regardless of when implemented) that either prohibits or, in effect,
prevents the Secretary of Defense from gaining entry to campuses or access to
students or information for military recruiting. DoD publishes each determination
of ineligibility in the Federal Register as well as publishing, once
every 6 months, a list of all currently ineligible schools. If DoD determines
that an institution is ineligible during an ongoing project period, NIH may
either continue the award or take an action to end the award as provided in “Administrative Requirements—Enforcement
Actions—Suspension, Termination, and Withholding of Support.” Funding
eligibility may be restored on the basis of new information provided to DoD.
The NGA is the legal document issued to notify the grantee
that an award has been made and that funds may be requested from the designated
HHS payment system or office. An NGA is issued for the initial budget period
and each subsequent budget period in the approved project period. The NGA
reflects any future-year commitments. A revised NGA may be issued during a
budget period to effect an action resulting in a change in the period or amount
of support or other change in the terms and conditions of award. NIH will not
issue a revised NGA to reflect a grantee’s post-award rebudgeting. Until an IC
has issued an NGA for the initial award, any costs incurred by the applicant
for the project are incurred at its own risk (see “Allowability of Costs/Activities—Selected
Items of Cost—Pre-Award (Pre-Agreement) Costs” for NIH policy on the
allowability of pre-award costs).
The NGA sets forth pertinent
information about the grant, including, but not limited to, the following:
identification number (“grant number”)
of grantee organization
of the PI
project period and budget period start and end dates
of funds authorized for obligation by the grantee
of anticipated future-year commitments (if applicable)
of the cognizant IC PO, GMO, and GMS
terms and conditions of award, either by reference or inclusion.
A grantee indicates acceptance of an NIH award and its
associated terms and conditions by drawing or requesting funds from the
designated HHS payment system or office. If the grantee cannot accept the
award, including the legal obligation to perform in accordance with its
provisions, it should notify the GMO immediately upon receipt of the NGA. If
resolution cannot be reached, the GMO will void the grant. NIH’s determination
of applicable terms and conditions of award or a GMO’s denial of a request to
change the terms and conditions is discretionary and not subject to appeal
(post-award appeal rights are discussed in “Administrative
Requirements—Grant Appeals Procedures”). Once the award is accepted by the
grantee, the contents of the NGA are binding on the grantee unless and until
modified by a revised NGA signed by the GMO.
For most grants, NIH uses the
project period system of funding. Under this system, projects are
programmatically approved for support in their entirety but are funded in
annual increments called budget periods. The length of an initial project
period (competitive segment) or of any subsequent competitive segment is
determined by the NIH awarding office on the basis of
statutory or regulatory requirements,
length of time requested by the applicant to complete the project,
limitation on the length of the project period recommended by the peer
awarding office’s programmatic determination of the frequency of competitive
review desirable for managing the project, and
The total project period consists of the initial competitive
segment, any additional competitive segments authorized by approval of a
competing continuation application, and any non-competing extensions. NIH
policy limits each competitive segment to a maximum of 5 years (exclusive of
non-competing extensions). A single award covering the entire period of support
generally is used only if the project is solely for construction or A&R of
real property, if the total planned period of support will be less than 18
months, or if the project is awarded under a special support mechanism.
The initial NGA provides funds for the project during the
first budget period. Budget periods usually are 12 months long; however,
shorter or longer budget periods may be established for compelling programmatic
or administrative reasons. An NGA that documents approval of a project period
that extends beyond the budget period for which funds are provided (including
anticipated levels of future support) expresses NIH’s intention to provide
continued financial support for the project. The amounts shown for subsequent
years represent projections of future funding levels based on the information
available at the time of the initial award. Such projected levels of future
support are contingent on satisfactory progress, the availability of funds, and
the continued best interests of the Federal government. They are not guarantees
by NIH that the project will be funded or will be funded at those levels and
create no legal obligation to provide funding beyond the ending date of the
current budget period as shown in the NGA.
Grantees are required to submit an annual progress report as
a prerequisite to NIH approval and funding of each subsequent budget period
(non-competing continuation award) within an approved project period (see “Administrative
Requirements—Monitoring—Reporting—Non-Competing Grant Progress Report”). A
decision to fund the next budget period will be formalized by the issuance of
an NGA indicating the new budget period and the amount of new funding. The NGA
also will reflect any remaining future-year commitments. NIH may decide to
withhold support for one or more of the reasons cited in “Administrative Requirements—Enforcement
Actions—Suspension, Termination, and Withholding of Support.” A grantee may
appeal this decision only if the withholding was for the grantee’s failure to
comply with the terms and conditions of a previous award (see “Administrative Requirements—Grant Appeals
Each NGA sets forth the amount of funds awarded. The amount
may be shown either as a categorical (line item) budget or as an amount for
total direct costs (not broken down by category) and an amount for F&A
costs, if applicable. Modular awards represent a type of award made without a
categorical budget (see “Modular
Applications and Awards”). The grantee has certain rebudgeting flexibility
within the overall amount awarded (see “Administrative
Requirements—Changes in Project and Budget”). The grantee may be required
to provide matching funds under construction awards as specified in “Construction Grants—Matching” in Subpart B of this part
as well as under other NIH programs or awards if specified in the funding
In addition to, or in lieu of, the standard terms and
conditions of award specified in the NIHGPS, NIH may use terms and conditions
for program-specific or award-specific reasons. For example, if, on the basis
of a grantee’s application or other available information, the GMO finds—at the
time of award or at any time subsequent to award—that the grantee’s management
systems and practices are not adequate to ensure the appropriate stewardship of
NIH funds or to achieve the objectives of the award, the GMO may impose
special, more restrictive terms and conditions on the award in accordance with
42 CFR 52.9 and 45 CFR 74.14 or 92.12. For example, NIH could require a grantee
to obtain prior approval for expenditures that ordinarily do not require such
approval or to provide more frequent reports. In addition to closer monitoring,
NIH may assist the grantee in taking any necessary corrective action.
HHS grant payments may be made by one of several advance
payment methods, including SMARTLINK II/ACH, CASHLINE/ACH, or cash request, or
by cash request on a reimbursement basis, as specified in the NGA and as
described in this section. Payments under NIH grants generally are made as
advance payments. Except as indicated in this section, NIH grant payments are
made by PMS, operated by DPM, in accordance with Department of the Treasury and
OMB requirements, as implemented by 45 CFR 74.22 and 92.21. These requirements
are intended to minimize the time elapsing between the transfer of funds from
the Federal government and disbursement by a grantee. Therefore, although the
grant may be financed by advance payments, the intent is that grantees draw
funds on an as-needed basis—specifically, no more than 3 days before the funds
All Federal funds deposited by PMS in a grantee’s bank
account as an unrestricted advance payment should be fully disbursed (checks
written, signed, and issued to the payees) by the close of business the next
workday after receipt of the funds. The potential for excessive Federal cash on
hand exists each time a grantee does not disburse Federal funds in this manner.
The grantee is responsible for determining when the Federal funds have been
deposited into its bank account for each drawdown, ensuring that the funds are
fully disbursed by the close of business the next workday after they are
received, and immediately returning all undisbursed Federal funds to PMS.
The Treasury and OMB policies also establish accountability
for interest earned on advances of grant funds and provide for use of the
reimbursement method if cash management requirements are not met. Advances made
by grantees to consortium participants and contractors under grants must
conform to substantially the same standards of timing and amount that govern
advances to the grantee.
Operational guidance for recipients is contained in the DHHS
Manual for Recipients Financed under the Payment Management System
(available through the HHS website at http://www.dpm.psc.gov/doc/hhsrecmanual.pdf).
Inquiries regarding payments should be directed to DPM at the
address shown in Part III of the NIHGPS.
OFM makes payments under grants to foreign or international
organizations, awards to individuals, and awards to agencies of the Federal
The SMARTLINK II/ACH method of advance payment makes direct
deposit of funds to a grantee’s bank account and requires grantees to have
Internet access to submit a request for funds to PMS. SMARTLINK II/ACH provides
funds the day following the request with direct deposit using the Federal
Reserve Bank’s (Richmond, Virginia) ACH process.
The CASHLINE/ACH method of advance payment provides for
direct deposit of funds to the recipient’s bank account using a touch-tone
telephone to dial directly to a “voice-response” computer located at PMS.
CASHLINE/ACH makes funds available the day following the request with direct
deposit using the Federal Reserve Bank’s ACH process.
Grantees not eligible for an unrestricted advance of funds
by SMARTLINK II/ACH or CASHLINE/ACH must submit a cash request, usually
monthly. The cash request may be on either an advance or reimbursement basis,
as specified by the NIH awarding office. Cash requests are used when a
grantee’s cash management must be closely monitored (for example, grantees
whose financial management systems do not meet the standards specified in
45 CFR 74.21 or 92.20) or under programs where reimbursement financing is
appropriate. A grantee also may be converted from an unrestricted advance
payment method to a cash request basis if, during post-award administration,
the GMO determines that a grantee is not complying with the cash management
requirements or other requirements of the award, including the submission of
complete and timely reports (see “Administrative
Requirements—Monitoring—Reporting” and “Administrative
Requirements—Enforcement Actions—Modification of the Terms of Award”).
If the cash request is for an advance payment, the grantee
may request grant funds from PMS monthly on the basis of expected disbursements
during the succeeding month and the amount of Federal funds already on hand. A
request for reimbursement may be submitted more often, if authorized. For
timely receipt of cash, a grantee must submit the request through the awarding
office early enough for it to be forwarded to PMS at least 2 weeks before the
cash is needed. PMS makes payment to the grantee electronically through the ACH
process upon receipt of the approved payment request from the awarding office.
Except as provided in 45 CFR 74.22(k), any NIH grantee
subject to the requirements of 45 CFR Part 74 that receives advance
payments must maintain those advances in an interest-bearing account.
Interest earned on advances
of Federal funds must be handled as follows:
grantees. Any interest on Federal advances of grant funds that exceeds $250 per
year in the aggregate must be remitted annually to PMS (as the government-wide
agent for collection). Recipients with electronic funds transfer (EFT)
capability should use an electronic medium to remit interest.
grantees other than States. Except as provided in 45 CFR 92.21(i), any interest
in excess of $100 per year in the aggregate earned by local governments or
Indian tribal governments on Federal advances of grant funds must be remitted
promptly, and at least quarterly, to PMS.
governments. State governments operating under Treasury-State agreements are
subject to the payment and receipt of interest as specified in their
agreements. All other State grantees are expected to follow sound financial
management practices that minimize the potential for excessive Federal cash on
hand and to comply with the cash management requirements of 45 CFR 92.20 and
Cost considerations are critical throughout the life cycle
of a grant. An applicant’s budget request is reviewed for compliance with the
governing cost principles and other requirements and policies applicable to the
type of recipient and the type of award. Any resulting award will include a
budget that is consistent with these requirements.
NIH anticipates that, because of the nature of research, the
grantee may need to modify its award budget during performance to accomplish
the award’s programmatic objectives. Therefore, NIH provides some flexibility
for grantees to deviate from the award budget, depending on the deviation’s
significance to the project or activity. More significant post-award changes
require NIH prior approval. Prior-approval requirements and authorities are
discussed in “Administrative Requirements—Changes
in Project and Budget.”
During post-award administration, the GMO monitors
expenditures for conformance with cost policies. The GMO’s monitoring includes,
among other things, responding to prior-approval requests and reviewing
progress reports, audit reports, and other periodic reports. The GMO also may
use audit findings as the basis for final cost adjustments (see “Administrative Requirements—Closeout”).
This section addresses the general principles underlying the
allowability of costs, differentiates direct costs from F&A costs, and
highlights a number of specific costs and categories of cost for NIH applicants
and grantees. It is not intended to be all-inclusive and should be used as a
supplement to the applicable cost principles.
In general, NIH grant awards provide for reimbursement of
actual, allowable costs incurred and are subject to Federal cost principles.
The cost principles establish standards for the allowability of costs, provide
detailed guidance on the cost accounting treatment of costs as direct or
F&A costs, and set forth allowability and allocability principles for
selected items of cost. Applicability of a particular set of cost principles
depends on the type of organization making the expenditure. For example, a
for-profit organization collaborating with a university grantee would be
subject to the cost principles for commercial organizations, while the
university would be subject to the cost principles for educational institutions.
The cost principles are set
forth in the following documents and are incorporated by reference in 45 CFR
74.27 and 92.22:
l OMB Circular A-21—Cost
Principles for Educational Institutions
l OMB Circular
A-87—Cost Principles for State and Local Governments and Indian Tribal
l OMB Circular
A-122—Cost Principles for Non-Profit Institutions
CFR Part 74, Appendix E—Principles for Determining Costs Applicable to Research
and Development under Grants and Contracts with Hospitals
l 48 CFR Subpart
31.2 (Federal Acquisition Regulation)—Contracts with Commercial Organizations.
The cost principles apply to all NIH award instruments,
award mechanisms, and special programs and authorities, including modular
awards and awards under SNAP with one exception: they do not apply to
Kirschstein-NRSA individual fellowship awards. The allowable use of funds under
those awards is included in “Ruth L.
Kirschstein National Research Service Awards” in Subpart B of this part.
Grantees can use their own accounting systems, policies, and
procedures to implement the cost principle requirements as long as the
standards prescribed in 45 CFR 74.21 or 92.20 for financial management systems
The cost principles address
four tests that NIH follows in determining the allowability of costs. The tests
are as follows:
Reasonableness (including necessity). A cost
may be considered reasonable if the nature of the goods or services acquired or
applied and the associated dollar amount reflect the action that a prudent
person would have taken under the circumstances prevailing when the decision to
incur the cost was made. The cost principles elaborate on this concept and
address considerations such as whether the cost is of a type generally
necessary for the organization’s operations or the grant’s performance, whether
the recipient complied with its established organizational policies in
incurring the cost or charge, and whether the individuals responsible for the
expenditure acted with due prudence in carrying out their responsibilities to
the Federal government and the public at large as well as to the organization.
Allocability. A cost is allocable to a specific
grant, function, department, or other component, known as a cost objective, if
the goods or services involved are chargeable or assignable to that cost
objective in accordance with the relative benefits received or other equitable
relationship. A cost is allocable to a grant if it is incurred solely in order
to advance work under the grant; it benefits both the grant and other work of
the institution, including other grant-supported projects; or it is necessary
to the overall operation of the organization and is deemed to be assignable, at
least in part, to the grant.
Consistency. Grantees must be consistent in
assigning costs to cost objectives. Therefore, under NIH grants, although costs
may be charged as either direct costs or F&A costs, depending on their
identifiable benefit to a particular project or program. They must be treated
consistently for all work of the organization under similar circumstances,
regardless of the source of funding, so as to avoid duplicate charges.
Conformance. This test of
allowability—conformance with limitations and exclusions as contained in the
terms and conditions of award, including those in the cost principles—varies by
the type of activity, the type of recipient, and other characteristics of
individual awards. “Allowability
of Costs/Activities” provides information common to most NIH grants and,
where appropriate, specifies some of the distinctions if there is a different
treatment based on the type of grant or grantee. Subpart B of this part
contains additional information on allowability of costs for particular types
of grants, grantees, and activities.
These four tests apply regardless of whether the particular
category of costs is one specified in the cost principles or one governed by
other terms and conditions of an award. These tests also apply regardless of
treatment as a direct cost or an F&A cost. The fact that a proposed cost is
awarded as requested by an applicant does not indicate a determination of
Project costs consist of the allowable direct costs directly
related to the performance of the grant plus the allocable portion of the
allowable F&A costs of the organization, less applicable credits (as
described below and in the cost principles). A “direct cost” is any cost that
can be specifically identified with a particular project, program, or activity
or that can be directly assigned to such activities relatively easily and with
a high degree of accuracy. Direct costs include, but are not limited to,
salaries, travel, equipment, and supplies directly benefiting the
grant-supported project or activity. Most organizations also incur costs for
common or joint objectives that, therefore, cannot be readily identified with
an individual project, program, or organizational activity. Facilities
operation and maintenance costs, depreciation, and administrative expenses are
examples of costs that usually are treated as F&A costs. The organization
is responsible for presenting costs consistently and must not include costs
associated with its F&A rate as direct costs.
The amount NIH awards for each budget period will reflect
the total approved budget for the grant, including direct costs and, if
applicable, F&A costs. (SBIR and STTR awards also may include a fee as
specified in “Grants to For-Profit
Organizations—Small Business Innovation Research and Small Business Technology
Transfer Programs” in Subpart B of this part.) If a grantee waives
reimbursement of full F&A costs, NIH will either not award F&A costs or
will award only partial F&A costs, as appropriate. The NIH award amount
shown in the NGA constitutes NIH’s maximum financial obligation to the grantee
under that award.
NIH will not reimburse F&A costs unless the grantee has
established an F&A cost rate covering the applicable activities and period
of time, except for awards under which F&A costs are reimbursed at a fixed
rate or for awards under which NIH does not reimburse F&A costs.
In addition, NIH will not require a recipient to establish
an F&A rate if the organization’s total operations consist of a single
grant-supported project or if the organization appropriately and consistently
treats all costs as direct costs to projects and accounts for them as such. In
the latter case, the GMO must be satisfied that the organization’s accounting
system can adequately identify and support all costs as direct costs to the
project. This includes being able to identify and segregate costs on the basis
of a process that assigns costs commensurate with the benefits provided to
individual projects (see “Administrative
Requirements—Management Systems and Procedures—Financial Management System
F&A rates are negotiated by DCA, DFAS in the Office of
Acquisition Management and Policy, NIH (responsible for negotiating F&A
cost rates for for-profit entities receiving awards from HHS), or other agency
with cognizance for F&A cost rate (and other special rate) negotiation. If
an applicant is advised by the GMO of the need to establish a rate, the GMO
will indicate the responsible office to be contacted.
F&A cost proposals must be prepared in accordance with
the applicable cost principles and guidance provided by the cognizant office or
agency, and must conform to cost policies in the NIHGPS. Further information
concerning the establishment of F&A rates and the reimbursement of F&A
costs may be obtained from DCA or DFAS
(see Part III). DCA should be
consulted to determine the need to submit a Disclosure Statement (DS-2)
pursuant to the requirements of OMB Circular A-21.
In accordance with NIH’s cost management plan, regardless of
the type of recipient, the negotiated rate(s) in effect at the beginning of the
competitive segment will be used to determine the amount budgeted for F&A
costs for each year of the competitive segment. If the rate agreement does not
extend to the end of the project period, the last rate in effect will be used to
establish the total cost commitment for any remaining future years. NIH
generally will not award additional F&A costs beyond those calculated in
the approved budget.
F&A costs awarded may be subject to upward or downward
adjustment, depending on the type of rate negotiated, and grantees may rebudget
between direct and F&A costs (in either direction) without NIH prior
approval, provided there is no change in the scope of the approved project.
F&A costs are subject to downward adjustment if the proposal that served as
the basis for the negotiation included unallowable costs.
Some award mechanisms require negotiation of project costs
annually, e.g., GCRCs, clinical trials, and Primate Research Center Grants
(P51). For these awards, the policies pertain to each year of support rather
than to a multiyear competitive segment.
Once NIH awards a grant, it is not obligated to make any
supplemental or other award for additional F&A costs or for any other
purpose. There are limited circumstances under which the GMO may award F&A
costs where none were previously awarded or may increase the amount previously
awarded. If an award does not include an amount for F&A costs because the
applicant or grantee did not submit a timely F&A cost proposal and the
grantee subsequently establishes a rate, the GMO may amend the award to provide
an appropriate amount for F&A costs if the amendment can be made using
funds from the same Federal fiscal year in which the award was made. However,
the amount will be limited to the F&A costs applicable to the period after
the date of the grantee’s F&A cost proposal submission. This provision does
not affect local governmental agencies that are not required to submit their
F&A (indirect) cost proposals to the Federal government. They may charge
F&A costs to NIH grants based on the rate computations they prepare and
keep on file for subsequent Federal review.
If funds are available, a GMO
may amend an award to provide additional funds for F&A costs, but only
under the following circumstances:
made an error in computing the award. This includes situations in which a
higher rate than the rate used in the grant award is negotiated and the date of
the rate agreement for the higher rate is on or before 1 calendar month prior
to the beginning date of the grant budget period.
restores funds previously recaptured as part of a grantee’s unobligated
grantee is eligible for additional F&A costs associated with additional
direct costs awarded for the supplementation or extension of a project.
NIH does not reimburse
indirect costs under the following classes of awards:
F&A costs will not be provided on Kirschstein-NRSA individual fellowships
or similar awards for which NIH funding is in the form of fixed amounts or is
determined by the normal published tuition rates of an institution and for
which the recipient is not required to account on an actual cost basis.
F&A costs will not be provided on construction grants.
to individuals. F&A costs will not be provided on awards to
to Federal institutions. F&A costs will not be provided on grants to
in support of scientific meetings (conference grants). F&A costs will
not be provided under grants in support of scientific meetings.
NIH provides F&A costs
without the need for a negotiated rate under the following classes of awards:
training and education grants (e.g., R25), and K awards. F&A costs
under Kirschstein-NRSA institutional research training grants and K awards will
be budgeted and reimbursed at a rate of 8 percent of modified total direct
costs, exclusive of tuition and fees, expenditures for equipment, and subgrants
and contracts in excess of $25,000. State and local governmental agencies,
except State universities or hospitals, and Indian tribal governments may
receive full F&A cost reimbursement under NIH Kirschstein-NRSA
institutional research training grants and K awards.
to foreign institutions and international organizations. With the exception
of the American University of Beirut and the World Health Organization, which
are eligible for full F&A cost reimbursement, F&A costs under grants to
foreign and international organizations will be funded at a rate of 8 percent
of modified total direct costs, exclusive of expenditures for equipment. NIH
provides F&A costs under these grants to support the costs of compliance
with applicable public policy requirements including, but not limited to, the
protection of human subjects, animal welfare, financial conflict of interest,
and invention reporting. NIH will not support the acquisition of or provide for
depreciation on any capital expenses (facilities) or the normal general
operations of foreign and international organizations. Awards to domestic
organizations with a foreign or international consortium participant may
include 8 percent of modified total direct costs, less equipment, for the
Cost transfers to NIH grants by grantees, consortium
participants, or contractors under grants that represent corrections of
clerical or bookkeeping errors should be accomplished within 90 days of when
the error was discovered. The transfers must be supported by documentation that
fully explains how the error occurred and a certification of the correctness of
the new charge by a responsible organizational official of the grantee,
consortium participant, or contractor. An explanation merely stating that the
transfer was made “to correct error” or “to transfer to correct project” is not
sufficient. Transfers of costs from one project to another or from one
competitive segment to the next solely to cover cost overruns are not
Grantees must maintain documentation of cost transfers,
pursuant to 45 CFR 74.53 or 92.42, and must make it available for audit or
other review (see “Administrative
Requirements—Monitoring—Record Retention and Access”). The grantee should
have systems in place to detect such errors within a reasonable time frame;
untimely discovery of errors could be an indication of poor internal controls.
Frequent errors in recording costs may indicate the need for accounting system
improvements, enhanced internal controls, or both. If such errors occur,
grantees are encouraged to evaluate the need for improvements and to make
whatever improvements are deemed necessary to prevent reoccurrence. NIH also
may require a grantee to take corrective action by imposing additional terms
and conditions on an award(s).
The GMO monitors grantee expenditure rates under individual
grants within each budget period and within the overall project period. The
funding that NIH provides for each budget period is based on an assessment of
the effort to be performed during that period and the grantee’s associated
budget, including the availability of unobligated balances. Although NIH allows
its grantees certain flexibilities with respect to rebudgeting (see “Administrative Requirements—Changes in Project and
Budget”), NIH expects the rate and types of expenditures to be consistent
with the approved project and budget and may question or restrict expenditures
that appear inconsistent with these expectations.
The GMO may review grantee cash drawdowns to determine
whether they indicate any pattern of accelerated or delayed expenditures.
Expenditure patterns are of particular concern because they may indicate a
deficiency in the grantee’s financial management system or internal controls.
Accelerated or delayed expenditures may result in a grantee’s inability to
complete the approved project within the approved budget and period of
performance. In these situations, the GMO may seek additional information from
the grantee and may make any necessary and appropriate adjustments.
Allocation of Costs and Closely Related Work
When salaries or other activities are supported by two or
more sources, issues arise as to how the direct costs should be allocated among
the sources of support. In general, a cost that benefits two or more projects
or activities in proportions that can be determined without undue effort or
cost should be allocated to the projects on the basis of the proportional
benefit. A cost that benefits two or more projects or activities in proportions
that cannot be determined because of the interrelationship of the work involved
may be allocated or transferred to the benefiting projects on any reasonable
basis as long as the costs charged are allowable, allocable, and reasonable under
the applicable cost principles and the grantee’s financial management system
includes adequate internal controls (for example, no one person has complete
control over all aspects of a financial transaction). As a result, a grantee
may allocate costs normally assignable to multiple projects to one of those
The term “applicable credits” refers to those receipt or
negative expenditure types of transactions that operate to offset or reduce
direct or F&A cost items. Typical examples are purchase discounts, rebates
or allowances, recoveries or indemnities on losses, and adjustments for
overpayments or erroneous charges. Additional information concerning applicable
credits is included in the cost principles.
Applicable credits to direct charges made to NIH grants must
be treated as an adjustment on the grantee’s FSR, whether those credits accrue
during or after the period of grant support. (See “Administrative
Requirements—Monitoring—Reporting” and “Administrative
Requirements—Closeout—Final Reports.”) The NIH awarding office will notify
the grantee of any additional actions that may be necessary.
A number of universities and other organizations have
established closely affiliated, but separately incorporated, organizations to
facilitate the administration of research and other programs supported by
Federal funds. Such legally independent entities are often referred to as “foundations,”
although this term does not necessarily appear in the name of the organization.
Typically, the parent organization provides considerable support services, in
the form of administration, facilities, equipment, accounting, and other
services, to its foundation, and the latter, acting in its own right as an NIH
grantee, includes the cost of these services in its F&A proposal.
Costs incurred by an
affiliated, but separate, legal entity in support of a grantee foundation are
allowable for reimbursement under NIH grants only if at least one of the
following conditions is met:
grantee foundation is charged for, and is legally obligated to pay for, the
services provided by the parent organization.
affiliated organizations are subject to State or local law that prescribes how
Federal reimbursement for the costs of the parent organization’s services will
be expended and requires that a State or local official acting in his or her
official capacity approves such expenditures.
is a valid written agreement between the affiliated organizations whereby the
parent organization agrees that the grantee foundation may retain Federal
reimbursement of parent organization costs. The parent organization may either
direct how the funds will be used or permit the grantee foundation that
If none of the above conditions is met, the costs of the
services provided by the parent organization to the grantee foundation are not
allowable for reimbursement under an NIH grant. However, the services may be acceptable
for cost-sharing (matching) purposes.
The governing cost principles address selected items of
cost, some of which are mentioned in this subsection for emphasis. This
subsection is not intended to be all-inclusive. The cost principles should be
consulted for the complete explanation of the allowability or unallowability of
This subsection also includes NIH-specific requirements
concerning costs and activities. The allowability of costs under individual NIH
awards may be subject to other requirements specified in the program
legislation, regulations, or the specific terms and conditions of an award,
which will take precedence over the general discussion provided here.
Applicants or grantees that have questions concerning the allowability of
particular costs should contact the GMO.
If a cost is allowable, it is allocable as either a direct
cost or an F&A cost, depending on the grantee’s accounting system. For some
costs addressed in this subsection, the text specifies whether the cost is
usually a direct cost or an F&A cost.
Unless otherwise indicated in the NGA, an award based on an
application that includes specific information concerning any costs or
activities that require NIH prior approval constitutes the prior approval for
those costs or activities. The grantee is not required to obtain any additional
approval for those costs/activities. Post-award requests to incur costs or
undertake activities requiring prior approval that are not described in the approved
application are subject to the requirements in “Administrative
Requirements—Changes in Project and Budget.”
Consortium participants and contractors under grants are
subject to the requirements of the cost principles otherwise applicable to
their type of organization and to any requirements placed on them by the
grantee to be able to comply with the terms and conditions of the NIH grant.
The cost principles do not address profit or fee. NIH policy
allows the payment of fee on SBIR/STTR grants (see “Grants to For-Profit Organizations”) but NIH
will not provide profit or fee to any other type of recipient under any other
grant program or support mechanism. A fee may not be paid by a grantee to a
consortium participant, including a for-profit organization. However, a fee
(profit) may be paid to a contractor providing routine goods or services under
a grant in accordance with normal commercial practice.
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