09-29 April 2009
II - Grant Administration
A. Monitoring Project Performance
1. Grantee Responsibilities
a. A grantee has full responsibility for the conduct of the project or activity supported under an NSF grant and for the results achieved. The grantee should monitor the performance of the project to assure adherence to performance goals, time schedules or other requirements as appropriate to the project or the terms of the grant. In order to carry out these responsibilities, each grantee organization shall agree to comply with the applicable Federal requirements for grants and to the prudent management of all expenditures and actions affecting the grant. Documentation for each expenditure or action affecting the grant shall reflect appropriate organizational reviews or approvals, which should be made in advance of the action. Organizational reviews are intended to help assure that expenditures are allowable, necessary and reasonable for the conduct of the project, and that the proposed action:
(i) is consistent with grant terms and conditions;
(ii) is consistent with NSF and grantee policies;
(iii) represents effective utilization of resources; and
(iv) does not constitute a change in objective or scope.
b. Notwithstanding these responsibilities, NSF continues to encourage communication between NSF program officers and PI/PDs on the progress of projects supported by NSF as well as on project changes.
c. NSF, through authorized representatives, has the right, at all reasonable times, to make site visits to review project accomplishments, grantee management control systems and administration and management of the grant and to provide technical assistance as may be required. If any site visit is made by the Foundation on the premises of the grantee or a subawardee under a grant, the grantee shall provide and shall require its subawardees to provide all reasonable facilities and assistance for the safety and convenience of the NSF representatives.
2. Grantee Notifications to NSF and Requests for NSF Approval
a. AAG Exhibit II-1 provides a listing of grantee notifications to and requests for approval from NSF. While the listing is not intended to be all-inclusive, it does highlight the most frequent areas where specific notifications and requests for approval are called for.
b. All notifications and requests contained in Exhibit II-1, and described below, must be submitted electronically via the NSF FastLane System.
B. Changes in Project Direction or Management
1. Changes in Objectives, Scope or Methodology
a. Changes in Objectives or Scope
Neither the phenomena under study nor the objectives of the project stated in the proposal or agreed modifications thereto should be changed without prior NSF approval. Such changes should be proposed to the cognizant NSF Program Officer by the PI/PD. If approved by NSF, the Grants and Agreements Officer will amend the grant.
b. Changes in Methodology
NSF believes that the PI/PD and co-PI/co-PD, operating within the established policies of the grantee organization, should feel free to pursue interesting and important leads that may arise during the conduct of a research (or other grant-supported) project or to adopt an alternative approach which appears to be a more promising means of achieving the objectives of the project. Significant changes in methods or procedures should be reported to appropriate grantee official(s) and the cognizant NSF Program Officer.
c. Significant Changes, Delays or Events of Unusual Interest
(i) In the event there are problems, delays or adverse conditions that will materially affect the ability to attain the objectives of the project or to meet such time schedules as may have been proposed, appropriate grantee officials should notify the NSF Program Officer.
(ii) NSF should be informed of any events of unusual interest that occur during the course of the project. Reports, communications or photographs should be submitted via the interim report capability in FastLane.
2. Changes in PI/PD, co-PI/co-PD or Person-Months Devoted to the Project
The NSF decision to support or not to support a proposed project is based to a considerable extent upon its evaluation of the proposed PI/PD and any identified co-PI/co-PD’s knowledge of the field of study and his/her capabilities to conduct the project in an efficient and productive manner. This is reflected in the NSF criteria for the selection of projects for funding (see GPG Chapter III). The named PI/PD (and co-PI/co-PD) should be continuously responsible for the conduct of the project and be closely involved with the effort.
b. Basic Requirements
If the PI/PD or co-PI/co-PD plans to, or becomes aware that he/she will: (i) devote substantially less effort to the project than anticipated in the approved proposal; (ii) sever his/her connection with the grantee organization; or (iii) otherwise relinquish active direction of the project, he/she shall advise the appropriate official at the grantee organization, who shall initiate action appropriate to the situation under the guidelines that follow.
c. Short-Term Absence of PI/PD or co-PI/co-PD
If the PI/PD or co-PI/co-PD will be absent from the project for short periods of up to three months, he/she shall notify appropriate officials of the grantee organization. The grantee shall then notify the NSF Program Officer of arrangements for conduct of the project during the PI/PD’s or co-PI/co-PD’s temporary absence.
d. Long-Term Absence of PI/PD or co-PI/co-PD
(i) In the event the PI/PD or co-PI/co-PD will be away from the project for a period greater than three months (e.g. sabbatical leave) but intends to return, arrangements for oversight of the project shall be sent electronically to NSF for approval. This information must be provided at least 30 days before departure or as soon as practicable after the prospective absence is known. The NSF Program Officer will provide written approval to the grantee if the arrangements are satisfactory, but no formal amendment to the grant will be made.
(ii) If the arrangements are not satisfactory to NSF, the grant may be terminated as prescribed in AAG Chapter VII.A. If the PI/PD’s or co-PI/co-PD’s temporary activities might constitute a conflict of interest (e.g., working for a Federal agency), a substitute PI/PD or co-PI/co-PD shall be appointed as described in AAG Chapter II.B.2g.
e. Change in Person-Months Devoted to the Project
If the PI/PD or co-PI/co-PD will devote substantially less time to the project than anticipated in the proposal, (defined in the Research Terms and Conditions (RTC) and NSF Grant Conditions (GC-1) as a reduction of 25% or more in time) he/she should consult with appropriate officials of the grantee organization and with the NSF Program Officer. If either determines that the reduction of effort will substantially impair the successful execution of the project, the Program Officer will consult the NSF Grants and Agreements Officer. The NSF Grants and Agreements Officer may:
(i) request the grantee to nominate a replacement PI/PD or co-PI/co-PD acceptable to the NSF Program Officer;
(ii) initiate the termination procedures described in AAG Chapter VII.A; or
(iii) negotiate an appropriate modification to the grant.
f. Withdrawal of PI/PD or co-PI/co-PD
In the event the PI/PD or co-PI/co-PD severs his/her connection with the grantee organization or otherwise relinquishes active direction of the project, the grantee, or equivalent, must notify the NSF Program Officer via the Notification and Request module in FastLane, and either:
(i) initiate transfer of the grant as described in AAG Chapter II.B.2h;
(ii) nominate a substitute as described in AAG Chapter II.B.2g; or
(iii) initiate grant closeout procedures through submission of final reports (AAG Chapter II.E.2 and AAG Chapter III.E.2).
g. Substitute PI/PD or co-PI/co-PD
In the event the grantee desires to continue the project with a substitute PI/PD or co-PI/co-PD, the appropriate officials at the grantee organization must advise the NSF Program Officer of the substitute PI/PD’s or co-PI/co-PD’s name, qualifications, and current and pending support for research from all sources. If approved by NSF, the Grants Officer will amend the grant. If not approved, NSF may take steps, pursuant to AAG Chapter VII.A to suspend or terminate the grant.
h. Disposition of a Grant When a PI/PD or co-PI/co-PD Transfers from One Organization to Another Organization
(i) Policy. When a PI/PD plans to leave an organization during the course of a grant, the organization has the prerogative to nominate a substitute PI/PD or request that the grant be terminated and closed out. In those cases where the PI/PD’s original and new organizations agree, NSF will facilitate a transfer of the grant and the assignment of remaining unobligated funds to the PI/PD’s new organization. This should normally be done with a tripartite agreement (involving NSF, the PI/PD’s original organization and new organization), or by a subaward arrangement (in certain circumstances) between the PI/PD’s original and new organizations, subject to NSF’s consent. (See AAG Chapter II.B.3.)
(ii) Procedures. When a PI/PD plans to leave an organization during the course of a grant, the PI/PD or the Sponsored Projects Office, or equivalent, shall notify the NSF Program Office. If the project is to continue with the original organization, the NSF Program Officer should advise the grantee to nominate a substitute PI/PD (see AAG Chapter II.B.2g. If the project is to be continued at the PI/PD’s new organization, and if NSF and both organizations agree, formal notification of the impending transfer can be electronically initiated by either the PI/PD or the PI/PD's organization. The most current Federal Cash Transaction Report must be posted to NSF’s financial accounting system prior to submitting the PI/PD transfer. The amount transferred has to be equal to or less than the unobligated balance.
The request shall include a:
(a) brief summary of progress to date;
(b) description of work yet to be accomplished;
(c) completed on-line transfer request, including total estimated disbursements to date (transfer amount will be automatically calculated, based on the amount entered in total estimated disbursements). The original organization is responsible for including in the total estimated disbursements, any anticipated costs yet to be incurred against the original grant.
(d) detailed line item budget for the transfer amount and any outstanding continuing grant increments.
The original organization concurs with the transfer of the award by electronically forwarding the request to the new organization.
The new organization completes the request by providing a detailed budget for the transfer amount agreed to by both organizations. The new organization must electronically sign the request when submitted to NSF. Submission of the request constitutes agreement by the new organization to assume responsibility for completion of the project effort and to administer the grant (as originally awarded) from the transfer date to completion in accordance with any special terms and conditions and the applicable general terms and conditions that normally govern NSF grants made to the new organization. Special terms and conditions, as appropriate, cited in the original award will convey to the new grantee organization.
FastLane will assign at submission a proposal number. This proposal number will become the new grant number when the transfer is approved by an NSF Grants and Agreements Officer.
(iii) Fund Transfer. Upon receipt of the above material, NSF will review the request and, if approved, deduct the specified transfer amount from the original grant and re-establish it under a new grant number at the new organization. Award notification by the NSF Grants and Agreements Officer will constitute NSF approval of the grant transfer. The award notification also will specify the applicable basic terms and conditions that govern the grant (i.e., RTC, NSF GC-1, FDP, or other Terms and Conditions).
(iv) Upon transfer of the grant to the new organization, any monetary discrepancies must be resolved between the original and the new grantee. NSF will not intervene in any disputes between the two organizations regarding the transferred amount.
(v) Equipment Transfers. Equipment purchased with NSF funds for use in a specific project should remain available for use for the duration of the project. PI/PDs who are in the midst of projects that included funding for equipment and who will continue the project at a new organization with NSF support should be able to arrange with their original organization to have the equipment transferred with them. Shipping costs for such equipment may be charged to the original or transferred grant as an allowable cost. Budgets should not include funds to “buy” equipment that had been previously obtained with Federal funds.
(vi) Possible Alternatives to the Transfer Process. When the amount of time and funds remaining in a project are modest, and if both the original and new organizations are in agreement, the original organization may issue a subaward to the new organization for completion of the project. This and other possible alternatives should be discussed with the NSF Grants and Agreements Officer.
3. Contracting or Transferring the Project Effort (Subawards)
a. Excluding the procurement of items such as commercially available supplies, materials, equipment or general support services allowable under the grant, no significant part of the research or substantive effort under an NSF grant may be contracted or otherwise transferred to another organization without prior NSF authorization. The intent to enter into such arrangements should be disclosed in the proposal submission.
b. If it becomes necessary to contract or otherwise transfer a significant part of the research or substantive effort after a grant has been made, the grantee shall submit, at a minimum:
(i) a clear description of the work to be performed;
(ii) the basis for selection of the subawardee (except for collaborative/joint arrangements5); and
(iii) a separate budget for each subaward.
The request must be submitted electronically, and NSF authorization will be indicated by an amendment to the grant signed by the Grants and Agreements Officer. The NSF grant conditions will identify which articles flow-down to subawardees.
c. Procurements under NSF grants are also subject to AAG Chapter V.C and OMB Circular A-110 Sections .41 through .48. (2 CFR §215.41-48)
C. Changes in the Grant Budget
1. OMB Directives
Section .25 of OMB Circular A-110 (2 CFR §215.25) contains optional requirements regarding budgetary revisions. NSF elects NOT to impose the following requirements on its grantees:
a. prior approval requirements for appropriate transfer between direct and indirect cost categories of the grant budget; and
b. restrictions in transfers of funds among direct cost categories for grants in which the Federal share exceeds $100,000.
2. Grant Changes and Approvals
a. If required in furtherance of the project, the grantee is authorized to transfer funds from one budget category to another for allowable expenditures. Exhibit II-1, however, highlights certain budget changes that may require prior NSF approval.
b. When a change requires NSF approval, the request must be submitted electronically via use of the Notification and Request module in FastLane. The request should clearly state which budget items, if any, are to be changed and by what amounts, and should explain the reasons for any changes
c. Whenever the amount of Federal funds authorized by an NSF grant is expected to exceed the requirements of the project, as outlined in the approved proposal, by more than $5,000 or 5 percent of the grant amount, whichever is greater, the grantee will promptly notify the NSF Program Officer.
D. Cost Sharing
Since issuance of the NSF Cost Sharing Policy in 1999, the Foundation’s cost sharing policy has continued to be an issue widely discussed by the community, as well as within NSF and the National Science Board (NSB). Cost sharing was most recently discussed formally at the NSB's 382nd meeting on October 13-14, 2004, when the Board approved a revision to the Foundation's policy on cost sharing to eliminate NSF program-specific cost sharing requirements.
In implementation of the Board's policy, there is no expectation by the Foundation that proposals submitted for funding will include a cost sharing component. When cost sharing is included on Line M, it is solely at the discretion of the proposing institution and will not be a factor in the Foundation's decision to make an award. However, once cost sharing is proposed on Line M, and accepted by the Foundation, the commitment of funds becomes legally binding is subject to audit.6
Failure to provide the level of cost sharing reflected in the approved grant budget may result in termination of the NSF grant, disallowance of grant costs and/or refund of grant funds to NSF by the grantee.
1. Statutory 1% Cost Sharing Requirement
In accordance with prior Congressional requirements, NSF required that each grantee share in the cost of NSF research projects resulting from unsolicited proposals. The appropriations providing funds to NSF and other independent agencies contained the following language:
“None of the funds provided in this Act may be used for payment, through grants and contracts, to recipients that do not share in the cost of conducting research resulting from proposals for projects not specifically solicited by the Government: Provided, that the extent of cost sharing by the recipient shall reflect the mutuality of interest of the grantee or contractor and the Government in the research.”
The statutory cost sharing requirement is eliminated effective with awards made on or after June 1, 2007.
2. Awards Issued Prior to Elimination of Statutory (1%) Cost Sharing Requirement
There are many existing awards that were awarded prior to the elimination of the statutory cost sharing amount. Grantees can meet the amount by either of two alternative methods:
(a) cost sharing one percent on each and every project; or
(b) cost sharing one percent on the aggregate total costs of all projects requiring cost sharing. This latter approach allows organizations greater flexibility by being able to share a greater percentage on some projects and not share at all on others.
Decisions on which method to use may be made by the grantee, and there is no requirement that NSF either be advised or approve of the method chosen. NSF does not use “organizational cost sharing agreements,” such as those used by some granting agencies, to provide for aggregated cost sharing.
Cost sharing responsibilities are assumed by the grantee upon acceptance of the grant. This accountability extends to subawardee cost share commitments made under the award.
3. Method of Providing Contributions
Unless the grant states otherwise, contributions may be made from any non-Federal source, including non-Federal grants or contracts. Contributions from non-Federal sources may be counted as cost sharing toward Federal projects only once. Thus, contributions counted as cost sharing toward projects of another Federal agency may not be counted as cost sharing toward projects supported by NSF. If such contributions however, are related to projects supported by more than one Federal agency, the recipient may elect to make a proration among the agencies involved.
The contributions may be in the form of either direct or indirect costs.
Only items that would be allowable under the applicable cost principles, if charged to the project, may be included as the grantee’s contribution.
Organizations will not be required to obtain prior NSF approval of the manner in which contributions are to be provided. The contributions may be in any allowable budget category or combination of categories. When direct cost items are contributed to the project, however, any indirect costs related to that item may not be charged to the project. Those indirect costs may, of course, be counted as part of the contribution. This restriction also applies to fringe benefits (when treated as direct costs) applicable to direct salaries contributed by the recipient.
If a grantee wishes to provide cost sharing in the indirect cost category, it should merely reduce its claim for indirect costs to which it would be otherwise entitled, indicating the difference as cost sharing.
4. Cost Sharing Records and Reports
a. Grantee Records.
(i) Grantees shall maintain records of all research project costs that are claimed by the grantee as being its contribution to cost participation, as well as records of costs to be paid by the government. Such records are subject to audit.
(ii) If the grantee’s cost participation includes in-kind contributions, the basis for determining the valuation for volunteer services and donated property must be documented.
(iii) Grantees using the aggregate cost sharing method may find it useful, on a fiscal year basis, to prepare a summary of the total project costs for the year of all NSF-funded projects requiring cost sharing (excluding those grants which require specific cost sharing amounts or percentages; see AAG Chapter II.D.5, the total amount of cost sharing on those projects for the year, and the aggregate level of cost sharing expressed as a percentage of contributed costs to total project costs. Such information will facilitate organizational and Federal audit review and analysis of compliance with the cost sharing requirements on the aggregate basis.
b. Grantee Reports. Unless otherwise required by the grant or requested by NSF, the actual cost participation by the grantee need not be reported to NSF. Recognizing that there are some awards that contain cost sharing, in those cases where the cost-sharing amount reflected on Line M of the cumulative award budget is $500,000 or more, the amount of cost sharing must be documented (on an annual and final basis), certified by the Authorized Organizational Representative, and reported to the NSF Program Officer via the reporting module in FastLane.
c. Should the awardee become aware that it may be unable to provide the cost sharing of at least the amount identified on Line M of the NSF award budget, it must: 1) immediately provide written notification to the Grants Officer of the situation; 2) indicate steps it plans to take to secure replacement cost sharing; 3) indicate the plans it has to either continue or phase out the project in the absence of cost sharing.
5. Cost Sharing Commitments
Grantees should be aware that cost sharing commitments are subject to audit. Audit findings involving cost sharing have pertained to: a) grantee accounting systems not capturing cost sharing identified with a particular project; b) failure to keep adequate source documentation for claimed cost sharing; c) unclear valuation of in-kind donated contributions; d) lack of support for cost sharing contributions by sub-recipients; and e) failure to complete annual certifications for awards with cost sharing requirements of $500,000 or more. These certifications must be submitted electronically via FastLane. Additional guidance on cost sharing may be obtained at http://www.nsf.gov/bfa/dias/caar/costrev.jsp.
Section .23 of OMB Circular A-110 (2 CFR §215.30) prescribes criteria and procedures for the allowability of cash and in-kind contributions in satisfying cost sharing and matching requirements. Cost sharing is defined as “all contributions, including cash and third party in-kind which meet seven criteria: verifiable, not included as contributions for any other federally-assisted project or program, necessary and reasonable for accomplishment of objectives, allowable, not paid by the Federal Government under another award (except where authorized by statute), provided for in the approved budget when required by the Federal awarding agency, and conform to other Circular provisions.”
E. Technical Reporting Requirements
NSF requires technical project reports for all assistance awards. Information from these reports is used in annual reports to Congress to demonstrate the Foundation’s performance as mandated by the Government Performance and Results Act (GPRA) of 1993. These reports also provide NSF program officers and administrative offices with information on the progress of supported projects and the way these funds are used. Information in these reports may be made available to the general public through the Freedom of Information Act (FOIA).
Technical reports must be submitted via the electronic project reporting system in FastLane.
1. Annual Project Reports
Unless otherwise specified in the grant, annual project reports shall be submitted at least 90 days prior to the end of the current budget period. In the case of continuing grants, failure to submit timely reports may delay processing of funding increments. See also AAG Chapter I.E.3.
Annual project reports are generally not required for fellowship awards. Specific reporting requirements for fellowships are established in the program solicitation and award conditions.
For multi-year standard grants, PIs are required to submit an annual report at least 90 days prior to the end of each 12 month period. In the case of cooperative agreements, the annual report is required before NSF approves any future funding increments.
Continuing grants also require annual reports at least 90 days prior to the end of each 12 month period. For continuing grants that have a duration of 18 months or more per increment, two annual reports are required. A report must be submitted for the first 12 months of the project, and then another report for the remaining months of the increment. Continuing grants which include an initial increment of 24 months will require an annual report at the end of each 12 month period.
2. Final Project Report
Within 90 days following expiration of the grant, a final project report must be submitted electronically via the NSF FastLane System. In addition, the grantee also shall provide to the cognizant NSF Program Officer, within 90 days following the expiration of the grant:
- any unique reports or other end items specified in the award, including any reporting requirements set forth in any NSF brochure, guide, solicitation, etc., referenced in the award as being directly related to either the award or the administration of the award.
- a final cost share notification documented and certified by the Authorized Organizational Representative for awards where the cost sharing amount reflected on Line M of the cumulative award budget is $500,000 or more.
Final project reports are normally not required for institutional graduate research fellowships and interagency agreements. However, final project reporting requirements for individual fellowships are established in the program solicitation.
3. Final Technical Information Items
As soon as they are available after completion of the project, the following technical items shall be submitted for NSF program management use:
a. abstracts of theses;
b. publication citations and reprints of articles;
c. data on scientific collaborations;
d. information on inventions;
e. technical description of the project and results;
f. other materials either required in the grant or considered to be useful to NSF; and
g. Universal Resource Locator numbers of electronic publications generated by the project.
4. Compliance with Technical Reporting Requirements
PIs must submit final technical reports within the time period specified. Failure to provide these reports on a timely basis will delay NSF review and processing of pending proposals for all identified PIs and co-PIs on a given award.
5. Grant Closeout
Grant closeout is the process by which NSF determines that all applicable administrative actions and all required work of the grant have been completed. Grants will be financially closed based on final costs reported on the Federal Financial Report (FFR) one full quarter after the expiration of the grant. Grants are administratively closed after receipt of the Final Project Report and after determination that any other administrative requirements in the grant have been met. In the event a final audit has not been performed prior to the closeout of the grant, NSF reserves the right to recover appropriate amounts after fully considering the recommendations on disallowed costs resulting from the final audit.
F. Records Retention and Audit
1. records, supporting documents, statistical records and other records pertinent to a grant will be retained by the grantee for a period of three years from submission of the Final Project Report described in AAG Chapter II.E.2 except that:
a. records related to audits, appeals, litigation or the settlement of claims arising out of the performance of the project will be retained until such audits, appeals, litigation or claims have been disposed of; and
b. records related to projects subject to special program income provisions (AAG Chapter VI.F.3) will be retained for three years beyond the end of the award period.
2. Unless court action or audit proceedings have been initiated, the grantee may substitute microfilm copies of original records.
3. The NSF Director and the Comptroller General of the United States, or any of their duly authorized representatives, shall have access to any pertinent books, documents, papers and records, of the grantee organization (and of the performing organization, if different) to make audits, examinations, excerpts and transcripts. Further, in accordance with Section .48(d) of OMB Circular A-110 (2 CFR §215.48(d)), any negotiated contract in excess of the small purchase threshold made by the grantee shall include a provision to the effect that the grantee, NSF, the Comptroller General or any of their duly authorized representatives, shall have access to pertinent records for similar purposes.
4. In order to avoid duplicate recordkeeping, NSF may make special arrangements with grantees to retain any records which are needed for joint use. NSF may request transfer to its custody of records not needed by the grantee when it determines that the records possess long-term retention value. When the records are transferred to or maintained by NSF, the three-year retention requirement is not applicable to the grantee. In the rare event that these provisions are exercised, NSF will negotiate a mutually agreeable arrangement with the grantee regarding reimbursement of costs.
5. It is the responsibility of grantees that are States, Local Governments or Non-Profit Organizations to arrange for the conduct of audits as required by OMB Circular A 133 “Audits of States, Local Governments, and Non-Profit Organizations” (including colleges and universities.) They shall provide copies of the reports of these audits to the cognizant Federal audit agency. Any Federal audit deemed necessary by NSF shall build upon the results of such audit(s).
Collaborative/joint arrangements may include closely related and coordinated activities at another organization; a joint activity by several organizations or consortia; and group proposals from multiple organizations. Back to Text
If proposed, the estimated value of any in-kind contributions should be included on Line M. An explanation of the source, nature, amount and availability of any proposed cost sharing also must be provided in the budget justification. Section .23 of OMB Circular A-110 describes criteria and procedures for the allowability of cash and in-kind contributions in satisfying cost sharing and matching requirements. Back to Text