Caveats to Consider Before Preaward Spending

Funding News Edition: September 20, 2023
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Imagine this scenario: your application received a score within our published payline and you’re waiting for your Notice of Award to start your project. In fact, you feel confident that you could initiate the research project immediately but for lack of money.

One option you have is to ask your institutional business office for preaward spending approval to cover costs up to 90 days before the start date of the initial budget period of a new or renewal award. Those funds would allow you to begin working on your project. However, there are some considerations you should be aware of first.

It is crucial to get permission before you spend since your institution is responsible for your expenses in the event that we reduce your award or cannot issue your grant, which can happen if we are unable to resolve a Bar to Award for human subjects or animal welfare concerns.

Keep the following key points in mind:

  • Incurring preaward costs in anticipation of a competing or noncompeting award does not put NIH under any obligation to make the award or to increase the amount of the approved budget if an award is made for less than the amount anticipated and is inadequate to cover preaward costs incurred.
  • Inherently, preaward costs result in borrowing against future support. This borrowing must not impair the recipient’s ability to accomplish the project objectives in the approved time frame or in any way adversely affect the conduct of the project.

If your institution gives you permission to use its money, the only preaward spending costs you can incur are those that: 1) are needed to conduct the project and 2) would be allowable under the grant’s approved scope, if awarded (inherently, you lack prior approval for a change of scope.)

Remember that for noncompeting grants, recipients submit progress reports at least annually and NIH grants management and program staff must assess these reports before award of the next noncompeting budget period. Even though you have an annual budget cap, you can still access the next year’s funds in the current award period if you have institutional approval.

For more information, check out Pre-Award (Pre-Agreement) Costs.

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