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Rebudgeting

After a project gets underway, a Principal Investigator (P.I.) may determine that funds need to be rebudgeted in order to meet project objectives. Some Sponsors give universities the authority to approve rebudgeting of funds in-house as long as there is no change in scope to the project. Significant rebudgeting occurs when expenditures in a single direct cost category deviate (increase or decrease) from the categorical commitment level established for the budget period by more than 25 percent of the total costs awarded (excluding carry over amounts). If significant rebudgeting is requested by the department, then we will need approval from OSP before moving forward.

Due to the upcoming OMB circulars reform (effective December 2014 to be named Uniform Guidance) that is distributed by the Office of Management and Budget (OMB), it has been determined it is necessary to strengthen The Office of Post Award Management rebudgeting and over expenditure business process controls.

Effective November 2014, The Office Post Award Management (OPM) will ensure the following when processing/approving expenditure transactions (Personnel Action Forms, IDTS, travel, and any other journals):

  • The budget line item(C5011, C5021, C6000, etc) where the expense is going to be incurred has sufficient funds to cover the expense
  • The associated IDC calculation cost of the direct cost expenditure will not overrun the cost center

NOTE: If there is not sufficient funds in the budget item please follow the "Rebudget Process for all Sponsored Projects".

This will better able the Office of Post Award Management to help ensure compliance with the proposed budget award terms, New Uniform Guidance (one of the most significant changes in which is the timeframe of award close-outs that reporting MUST BE no later than 90 days after end date of period of performance – submittal of all performance, financial and other reports as required), help with ease of financial management throughout the life cycle of the award, and the above mentioned award close-out process.

OPM will continue to offer any assistance needed during this change of policy and any of your future financial endeavors. If any questions regarding this policy change please contact Kelly McKinney at 972-883-4540 or at kellymc@utdallas.edu

Rebudget Process for all Sponsored Projects
  1. All sponsored project budget revisions are conducted by the Office of Post Award Management (OPM). Please note approvals may be needed by the Office of Sponsored Projects (OSP) (See #7 below).
  2. All revision requests will be provided in email or written format and include the following:
    • Justification for why the budget is not being spent in the original category
    • Amount to be moved
    • "From" object code
    • "To" object code
    • Approval from the Principal Investigator named on the grant
  3. If the Revision is missing any of these items, it will be returned to the requestor for correction.
  4. OPM will notify the department and PI once a Revision is completed.
  5. All Revisions will be handled in the order they are received.
  6. Please allow 3 business days for processing.
  7. EXCEPTION: The following Revisions will need OSP approval prior to being sent to OPM:
    • Change of any named personnel
    • Reduction of salary/effort
    • Change in equipment costs
    • Addition of foreign travel
    • Change greater than 25% of budget item
    • Change in student support (C7000)

Any of the above Revisions will be provided to the OSP for review of compliance with the respective terms and conditions.

  1. If the Revision is within the guidelines of the grant/contract, OSP will assist in the departmental approval process and forward such Revision to OPM with email notification to the PI and department.
  2. If the Revision requires sponsor approval, OSP will seek such approval and notify via email the PI and department of such.
    • If approved by sponsor, OSP will forward to OPM for budget revision and notify department and PI that request has moved to OPM.
    • If the request is denied by sponsor, OSP will forward notification to PI and department.

Rebudgetting That Impacts F&A

Certain budget categories do not generate F&A:

  • Capital Equipment ≥ $5000
  • Tuition/Scholarships/Fellowships
  • Subcontracts over the first $25,000
  • NSF Participant Support
  • Rental costs of off-site facility

Please be aware of the following when a rebudget includes these items:

If the rebudget transfers money from a non F&A bearing budget item (such as equipment) to an F&A bearing item (such as materials), the F&A dollar amount will increase in order to maintain the contracted F&A percentage.

Example 1: Suppose a grant has capital equipment budget of $10,000 and an F&A rate of 56%. If only $8,000 was spent for equipment the PI would most likely want to spend the remaining $2,000 on other materials. This is acceptable; however the $2,000 balance in equipment will need to be rebudgeted between materials and F&A since the materials purchases will generate F&A. OPM can assist with these rebudgeting calculations. In this scenario, the $2,000 would be rebudgeted so that $1,282 would be added to materials and $718 added to F&A ($1,282 + $718 = $2,000).

If the rebudget transfers money from an F&A bearing budget item (such as materials) to a non F&A bearing budget item (such as equipment), the F&A dollar amount will decrease in order to maintain the contracted F&A percentage. When the F&A amount goes down, OSP approval may be required.

Example 2: Suppose a grant has capital equipment budget of $10,000 and an F&A rate of 56%. If $12,000 was spent on equipment a rebudget should be done to reduce the F&A dollar amount since the additional $2,000 spent on equipment does not generate F&A. OPM can assist with the re budgeting calculations. In this scenario, the F&A budget would be reduced by $1,120 (56% of $2,000) that could be re allocated to the equipment budget.

Exhibit A

Sponsor NCE Pre-Award Subcontracts PI Status Rebudgeting
The National Science Foundation (NSF) One time extension for up to 12 months may be approved institutionally. NSF must be notified with supporting reasons no later than 10 days prior to expiration date. Pre-award costs may be approved institutionally for costs incurred within 90 days preceding the effective date. NSF prior approval required for subcontracts not included in the approved budget. NIH prior approval is required for change of PI, absence of PI for 3 months or more or reduction of PI effort by 25% or more. NSF prior approval is required for reallocation of funds budgeted for participant or trainee support costs.
The National Institutes of Health (NIH) One time extension for up to 12 months may be approved institutionally. NASA must be notified with supporting reasons no later than 10 days prior to expiration date. Pre-award costs may be approved institutionally for costs incurred within 90 days preceding the effective date NIH prior approval is required for subcontracts not included in the approved budget only if transfer would be to a foreign component or result in a change in scope NIH prior approval is required for change of PI, absence of PI for 3 months or more or reduction of PI effort by 25% or more. Prior approval required when expenditures in a direct cost category increase/ decrease by more than 25% of the total award. (N/A to modular grants.)
The National Aeronautics and Space Administration (NASA) One time extension for up to 12 months may be approved institutionally. NASA must be notified with supporting reasons no later than 10 days prior to expiration date. Pre-award costs may be approved institutionally for costs incurred within 90 days preceding the effective date NASA prior approval is required for all subcontracts greater than $100,000 not included in the approved budget. Subcontracts of $100,000 or less not included in the approved budget may be approved institutionally. NASA prior approval is required for changeof PI, absence of PI for 3 months or more or reduction of PI effort by 25% or more. Per award terms
The Office of Naval Research (ONR) ONR prior approval is required. Pre-award costs may be approved institutionally for costs incurred within 90 days preceding the effective date AFOSR/ AFRL prior approval required for subcontracts not included in the approved budget. ONR Prior approval is required for change of PI, absence of PI for 3 months or more. Per award terms
The US Department of Energy (DOE)  One time extension for up to 12 months may be approved institutionally. DOE must be notified with supporting reasons no later than 10 days prior to expiration date. Pre-award costs may be approved institutionally for costs incurred within 90 days preceding the effective date DOE prior approval required for subcontracts not included in the approved budget. DOE prior approval is required for changeof PI, absence of PI for 3 months or more or reduction of PI effort by 25% or more. Per award terms

THIS IS A GUIDE THAT IS SUBJECT TO CHANGE BY THE SPONSOR