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Pre-Award Spending

 

Background and Contingencies

Under limited circumstances, Principal Investigators (PIs) may request authorization to spend funds in support of a sponsored project in advance of receiving a notice of an award from a sponsor. Authorization of pre-award spending is contingent upon the following:

  • An essential need to advance or commit funds prior to the receipt of an award;
  • Approval of human subjects, animal and/or biosafety protocols, as applicable;
  • Successful completion of the human subject tutorial by the PI and all key personnel participating on the project, if human subjects are involved;
  • Approval of financial disclosures on the Federal Financial Disclosure form and/or the State Financial Disclosure form 700-U, as applicable;
  • Approval of Exception to Principal Investigator Eligibility, as applicable;
  • Certification by the Principal Investigator that the level of effort, scope, and objectives of the project as proposed or negotiated will not change;
  • Certification by the chair/director of the unit responsible for administering the anticipated award, along with the appropriate dean or vice chancellor, that any monetary loss to the campus resulting from the sponsor's failure to make the award, or from costs incurred but disallowed by the sponsor, shall be the responsibility of that unit or school; and
  • Receipt of a firm commitment by an authorized representative of the sponsor to the Office of Research Administration (ORA) that an award is forthcoming.

Pre-Award Spending - Risks, Liabilities and Limitations

The risks, liabilities and limitations associated with pre-award spending must be carefully considered prior to requesting authorization to spend funds in advance of receiving the award.

Risks: Whenever the University authorizes pre-award spending, the University is risking monetary loss. Other funding must be available to cover the risk of a delayed start date, costs disallowed by the sponsor or failure of the sponsor to make an award as anticipated.

Liabilities: Special care must be exercised in assessing the impact of pre-award spending on the legal obligations of the University prior to requesting or approving a RAS. The University must consider the impact of not having a fully executed grant or contract agreement on its legal obligations regarding intellectual property rights, subject injury, indemnification, etc.

To minimize the legal liabilities, approval of pre-award spending is prohibited for agreements with for-profit entities and agreements for clinical trials.

Limitations: A sponsor's policies, the terms and conditions of the anticipated award, and campus policies and practices determine whether or not pre-award spending or pre-award activities are allowable. Restrictions differ depending on the funding agency and the type of award anticipated (i.e., grant, cooperative agreement, or contract).

Submission and Routing of RAS

Requests for pre-award spending are routed on the Request for Approval to Spend Funds ("RAS") form.

The PI should complete the RAS, explaining the essential need, the amount of funds and the period of time requested for pre-award spending. The PI must also sign and date the RAS; thereby certifying that the level of effort, scope and objectives of the project as proposed or negotiated will not change.

The Department Chair/Director and the Dean/Vice Chancellor each must sign the RAS and place a check mark in the appropriate boxes indicating who will provide funding for any losses incurred as a consequence of the approval of this request.

Once the RAS is completed and signed, it may be submitted to Sponsored Projects (SP) to secure a firm commitment from the sponsor's authorized representative. SP will analyze the request to verify all administrative requirements have been met. If such requirements have been met, SP will secure a firm commitment from the sponsor's authorized representative.

If the sponsor provides a firm commitment, SP will then approve the RAS and forward it to Contract and Grant Accounting for account/fund number assignment.

If the sponsor cannot provide a firm commitment, pre-award spending will not be approved, unless the department chair/director or dean, as appropriate, is willing to accept the increased risk.

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