Program Income

Certain kinds of NIH grants generate income for Meharry Medical College. Examples include grants that  pay for the operation of core facilities that charge users for their services; and grants that fund  conferences for which participants pay a registration fee. If you direct such a project you must set up a  Meharry account to receive this income. Such accounts are known as program income accounts; to set  one up, contact Mr. George Williams, Director of the Office of Grants and Contracts Administration at  6815. 

In general NIH requires income generated by a grant to be spent in ways which further the program  funded by the parent grant. In addition, Meharry must report such income in the annual progress report  that it submits to NIH, and in the financial status reports sent to NIH by the Office of Grants and  Contracts Administration. These requirements are outlined in the NIH Grants Policy Statement at

http://grants1.nih.gov/grants/policy/nihgps_2003/index.htm

The text of this section is given below: 

Program income is gross income earned by a grantee, a consortium participant, or a contractor  under a grant that was directly generated by the grant-supported activity or earned as a result  of the award. Program income includes, but is not limited to, income from fees for services  performed, the use or rental of real or personal property acquired under the grant, the sale of  commodities or items fabricated under an award, and license fees and royalties on patents and  copyrights. The requirements for accountability for these various types of income under NIH  grants are specified in this subsection. Accountability refers to whether NIH will specify how  the income is to be used and whether the income needs to be reported to NIH and for what  length of time. Unless otherwise specified in the terms and conditions of the award, NIH  grantees are not accountable for program income accrued after the period of grant support. 

Consortium agreements and contracts under grants are subject to the terms of the agreement  or contract with regard to the income generated by the activities, but the terms specified by  the grantee must be consistent with the requirements of the grant award. Program income  must be reported by the grantee as discussed in this subsection. 

Program income earned during the period of grant support (other than income earned as a  result of copyrights, patents, or inventions or as a result of the sale of real property,  equipment, or supplies) shall be retained by the grantee and may be used in one or a  combination of the alternatives indicated in Table II-3 as specified by NIH. This includes  income earned from charges to third parties for use of equipment or supplies acquired with  NIH grant funds as well as charges for research resources. 

NIH may require an different use of program income than that indicated in Table II-3 if a  grantee has deficient systems or the PI has a history of frequent, large annual unobligated  balances on previous grants or has requested multiple extensions of the budget/project period.  Regardless of the alternative applied, program income may be used only for allowable costs,  in accordance with the applicable cost principles and the terms and conditions of the award. 

TABLE II-3
REQUIREMENTS FOR PROGRAM INCOME ACCOUNTABILITY

Reporting of Program Income

If a grantee is accountable for the use of program income during the period of grant support  (other than income resulting from royalties or licensing fees, for which there may be no  accountability or which will be reported separately), the amount earned and the amount  expended must be reported on the FSR (SF-269—Long Form). The costs associated with the  generation of the "gross" amount of program income, if they are not costs charged to the grant,  should be deducted from the "gross" program income earned, and the "net" program income  should be the amount reported. Program income subject to the additive alternative must be  reported on lines 10r and 10s, as appropriate, of the FSR (SF-269); program income subject to  the deductive alternative must be reported on lines 10c and 10q of the FSR (SF-269); and  program income subject to the matching alternative must be reported on lines 10g and 10q of  the FSR (SF-269). (See "Administrative Requirements—Monitoring—Reporting.") For awards  under SNAP, the amount of program income earned must be reported in the noncompeting  continuation request and the amount expended reported on line 11g of the FCTR (SF-272). The  FSR for the competitive segment must include the aggregate amounts earned and spent.     

Income earned from the sale of equipment must be reported on the FSR for the period in which  the proceeds are received and in accordance with the reporting requirements for the program  income alternative specified. Amounts due NIH for unused supplies must be reflected as a  credit to the grant on line 10c of the FSR (SF-269).     

Where the terms of the NGA, including this policy statement, do not specify any accountability  requirement for income earned, no reporting of income is required. Reporting requirements for  accountable income accrued after grant support ends will be specified in the NGA.