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Pre-award Costs

The concept of pre-award costs - allowing recipients to begin sponsored program spending prior to the receipt of an actual award - came about several years ago as a government effort to streamline the administration of its awards. The allowability of pre-award costs is determined by either 1.) Office of Management and Budget (OMB) Circular A-110 Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations (generally for grants and cooperative agreements), or 2.) individual contracting officer approvals on a case-by-case basis (federal contracts). The authorization of recipients to incur pre-award costs must be explicitly stated in the award document or incorporated by reference.

Pre-award costs provide the option to recipient institutions of not having to wait for the actual receipt of an award, which may be released later than expected for a variety of reasons. The only caveat to incurring pre-award costs is that, while pre-award may be allowed by the sponsor, the government will reimburse pre-award costs only in the event that an award is made and sufficient funding is made available. Until that time, pre-award costs are incurred at the risk of the institution. OMB Circular A-110 states in 25.(e)(1) that "All pre-award costs are incurred at the recipient's risk (i.e., the Federal awarding agency is under no obligation to reimburse such costs if for any reason the recipient does not receive an award or if the award is less than anticipated and inadequate to cover such costs)."

At Worcester Polytechnic Institute, authorization to incur pre-award costs may be requested using the "Institute Prior Approval System (IPAS)" Form. This form, when completed and authorized on behalf of the department, should be submitted to the Office of Research Administration (ORA), together with available documentation supporting the expectation that an award will be forthcoming.

Questions regarding pre-award costs may be addressed to ORA.

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Last modified: April 24, 2008 11:27:54