A dozen things All PIs should know about the U.S. Federal budget as it relates to NSF research grants


Things upstream from a grant decision


1

There is an annual budget cycle (see graphic, below):

a.    Request: The President puts out a plan for a budget in a request to Congress.

b.    Appropriation: Congress decides how much (described in this downloadable PDF) to actually provide to each agency, (e.g., NSF). This is signed into law by the President. Annual appropriations start on October 1 each year. Even if Congress is delayed in finalizing the budget for that year, the October 1 “birthday” of the funds applies retroactively.

c.    Allocation and Allotment: The appropriations are passed down from the Treasury through the agency to funding programs (e.g., Population and Community Ecology, Dimensions of Biodiversity).

d.    Commitment and Obligation: Funding is applied to projects (typically as grants) after merit review. Technically, Program Officers “recommend” funding (d-i), Division Directors concur the decision to “commit” funds (d-ii), Grants Specialists make the “award obligation” (d-iii), and the award is made to the institution (not the PI).

e.    Expenditure & Reimbursement: Over the subsequent months and years, the PIs of funded projects use the funding to make science happen and receive reimbursement from Treasury accounts.

Diagram of the relationship between the annual U.S. Federal budget process and NSF merit review system.

Diagram of the relationship between the annual U.S. Federal budget process and NSF merit review system.


2

At any given time, we are thinking about 3 or 4 different years’ budgets:

a.    Reporting on last year

b.    Managing this year

c.    Planning for next year

d.    Building momentum for the year after next


3

While we often refer to “the budget” in the singular abstract form, there are different pots of money at different levels in the agency.


4

At the highest level, there are 6 different pots (described in this PDF), called accounts[i]. These pots can’t be mixed[ii]. And, only 2 typically matter directly to researchers: Research & Related Activities (R&RA) and Education & Human Resources (EHR).


5

Individual program[iii] budgets, scopes, and lifespans are usually managed by each Division, but specific guidance from the White House Office of Management & Budget (OMB) or Congress can lead to changes and cancellations.


6

Our window to put the funding onto projects through grants (item 1d, above) is the most constrained step. Funds are supposed to arrive by October 1 each year, but it’s not uncommon that delays in the budget cycle mean we don’t see the full (i.e., appropriated and allocated) budget at the program level until the following March, April, or later. And, all funds need to be obligated by the end of each fiscal year (September 30)[iv].


 

Things downstream from a grant decision


7

Every dollar that supports your NSF research grant has an expiration date. The same is true for much of the Federal budget appropriated by Congress. For NSF research (R&RA) funds, the expiration date is 7 years from the start of the fiscal year (October 1 annually) in which the funds were provided to the agency (i.e., appropriated).


8

Because most DEB awards made in a given fiscal year have start dates well after October 1, the clock started ticking even before you received a grant. For example, if your award start date is July 1, then the funds you received are already 9 months old.


9

Although you can request a delay in the official start date of an award, which affects when you start spending your funds, you can’t delay the aging of your award funds. A delayed start doesn’t provide you any extra time to complete the work. The ultimate limit on how long you can extend a funded project (no-cost extensions) depends on when those dollars expire.


10

Money doesn’t actually go to your institution when you get a grant. It stays in the US Treasury until spent. We refer to your award as a federal obligation because it authorizes your institution to charge for expenditures incurred in the conduct of that award, and get reimbursed from the Treasury. We can see how much you have spent of your funds at any time.


11

There is a whole lot of regulation defining what projects can and can’t spend money on; meeting those regulatory obligations is largely the responsibility of your Sponsored Research Office (SRO)[v]. The ability of your SRO to meet those obligations is one of the things NSF reviews between the time when we (the programs) say “this is a good project” and the formal issuing of the grant. The consequences for failing to follow these rules are serious.


12

When we make a grant, we want you to use your full award. Funds that expire at the end of the 7 year clock don’t support your research or our mission. When we see expiring funds, we realize that we could have funded someone else but now we can’t (and there are lots of others who would have been happy for any funding). It also looks like you inflated your budget and/or can’t manage your projects effectively. And, it sends a message that the community has more money than it can put to good use.


[i] In 2009, ARRA “stimulus” funding was a 7th pot of money.

[ii] Without specific authority granted through legislation.

[iii] E.g., this list http://www.nsf.gov/funding/programs.jsp?org=DEB

[iv] Technically, NSF has two years in which to obligate our R&RA annual appropriation, but DEB, like most of NSF, does not “carryover” any funds into a second year. We commit and obligate every dollar allocated to us in a fiscal year and typically do so by mid-August. This allows maximum time for the funded projects to put the funds to use and minimizes the complexities of accounting across different appropriations.

[v] Therefore, your questions about use of funds already awarded should be directed at your SRO, not NSF Program Officers!

One thought on “A dozen things All PIs should know about the U.S. Federal budget as it relates to NSF research grants

  1. Pingback: Fall 2016 DEB Panels status: “When will I have a decision?” edition – DEBrief

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