Spending Prior to the Award Period of Performance Start Date
There are times when it is in the best interest of the project to spend funds prior to the award period start date. An example is when equipment needs to be ordered so that it is available for use at the beginning of the project. Prior approval from the sponsor is necessary before spending funds before the start date. Some sponsors automatically allow pre-award spending during a certain period before the start date. The department and PI should consult the award terms and conditions for the requirements particular to their award. If prior approval is required, the department or PI should forward the prior approval request to their SPO team for review and submission to the sponsor. If the sponsor does not require prior approval, the department should forward the PI's request to their SPO team for processing in ORBiT.
Spending Prior to the Receipt of an Award
Under limited circumstances, Principal Investigators (PIs) may request authorization to spend funds in support of a sponsored project in advance of receiving an award from a sponsor. This is called a Request for Approval to Spend Funds or RAS. Authorization of spending prior to receiving an award 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;
- 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 PI along with the approval from the appropriate dean and the VCR, 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 the PI and backed up by the funding source provided on the pre-award spending form; and
- Receipt of a firm commitment by an authorized representative of the sponsor to SPO that an award is forthcoming.
Before requesting a RAS, please review the campus policy on spending prior to receipt of an award.
Spending Prior to Receipt of an Award: 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 a RAS, the University is risking monetary loss. The PI must identify other funding that 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 a RAS 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.
- Limitations: A sponsor's policies, the terms and conditions of the anticipated award, and campus policies and practices determine whether or not a RAS and the associated 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).
REQUESTING A RAS:
When requesting a RAS please complete the Request for Approval to Expend Funds (RAS) form.
Once the form is completed and signed, it may be submitted to Sponsored Projects (SPO) to secure a firm commitment from the sponsor's authorized representative. SPO will analyze the request to verify all administrative requirements have been met. If such requirements have been met, SPO will secure a firm commitment from the sponsor's authorized representative.
If the sponsor provides a firm commitment, SPO will then approve the RAS and forward it to Extramural Funds Accounting for account/fund number assignment.