Grants and Contract Administration

Effective Date: 07/01/1995, updated 07/01/2009

Policy Statement 5:  Expenditure Guidelines – Allowable Costs and Cost Principles


Most sponsors issue their own policy guidelines and directives defining acceptable costs for purposes of their programs. Despite many similar policies among the various agencies, there are sufficient variations in requirements to make it impractical to issue and maintain one all-inclusive policy defining acceptable costs.  Principal Investigators (PI) and departmental administrators (DA) should review individual award terms and conditions and specific sponsor policies and guidelines in assessing the appropriateness of costs to be charged to a sponsored project.

Other Policy Statements in the Business Manual provide additional information on specific cost areas for sponsored projects.  The following information is provided as a general guideline.  Specific award terms and conditions or general sponsor policies may be more restrictive or may allow exceptions to the guidance provided.  

University policies may be more restrictive than sponsor regulations.  The most restrictive policy will usually apply to all expenditures.

The following information is based on federal regulations and some details do not apply to non-federal awards.  However, many non-federal sponsors have similar restrictions.  PIs/DAs are encouraged to closely review these guidelines before incurring costs on any sponsored project.  Even if not mandated by specific sponsor policies, the following guidelines provide best practices tips for managing sponsored awards, identify potential areas of concern or restricted costs, help departments develop adequate financial review and cost oversight practices and help minimize disallowances, audit findings and adverse management comments. 

For federal awards, a documented exception request and approval must be on file in the OGC audit file for any A21 normally not allowed or normally F&A costs to be incurred on a sponsored project.  A copy of the request format/form is at the end of these guidelines.  All exception requests should be submitted as soon as it is known that costs will need to be incurred.  A21 exceptional costs must be removed from the sponsored project to a non-sponsored fund if an authorization is not approved.  Inclusion of costs in a proposal budget is not an authorization.  All exceptional costs must have the specific approval of OGC.  Requests for exception may be submitted at the time of the proposal or after the award is received but must be approved prior to the budget end date.

Contact your OGC representative for information or questions on the requirements for a specific sponsor or award.


All costs charged to a sponsored project must be allowable under both sponsor guidelines and University policies.  An expense is allowable if it meets all of the following criteria:

·        The cost is incurred within the award budget term dates;

·        The cost is reasonable – a prudent person would have purchased this item at this cost;

·        The cost is necessary – the expense is specifically required to fulfill the terms and needs of the award;

·        The cost is allocable – the expense specifically benefits the award and when the item is used for more than one activity, award or purpose, the appropriate share charged can be documented and identified to the specific activity, award or purpose;

·        The cost is consistently treated – expenses of the same nature or used for the same purpose are treated and identified in a like way under like circumstances; and

·        The cost is not prohibited – the expense is not prohibited by sponsor policies and/or has specific sponsor approval and is not prohibited by University policies.

When costs are not allowed as a direct charge to the sponsored agreement, they usually cannot be used for cost-share or match purposes.  While there are occasional exceptions, cost-share expenditures must normally meet the same allowability criteria as costs charged directly to the sponsored project.


To facilitate reference, arrangement of this section is alphabetical. For comments and guidance on items not referenced, please consult sponsor policies or contact your OGC representative. 

For comments and guidance on F&A (indirect) costs, please contact OSP for proposal preparation prior to an award or OGC for expenditure information, calculations and distributions after the award has been issued.


Accounting and Audit Costs

Normally not allowed.  Specific authorization must be indicated in the award documents and all costs must be in accordance with University policies and procedures related to audits and accounting functions.  (Normally F&A.)

Administrative/Managerial/Clerical Salaries/Wages and Benefits

This category includes employees providing administrative or financial services to the PI/Department on behalf of the project.  Such costs are normally not allowable on federal awards without a specific exception authorized by OGC.  Such costs are also often restricted by non-federal sponsors.  Administrative/managerial costs should not be charged to a sponsored project without specific award approval.  (Normally F&A.)

Advertising and Promotion

Normally not allowed.  See exceptions for Patient and Participant Recruitment.


Not allowed.

Alterations or Renovations, Construction Costs, Architectural Fees

These costs are allowed only in exceptional cases and subject to specific sponsor guidelines and limitations. They are normally only authorized for construction-specific award and for specialized facility requirements; not for general purpose space or general facilities improvement.  (Normally F&A.)

Alumni Activities

Not allowed.


Purchase and animal care use fees or per diem is allowed for projects using animal models.  The award must indicate that animals will be used for the project and the sponsor must usually authorize animal costs.  Animal-related costs may not be incurred without an approved animal subjects protocol (as needed).  For additional information on procedures for animal protocol authorization requirements go to the ECU Institutional Animal Care and Use Committee (IACUC) website.

Costs for the purchase of animals, use fees or per diems must be established through a service center mechanism or vendor published catalog with consistently applied rates charged to all users.

Bad Debts

Not allowed.

Banking Fees, Charges or Interest

Normally not allowed.  International bank wire transfer fees, related to the project expenditure or revenue activities, are normally allowable and do not usually require specific approval.  All other banking costs are normally considered University expenses.  (Normally F&A.)

Charitable Contributions, Donations or Gifts

Not allowed.

Commencement and Convocation Expenses

Not allowed.


Salaries and wages for faculty, scientific/technical professionals, students and other individuals working specifically on the scientific/technical aspects of the project are normally allowed.  Salaries and wages for individuals performing general clerical/accounting/managements/administration duties are normally not allowed (normally F&A).

Computer Service or Use Fees

Routine, standard computer services such as networking costs, internet access or software license and maintenance are normally not allowed.  (Normally F&A.)  Specialized computer search or scientific data base services may be allowable if the service is directly related to the award’s needs and costs can be allocated to the individual project.  Rates must be established through a service center mechanism with consistently applied rates charged to all users.  Costs must be prorated if used for multiple purposes, awards or activities.

Conference Costs

Conference costs (i.e., conducting a conference, not attendance at a conference), is not normally allowed except when the purpose of the award is to conduct such a conference or the sponsor has given specific authorization to incur such costs.  Conference grants usually have additional, specific requirements for types of costs that can be incurred, match requirements and reporting procedures.  Attendance at a conference is usually treated as a travel cost, if related to the scientific/technical needs of the award, and is subject to the sponsor’s guidelines on travel costs or restrictions.

Consortium Costs/Subcontracting

Usually requires specific agency authorization.  Contact the Office of Sponsored Programs to establish an agreement with a collaborating institution.

Consultant Services or Professional fees

Consultant charges and professional fees are subjected to particular scrutiny by a sponsor. Most sponsors permits such charges if budgeted in advance and if it can be documented that such services are essential and will be obtained from the most qualified person at reasonable and normal rates.  When considering consultant or professional services, the PI must establish defined performance requirements, a timeline within the award period, and an appropriate rationale for the rate of payment.  Some sponsors will establish a maximum daily rate that can be charged for consultant services or professional fees.

ECU faculty/employees may not normally be used as consultants on an ECU sponsored project.  ECU faculty/employees should be listed in the personnel section of a proposal budget and will receive an appropriate percentage/proportion of pay, based on their effort and their normal institutional salary structure; not consultancy rates.

Please use the "Contractual Services Non University Employee Form" when requesting payment for consultants. It is imperative that tax numbers or social security numbers be shown on the form. Payment cannot be made until these numbers are furnished.  Please contact Materials Management – Contractual Services for assistance in establishing consulting agreements or processing requisitions.

Full-time UNC employees are not authorized to be paid consultant fees by the University; even if the individual is at another UNC campus.  UNC employees who work on sponsored projects will charge the sponsored program an appropriate percentage of their salary for the effort performed on behalf of the sponsored project.  Most times the use of a UNC employee at another campus will require that a subagreement be issued to the collaborator’s home institution.

Nine month faculty/employees that perform authorized services for a sponsored project may be paid for services performed in proportion with their effort expended and institutional base salary either in the uncommitted summer period (May-August) or during the academic year in conformance with an approved buy-out or salary offset process.  Such payments are salary, not consultant fees, and are subject to normal payroll restrictions and deductions.  

Twelve month faculty/employees may be charged to a sponsored project in proportion with their effort expended and their institutional base salary.  Such payments are salary, not consultant fees, and are subject to normal payroll restrictions and deductions.

Other State employees must be paid through the established "Dual Employment" procedures. (Please refer to Human Resources and Budget and Cost Analysis sections for additional information.)

Cost Sharing or Match Funding

Expenditures used for cost share or match requirements must follow the same reasonable, necessary, fund availability and allowability requirements as costs charged to the award.  All cost share must be documented in the accounting system and/or through the effort reporting system in order to be reported to the sponsor as match.

Dues and Memberships

Individual memberships normally are not allowed.  Institutional memberships are occasionally allowed for specialized training programs.  Some individual fellowship or training programs do allow such charges.  Please check with OGC to determine whether or not such costs are allowed before charging any sponsored project.  (Normally F&A.)

Equipment Purchase and Equipment Fabrication

Scientific/Technical equipment is normally allowed if within sponsor guidelines.  Most agencies have limitations on levels of purchases.  Rental or lease of equipment is normally not allowed (normally F&A) but may be approved under exceptional circumstances. General purpose and multi-purpose equipment (furniture, computers, faxes, typewriters, file cabinets, refrigerators, etc.) is normally not allowed (normally F&A.).

Equipment fabrication is normally allowed if the item is scientific/technical equipment.  General purpose equipment fabrication is normally not allowed.  Contact OGC for procedures on fabrication approvals.

Some sponsors have more restrictive definitions on what is classified as equipment.  The PI/DA will need to track equipment in accordance with the sponsor’s definitions, in addition to University procedures.  The University definition of equipment is a unit value of $5,000 with a life expectancy of one year.

Equipment Maintenance and Repair Costs

Costs normally may be charged to a sponsored agreement (including maintenance service agreements) so long as the equipment has been purchased by the sponsored project and/or is being used by the sponsored project to fulfill the needs of the award; but only if the costs of the repair and maintenance can be specifically allocated to the individual award. 

The award can only be charged an appropriate share of the costs.  If the equipment is used for multiple users, purposes, activities or awards the costs must be allocated to all or must be considered normally F&A and cannot be charged to the sponsored project.  Documentation of the allocation methodology must be maintained with the cost documents. 

If an equipment item has multiple purposes, users or activities, costs must be established through a service center/allocation mechanism with consistently applied rates charged to all users.  In most cases, where equipment is used for multiple purposes, users or activities, the repair and maintenance costs would not normally be charged to individual sponsored projects.  The more users, activities or purposes for the equipment, the less likely it would be allowable to charge an individual award for the maintenance and repair costs and the more likely it would be considered F&A.

Facilities Management

Building maintenance, work orders or repair charges are normally not allowed.  (Normally F&A.)

Food Costs

May be allowable for specific approved project purposes such as conferences or as part of a travel reimbursement.  Normally in-town meals for faculty/staff are not allowed.  In-town meal costs are normally only allowed when part of a conference or official business meeting with a published agenda and a list of attendees and the purpose of the meeting is specifically related to the grant program.  Food costs related to entertainment, morale, general collaboration meetings, staff meetings, student/faculty meetings, collaborator meetings or seminars are normally not allowed.

Food costs on behalf of human subjects, either as an incentive or for test purposes, and animal food costs are normally allowable when related to the specific purposes of the award. 

Fringe Benefits

Standard fringe benefits associated with compensation as established by the HR system are normally an allowable cost.  Fringe benefit costs must be in proportion to the individual’s salary charged to the award.  Fringe benefits may not be charged to an award if there is no related compensation charged to the award.  Some awards allow compensation but do not pay fringe benefits or will not cover all of the fringe benefit costs.  When the sponsor does not allow all or a part of the fringe benefit costs, the costs must be transferred to a departmental non-sponsored fund.

Fund Raising and Investment Management Costs

Not allowed.


Normally not allowed.  Speaker fees or other compensation for service (see below) may be allowable for some awards.

Housing and Living Expenses or Recruitment and Relocation Expenses

These costs are not normally allowed on sponsored projects and must have specific approval.  Some conference awards or professional training projects may allow housing and living costs for participants.  Some awards may allow relocation expenses when employees are specifically recruited and employed for the purposes of the award.  However, this is very rare.  Please check with OGC to determine whether or not such costs are allowed before charging any sponsored project.

Human Subjects Payments/Incentives

The award must specifically indicate that human subject activities have been authorized by the sponsor.  Some sponsors may require detail-specific approval for types and amounts of incentives.

No costs related to human subjects may be incurred without an IRB review and an approved human subject protocol (as needed).    For additional information on human subjects procedures and protocol requirements go to the ECU University & Medical Center Institutional Review Board website.

Insurance and Visas

Health/Dental/Life insurance for employees is classified as a fringe benefit and is normally allowable.  (See Fringe Benefits.)  Some training/fellowship programs may allow insurance costs for specified trainees who might not otherwise be eligible for employee fringe benefits.  

For some foreign travel, it may be necessary to secure travel medical coverage for a specific country or to receive a visa.  Such specific, temporary medical coverage may be allowable when the travel is authorized for the project and wholly charged to the sponsored agreement.  If the travel is split-funded, the cost of the insurance must be in proportion to the other travel costs charged.  However, the cost of the visa is not normally allowed on a sponsored project.

No other insurance costs (liability, property, vehicle, etc.) are usually allowed on sponsored projects.  (Normally F&A)

Legal Costs

Not allowed. (Normally F&A.) 

Library Costs/Collections/Acquisitions

Normally only allowable when the basic purpose of the award is to support specific library functions (e.g., library resource grants).  All library-related costs must have specific authorization.  (Normally F&A)

Licenses, Certifications, Professional Insurance

Costs of securing or maintaining a license, certification or professional insurance are normally not allowed.  This is considered an individual’s personal, professional cost/responsibility (or F&A).  Even if needed for activities on the project, the individual must be qualified to work on the project, as part of the hire, and should already have appropriate degrees, licenses, certifications.  The cost is personal/individual and should not be charged to the award. 

Professional development costs or any type are normally not allowed.  Even if ECU policy allows payment for the activity; it cannot be charged to a grant fund and must be paid from a non-sponsored fund. 

There may be occasional exceptions for controlled substance or other unique one-time requirements specific to the activities of the award.  Contact your OGC representative for exceptions for a specific award.

Lobbying Costs

Not allowed.

Parking Costs

Incidental parking costs as part of travel or other related sponsored projects activities is normally allowed.  Costs for employee, student or trainee parking deck/lot access or fees incurred for normal employment/training activities or access to University facilities is not allowed.  Costs of parking tickets or towing are not allowed.  (Normally F&A.)

Participant Support Costs

The award must specifically indicate that participant support costs have been authorized by the sponsor.  Sponsors have unique definitions of participant support cost.  Contact OGC before classifying any cost as participant support cost.  Account codes 73063 and 73074 should not be used without OGC approval.  The cost activity may be allowed but may need to be classified as other than participant costs; based on the sponsor and terms and conditions of the award.

Patient or Participant Advertising and Recruitment

Costs are usually allowable for projects that include human subjects.  The award must specifically indicate that human subjects will be used for the project.  Costs related to human subjects may not be incurred without review/approval by the University & Medical Center Institutional Review Board (IRB).  For additional information on human subjects procedures and protocol requirements go to the ECU University & Medical Center Institutional Review Board website. 

Patient advertising and recruitment is also limited to awards that have specific sponsor authorization for “patient care” activities (inpatient or outpatient); not just human subjects participation.  General advertising of an academic program, department or center or for recruitment of students is not normally allowed.

Patient Care (Inpatient/Outpatient)

The award must specifically indicate that patient care activities have been authorized by the sponsor.  Costs related to patient care may not be incurred without review/approval by the University & Medical Center Institutional Review Board (IRB).  For additional information on human subjects procedures and protocol requirements go to the ECU University & Medical Center Institutional Review Board website. 

Patient care costs may also be restricted to certain rates for certain activities or to Medicare rates or to activities beyond Standard of Care or to activities not eligible for other third party billing.  The PI should carefully review specific requirements and restrictions for patient care activities and expenditure restrictions before charging costs to any sponsored agreement.

Postage (Includes Shipping/FedEx/Courier)

Routine postage costs are not allowed.  This includes normal project costs related to collaborator correspondence, sponsor proposal submissions or progress reports and manuscript submissions.  Postage is only allowable when based on specific extraordinary needs of the project (e.g., a large survey project requiring numerous mailings beyond the need of an average award).  Postage may also be approved in situations where samples or materials (e.g., blood, tissue, x-rays) must be submitted to another institution for lab tests, analysis or other scientific activities directly related to the scope of the project. (Normally F&A.)

Pre-Award or Pre-Agreement Costs

Usually not allowed.  Some federal sponsors do allow pre-award costs, up to 90-days, for specific types of awards.  Most sponsors must specifically authorize pre-award costs.  Contact your OGC representative for determination on pre-award costs for a specific award.

Printing and Photocopying

Costs are usually allowed when related to the scientific/technical purposes of the award.


Conference registrations are normally allowed when directly related to the needs of the project and when travel is authorized under the terms of the agreement.  Registration and conference fees may only be charged for individuals working on the sponsored project.  When dues or memberships are a part of the registration fee, that portion of the fee normally cannot be charged to a federal sponsored project and must be allocated to a non-sponsored fund.  Even when registration fees are net-lowered by the membership affiliation, the dues/membership fee cannot be charged to the federal sponsored project.  Some awards establish maximum travel costs per trip or activity or calendar period.  In those cases, the registration fee must be considered as part of the total costs when assessing maximum amounts chargeable to the award.

 Rental/Lease Space Costs

Usually only allowable for “off campus” projects where the University pays rent to an unaffiliated entity.  The award must indicate that such costs are approved for the project.  Incidental space rent for meetings or conferences may be appropriate for some “on campus” projects.  All other space costs including internal University assessments or recharges are normally not allowed.  (Normally F&A.)

Sabbatical Leave

Normally not allowed.  Very rarely, a portion of the sabbatical time may be for activities directly related to work on the project and may be authorized.  In order to be charged to a sponsored project, sabbatical salary must have specific authorization from the sponsor and must include an explanation and justification for the proportion of salary charged.  Sabbatical leave, during the period of the award, even when salary is not charged to the agreement, should be reported to the sponsor and may require sponsor approval.  The sponsor may disallow costs or require termination or suspension of an award due to “absence” of the PI or other key personnel from the project; if not specifically approved.

Scholarships, Stipends, Tuition or fees and other Student Aid Costs

Normally not allowed except for authorized institutional training programs, some individual fellowship programs and financial aid agreements.    Such costs may not normally be charged to regular research, instruction or service agreements (except for PH.D. assistantships – see ECU Graduate Assistants Policy).  Students working on a sponsored project normally should receive payment through compensation/salary procedures; not stipend or tuition payments. 

Scientific/Technical Service Fees

Costs for internal service activities through a service center mechanism with consistently applied rates to all users are normally allowable.  Fees for the service of “individuals” are not normally allowable or would be subject to payment under either the consulting or compensation requirements.

Speaker Fees

Payment for services rendered is allowed when specifically related to the project activities.  Payment may only be made for engagements specifically linked to the purpose and terms of the award.  If the presentation is open to participation by individuals not specifically linked to the award, the costs must be prorated and cannot be charged solely to the sponsored project.


Normally not allowable.  Some specific development or training programs may allow such charges.  Subscription/book/periodical purchases should be limited to publications not available through the library and to items specifically necessary to fulfill the scientific/technical aims of the project.  General field or discipline literature, subscriptions or publications, even when technical in nature (e.g., JAMA), would not normally qualify as an allowable cost.   (Normally F&A.)  See also Library Costs.


Medical/scientific/technical/laboratory materials such as chemicals, gases and liquids, scientific software, pharmaceuticals, etc., are normally allowed.  General purpose or multiple purpose supplies such as paper, pens, computer supplies, non-scientific software, calculators, cameras, computers, etc. are normally not allowed unless specifically approved.  Authorization must be based on exceptional need and mitigating circumstances of the program activities.  (General purpose supplies are normally F&A.)

A few sponsors have their own more specific definition of supplies and allowable types of supply items.  The University’s general definition of a supply cost is an item with a unit value less than $5,000 and a life expectancy of less than one year. 

Telephone, Fax and Internet

Long-distance charges which can be directly allocated to the specific activity or project are normally allowable costs.  Local charges or the basic cost of telephone/fax/internet/pager/cell phones equipment, supplies or services are normally not allowable and must be specifically approved on an exception basis.  (All but long distance is normally F&A.)

Transportation Costs

Standard freight, postage, cartage and other transportation costs related to goods purchased is allowable when included as part of the goods/equipment/supply purchased and the purchased good is an allowable cost.  Costs would normally be included as part of the invoice for the goods/equipment and would not normally be charged separately.  Express, overnight or other special shipping would only be allowable under extenuating circumstances such as spoilage or decay of the item shipped.

Travel Costs and Vehicle Use Costs

Normally allowable when related to the needs of the project.  Allowable only for individuals working on the project.  Travel must be by coach class and for federal awards must be by U.S. Flag Carrier.  OGC must authorize any use of non-U.S. Flag Carriers under federal awards.  Vehicle use costs may be included in travel costs when vehicle rental or mileage reimbursement is for approved travel for the project and is in accordance with University and sponsor guidelines.  No other type of vehicle costs/purchase/maintenance may be charged to a sponsored project without specific authorization. 

University policies may be more restrictive than sponsor requirements.  See University Travel Policy for details.

All travel costs must be necessary and related to the scientific/technical needs of the project.  No personal expenses, entertainment costs, souvenirs, excursions or alcoholic beverages may be charged to the sponsored project.  No meals or other costs may be charged for individuals not working on the project.

It is very common for there to be specific restrictions on foreign travel.  Please contact your OGC representative, prior to incurring costs, to verify award-specific procedures for foreign travel.


The following outlines possible circumstances under which normally F & A costs may be charged as direct costs to a federally sponsored project. These costs should be explained and justified in the proposal budget when the sponsor requires a detailed budget. These examples are not exhaustive nor are they intended to imply that direct charging would always be appropriate for the situations illustrated.


Administrative/Managerial/Clerical Salaries/Wages/Benefits

These costs may only be authorized for projects where the nature of the work performed requires an extensive amount of administrative or clerical support. Such costs might be appropriate for:

General Purpose Equipment

Computers and printers and other selected items may be appropriate as a direct cost when the PI certifies that the equipment is necessary for the unique scientific/technical tasks of the specific agreement. (Examples: A computer, which will be used primarily to store and access a large scientific database, or which serves as an operational unit of a large piece of scientific equipment, may be appropriate as a direct cost. A computer used for processing reports, manuscripts, correspondence and publications, accessing email, as well as database or scientific activities, would not be appropriate. A photocopier normally services many diverse functions and projects and would not be appropriate as a direct cost).

Membership Dues

Appropriate as a direct cost on an exception basis only where: (1) Membership is a mandatory requirement of the specific agreement; or (2) For training/fellowship programs where the membership is authorized for a trainee as part of the trainee's development/training program; or (3) Where the membership is required/included as part of the registration costs for a conference and participation in the conference is directly related to the specific needs of the agreement.

Office Supplies


Extraordinary costs for office supplies used specifically for the technical/scientific needs of the agreement may be appropriate as a direct cost. (Examples: Paper, envelopes or computer paper, used as part of a survey mailed to hundreds of participants for an epidemiological study may be appropriate. Paper, envelopes or computer paper used as part of the administration of the project or for routine correspondence and publications would not be appropriate.)


Extraordinary costs for postage, Federal Express or courier directly related to the scientific/technical needs of the agreement may be appropriate. (Examples: Costs of shipping project samples to a laboratory or a collaborator, for analysis, may be appropriate, as would costs for mailing large epidemiological surveys to hundreds of participants. Shipping costs for returning a piece of equipment may be appropriate, if the item was originally purchased on the agreement. Costs for routine correspondence or mailing proposals, manuscripts or reports would not be appropriate.)



Costs may be appropriate as a direct cost when the PI certifies that the publication is a necessary requirement for the scientific/technical completion of the specific agreement and that it does not benefit other agreements or activities. (This situation would be extremely rare.) An exception may also be appropriate for training agreements where the publication purchase is for a trainee and the publication is an integral part of the trainee's planned program. Publications that provide a general benefit to research and teaching activities would not be a direct cost.  Publications that are available through library services would normally not be a direct cost.


The cost of telephone lines may be appropriate for a project requiring extensive telephone surveying where the function of specified staff is to telephone respondents. Costs would only be permitted for the dedicated lines not for all telephone services supporting the project. Telephone costs would not be appropriate where the purpose is to provide general telephone accessibility to staff or a space/lab; even if related to project activities.

Pagers or cellular telephone costs may be appropriate for an individual whose primary task is to travel from location to location to gather data or conduct patient surveys and that individual must maintain contact on a continual basis, as part of the specific needs of the agreement. Costs would only be allowable based on the pager/cellular telephone use being dedicated solely to the needs of the project. In the case of an individual who has multiple duties or works on several agreements or where the pager/cellular telephone is not an integral part of the specific tasks associated with the agreement, costs of a pager/cellular telephone would not be appropriate as a direct cost. If the pager/cellular is needed primarily because the person needs to be reachable by staff, such costs may not be directly charged to a sponsored agreement.







TO:                              Office of Grants & Contracts, Suite 2900 Greenville Centre


FROM PI/Dept:           Example:  John Jones, Public Health


RE AWARD/FUND:   Example: NIH R01AI12345, 210885


ITEM:        List cost items for which an exception is requested (e.g., admin/clerical/management salaries, postage, general purpose equipment, books/subscriptions, local telephone or telephone equipment, etc.).  List category and amount and if cost is projected, list period of request.    If more than one item is requested, provide detail for all items.  If retroactive approval is requested, list specific details and attach a copy of the cost transaction document.


Example:  Postage, $500, for 3 year period of the award.


JUSTIFICATION:  Provide information about why the item is being requested and outline the exceptional circumstances for the need.  Note:  Only those items that meet the exceptional, mitigating circumstance based on specific project objectives will be approved.  Routine operating needs and small amounts will not normally be approved.


                  Example:  This project is an epidemiological study that involves sending survey materials to 150 or more participants throughout North Carolina.  Postage is needed to send surveys, provide return postage, send reminder notices, send follow-up survey questions, etc.  It is estimated that there will be the need to mail information or materials to each participant at least 2 or 3 times during the period of the award. 


CERTIFICATION:  I have read the cost principles policy and understand that these costs are not normally allowable under a federal award.  The costs requested are an exception and are based on unique, mitigating circumstances of the project.  The costs approved will not be used for routine business purposes but only for the specific purposes outlined in this justification.  I understand that OGC approval does not guarantee that costs will be allowable in the event of an audit and that A21 exceptions are subject to potential review and audit.  I understand that the costs will need to be transferred to a departmental non-sponsored fund if not approved by OGC or if disallowed by a sponsor review or audit.




SIGNATURES:     ______________________________________________   

                                    PI                                                         Date



                                    CHAIR/DIRECTOR                            Date