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Program income is income earned by Federal financial assistance recipients or sub-recipients from award activities.
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Overview
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Federal regulation encourages Federal financial assistance recipients to earn income from award activities as a means to help leverage funds. This income, termed 'program income' must be properly accounted for, reported on the Federal Financial Report, and must be used in the manner approved in the Federal award.
Authorities
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2 CFR 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards
§200.80 Program income.
Program income means gross income earned by the non-Federal entity that is Income is gross income received by the grantee or subgrantee directly generated by a grant supported activity , or earned only as a result of the grant Federal award during the grant period . ‘‘During the grant period’’ is the time between the effective date of the award and the ending date of the award reflected in the final financial report.
43 CFR 12 Administrative Requirements
12.65 Program Income
a) General. Grantees are encouraged to earn income to defray program costs. Program income includes of performance except as provided in §200.307 paragraph (f). (See §200.77 Period of performance.) Program income includes but is not limited to income from fees for services performed, from the use or rental of or real or personal property acquired with grant funds, from under Federal awards, the sale of commodities or items fabricated under a grant agreementFederal award, license fees and royalties on patents and copyrights, and from payments of principal and interest on loans made with grant fundsFederal award funds. Interest earned on advances of Federal funds is not program income. Except as otherwise provided in Federal statutes, regulations, or the terms and conditions of the Federal agencyaward, program income does not include interest on grant funds, rebates, credits, discounts, refunds, etc. and interest earned on any of them.
(b) Definition of program income. Program income means gross income received by the grantee or subgrantee directly generated by a grant supported activity, or earned only as a result of the grant agreement during the grant period. "During the grant period" is the time between the effective date of the award and the ending date of the award reflected in the final financial report.
. See also §200.407 Prior written approval (prior approval). See also 35 U.S.C. 200-212 “Disposition of Rights in Educational Awards” applies to inventions made under Federal awards.
[78 FR 78608, Dec. 26, 2013, as amended at 79 FR 75880, Dec. 19, 2014]
§200.307 Program income.
(a) General. Non-Federal entities are encouraged to earn income to defray program costs where appropriate.
(b(c) Cost of generating program income. If authorized by Federal regulations or the grant agreementFederal award, costs incident incidental to the generation of program income may be deducted from gross income to determine program income, provided these costs have not been charged to the Federal award.
(dc) Governmental revenues. Taxes, special assessments, levies, fines, and other such revenues raised by a grantee or subgrantee non-Federal entity are not program income unless the revenues are specifically identified in the grant agreement or Federal agency regulations as program income.(e) Royalties. Income from royalties and license fees for copyrighted material, patents, and inventions developed by a grantee or subgrantee is program income only if the revenues are specifically identified in the grant agreement or Federal Federal award or Federal awarding agency regulations as program income. (See S12.74.)
(fd) Property. Proceeds from the sale of real property or equipment , equipment, or supplies are not program income; such proceeds will be handled in accordance with the requirements of SS12.71 and 12.72.of Subpart D—Post Federal Award Requirements of this part, Property Standards §§200.311 Real property, 200.313 Equipment, and 200.314 Supplies, or as specifically identified in Federal statutes, regulations, or the terms and conditions of the Federal award.
(e(g) Use of program income. Program income shall be deducted from outlays which may be both Federal and non-Federal as described below, unless the Federal agency regulations or the grant agreement specify another alternative (or a combination of the alternatives). In specifying alternatives, the Federal If the Federal awarding agency does not specify in its regulations or the terms and conditions of the Federal award, or give prior approval for how program income is to be used, paragraph (e)(1) of this section must apply. For Federal awards made to IHEs and nonprofit research institutions, if the Federal awarding agency does not specify in its regulations or the terms and conditions of the Federal award how program income is to be used, paragraph (e)(2) of this section must apply. In specifying alternatives to paragraphs (e)(1) and (2) of this section, the Federal awarding agency may distinguish between income earned by the grantee recipient and income earned by subgrantees subrecipients and between the sources, kinds, or amounts of income. When the Federal agencies authorize the alternatives awarding agency authorizes the approaches in paragraphs (ge)(2) and (3) of this section, program income in excess of any limits stipulated shall amounts specified must also be deducted from outlaysexpenditures.
(1) Deduction. Ordinarily program income
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must be deducted from total allowable costs to determine the net allowable costs. Program income
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must be used for current costs unless the Federal awarding agency authorizes otherwise. Program income
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that the non-Federal entity did not anticipate at the time of the Federal award
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must be used to reduce the Federal
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award and non-Federal entity contributions rather than to increase the funds committed to the project.
(2) Addition.
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With prior approval of the Federal awarding agency (except for IHEs and nonprofit research institutions, as described in paragraph (e) of this section) program income may be added to the
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Federal award by the Federal agency and
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the
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non-Federal entity. The program income
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must be used for the purposes and under the conditions of the
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Federal award.
(3) Cost sharing or matching.
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With prior approval of the Federal awarding agency, program income may be used to meet the cost sharing or matching requirement of the
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Federal award. The amount of the Federal
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award remains the same.
(hf) Income after the award period of performance. There are no Federal requirements governing the disposition of program income earned after the end of the award period (i.e., until the ending date of the final financial report, see paragraph (a) of this section), unless the terms of the agreement or the Federal agency regulations provide otherwise.
50 CFR 80 Wildlife and Sport Fish Restoration
Subpart I—Program Income
§ 80.120 What is program income?
(a) Program income is gross income received by the grantee or subgrantee and earned only as a result of the grant during the grant period.
(b) Program income includes revenue from:
(1) Services performed under a grant;
(2) Use or rental of real or personal property acquired,
constructed, or managed with grant funds;
(3) Payments by concessioners or contractors under an arrangement with the agency or subgrantee to provide a service in support of grant objectives on real property acquired, constructed, or managed with grant funds;
(4) Sale of items produced under a grant;
(5) Royalties and license fees for copyrighted material, patents, and inventions developed as a result of a grant; or
(6) Sale of a product of mining, drilling, forestry, or agriculture during the period of a grant that supports the:
(i) Mining, drilling, forestry, or agriculture; or
(ii) Acquisition of the land on which these activities occurred.
(c) Program income does not include:
(1) Interest on grant funds, rebates, credits, discounts, or refunds;
(2) Sales receipts retained by concessioners or contractors under an arrangement with the agency to provide a service in support of grant objectives on real property acquired, constructed, or managed with grant funds;
(3) Cash received by the agency or by volunteer instructors to cover incidental costs of a class for hunter or aquatic-resource education;
(4) Cooperative farming or grazing arrangements as described at § 80.98; or
(5) Proceeds from the sale of real property.
§ 80.121 May an agency earn program income?
A State fish and wildlife agency may earn income from activities incidental to the grant purposes as long as producing income is not a primary purpose. The agency must account for income received from these activities in the project records and dispose of it according to the terms of the grant.
§ 80.122 May an agency deduct the costs of generating program income from gross income?
(a) A State fish and wildlife agency may deduct the costs of generating program income from gross income when it calculates program income as long as the agency does not:
(1) Pay these costs with:
(i) Federal or matching cash under a Federal grant, or (ii) Federal cash unrelated to a grant.
(2) Cover these costs by accepting:
(i) Matching in-kind contributions for a Federal grant, or (ii) Donations of services, personal property, or real property unrelated to a Federal grant.
(b) Examples of costs of generating program that may qualify for deduction from gross income if they are consistent with paragraph (a) of this section are:
(1) Cost of estimating the amount of commercially acceptable timber in a forest and marking it for harvest if the commercial harvest is incidental to a grant-funded habitat- management or facilities-construction project.
of performance for the Federal award, unless the Federal awarding agency regulations or the terms and conditions of the Federal award provide otherwise. The Federal awarding agency may negotiate agreements with recipients regarding appropriate uses of income earned after the period of performance as part of the grant closeout process. See also §200.343 Closeout.
(g) Unless the Federal statute, regulations, or terms and conditions for the Federal award provide otherwise, the non-Federal entity has no obligation to the Federal awarding agency with respect to program income earned from license fees and royalties for copyrighted material, patents, patent applications, trademarks, and inventions made under a Federal award to which 37 CFR part 401,“Rights to Inventions Made by Nonprofit Organizations and Small Business Firms Under Government Awards, Contracts and Cooperative Agreements” is applicable.
[78 FR 78608, Dec. 26, 2013, as amended at 79 FR 75884, Dec. 19, 2014]
Frequently Asked Questions
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Learning Aids
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Related Pages
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Program Income earned under WSFR
Resources
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References
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(2) Cost of publishing research results as a pamphlet or book for sale if the publication is incidental to a grant-funded research project.
