What is the Modular Grant Application Concept?

The Modular Grant concept establishes specific modules or increments in which direct costs must be requested, as well as a maximum level for requested budgets of $250,000 direct costs (excluding any consortium F&A costs). The Modular Grant application does not require a categorical breakdown of direct costs requested in the application; however, other requirements still apply. Application directions should be reviewed for specific modular instructions.

Is the Modular Grant application process used by all Institutes and Centers?

Yes.

Do the Modular Grant Guidelines apply to applications submitted electronically using the SF424 R&R?

Yes. Applicants should follow the instructions provided in the applicable Funding Opportunity Announcement and utilize the SF424 R&R Application Guide for completing this electronic application. If an application meets the modular limit of $250K or less, the applicant must submit using the modular budget.

SF424 (R&R) Application and Electronic Submission Information for NIH: See section 5.4 in the Application Guide for instructions on completing the Modular Budget component.

Do Modular Grant Guidelines apply to applications submitted to the SBIR/STTR program?

No. The modular format was excluded from SBIR/STTRs beginning with the 2005 Omnibus Solicitation (2006 Solicitation available at http://grants.nih.gov/grants/funding/sbirsttr1/2006-2_SBIR-STTR-topics.pdf).

Do Modular Grant Guidelines apply to applications submitted from Foreign Institutions?

No. According to the NIH Guide Notice NOT-OD-096, all competing grant applications (new, competing continuation/renewal applications, amended/resubmission, and competing supplement/revision) from foreign (non-U.S.) institutions must include only detailed (non-modular) budgets.

Do Modular Grant Application procedures apply to administrative supplement programs such as the under-represented minority, disability and re-entry applications?

No. These administrative supplements should be submitted using the detailed budget format.

Is the Modular Grant program in addition to the R01 program or does it replace it?

The Modular application and award process is not a new grant program. Instead, it is a revised application and award process for R01 and other kinds of awards that do not exceed $250,000 direct costs per year.

Which application form should be used?

Since all award mechanisms that utilize the modular format have transitioned to electronic submission, the SF 424 R&R application must be used (http://grants.nih.gov/grants/funding/424/index.htm). Review all application instructions carefully for specific directions that apply to the modular budget.

If I am filling out the SF424 R&R and the Modular Grant Guidelines apply, what budget pages should I use?

The NIH has developed specific PHS398 components as part of the SF424 R&R application package. The Modular budget component requires direct and indirect cost information and provides a location to upload the budget justification for personnel, consortium, and other.

Note: Some applications will list both the modular and detailed budget components as “optional.” This is to allow the appropriate component to be chosen. If the application is $250K or less, the modular budget should be utilized and not the detailed budget. (Do not submit two types of budgets. If the application is applicable to the modular format, then do not submit categorical budget information as well.)

If an application is submitted in the traditional budget format, will it be returned or will you request or require revised budget narrative pages at a later date?

The NIH screens applications (paper and electronic submissions) for compliance with requirements, including appropriate budget submission. When applications are identified that are not in compliance, the investigators will be contacted and given a short period of time to correct the problem. If the application cannot be corrected in that time period, deferral to the next receipt and review cycle may be necessary. This spot-checking will not necessarily identify all applications with compliance problems. If reviewers or other NIH staff identify noncompliant applications later in the process, applications may be deferred or withdrawn at that time.

Under the Modular Grant model, are there any changes regarding submission of certifications of human or animal use?

No.

May we submit an R01 application with a detailed categorical budget format, even though the direct costs per year do not exceed $250,000?

No. The Modular Grant application format is required for applications requesting up to $250,000 in direct costs per year.

Do Modular Grants have the same cycle from submission to award as non-modular applications?

Yes. However, NIH is aggressively working to shorten the cycle as part of its overall Reinvention Initiatives.

Is a budget narrative required for Key Personnel only or All personnel?

List ALL personnel including names, number of person months devoted to the project (indicate academic, calendar, and/or summer) and roles on the project. No individual salary information should be provided. This includes consultants, personnel on any Consortium/Contractual arrangements and any "to be appointed" positions. See NIH Guide: NIH Modular Grant Application Modification and Update http://grants.nih.gov/grants/guide/notice-files/NOT-OD-00-046.html.

I understand that Modular Grant applications may not request future year escalation, at least in the standard manner. Does this apply to non-modular grant applications requesting more than $250,000 per year?

No, the escalation policy for non-modular grant applications has not changed. Applications requesting more than $250,000 direct costs should submit budgets which include future year escalations.

Remember: The $250,000 cap on modular budgets is determined by the requested Direct Costs less Consortium F&A. See Guide Notice: NOT-OD-05-004: NIH Announces Revised Policy: Applications that Include Consortium/Contractual Facilities and Administrative Costs.

What do I do if I need more than $250,000 in direct costs in one or more years?

Submit the detailed categorical budget information as currently required for a particular application. None of the modular grant application instructions apply.

Do we continue to include the first $25,000 of total costs per consortium in calculating our F&A costs?

Yes, as long as this is consistent with your institution's F&A rate agreement.

The Modular Grant model requires budget information about consortium/contractual arrangements. Do the Facilities and Administrative (indirect) costs on such an arrangement become part of the total modular amount requested or can the total be exceeded by the amount of the F&A costs?

In calculating the $250,000 direct cost level, the applicant should not include the F&A costs associated with any consortium/contractual arrangements. Those costs may be requested above the normal $250,000 direct cost limit. Fields are provided to separately capture consortium F&A costs for each budget year.

Modular, With Consortium/Contractual Costs. On the Modular Budget Format Page, the Direct Costs less Consortium F&A, Consortium F&A, and Total Direct Costs requested for each year should be entered separately.

Remember: While only the direct cost for a consortium/contractual arrangement is factored into eligibility for using the modular budget format, the total consortium/contractual costs must be included in the overall requested modular direct cost amount.

How will Facilities & Administrative (indirect) costs be requested and awarded with Modular Grants?

F&A costs will be requested and awarded in the same manner as for grants with detailed categorical budgets. In the SF424 (R&R) F&A costs are requested as part of the Modular Budget component for each support year.

How do we handle escalation in future years if:

1. Costs are expected to be consistent from year-to-year?
   
   Calculate the total direct costs you need over all the years, including one time costs (such as equipment) and escalation, and then divide by the number of years. Request the amount in modules of $25,000 closest to that dollar level.


2. Costs are expected to differ significantly from year- to-year?
   
   In this situation, appropriate annual variations in the number of modules should be requested and requires sufficient justification. (For example, the purchase of equipment in year 1 may result in a request for a greater number of modules than in subsequent years.)

Are detailed budgets necessary for the development of modules at the time of application?

This matter is left to the discretion of the applicant institution. It may be necessary for institutions to require certain budgetary detail from principal investigators for purposes of determining exclusions from the base when calculating facilities and administrative (indirect) costs. In addition, institutions may need to ensure that adequate resources are being requested for the proposed research activity. However, any budgetary details required by the institution are for its internal use only and should not be submitted in the application.

Must competitive supplement applications be submitted in modules?

Competitive supplement applications should be submitted in the same format as the parent application, regardless of the direct cost level requested. (For example, supplement requests for $250K or more should be submitted as modular if the parent application was submitted in modular.)

If a grant is transferring to a new institution and the original award was awarded in the modular format, can a modular budget be submitted from the new institution or is a categorical budget required?

If the original award utilized the modular format, then the application from the new institution should use the application instructions and forms for a modular grant.

Must detailed categorical budgets be developed at the time of application or award to comply with Consistency Standards contained in OMB Circular A-21?

No. OMB Circular A-21 does not proscribe the categories to be used in estimating, accumulating, or reporting costs by educational institutions. A categorical budget for purposes of the modular application is defined as a direct cost and a facilities and administration (indirect) cost. Costs are estimated (application), accumulated, and reported (Financial Status Report) on this basis. Thus, we have confirmed with the Office of Audit Resolution and Cost Policy, HHS, the Office of Grants Management, HHS, the Office of Inspector General, HHS, and the Office of Naval Research that no additional categorical detail is required to satisfy OMB Circular A-21 cost consistency standards. However, as stated in the question above, institutions may require detailed categorical budgets to meet internal institutional needs.

Institutions are reminded that they must have a mechanism to accurately monitor and report institutional cost sharing. In addition, recipients are reminded that they must meet the standards for financial management systems in 45 CFR 74.21 which require, among other things, that actual outlays must be compared with budgeted amounts for each award. Such comparison will be made on the basis of the modular application budget categories of direct and F&A costs.

Should applicant institutions request detailed budgets from consortium participants when estimating the number of modules to be requested in the application to NIH?

Institutions must be able to reasonably estimate the total (direct and facilities and administrative) cost of the consortium arrangement to the nearest $1,000. Applicant institutions may request from the consortium participants whatever information is necessary for making this estimate. Therefore, the level of detailed budget shared between the prime and the consortium grantee is negotiated between those parties.

Under the Modular Guidelines, subcontracts should be listed under the “Consortium” header with the following information for each:

• Estimate of Total Costs (Direct plus F&A) rounded to the nearest $1,000.
• For each key individual/organization listed, the role and percent effort should be provided.
• Whether each collaborating Institution is foreign or domestic should be indicated

Caps on compensation:

1. If an investigator's salary exceeds the current salary cap, should the applicant use the legislatively imposed salary cap or actual institutional base salary when estimating the number of modules requested?
   
   Since the modules should be a reasonable estimate of costs allowable, allocable, and reasonable for the proposed project, applicants must use the current salary cap when estimating the number of modules. With the significant rebudgeting flexibility and the ability to carry forward unobligated balances, funds generally should be available to cover any modest change in the legislatively imposed salary cap.



2. How should compensation for graduate students be requested in a modular application?
   
   The NIH will provide reasonable amounts for graduate compensation consistent with the requested budget for the position(s) and up to the currently effective NRSA zero postdoctoral stipend level at the time the application is submitted. This level should be included when estimating the number of modules. Compensation includes salary or wages, fringe benefits and tuition remission. See http://grants.nih.gov/grants/guide/notice-files/NOT-OD-02-017.html

How do we request funds for general administrative and clerical support?

The NIH GUIDE, Volume 23, Number 34, September 23, 1994, http://grants.nih.gov/grants/guide/notice-files/not94-276.html, discussed the treatment of administrative and clerical salaries. If you plan to use grant funds to pay for clerical salaries and/or other administrative costs that are covered in the examples provided, you will not need NIH approval to charge those costs to the project. NIH has already determined these are acceptable direct costs charges. If you wish to charge those costs to an NIH supported project and they are not one of the examples provided in the NIH GUIDE, you will need to contact NIH prior to obligating grant funds to ensure the costs are allocable as a direct cost to the project.

How should we reflect individuals who do not have 12-month appointments, i.e., academic year and summer period?

The academic year effort and the summer period effort should be shown separately in the form of person months. (See person months FAQs: http://grants.nih.gov/grants/policy/person_months_faqs.htm)

How should we reflect the level of effort for individuals who are not employed full-time at the applicant organization?

Follow the current application instructions. (i.e., show the individual's level of effort at the applicant institution in the form of person months and indicate if the institutional appointment is less than full-time.) Be sure to list all current employment responsibilities for the individual on the Biographical Sketch page.

Does the NIH policy on carryover of unobligated balances apply to Modular Grant applications that are awarded?

There is no change in the NIH policy on carryover of unobligated balances for these awards.

Does the “25% Rebudgeting Rule” apply to Modular Grants?

Prior approval for “Significant Rebudgeting” or the “25% Rebudgeting Rule” is now only required if it is likely to be considered a change in scope (a significant change from the aims, objectives, or purposes of the approved project.)

Significant rebudgeting occurs when expenditures in a single direct cost budget category deviate (increase or decrease) from the categorical commitment level established for the budget period by more than 25 percent of the total costs awarded. For example, if the award budget for total costs is $200,000, any rebudgeting that would result in an increase or decrease of more than $50,000 in a budget category is considered “significant rebudgeting.” The base used for determining significant rebudgeting excludes the effects of prior-year carryover balances but includes competing and non-competing supplements.

Upon receipt of the award, are recipient institutions required to establish categorical budgets?

Although this is not a requirement by the NIH, Institutions will have discretion in determining the need to establish categorical budgets once the NIH award is received. However, recipient institutions are still required to ensure that all costs charged to modular awards are in accordance with applicable costs principles, the NIH Grants Policy statement, and legislatively imposed restrictions.

Are Modular Grant applications reviewed by existing study sections or by special Modular Grant review committees?

Investigator initiated Modular Grant applications will be reviewed by existing study sections and Special Emphasis Panels. Modular Grant applications solicited through RFAs will be reviewed by committees established for the review of that RFA, a process identical to that currently used for non-modular RFA submissions.

Could the requested Modular Grant budget be reduced by the Scientific Review Group (SRG) and/or by the awarding institute?

Yes, the SRG may adjust the requested budgets. Any overall adjustments by the SRG must be made in modules. In addition, the reviewers may recommend specific budgetary changes that are described in the summary statement, but cannot be reflected in a modular reduction. In these cases, Institute staff will obtain the necessary cost information prior to any award. Also, the awarding institute may adjust the amount to be awarded based on identified overlap and/or a requirement to meet its current management objectives. Adjustments by the awarding institute need not be in modules.