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NIH, NSF Issue Guidance On OMB’s Extension of Flexibility for Federal Agencies

June 26, 2020

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The National Institutes of Health (NIH) and the National Science Foundation (NSF) released their nearly identical implementation guidance documents on June 25 in response to the June 18 White House Office of Management and Budget (OMB) memo allowing federal funding agencies to continue to provide certain administrative flexibility to their grantees as a result of the global pandemic.

Each funding agency will need to issue guidance to grantee organizations on how it will be implementing this new direction, with agencies encouraged by the White House Office of Science and Technology Policy to adopt the language issued by NIH and NSF to the greatest extent possible. 

The memo, M-20-26, replaces three earlier memos (M-20-11, M-20-20, and M-20-17) that allowed funding agencies to waive or modify a number of administrative requirements for grantees whose research was impacted by the COVID-19 pandemic. While memo M-20-17 described 13 permissible actions that the agencies could take to reduce administrative burden on grantees and assist grantee institutions in maintaining researcher salaries and activities while research labs were closed, the new memo extends only two of those allowable actions and adds additional requirements to each.

As of the June 18 memo, funding agencies may still allow recipients to continue to charge salaries and benefits to active federal awards and may allow grantees to delay their single audit reporting submission dates for three or six months, depending on the existing due dates for those reports. All other previous flexibilities are no longer available. As clarified in the NIH and the NSF documents, the salary support flexibility allowed by OMB will expire on Sept. 30, 2020, and the extension of audit deadlines will expire Dec. 31, 2020.

The M-20-26 memo has added new restrictions to the original memo, which allowed broad use of grants to cover salaries and benefits while research was halted. OMB now directs agencies to require grantees to “exhaust other available funding sources to sustain its workforce and implement necessary steps to save overall operational costs (such as rent renegotiations).” The memo also directs that grant recipients should “retain documentation of their efforts to exhaust other funding sources and reduce overall operational costs.”

The guidance from NIH and NSF reiterates the restrictions detailed in the memo and also cautions grantees not to charge salary support to grants if those salaries are being covered through Paycheck Protection Program loans or any other federal Coronavirus Aid, Relief, and Economic Security (CARES) Act programs.

As memo M-20-17 neared its expiration date, the AAMC joined the Council on Governmental Relations, the Association of American Universities, and the Association of Public and Land-grant Universities in a May 27 letter to OMB requesting that the memo’s content be extended in its entirety through Sept. 30, 2020.

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