Millions of Unspent NIH Grant Funds Available for Use

During a review of indirect cost rates for National Institutes of Health (NIH) grantees, GAO identified an opportunity for NIH to realize a one-time funding windfall of from $41 million to $143 million by offsetting grantees' estimated yearend unspent grant fund balances against the next period's grant awards.

NIH has permitted grantees to carry over any unspent grant funds but not to expend them; thus, they are available but not used for an entire year before being offset against future grant funding. Regulations require grantees to either: (1) report promptly when a grant is expected to exceed needs by more than $5,000 or 5 percent of the grant; or (2) include an estimate of expected unused funds in their applications for the next period's funding. To ensure that grantees have sufficient funds in case their estimates of unspent funds are overstated, NIH generally does not offset any of the unspent funds against the next period's grant awards. GAO estimated that about 27 percent of the NIH fiscal year 1981 total grant awards had unspent fund balances in excess of $2,500 and that between $23 million and $126 million of these balances involved individual fund balances of $10,000 or more.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Franklin A. Curtis Team: General Accounting Office: Human Resources Division Phone: (202) 275-5451