NIH MODULAR GRANTS:
USC GUIDELINES FOR APPLICATIONS
OnJune 1, 1999, the National Institutes of Health (NIH) streamlined the application process for many of its research grants. Certain grant types requesting not more than $250,000 per year for direct costs are to be applied for and awarded in lump sum amounts (for direct costs), called "modules" in multiples of $25,000 rather than on the basis of detailed budget categories.
The NIH Modular Grant application and award process is not a new grant program, but a revised application and award procedure for certain existing grant mechanisms. The Modular Grant will be used for all unsolicited new, revised, and competing continuation R01, R03, R15, R21, R41, and R43 grants and competing supplements, as well as applications responding to RFA’s for these mechanisms. Administrative supplemental requests should be submitted in the usual format.
In preparing a Modular Grant application, NIH recommends that investigators calculate the total direct costs needed over the entire project period, including consortium/subcontract agreements and one time costs, such as equipment, plus escalation (currently estimated at 3% per year). The proposed costs should also use the current NIH salary cap when estimating project costs. The total estimated cost for direct costs should then be divided by the number of years in the project period. The amount in increments of $25,000 closest to that dollar level would then be the amount requested for each year. In most cases, the amount of funding requested should be constant in each year of the proposal.
NIH has published guidelines, available on its Web site, describing the specific pages and forms within the PHS 398 application package to be used for Modular Grants. In general, Modular Grants will not use the budget pages (for either the initial period or for the entire proposed period) or the Other Support Page. Instead, a budget narrative describing personnel by position, role, and level of effort, and a four-page (maximum) biographical sketch are required by NIH. The biographical sketch must include the goals of active research and any other research conducted over the past three years. (As a part of its just-in-time procedures, NIH will request the Other Support Page prior to award of a Modular Grant.) The NIH checklist must also be submitted to show the basis -- MTDC base and rate applied -- for indirect (F&A) costs for each year of the proposed project. See the following webpage for use of specific forms in the PHS Form 398 application kit:
NIH Modular Grant Forms
NIH research grant applications requesting more than $250,000 for direct costs in any year and those RFA’s or PA’s which indicate that the modular format is not applicable must use the traditional NIH application instructions and detailed budgets and would be awarded by NIH in the traditional manner, with funds assigned to each category of cost.
USC Internal Guidelines for Modular Grants:
USC officials in the Office of Sponsored Awards Management (SAM) will not require detailed budgets for NIH applications for Modular Grants at the time of proposal. This office, however, requests that the PI provide us internal budgetary information on the following costs [which are exclusions from the indirect (F&A) cost base] for Modular Grant applications: consortium/subcontract agreement costs; capital equipment; tuition, and rental of space. Information on these items may be provided in any format which will allow correct calculation of indirect (F&A) costs.
Other USC offices, such as department chairs, center directors, or dean's offices, may still require certain budgetary detail for Modular Grant applications. Investigators should check with those offices to confirm the level of information necessary to obtain departmental or school approvals.
Indirect (F&A) costs will be requested from and awarded by NIH in the same manner as usual. The Checklist (NIH Form II) submitted with the application will contain the correct direct cost base and the applicable indirect (F&A) rate for each year of the project.
For consortium/subcontract agreements, NIH only requires that we be able to reasonably estimate the total (direct and facilities and administrative) cost of consortium/subcontract agreements to the nearest $1,000. USC will accept budgetary proposals from consortium/subcontract participants in lump sum fashion, to the nearest $1000 unless the USC PI or the collaborating institution prefers greater detail. Note that indirect (F&A) costs requested as part of consortium/subcontract agreements become part of the total modular amount requested by USC.
Post-Award Considerations:
The personnel and levels of effort as presented in the NIH proposal will be used to govern the assignment of key personnel budgeted and expended in a funded Modular Grant. Although Modular Grants awards permit some degree of budget flexibility, PIs will be expected to honor commitments of effort as represented in the grant application.
USC is 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. Accordingly, once a Modular Grant award has been received, an internal USCaccount will be established using the necessary internal forms. A line item budget (major line items only, such as personnel, fringe benefits, travel, equipment, supplies, subawards, and other costs) will be requested from the PI if one was not previously supplied to SAM. Specific justification will be needed for budgeting or expending funds for general administrative expenses, such as clerical and administrative salaries, general office supplies, postage, subscriptions, and similar general costs that are subject to the federal Cost Accounting Standards and OMB Circular A-21.
Because Modular Awards are issued by NIH without direct cost categorical breakdowns, the NIH significant rebudgeting provision does not apply. For traditional grants, a grantee may not rebudget more than 25% of the total funds awarded in any one budget category without NIH approval. Under Modular Grants, notification of significant rebudgeting is no longer required. Significant changes in effort for the principal investigator will still require NIH notice and approval.
Through its simplified budget features, the modular grant application will help address the broader NIH goal of reducing the length of time between application receipt and grant award. Modular Grants will initially have the same cycle from submission to award as the current non- modular applications, but NIH is aggressively working to shorten the cycle as part of its overall Reinvention Initiatives.
Since 1999 NIH has revised the policy and guidelines for Modular Grants based on experience during implementation. PI’s should monitor the NIH modular grant site, listed below, for updates and changes in policy and guidelines.