Project Rebudgeting Approval Process

The budget plan is the financial expression of the project or program as approved during the award process. After a grant or contract has been awarded, the Principal Investigator (PI) may determine that the approved budget allocations are not consistent with actual project needs and may request the formal reallocation of funds from one spending category to another category that better reflects the project requirements. This process is called rebudgeting or budget revision.

Informal rebudgeting occurs when actual expenditures exceed or fall short of the allocated amount budgeted or when actual expenditures occur in a spending category that has no budget allocation.

Many sponsors allow rebudgeting without prior approval, while others require approval when rebudgeting into or out of a spending category exceeds a specified percentage of the award amount. If prior approval is not required, then formal rebudgeting is not necessary but may be requested to assist in budget management. 

Note:Rebudgeting may have an effect on Facilities and Administrative (F&A) Costs.

Procedure

To request rebudgeting of funds on grant or contract:

Determine if the sponsor of the grant or contract allows rebudgeting and whether prior approval is required or not.

Note: If the sponsor requires prior approval for rebudgeting that exceeds a certain percentage of the budget, care must be taken to ensure this limit is not exceeded when multiple rebudgeting events occur in a single budget period. For example, per the NIH Grants Policy Statement, "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 25 percent or more of the total costs awarded."

Rebudgeting

Sometimes the approved award budget is not consistent with the actual project needs. Many sponsors allow reasonable budget revisions without prior approval. However, some sponsors require prior approval and may include a detailed set of guidelines to follow. Review the award and sponsor guidance to ensure compliance with rebudgeting requirements.

Rebudgeting - Sponsor Approval Required

When the sponsor approval is required you will need to submit the request on the Request for Modification to a Sponsored Project form (RFM) to Research & Sponsored Program Development (RSPD).

• Complete the form by selecting Budget Modification under Type of Modification, and within the comments box indicate a justification for the rebudgeting request.
  • Detail the need for the request and reflect how the rebudgeting will support the project: include any other supporting sponsor required documentation, e.g. a Detailed Budget.
  • If a sponsor utilizes an electronic system for prior approvals, use that system to prepare and forward your request to RSPD.
  • RSPD will submit the request to the sponsor.
  • RSPD will notify the Grants & Contracts Accounting (G&C) Grants Officer (GO) upon sponsor approval. The GO will update the financial system once the Award Budget Setup form (ABS) is received and notify the PI and department accordingly.

Rebudgeting - Sponsor Approval NOT Required

This includes rebudgeting or reallocating funds between award lines and requesting an award line for a subaward when sponsor approval is not required.

When sponsor approval is not required:

• Department Administrator completes the ABS or other budget revision tool and emails the form to the GO with the Subject: Rebudgeting Request, PI Name, UND Project #.
• The GO will review sponsor's award terms and conditions, review the request and contact the PI and department if there are any questions.
• If the request is acceptable, the GO will update the financial system and notify the PI and department via email.