Budget Revision (Rebudgeting)
Budget revision or rebudgeting is a reallocation of funds from one spending category to another category.
The budget for a sponsored project is the financial expression of the costs necessary to complete a project or program as approved during the award process. Budget revision or rebudgeting is a reallocation of funds from one spending category to another category. Sponsors may or may not require prior approval for budget revisions, and/or may provide thresholds that require prior approval (either by a percentage of the budget or an amount of deviation by budget category or line item).
Requesting Budget Revision
Routing of the completed Budget Revision Form is only required when:
- Prior approval is required from the sponsor, including a change in the scope of work associated with the budget revision
- Requested budget changes impact F&A (increase OR decrease).
If the Budget Revision Form is needed, it should be signed by the PI and routed by the LRA to the Pre-Award point of contact. In instances where a reduction in the F&A amount is greater than $2,500, the Authorized Official at the PI’s School / Center must also sign the request before it is sent to Pre-Award. Please note that HNRCA must sign all requests in all instances where there is a reduction in F&A for any amount.
Calculations for F&A Impact
Budget revisions impact Facilities and Administration (F&A) costs when amounts are rebudgeted to or from the following budget categories that do not generate F&A:
- Capital Equipment ≥ $5000
- Subawards (over the first $25,000 of each subaward)
- Participant Support Costs
- Rental costs of off-site facility.
If a given budget revision transfers money from a non-F&A bearing budget item (such as equipment) to an F&A bearing item (such as materials), the F&A dollar amount will increase. (See Example 1)
Example 1: An award has a capital equipment budget of $10,000 and an F&A rate of 56%. If only $8,000 was spent on equipment, and the remaining $2,000 will be spent on other materials. The $2,000 balance in equipment will need to be rebudgeted between materials and F&A since the materials purchases will generate F&A. In this scenario, $1,282 would be added to materials and $718 would be added to F&A ($1,282 + $718 = $2,000).
If the budget revision transfers money from an F&A bearing budget item (such as materials) to a non F&A bearing budget item (such as equipment), the F&A dollar amount will decrease. (See Example 2)
Example 2: An award has a capital equipment budget of $10,000 and an F&A rate of 56%. If $12,000 was spent on equipment a budget revision would need to reduce the F&A dollar amount since the additional $2,000 spent on equipment does not generate F&A. In this scenario, the F&A budget would be reduced by $1,120 (56% of $2,000) that would be re allocated to the equipment budget.
Contact Post-Award for assistance with budget revision calculations.
Processing Budget Revision
Requests for budget revision that do not require prior agency approval will be expeditiously routed to Post-Award for processing in RAS/PeopleSoft.
If prior sponsor approval is required, Pre-Award will contact the sponsor on behalf of the PI and obtain such approval. Once the sponsor approval is received, Pre-Award will route to Post-Award the Budget Revision Form together with a copy of any applicable approval from the agency. After they are processed by Post-Award, budget revisions are reflected in Data Warehouse on the following day.