[Code of Federal Regulations]
[Title 34, Volume 1]
[Revised as of July 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 34CFR74.24]

[Page 111-112]
 
                           TITLE 34--EDUCATION
 
PART 74_ADMINISTRATION OF GRANTS AND AGREEMENTS WITH INSTITUTIONS OF 
 
                    Subpart C_Post-Award Requirements
 
Sec. 74.24  Program income.

    (a) The Secretary applies the standards contained in this section in 
requiring recipient organizations to account for program income related 
to projects financed in whole or in part with Federal funds.
    (b) Except as provided in paragraph (h) of this section, program 
income earned during the project period must be retained by the 
recipient and, in accordance with ED regulations or the terms and 
conditions of the award, must be used in one or more of the following 
ways:
    (1) Added to funds committed to the project by the Secretary and 
recipient and used to further eligible project or program objectives.
    (2) Used to finance the non-Federal share of the project or program.

[[Page 112]]

    (3) Deducted from the total project or program allowable cost in 
determining the net allowable costs on which the Federal share of costs 
is based.
    (c) When the Secretary authorizes the disposition of program income 
as described in paragraphs (b)(1) or (b)(2) of this section, program 
income in excess of any limits stipulated shall be used in accordance 
with paragraph (b)(3) of this section.
    (d) In the event that the Secretary does not specify in program 
regulations or the terms and conditions of the award how program income 
is to be used, paragraph (b)(3) of this section applies automatically to 
all projects or programs except research. For awards that support 
research, paragraph (b)(1) of this section applies automatically unless 
the Secretary indicates in the terms and conditions another alternative 
on the award or the recipient is subject to special award conditions, as 
indicated in Sec. 74.14.
    (e) Unless ED regulations or the terms and conditions of the award 
provide otherwise, recipients have no obligation to the Federal 
Government regarding program income earned after the end of the project 
period.
    (f) If authorized by ED or the terms and conditions of the award, 
costs incident to the generation of program income may be deducted from 
gross income to determine program income, provided these costs have not 
been charged to the award.
    (g) Proceeds from the sale of property shall be handled in 
accordance with the requirements of the Property Standards (See 
Sec. Sec. 74.30 through 74.37).
    (h) Unless ED regulations or the terms and condition of the award 
provide otherwise, recipients have no obligation to the Federal 
Government with respect to program income earned from license fees and 
royalties for copyrighted material, patents, patent applications, 
trademarks, and inventions produced under an award. However, Patent and 
Trademark Amendments (35 U.S.C. 18) apply to inventions made under an 
experimental, developmental, or research award.

(Authority: 20 U.S.C. 1221e-3, 3474; OMB Circular A-110)