[Code of Federal Regulations]

[Title 49, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 49CFR19.24]



[Page 159-160]

 

                        TITLE 49--TRANSPORTATION

 

          Subtitle A--Office of the Secretary of Transportation

 

PART 19_UNIFORM ADMINISTRATIVE REQUIREMENTS FOR GRANTS AND AGREEMENTS 

WITH INSTITUTIONS OF HIGHER EDUCATION, HOSPITALS, AND OTHER NON-PROFIT 

ORGANIZATIONS--Table of Contents

 

                    Subpart C_Post-Award Requirements

 

Sec. 19.24  Program income.



    (a) Federal awarding agencies shall apply the standards set forth 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 shall be retained by the 

recipient and, in accordance with Federal awarding agency regulations or 

the terms and conditions of the award, shall be used in one or more of 

the ways listed in the following.

    (1) Added to funds committed to the project by the Federal awarding 

agency 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 160]]



    (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 an agency authorizes the disposition of program income as 

described in paragraph (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 Federal awarding agency does not specify 

in its regulations or the terms and conditions of the award how program 

income is to be used, paragraph (b)(3) of this section shall apply 

automatically to all projects or programs except research. For awards 

that support research, paragraph (b)(1) of this section shall apply 

automatically unless the awarding agency indicates in the terms and 

conditions another alternative on the award or the recipient is subject 

to special award conditions, as indicated in Sec. 19.14.

    (e) Unless Federal awarding agency regulations or the terms and 

conditions of the award provide otherwise, recipients shall have no 

obligation to the Federal Government regarding program income earned 

after the end of the project period.

    (f) If authorized by Federal awarding agency regulations 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. 19.30 through 19.37).

    (h) Unless Federal awarding agency regulations or the terms and 

condition of the award provide otherwise, recipients shall 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.

    (i) Section 4(a) of the Federal Transit Act, as amended, (49 U.S.C. 

app. 1603(a)) allows FTA recipients to retain program income for 

allowable capital or operating expenses, but program income may not be 

used to refund or reduce the local share of a grant. The section 16 and 

18 programs, however, operate differently. Under the special authority 

to set appropriate terms and conditions for the section 16(b)(2) 

program, program income in the form of contract service revenue may be 

used as local share without a proportionate reduction in the Federal 

share. Similarly, section 18 allows the use of program income in the 

form of contract service revenue as local share without requiring a 

proportionate reduction in the Federal share. Grantees must account for 

program income in their accounting systems, which are subject to audit. 

The accounting system must be capable of identifying program income and 

the purpose for which it was used. Nonregulatory guidance is contained 

in FTA notice N 5.5005.1, Guidance on Program Income and Sales Proceeds.