[Code of Federal Regulations]

[Title 32, Volume 1]

[Revised as of July 1, 2006]

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

[CITE: 32CFR34.14]



[Page 211-212]

 

                       TITLE 32--NATIONAL DEFENSE

 

              CHAPTER I--OFFICE OF THE SECRETARY OF DEFENSE

 

PART 34_ADMINISTRATIVE REQUIREMENTS FOR GRANTS AND AGREEMENTS WITH 

FOR-PROFIT ORGANIZATIONS--Table of Contents

 

                    Subpart B_Post-award Requirements

 

Sec.  34.14  Program income.



    (a) DoD Components shall apply the standards in this section to the 

disposition of program income from projects financed in whole or in part 

with Federal funds.

    (b) Recipients shall have no obligation to the Government, unless 

the terms and conditions of the award provide otherwise, for program 

income earned:

    (1) From license fees and royalties for copyrighted material, 

patents, patent applications, trademarks, and inventions produced under 

an award. Note, however, that the Patent and Trademark Amendments (35 

U.S.C. Chapter 18), as implemented in Sec.  34.25, apply to inventions 

made under a research award.

    (2) After the end of the project period. If a grants officer 

anticipates that an award is likely to generate program income after the 

end of the project period, the grants officer should indicate in the 

award document whether the recipient will have any obligation to the 

Federal Government with respect to such income.

    (c) If authorized by 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.

    (d) Other than any program income excluded pursuant to paragraphs 

(b) and (c) of this section, program income earned during the project 

period shall be retained by the recipient and used in one or more of the 

following ways, as specified in program regulations or the terms and 

conditions of the award:

    (1) Added to funds committed to the project by the DoD Component and 

recipient and used to further eligible project or program objectives.

    (2) Used to finance the non-Federal share of the project or program.

    (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.

    (e) If the terms and conditions of an award authorize the 

disposition of program income as described in paragraph (d)(1) or (d)(2) 

of this section, and stipulate a limit on the amounts that may be used 

in those ways, program income in excess of the stipulated limits shall 

be used in accordance with paragraph (d)(3) of this section.

    (f) In the event that the terms and conditions of the award do not 

specify how program income is to be used, paragraph (d)(3) of this 

section shall apply automatically to all projects or programs except 

research. For awards that support research, paragraph (d)(1) of this 

section shall apply automatically unless the terms and conditions 

specify another alternative or the recipient is subject to special award 

conditions, as indicated in Sec.  34.4.

    (g) Proceeds from the sale of property that is acquired, rather than 

fabricated, under an award are not program income and shall be handled 

in



[[Page 212]]



accordance with the requirements of the Property Standards (see 

Sec. Sec.  34.20 through 34.25).