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Chapters:

3.4 Program Income

Introduction

Program income means gross income earned by the non-Federal entity that is directly generated by a supported activity or earned as a result of the Federal award during the period of performance.  See 2 C.F.R. § 200.80(definition of “Program Income”).  Non-Federal entities are encouraged to earn income to defray program costs where appropriate.  See 2 C.F.R. § 200.307(a).

  • Depending on guidance provided by the DOJ grant-making component, award recipients can either use program income to advance program objectives or refund program income to the awarding agency. Most types of recipients, absent more specific guidance form the DOJ grant-making component, must use program income to offset total allowable costs, and reduce the Federal award and non-Federal entity contributions (i.e., the deduction method).  Institutions of Higher Education (IHE) and non-profit research institutions, absent more specific guidance, may use program income to add to the total allowable costs for the project (i.e., the addition method).  See 2 C.F.R. § 200.307(e).    
  • Program income may only be used for allowable program costs and must be spent prior to draw downs. See 2 C.F.R. § 200.305(b)(5)

information iconOJP Specific Tip

The draw down restriction does not apply to Juvenile Accountability Block Grant (JABG) and Justice Assistance Grant (JAG) awards.

information iconOVW Specific Tip

Without prior approval from OVW, program income must be deducted from total allowable cost to determine the net allowable costs. In order to add program income to the OVW award, the recipient must seek approval from its program manager via a budget modification Grant Adjustment Notice (GAN) prior to generating any program income.

information iconFinancial Management Tip

If the cost is allowable under your program award, then it is allowable to apply program income to that cost.