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Allowable costs   

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(a) Limitation on use of funds. Grant funds may be used only for:

(1) The allowable costs of the grantees, subgrantees and cost-type contractors, including allowable costs in the form of payments to fixed-price contractors; and

(2) Reasonable fees or profit to cost-type contractors but not any fee or profit (or other increment above allowable costs) to the grantee or subgrantee.

(b) For each kind of organization, there is a set of Federal principles for determining allowable costs. For the costs of a State, local, or Indian tribal government, the Secretary applies the cost principles in OMB Circular A-87, as amended on June 9, 1987.

For the costs of a-- Use the principles in--

State, local or Indian tribal OMB Circular A-87.

government Private nonprofit organization other OMB Circular A-122.

than an (1) institution of higher

education, (2) hospital, or (3)

organization named in OMB Circular

A-122 as not subject to that

circular Educational institutions. OMB Circular A-21.

For-profit organization other than a 48 CFR Part 31. Contract Cost

hospital and an organization named

Principles and Procedures, or

in OBM Circular A-122 as not subject

uniform cost accounting standards

to that circular that comply with cost principles

acceptable to the Federal agency.

(Authority: 20 U.S.C. 3474; OMB Circular A-102)

[53 FR 8071 and 8087, Mar. 11, 1988, as amended at 53 FR 8072, Mar. 11, 1988]