COVID-19 Impacts to Proposals, Grants and Contracts



Updated March 11, 2021

The US Secretary of Health and Human Services declared a public health emergency for the entire United States on 1/31/20. The Governor of Pennsylvania subsequently proclaimed the existence of a disaster emergency throughout the Commonwealth on 3/6/20. The US Office of Management and Budget (OMB) issued special guidance on 3/19/20 stating that Federal agencies may allow recipients to charge salaries and benefits of non-working individuals on sponsored programs, but only to the extent such recipients have a consistent policy of charging such salaries to all funding sources, Federal and non-Federal. (OMB's guidance sunsetted 6/17/20.)

Many Federal agencies (but not all of them) issued memos implementing the above authority. (See sponsor-specific guidance below.) On 3/24/20, Penn State announced that it would cover all employee and student worker salaries through 4/30/20, regardless of whether employees could work. On 4/9/20, Penn State stated that all graduate assistant stipends would be covered through the end of the Spring Semester. Penn State subsequently announced that salaries of non-working individuals would be covered at 50% from May 4 to June 30.  (This arrangement was later extended to July 31). In accordance with the above, salaries of non-working individuals continued on sponsored programs from 3/24/20 to 5/3/20 in accordance with previously established allocations of effort. Graduate student stipends, benefits, and tuition were paid in accordance with previously established allocations of effort through the end of the Spring  assistantship appointment period. Penn State continued to charge salaries and benefits of non-working individuals to sponsored programs from 5/4/20-6/17/20, albeit at 50% of previously established allocations of effort in accordance with Penn State’s policy of compensating non-working individuals at half pay for the subject period. Penn State’s policy on personnel costs, articulated in RA64, permitted Penn State to charge salaries and benefits of non-working individuals to sponsored programs in “extraordinary circumstances.” Penn State also developed a  Decision Tool to determine the appropriateness of charging non-working individuals to sponsored programs from 3/24/20 to 6/17/20. However, as noted above, OMB's guidance sunsetted 6/17/20. Beginning 6/18/20, Penn State only permitted effort on sponsored projects to the extent that such effort was clearly allocable to the project.

Frequently Asked Questions regarding grant administration, travel, effort, and other topics:

Several sponsors have provided guidance, subject to update and revision:

Federal Agencies

State Agencies

Project Management: COVID-19 may impact performance of sponsored projects, e.g., cancelled travel, temporary loss of personnel, delays in acquiring equipment and supplies, and interruption of other essential services. It is important to remain in communication with your sponsor regarding any delays or other challenges you experience:

Federal grants and cooperative agreements: Penn State is required to request prior approval from Federal award agencies whenever there is a change in the scope of work or key personnel. Penn State also must request prior approval whenever the PI will be disengaged from the project for more than three months and/or experience a 25 percent reduction in time devoted to the project (2 CFR 200.308(c)). Some grants may be subject to more stringent prior approval requirements.

Federal contracts and other sponsored agreements: Please consult your specific terms and conditions to determine when prior approvals are required. Many Federal and industry-sponsored contracts are subject to strict deliverable due dates. Even if your sponsor is sympathetic with the delay, it is generally necessary to modify the contract to reflect the revised deliverable schedule.

Subawards and subcontracts: Please monitor all subrecipients to ensure they making adequate progress. If a subrecipient is unable to perform and/or meet deadlines, it may impact your performance as well. Please communicate with your sponsor regarding any such challenges.

Short-term vs. long-term absences: Researchers may continue to charge effort to sponsored programs when they are ill, in proportion to their previously established allocation of effort. However, if an individual is going to be disengaged from a project for more than three months, his or her salary should be removed from the project to avoid an undue burden on the sponsored fund. (See RA64, OTHER LEAVE/EXTENDED LEAVE.)

Reimbursement for cancelled travel: The Controller's office has issued a supplement to policy to indicate when cancelled travel can be charged to sponsored programs. See here for details regarding reimbursement for cancelled travel.

Additional guidance regarding the above can be found here.

Please contact if you have any specific questions or concerns.