NSF Participant Support Costs & Rebudgeting

Last verified: August 16, 2026. This guide covers the general federal rules under the OMB Uniform Guidance (2 CFR 200), with the NIH and NSF implementation specifics that account for most day-to-day sponsored-programs questions — including, in detail below, exactly what NSF participant support costs cover, what cannot be charged to that line, and why funds can move freely into the category but not back out of it without prior approval. Always confirm against the specific terms of your Notice of Award, cooperative agreement, or award letter — agency-specific and even award-specific terms can be more restrictive than the government-wide baseline described here.

The Baseline: What 2 CFR 200.308 Actually Requires

Every federal grant has an “approved budget” — the financial plan the awarding agency accepted when it made the award. Under 2 CFR 200.308 (“Revision of budget and program plans”), a recipient must request prior written approval from the federal agency or pass-through entity before making certain changes to that budget or to the underlying scope of work — whether or not the change has a budgetary impact.

Section 200.308(e) also establishes what research administrators generally call the expanded-authorities concept, even though the regulation itself doesn’t use that exact phrase: “Unless specified in this guidance, the Federal agency must not impose additional prior approval requirements without OMB approval.” In practice, this means agencies delegate a substantial amount of day-to-day budget flexibility to recipients — rebudgeting between most direct cost categories, for example — while retaining approval authority over a specific, enumerated list of higher-risk changes. Knowing that list is the actual skill; everything not on it is generally something your institution can approve internally under its own delegated signature authority.

2 CFR 200.308(f): The Government-Wide List Requiring Prior Approval

Change in the scope or objective of the project, even without an associated budget change
Change in key personnel identified by name or position in the award
Disengagement from the project for more than three months, or a 25 percent reduction in time and effort devoted to the award, by the approved project director or principal investigator
Inclusion of costs that themselves require prior approval under Subpart E (e.g., certain equipment, participant support, or foreign travel costs)
Transfer of funds budgeted for participant support costs to other budget categories
Subaward activities not proposed and approved in the original application
Changes in the total approved cost-sharing amount
Need for additional federal funds to complete the project
Transferring funds between construction and non-construction work
A no-cost extension beyond any one-time extension the agency has already authorized

This list is the floor, not the ceiling — individual agencies layer additional detail on top of it in their own policy statements. NIH’s and NSF’s versions diverge in useful, specific ways, which is why the table below exists.

Prior Approval: NIH vs. NSF, Change by Change

The table below maps the most commonly triggered prior-approval events to how NIH and NSF each implement them, with the operative citation for each. Treat “NIH” as shorthand for the current NIH Grants Policy Statement (revised March 2026) and “NSF” as shorthand for the Proposal & Award Policies & Procedures Guide (PAPPG 24-1 remains the current, in-force edition; NSF deferred the planned 26-1 revision).

Change type	NIH	NSF	Citation
Change in project scope or objective	Prior approval required in all instances (NIH GPS 8.1.2.5)	Prior approval required in all instances	2 CFR 200.308(f)(1)
Change in PD/PI or named senior/key personnel	Prior approval required for withdrawal, absence of 3+ continuous months, or a 25% or greater reduction in level of effort from the approved amount (NIH GPS 8.1.2.6)	Prior approval required for the same categories of change	2 CFR 200.308(f)(2)-(3)
No-cost extension of the project period	Recipients have delegated authority for one, automatic, one-time extension of up to 12 months via the NIH Standard Terms of Award; a second extension, or one exceeding 12 months, requires prior approval through eRA Commons (NIH GPS 8.1.2.1)	NSF similarly permits one grantee-approved extension of up to 12 months without NSF prior approval; further extensions require program officer approval	2 CFR 200.308(f)(10); agency-specific delegation
Carryover of unobligated balances into the next budget period	Depends on the Notice of Award: automatic if the NoA states the recipient has that authority; prior approval required if it does not (NIH GPS 8.1.2.4)	NSF’s general post-award framework similarly allows carryover under delegated authority for most standard grants, subject to the specific award’s terms and conditions	2 CFR 200.308(e); award-specific terms
Rebudgeting into alterations & renovations (A&R)	Prior approval required if rebudgeting exceeds 25% of the total approved budget for the period, or if a lesser amount would still cause a change in scope (NIH GPS 8.1.2.2)	Handled under NSF’s general rebudgeting flexibility; large facilities-type changes typically require program officer contact	Agency-specific threshold; general authority under 2 CFR 200.308(e)
Capital expenditures (equipment, land, buildings)	Prior approval required in all instances (NIH GPS 8.1.2.3)	Prior approval required in all instances	2 CFR 200.439
Transfer of funds out of participant support costs into other categories	Prior approval required	Prior approval required — NSF applies this rule strictly given how heavily participant-support budgets are used in its solicitations	2 CFR 200.308(f)(5) — government-wide
Foreign component added to a domestic award	Prior approval required in all instances (NIH GPS 8.1.2.10)	Prior approval required	2 CFR 200.308(f)(6)
Subawards issued on a fixed-amount basis	Prior approval required in all instances (NIH GPS 8.1.2.11)	Prior approval required, consistent with 2 CFR 200.333	2 CFR 200.308

For the NIH-specific mechanics of equipment and capital-expenditure approvals in more depth, see our guide on equipment and capital expenditures prior approval under 2 CFR 200.439. See also our prior approval and NIH prior approval dictionary entries for the underlying definitions.

The 25 Percent Rule: Reduction in Effort and Key Personnel

The single most-triggered prior-approval event on a federal grant isn’t a dollar change at all — it’s a change in the PI’s own committed time. Under 2 CFR 200.308(f)(3) and its NIH implementation (GPS 8.1.2.6), prior approval is required when the approved project director or principal investigator either:

disengages from the project for more than three continuous months, or
reduces the time and effort devoted to the award by 25 percent or more from the level approved in the initial competing-year award.

This threshold is cumulative against the originally approved level, not against the prior reporting period — a PI who steps down from 20% to 16% effort (a 4-point drop, but a 20% relative reduction) hasn’t crossed the line; one who drops from 20% to 14% (a 30% relative reduction) has. Sponsored-programs offices typically flag this at proposal-renewal and no-cost-extension time, since it’s easy to lose track of incrementally across a multi-year award. See our guide on effort reporting and payroll certification for how this threshold interacts with certified effort reporting, and the time and effort reporting dictionary entry for the underlying concept.

Rebudgeting: What You Can Move Without Asking

“Rebudgeting” simply means shifting funds between the categories of an already-approved budget — moving money from travel into supplies, for instance. Under the expanded-authorities framework described above, most rebudgeting between direct cost categories does not require federal agency prior approval; it’s exactly the flexibility 2 CFR 200.308(e) is designed to preserve. The exceptions are the enumerated list in 200.308(f) above, plus any category an individual agency has flagged as sensitive (NIH’s 25%-of-budget A&R threshold is the clearest example — see the table above).

Two rebudgeting moves deserve specific attention because they’re asymmetric and frequently misunderstood:

Participant support costs: moving funds out of this category into another requires prior approval; NSF and other agencies do not generally require the same approval to move funds into participant support from other categories. See the dedicated section below.
Trainee costs on NIH training grants (T32 and related mechanisms): NIH requires prior approval to rebudget funds from trainee costs, in all instances, regardless of amount (NIH GPS 8.1.2.15) — a stricter rule than the general 2 CFR 200.308 baseline.

Carryover of Unobligated Balances

Carryover is what happens to money budgeted but not spent by the end of a budget period. Whether it can simply roll forward into the next period, or requires a formal request first, depends entirely on the specific award:

Automatic carryover authority: many multi-year awards — particularly non-competing continuations — are issued with the Notice of Award (or equivalent) explicitly stating the recipient has authority to carry unobligated balances forward without a separate approval step.
Prior-approval carryover: if the award document does not grant that authority, the recipient must submit a formal request — typically a detailed budget by direct cost category, with the applicable indirect cost base and rate — before carrying the balance forward (NIH GPS 8.1.2.4).

NIH notes an important wrinkle for carryover approved several years into a project: the indirect cost rate applied to carried-over funds is generally the rate in effect when the original funds were awarded, not the rate current at the time of carryover approval. Carryover requests are also bounded by the government-wide requirement that federal agencies close out fixed-year appropriation accounts and cancel remaining balances five fiscal years after the year of availability (31 U.S.C. §1552(a)) — a hard backstop on how long unspent funds can realistically be carried.

NSF Participant Support Costs: What Counts and What Cannot Move

Participant support costs are their own budget category, and — on NSF awards especially, given how heavily programs like REU sites, conferences, and training institutes rely on the category — the one applicants and post-award administrators most often get wrong, both in what they charge to it and in how they try to rebudget it.

What Counts as a Participant Support Cost

Under 2 CFR 200.456, participant support costs are allowable direct costs paid to or on behalf of participants or trainees — not employees — in connection with conferences, meetings, symposia, or training activities. NSF’s PAPPG (Chapter II) is explicit about what belongs here: stipends or subsistence allowances, travel allowances, and registration fees for participants or trainees. The classification must be documented in the recipient’s own written policies and procedures and applied consistently across all federal awards — an institution can’t decide, award by award, what counts.

Qualifies as participant support	Does not qualify — charge elsewhere (or unallowable)
Stipend or subsistence allowance paid to a conference/training participant	Salary, wages, or fringe benefits for a project employee — that’s personnel compensation, not participant support
Travel allowance for a participant to attend the funded conference, workshop, or training activity	Travel or per diem for the PI or project staff attending in their own working capacity — a direct travel cost, not participant support
Registration fee paid to or on behalf of a participant	Consultant fees for services rendered to the project
Stipends for REU (Research Experience for Undergraduates) students or workshop trainees who are not university employees	General costs of organizing the conference itself — facility rental, staff catering, A/V — which are typically Other Direct Costs, not participant support, unless directly tied to a participant benefit

Who Counts as a “Participant”

The judgment call underneath the table above is whose benefit the payment is for. A “participant” is someone receiving the training, conference, or outreach benefit itself — an REU student, a workshop attendee, a K-12 teacher in an outreach institute — not someone performing paid work for the awardee institution. A graduate research assistant who is already a paid employee of the university and doing research as part of a compensated assistantship is not a “participant” for cost-classification purposes, even if they also attend project-related training, because they are already being paid as project staff rather than supported as a training beneficiary. The harder cases are short-term visitors who are neither clearly employees nor clearly separate from the research effort — for example, a visiting scholar who both contributes labor and receives training. NSF’s PAPPG puts the burden on the institution to apply this classification consistently, in writing, across its awards, rather than deciding case by case which category is more advantageous for a given budget line.

They Don’t Generate Indirect Cost Recovery

Participant support costs are excluded from the Modified Total Direct Cost (MTDC) base used to calculate F&A/indirect costs, per the MTDC definition at 2 CFR 200.1. Practically: budgeting $50,000 in participant support does not increase the indirect-cost dollars an institution recovers on that award, the way $50,000 in supplies or personnel would. NSF’s PAPPG reinforces this directly — F&A is “not usually allowed on costs budgeted as participant support” unless an institution’s federally negotiated indirect cost rate agreement specifically provides for allocating F&A to this category, which is uncommon. Budget officers who load participant-heavy workshops or training awards without accounting for this will see a lower effective indirect recovery than a same-size research award — not an error, just how the category is designed to work.

The Rebudgeting Prohibition: What Cannot Move

This is the rule with the highest search volume in this entire topic area, and it’s genuinely asymmetric:

Moving funds OUT of participant support into another category requires prior approval. This is a government-wide requirement under 2 CFR 200.308(f)(5), not an NSF-specific quirk — it applies across federal awarding agencies.
Moving funds INTO participant support from another category is generally not subject to that same prior-approval trigger — it falls under the recipient’s ordinary rebudgeting flexibility, the same as most other category-to-category moves under 2 CFR 200.308(e).

The logic: agencies want assurance that money explicitly awarded to support participants — often a condition tied to the merit of the proposal itself, e.g., an NSF conference or REU grant — actually reaches those participants, rather than being quietly absorbed into the institution’s other direct costs after the fact. Moving money the other direction doesn’t raise that concern, so it isn’t gated the same way. If your award budget includes a participant support line and you are considering reducing it for any reason, build in time for a prior-approval request rather than assuming it can be handled at the institutional level.

The same logic governs what happens if the line ends up underspent — a workshop with lower-than-planned enrollment, for example. Because moving money out of participant support requires prior approval, an institution cannot simply absorb the difference into supplies, travel, or other direct costs at closeout without going through that same approval step first. In practice, sponsored-programs offices generally either request prior approval early once a shortfall becomes apparent, or leave the unspent balance unobligated and return it — treating an underspent participant support line as functionally reserved for participants only, not as a discretionary reserve for the rest of the budget.

What Makes a Cost Allowable

Separately from prior approval — which governs whether you can move money into a category — allowability governs whether a cost can be charged to a federal award at all. Under 2 CFR 200 Subpart E (§§200.400-200.476), a cost must satisfy all of the following to be allowable:

Reasonable: a prudent person would have incurred the cost under the circumstances prevailing when the decision was made; it reflects sound business practices, arm’s-length bargaining, and the market prices for comparable goods/services (2 CFR 200.404).
Allocable: the cost is chargeable to the award in proportion to the benefit the award actually receives; it must be incurred specifically for the award, benefit both the award and other work in proportions that can be reasonably determined, or be necessary to the overall operation of the organization (2 CFR 200.405).
Consistently treated: costs incurred for the same purpose, in like circumstances, must be treated consistently as either direct costs or indirect (F&A) costs across the institution — an institution cannot charge the same type of cost as direct on one award and indirect on another (2 CFR 200.403(c); this consistency requirement is also the basis of Cost Accounting Standards compliance for larger institutions — see our guide on Cost Accounting Standards and DS-2 consistency requirements).
Conforms to award limitations: the cost must be allowable under both the general Uniform Guidance cost principles and any specific limitations or exclusions in the federal award’s own terms, the applicable agency-wide policy (NIH GPS, NSF PAPPG), or an approved federally negotiated rate agreement (2 CFR 200.403(f), 200.407).

All four conditions must be met — a cost that’s reasonable and allocable but conflicts with an award-specific restriction is still unallowable on that award, even though it might be perfectly chargeable on a different one.

Specifically Unallowable Costs Researchers Trip Over

Beyond the general four-part test, 2 CFR 200 Subpart E lists specific cost categories that are unallowable outright, or unallowable except in narrow circumstances, regardless of how reasonable or allocable they might otherwise seem. The ones that most often catch investigators and administrators off guard:

Alcoholic beverages — unallowable as a direct or indirect cost on federal awards.
Entertainment costs — unallowable except in the narrow case where they have a clear and direct programmatic purpose and are authorized in the approved budget or have prior written agency approval.
Lobbying — costs of attempting to influence the outcome of federal, state, or local elections, referenda, or legislation are unallowable, with narrowly defined exceptions for certain technical/factual presentations.
Fines and penalties — unallowable except when incurred as a result of complying with specific provisions of the federal award, or when they result from instructions from the awarding agency.
First-class or business-class air travel — the cost above the customary standard (coach/economy) commercial airfare is unallowable except in specific, documented circumstances (e.g., medical necessity, no reasonably-timed coach seat available).
Memberships in social, dining, or country clubs — unallowable, distinct from professional/technical organization memberships, which generally are allowable.

Our unallowable cost dictionary entry covers the underlying definition and how it’s distinguished from an “unallocable” cost. When in doubt about a specific line item, the operative question is always the four-part test above, applied to that specific award — a cost’s allowability is not a fixed, universal label independent of the award it’s charged to.

Frequently Asked Questions

What is “prior approval” on a federal grant?

Prior approval is written authorization from the federal awarding agency (or pass-through entity, for a subaward) that a recipient must obtain before making certain changes to an approved budget or project scope, as defined by 2 CFR 200.308 and each agency’s own implementing policy. Some changes require it in all instances (e.g., capital expenditures); others only above a defined threshold (e.g., NIH’s 25% A&R rebudgeting limit).

How much can I rebudget on a federal grant without prior approval?

There’s no single government-wide percentage. Most category-to-category rebudgeting is allowed under the recipient’s own delegated authority unless the change falls on the specific list in 2 CFR 200.308(f), or triggers an agency-specific threshold — NIH’s 25%-of-budget rule for alterations and renovations is the clearest numeric example; NSF applies its own thresholds under PAPPG Chapter X. Check both the government-wide list and your specific award terms before assuming a move is pre-approved.

Can I rebudget funds into participant support costs without prior approval?

Generally yes — moving funds into participant support from another category is treated as ordinary rebudgeting. Moving funds out of participant support into another category is the direction that requires prior approval under 2 CFR 200.308(f)(5).

Are participant support costs subject to indirect (F&A) costs?

Generally no. Participant support costs are excluded from the Modified Total Direct Cost base used to calculate F&A, unless an institution’s specific negotiated indirect cost rate agreement provides otherwise.

Is a graduate research assistant a “participant” for NSF participant support cost purposes?

Generally no. A graduate research assistant who is a paid employee of the university, performing compensated research work, is treated as project personnel — a direct salary/wages cost — not a participant, even if they also attend project-related training or a workshop. Participant support is for people receiving the training or conference benefit itself, not for compensated staff.

What happens to unspent NSF participant support funds at the end of an award?

They generally can’t simply be redirected to other project costs, because moving money out of participant support requires prior approval under 2 CFR 200.308(f)(5). Institutions typically either request that approval before the funds are otherwise obligated, or leave the balance unobligated and return it at closeout, rather than absorbing it into another budget category without authorization.

What is the NIH 25 percent rule?

It refers to two related but distinct thresholds: (1) a 25% or greater reduction in the PI’s approved level of effort requires prior approval (2 CFR 200.308(f)(3); NIH GPS 8.1.2.6), and (2) rebudgeting more than 25% of a budget period’s total approved budget into alterations and renovations requires prior approval (NIH GPS 8.1.2.2). Context determines which applies.

What’s the difference between rebudgeting and carryover?

Rebudgeting moves funds between categories within the same budget period. Carryover moves unobligated funds from one budget period forward into a later one. Both can require prior approval, but the triggers are different — rebudgeting approval depends on which categories are involved; carryover approval depends on whether the specific award’s Notice of Award grants automatic carryover authority.