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National Institutes of Health Salary Cap Increase

February 7, 2020

The National Institutes of Health (NIH) has increased the NIH Salary Cap for Executive Level II to $197,300, effective January 5, 2020. The salary cap is a mandated provision of Congress that limits the amount of direct salary that can be charged to an NIH grant or contract. Salaries above the $197,300 limit must be allocated to the impacted grant’s cost share fund (281XXX).

 

The previous salary cap of $192,300 must still be used for all effort reporting periods prior to December 31, 2019, and for the period from January 1-4, 2020. Effective January 5, 2020, the new, higher rate can be used. In order to appropriately allocate the new salary cap, you will need to prorate, via a labor redistribution, the cost sharing of salaries for the month of January 2020 based on the effective date of the increase.

 

Although NIH will not be adjusting awards already issued in FY 2020, re-budgeting will be allowed to reflect the increase in the salary cap.

 

The full context of the NIH guidance can be found at: grants.nih.gov/grants/guide/notice-files/NOT-OD-20-065.html.

 

A historical record of the salary cap, including effective dates can be found at: grants.nih.gov/grants/policy/salcap_summary.htm.

 

If you have any questions regarding the new rates, please contact ras@drexel.edu.