[Rowdy.research] Drawing down federal funds - quick definitions

Hi, all, I’ve fielded a few questions about drawing down federal funds for grants and thought I’d send a quick explainer about what it means. When we receive a grant from a federal agency, the award document represents authority to spend the obligated award amount. Depending on the language in the grant, that obligated award amount might be for the whole project period, or for a year of funding until continuation years are granted and the obligated award amount increases. We don’t receive actual money from the sponsor until we start spending on the grant. Letter of Credit (LOC) draws are a way for grantees to electronically request reimbursement for expenses incurred on federal grants instead of sending paper/email invoices. The funds are transferred to the grantee by EFT/wire transfer. GCFS handles LOC draws based on expenditure activity on the grant. We are only allowed to be reimbursed for what we spent on a grant during a given period, and only up to the obligated award amount. GCFS pulls expenditures for federal sponsors with LOC capability, and only expenditures. We cannot draw funds for encumbrances. This applies only to federal grants and some cooperative agreements but not contracts or awards from non-federal sponsors (including subfederal awards where UTSA is the subrecipient). If you have questions, please email through this list. Thanks, Lori