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No-Cost Extensions

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What is a No Cost Extension, and what limits are there?

No Cost Extensions (NCE) provide a one time extension of the end date for a final budget period of a previously approved grant project period without additional funding.

NCEs can, by HHS policy, be approved for up to 12 months, but are typically only approved for three months.

The extension must be justified on the basis of time required to complete existing project activities, or permit the orderly closeout of the award.

HHS Grants Policy specifically precludes NCEs in cases where the only justification is having unobligated funds at the end of the project period.

The extension may not violate a limitation in the authorizing statute, or extend beyond the availability of funding.

There can be no change in the project's currently approved scope of work or objectives.

Reasons to request an NCE

Additional time beyond the established expiration date is required to ensure adequate completion of the originally approved project.

Continuity of an IHS grant support project is required while a competing continuation application is under review.

The extension is necessary to permit an orderly phase-out of a project that will not receive continued support.

  • The recipient must demonstrate that they have made satisfactory progress througout the project period.

What information is required when requesting an NCE?

An NCE requires an amendment to be approved. The Grants Management Specialist (GMS) and the Program Officer (PO) will need to review some documentation in order to properly review the request and make a determination. That information includes:

  • A detailed reason why the NCE is needed.
  • The length of time the NCE will be needed, stated as a date range. For example, "We request a No Cost Extension from September 30, 2021 through November 30, 2021."
  • A detailed description of what will be accomplished during the NCE.
  • If you plan to use unobligated funds to cover expenses incurred during the NCE, provide a detailed explanation as to how much and for what purpose.

How do we request an NCE?

An NCE is an amendment, and must be submitted in GrantSolutions as an amendment application. As with any amendments, start by contacting your GMS to discuss the request. Your GMS will provide you with details on what is required and how to submit it. The information here is a guide, but follow the instructions from your GMS.

The request should be in the form of a business letter, on your organization's letterhead, signed and dated by the Principal Investigator (PI), Project Director (PD), or Authorizing Official (AO) listed on your Notice of Award (NoA). It must be cosigned by your organization's Business Official.

Please submit an NCE request at least 30 days before the end of your award's project period. It takes time to process an amendment, and there may be delays if there are problems with your documents.

How is an NCE request processed?

Upon receipt of your NCE amendment application, your GMS will:

  • Review your application to ensure all documents have been submitted to explain and substantiate the request.
  • Consult with the IHS Program Official about your request.
  • If approved, execute an amended Notice of Award to extend the budget period and project period end dates.

Note: All previous terms and conditions of the current award apply during the extended period. All reporting must continue on the reporting frequency applicable to the original award. Final reports are delayed until after the NCE is concluded.

Sample NCE Letter

The NSC Tribe is requesting a 3 month No Cost Extension in order for our IHS Behavioral Health program to conduct an orderly closeout. During this time, we will complete and submit our final Federal Financial Report, Progress Report, and Equipment and Supply disposition reports. We are requesting an extension from September 30, 2021 to December 31, 2021.

We would also lie to use unobligated funds in the amount of $7,000 to cover the salary for our clerical staff to continue working on these documents during the no cost extension period.


Jane Brown, Principal Investigator

John Smith, Chief Financial Officer


Frequently Asked Questions

  • If a grantee wants to use unobligated funds in their NCE phase, is the information they have to provide for those funds the same as for a Carryover request?
    The information is similar. If the amount of funding you wish to use is greater than 25% of the prior year annual award, then you will need to request approval to use the unobligated funds. If the amount is less than 25%, no approval is required. However, in both cases, a brief line item budget and justification explaining what the funds will be used for is required and should be included with the amendment application.

  • Is a No Cost Extension automatically issued if there is a delay in starting a continuation?
    No, an NCE is not issued due to the late start-up of the continuation award with future years. Notify your GMS if your continuation is delayed.

  • Is the Business Official's signature really required?
    • Yes, two signatures are required, the Authorizing Official and teh Business Official.

    • The Authorizing Official signs as the overall person held accountable for the federal grant funds and provides approval to requesting an extension on behalf of the organization to continue to do business with the IHS issued grant funds.

    • The Business Official provides their signature to certify that they are aware of the financial obligations already incurred and any possible obligations that will be requested during the NCE period. They are agreeing to monitor all spending to avoid over limit expenses that may cause any possible financial debt or related concerns for the organization at all times during the period of performance in their financial management system, and provides checks and balances for cash on hand for the organization.

  • What positions are considered appropriate for the Business Official?
    Appropriate positions for the Business Official would be the Chief Financial Officer, Financial Accountant, or Analyst. Anyone who oversees and manages the grantee organization's financial information, disburses the IHS grant funds, or maintains the general accounting ledger and accounting balances.

  • Can No Cost Extensions be requested electronically, or must they be submitted in hard copy?
    No Cost Extensions must be requested by initiating a new amendment in GrantSolutions.