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March 7, 2023

Federal Railroad Administration Answers to Frequently 

Asked Questions about Advance and Pre-Award Costs for 

Federal State Partnership for Intercity Passenger Rail (FSP) 

Northeast Corridor (NEC) Grants 

I. Introduction 

These answers to frequently asked questions (FAQs) are intended to assist project sponsors with 

determining eligibility for incurring Advance Costs and Pre-Award Costs for the Federal 

Railroad Administration’s (FRA) Federal-State Partnership for Intercity Passenger Rail (FSP) 

Northeast Corridor (NEC) projects. These FAQs supplement a policy issued by FRA on March 

3, 2023, which is available on FRA’s website here. The information in the FAQs is only 

applicable for FSP projects listed on the NEC Project Inventory with an Anticipated Obligation 

amount. The information in the FAQs does not apply to projects applying for FSP grants off the 

NEC or for any other FRA grant program. 

The FAQs are offered as guidance; they do not have the force and effect of law and are not 

meant to bind the public in any way. This FAQ document is intended only to provide 

information to the public regarding existing requirements under the law or agency policies. 

Please contact FRA-Grants@dot.gov for additional related questions.

II. Questions 

1. What are Advance Costs and Pre-Award Costs? 

Advance Costs means costs incurred before grant selection and obligation. After obligation 

of an award, these costs may be approved as Pre-Award Costs. Advance Costs and PreAward Costs are permitted under 2 CFR 200.458, which states:

Pre-award costs are those incurred prior to the effective date of the 

Federal award or subaward directly pursuant to the negotiation and in 

anticipation of the Federal award where such costs are necessary for 

efficient and timely performance of the scope of work. Such costs are 

allowable only to the extent that they would have been allowable if 

incurred after the date of the Federal award and only with the written 

approval of the Federal awarding agency. If charged to the award, these 

costs must be charged to the initial budget period of the award, unless 

otherwise specified by the Federal awarding agency or pass-through 

entity. 
 

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All Advance Costs are incurred at a Project Sponsor’s risk and the pre-obligation approval 

of Advance Cost incurrence does not commit FRA to reimburse such costs; only costs 

properly requested that are otherwise consistent with the terms of the executed grant 

agreement would be eligible for reimbursement or could be used as match. 

Approval of Advance Cost incurrence is not a legal or implied commitment that the subject 

project will be selected for FRA assistance or that FRA will obligate Federal funds. 

Furthermore, it is not a legal or implied commitment that activities undertaken by the 

Project Sponsor will be eligible for inclusion in the project.

2. What projects are eligible for approval of costs incurred before the date the project is 

selected? 

FRA may approve such costs only for FSP projects on the NEC that are listed on the NEC 

Project Inventory with an Anticipated Obligation amount. However, inclusion in the NEC 

Project Inventory is not an approval of the costs. 

3. What is the Earliest Incurrence Date permitted for costs incurred before obligation? 

See FRA’s policy on Advance and Pre-Award costs for FSP-NEC projects for the definition 

of “Earliest Incurrence Date” here. The Earliest Incurrence Date for FSP-NEC projects is 

the date of the first NEC Project Inventory in which the project is listed with an Anticipated 

Obligation. For all other FRA projects, the Earliest Incurrence Date is the date FRA 

announces that the project is selected to receive a grant.

4. What types of Advance Costs may be incurred? 

In general, activities eligible to receive funding under the FSP Program and within the scope 

of the project listed on the NEC Project Inventory are eligible to receive approval for

Advance Cost incurrence, though the form of approval required will depend on the activity. 

Costs associated with planning and operations are not eligible. 

For a description of the categories of eligible activities, please refer to FRA’s policy here. 

 

5. How do I request approval to incur Advance Costs for Preliminary Engineering, 

Preliminary Environmental Investigation, and Preliminary Real Property 

Investigation activities? 

Email a Written Notice to FRA-Grants@dot.gov explaining your incurrence, or intention to 

begin incurring, Preliminary Engineering, Preliminary Environmental Investigation, or 

Preliminary Real Property Investigation costs. Project Sponsors should title the Subject of 

the Written Notice with the following convention “Advance Cost Incurrence Notice – 

[Project Title]”. Further direction on what to include in your Written Notice can be found in 

FRA’s published policy on FSP-NEC Advance and Pre-Award Costs. 
 

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Please ensure that you comply with the requirements therein, which include coordinating 

with FRA project management and technical staff.

6. How do I request approval to incur Advance Costs for National Environmental Policy 

Act (NEPA) Documentation, Real Property Acquisition and Equipment and 

Construction Materials Acquisition, Final Design (FD), and Construction activities? 

Email FRA-Grants@dot.gov with a Written Request explaining your intention to begin 

incurring costs associated with NEPA Documentation, Real Property Acquisition and 

Equipment and Construction Materials Acquisition, Final Design, and Construction 

activities. Project Sponsors should title the Subject of the Written Request with the 

following convention “Advance Cost Incurrence Written Request - Project Title”. 

The Written Request should include: (1) a description of the items or activities to be covered 

by the Pre-Award Authority; (2) the amount to be incurred; and (3) a justification for 

advancing the identified activities under 2 CFR 200.458, including an explanation of how 

incurring the costs before grant obligation is necessary for the efficient and timely 

performance of the scope of work. Additional guidance for what to include in the Written 

Request can be found here. 

7. How will I know if my Written Request to incur Advance Costs is approved?

FRA will review the Written Request and approve, disapprove, or request more information, 

subject to coordination. If a project is selected for award, only Pre-Award Costs that are 

covered by an FRA approval are eligible for future reimbursement or may be applied as a 

non-Federal match. 

FRA technical and project delivery staff may request additional information and/or 

disapprove the Written Request for approval of the Advance Costs Incurrence due to 

instances of noncompliance or project delivery risk. 

 

8. How do I get reimbursed for incurred Advance Costs? 

Incurring Advance Costs before selection and obligation of a grant is at your own risk. You 

are not guaranteed that your project will be selected for award or that the costs will be 

reimbursed. However, if your project is selected for award and the costs are included in the 

scope of work for the executed grant agreement, you should submit a complete request for 

reimbursement. 

9. Is there a minimum local match requirement for incurred Advance Costs? 

No. There is not a minimum match requirement while incurring Advance Costs. However, 

after selection and obligation of a grant agreement, a Project Sponsor’s request for 

reimbursement should be consistent with the cost-share percentages and other terms and 

conditions included in the executed grant agreement.
 

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10. Can I apply incurred Advance Costs as non-Federal match?

Yes. Eligible Advance Costs incurred consistent with this policy and other applicable 

requirements may be applied as non-Federal match once a project has been selected for 

award and a grant agreement is obligated. Project Sponsors should carefully review the 

principles for cost sharing or matching in 2 CFR 200.306. 

11. Is there a minimum or maximum amount of Advance Costs that can be incurred?

No. However, Project Sponsors are reminded that incurring such costs are at their own risk, 

and a pre-obligation approval of Advance Cost incurrence is not a legal or implied 

commitment that the subject project will be selected for assistance or that FRA will obligate 

federal funds. Project Sponsors should ensure that all applicable prerequisites (e.g., 

engineering and environmental review) have been met to avoid complications in the event 

the project is selected, a grant agreement is obligated, and the Project Sponsor requests 

reimbursement. Incurring project costs that do not comply with Federal requirements may 

not only render the incurred Advance Costs ineligible, but it may make the entire project

ineligible for FSP funding. Project Sponsors are strongly encouraged to contact FRA with 

any questions before proceeding to incur Advance Costs. If estimated Advance Costs 

change, please see Question 12. 

12. What if my estimated Advance Costs change? Can Advance Costs be revised or 

updated after receiving FRA approval?

Yes. The Project Sponsor should submit an updated Written Notice or Written Request, as 

applicable, to FRA-Grants@dot.gov when costs either increase or decrease, explaining the 

change. 

13. Could FRA deny my request to incur Advance Costs? 

Yes. FRA may deny a request to incur Advance Costs for NEPA Documentation, Real 

Property Acquisition and Equipment and Construction Materials Acquisition, Final Design, 

and Construction costs due to instances of noncompliance or project delivery risk. For 

example, because Final Design and Construction and Real Property Acquisition and 

Equipment and Construction Materials Acquisition costs cannot be incurred before 

completion of the environmental review process, FRA will not issue an approval letter for 

such activities until the environmental review process has been completed with a Record of 

Decision, Finding of No Significant Impact, or Categorical Exclusion determination. 
 

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However, a Project Sponsor may proceed with Preliminary Engineering, Preliminary 

Environmental Investigation, and Preliminary Real Property Investigation activities, at risk, 

after submitting a Written Notice. 

Please see additional guidance regarding FRA’s review and approval to incur Advance 

Costs at here. 

14. What if I incur costs for Preliminary Engineering, Preliminary Environmental 

Investigation Preliminary, or Preliminary Real Property Investigation Activities

before sending a Written Notice? 

Preliminary Engineering, Preliminary Environmental Investigation, and Preliminary Real 

Property Investigation Advance Costs that have been incurred before Written Notice has 

been sent are incurred at the Project Sponsor’s risk. Please notify FRA of your incurrence or 

intention to begin incurring such costs (see Question 5). 

15. What if I incur costs for NEPA Documentation, Real Property Acquisition and 

Equipment and Construction Materials Acquisition, Final Design, or Construction

activities before receiving an approval letter? 

Please notify FRA of your incurrence or intention to begin incurring Advance Costs for 

these activities (see Question 6). Such costs that have been incurred before receiving FRA 

approval are incurred at the Project Sponsor’s risk. FRA will review and may deny certain 

costs due to instances of noncompliance or project delivery risk.

 

16. What if my project is not selected and I have already incurred costs? 

Those costs may still be eligible under a future award because FRA could select a project

for award under a future Notice of Funding Opportunity (NOFO). All Advance Costs are 

incurred at the Project Sponsor’s risk until a grant agreement is executed and the costs are 

deemed eligible for reimbursement or match. FRA may provide a pre-obligation approval of 

Advance Cost incurrence only for FSP projects on the NEC that are listed on the NEC 

Project Inventory with an Anticipated Obligation amount. 

17. What if I’m not selected from the first NOFO, can I still count my costs back to the 

date of the first NEC Project Inventory if I’m selected under a subsequent NOFO? 

FRA may approve costs incurred on or after the date of the first NEC Project Inventory in 

which the project is listed with an Anticipated Obligation. (See Question 3.) 

18. What if I finish the Project Lifecycle Stage and my project is no longer on the NEC 

Project Inventory as a funding need? 

FRA may approve costs incurred on or after the date of the first NEC Project Inventory in 

which the project is listed with an Anticipated Obligation. (Question 3). If your Project has 
 

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been removed from the NEC Project Inventory, or had its “Anticipated Obligation” amount 

removed, or is listed on the NEC Project Inventory with a funding allocation to support a 

different Lifecycle Stage, please contact your FRA Project Manager for additional 

clarification. Are project costs incurred before the publication of the first NEC Project 

Inventory in which my project is listed with an Anticipated Obligation eligible to 

receive approval? 

No. These costs are not eligible.

19. Does this policy extend approval for the incurrence of Advance Costs beyond this FSP 

Program? 

No. This FAQ and policy are only applicable to projects listed on the NEC Project Inventory 

with an Anticipated Obligation amount. This FAQ and policy do not apply to projects that 

are eligible for FSP funding but located off the NEC. 

20. When was the NEC Project Inventory published?

The first NEC Project Inventory was published on November 15, 2022, and it is located 

here. FRA will publish an updated NEC Project Inventory at least once every two years. 

21. Should I include incurred Advance Costs in my application for the FSP-NEC 

program? 

Yes. Any incurred Advance Costs should be included by task and estimated Federal and 

non-Federal share of costs in the grant application. Such information will not negatively 

impact an application.

22. If FRA approves an Advance Cost Incurrence or approves Pre-Award costs after 

obligation, does that mean the project is automatically eligible for similar authority 

related to Federal Transit Administration (FTA) or other modal administration funds 

as well?

No. For a project that includes or may include FTA funding or funding from other modal 

administrations, project sponsors should contact the modal administration for guidance on 

the eligibility of such costs for their funding.