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September 22, 2023

Federal Railroad Administration Answers to Frequently

Asked Questions about Pre-Award Authority 

I. Introduction

These answers to frequently asked questions (FAQs) are intended to assist Project Sponsors 

with obtaining Pre-Award Authority for activities funded under Federal Railroad 

Administration (FRA) grants other than Federal-State Partnership for Intercity Passenger Rail 

(FSP) Northeast Corridor (NEC) grants.1 

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 questions about the FAQs. For project-specific 

questions, please contact the assigned FRA Project Manager.

II. Questions

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

Pre-Award Costs are incurred after the award selection announcement date (i.e., the project 

selected in response to a Notice of Funding Opportunity (NOFO)) but before the grant is 

obligated. All Pre-Award Costs are incurred at a Project Sponsor’s risk.

Pre-Award 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.

Pre-Award Authority is provided by FRA that confirms Pre-Award Costs will be 

reimbursed after obligation provided those costs were incurred after the award selection

announcement date, are compliant with Federal law, and are permissible under 2 CFR 200

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 Pre-award cost information for FSP-NEC projects is available on FRA’s website here. 
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and the award. Pre-Award Authority does not commit FRA to obligate the award or 

reimburse Pre-Award Costs. FRA may, at its discretion, conduct oversight of Pre-Award 

Costs in the same manner that it would conduct oversight of a project and project costs 

post-award.

2. For what types of activities may FRA provide Pre-Award Authority? 

For activities funded under FRA’s discretionary grant programs, Pre-Award Costs need to 

be incurred for activities within the scope of the project selected and may be associated 

with any stage in the project lifecycle2 provided they are incurred in compliance with 

applicable requirements. 

For activities funded with directed funding (e.g., congressionally directed spending, 

Amtrak, and administratively directed spending), Project Sponsors should contact FRAGrants@dot.gov to discuss Pre-Award Costs. 

3. How do National Environmental Policy Act (NEPA) requirements affect Pre-Award 

Costs? 

Generally, NEPA must be completed before Pre-Award Costs are incurred for property 

acquisition, purchase of construction materials or rolling stock, final design, and 

construction activities as detailed in 23 CFR § 771.113. Some exceptions to this 

restriction include the purchase of railroad components or materials that can be used for 

other projects or resold, per 23 CFR § 771.113(d)(4). FRA strongly recommends that 

Project Sponsors with questions about incurring costs related to the timing of NEPA 

completion contact FRA-Grants@dot.gov for routing to the appropriate FRA subject 

matter expert. 

4. What is the earliest date Pre-Award Costs may be incurred before grant obligation? 

The earliest date Pre-Award Costs may be incurred for certain activities is the award 

selection announcement date. Examples of activities for which Pre-Award Costs may be 

incurred as of the award selection announcement date include preliminary design and 

engineering, environmental document preparation, project administration costs, and 

hiring consultants for allowable purposes. 

However, for final design activities, property acquisition, purchase of construction 

materials or rolling stock, or project construction, the earliest date Pre-Award Costs may 

be incurred is the award selection announcement date or the signature date on the 

associated environmental decision (i.e., Record of Decision (ROD), Finding of No 

Significant Impact (FONSI), or Categorical Exclusion (CE)), whichever is later. This is 

because, under 23 CFR § 771.113(a), Pre-Award Costs for such activities may not be 

2 See FRA Guidance on Development and Implementation of Railroad Capital Projects, January 11, 2023 available on 

FRA’s website here. 
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incurred before the CE, FONSI or ROD is completed.

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FRA may identify additional prerequisites to incurring Pre-Award Costs, such as 

completion of preliminary engineering before final design activities. FRA encourages 

Project Sponsors to contact FRA-Grants@dot.gov to discuss the timing of incurring PreAward Costs. 

Any costs incurred before the above-specified earliest date may make the entire project

unallowable. 

FRA will not reimburse Project Sponsors for costs incurred before the award selection 

announcement date. 

5. How do I request Pre-Award Authority? 

FRA will contact each Project Sponsor shortly after the award selection announcement 

date to discuss the requirements for grant obligation, FRA points of contact, and PreAward Costs. In general, to request Pre-Award Authority, the Project Sponsor should 

provide the following to the FRA Project Manager: 

A. Description of the items/activities associated with the Pre-Award Costs for which 

Pre-Award Authority is requested; 

B. If applicable (see Question 4), the date of the environmental decision document and 

any other prerequisites (e.g., engineering status);

C. Explanation of how the items/activities fit into the scope of work, including the 

specific Tasks the request falls under; 

D. Confirmation that the activities associated with the requested Pre-Award Costs were 

included in the grant application; 

E. Explanation of how the Pre-Award Costs incurrence is necessary for efficient and 

timely performance of the scope of work and why the costs cannot wait until after 

the grant is obligated; 

F. The total estimated cost to be incurred, including a breakdown of cost by unit (for 

material purchase) or activity, Task, and Federal and non-Federal matching shares;

G. The period for pre-award costs, including the date on which costs will begin to be 

incurred; 

H. Acknowledgment that the costs are being incurred at risk, subject to all applicable 

requirements and that if the grant is not obligated or costs are deemed unallowable, 

FRA will not be able to reimburse Project Sponsor for the costs. 

Project Sponsors are encouraged to discuss the proposed Pre-Award Costs with their FRA 

Project Manager before submission. Please contact FRA-Grants@dot.gov for additional 

related questions. 

3 FRA may make exceptions on a case-by-case basis for purchases of railroad components or materials that can be used 

for other projects or resold that occur after the award selection announcement but prior to the environmental decision, 

per 23 CFR 771.113(d)(4). These costs must still be incurred after selection. 
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6. What if my estimated Pre-Award Costs change? Can Pre-Award Authority be 

revised or updated after receiving FRA approval? 

Yes. A Project Sponsor should submit an updated Pre-Award Authority request if the 

proposed activities or budget changes. Please contact the FRA Project Manager for 

additional information. 

7. Could FRA deny my request for Pre-Award Authority? 

Yes. FRA may deny a request for Pre-Award Authority for different reasons, including 

programmatic or regulatory noncompliance. A request may also be denied due to project 

delivery risk or insufficient information in the request letter. 

8. How do I get reimbursed for incurred Pre-Award Costs or count them towards a 

match? 

Incurring Pre-Award Costs is at the Project Sponsor’s own risk and does not guarantee that 

the grant will be obligated or that the Pre-Award Costs will be reimbursed. However, FRA 

may reimburse or count as match Pre-Award Costs if the grant is obligated, the costs are for 

activities included in the grant scope of work, and the activities are permissible under the 

grant. The Project Sponsor may work with FRA to include the Pre-Award Costs in the project 

budget as a match and/or submit a request for reimbursement after obligation. Project 

Sponsors should carefully review the cost-sharing or matching principles in 2 CFR 200.306. 

9. Is there a minimum or maximum amount for incurred Pre-Award Costs?

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

Pre-Award Authority is not a legal or implied commitment that the grant will be obligated. 

If obligated, 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.

10. What if I incur Pre-Award Costs before submitting a request letter? 

The Pre-Award Costs may still be reimbursed if incurred after the award selection 

announcement date. Please work with your FRA Project Manager to determine 

allowability.

11. If FRA provides Pre-Award Authority, does that mean Pre-Award Costs may be 

incurred for Federal Transit Administration (FTA) or other modal administration 

funds as well?

No. Project Sponsors should contact FTA or other U.S. Department of Transportation 

modal administrations for guidance on Pre-Award Costs associated with their funding. 
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12. How do I know if my application was selected for funding?

Project Sponsors on the grant application to FRA’s discretionary grant programs can 

review award selection announcements on FRA’s website here. 

Project Sponsors who have received directed funding should contact FRA-Grants@dot.gov

to discuss Pre-Award Costs.