Which of the following is true about Floors in funding?

• A. Floors are maximum spending limits that cap costs before the end of the period of availability.
• B. Floors refer to fixed costs that must be spent each quarter.
• C. Floors determine how funds are carried over to the next period.
• D. Floors are minimum amounts you can spend on a particular program by the end of the period of availability.

Answer: (D)

Floors set a minimum level of activity for a program, meaning you are expected to spend at least a certain amount by the end of the period of availability. This is not a cap, nor a requirement to spend a fixed amount every quarter, and it doesn’t determine how funds carry over to the next period. The idea behind a floor is to ensure that the program actually uses a baseline amount of funding, reflecting a commitment to implement or sustain the funded activities. If the program underspends the floor, it can trigger review or corrective actions in grant administration. So the statement that floors are minimum amounts you can spend by the end of the period of availability is the accurate description.