40 CFR § 35.2205 - Maximum allowable project cost.

---
identifier: "/us/cfr/t40/s35.2205"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "40 CFR § 35.2205 - Maximum allowable project cost."
title_number: 40
title_name: "Protection of Environment"
section_number: "35.2205"
section_name: "Maximum allowable project cost."
chapter_name: "ENVIRONMENTAL PROTECTION AGENCY"
subchapter_number: "B"
subchapter_name: "GRANTS AND OTHER FEDERAL ASSISTANCE"
part_number: "35"
part_name: "STATE AND LOCAL ASSISTANCE"
positive_law: false
currency: "2026-03-24"
last_updated: "2026-03-24"
format_version: "1.1.0"
generator: "[email protected]"
authority: "42 U.S.C. 7401  33 U.S.C. 1251  42 U.S.C. 300f  42 U.S.C. 6901  7 U.S.C. 136  15 U.S.C. 2601  42 U.S.C. 13101  Pub. L. 104-134, 110 Stat. 1321, 1321-299 (1996); Pub. L. 105-65, 111 Stat. 1344, 1373 (1997), 2 CFR 200."
cfr_part: "35"
---


# 35.2205 Maximum allowable project cost.

(a) *Grants awarded on or after the effective date of this regulation.* Except as provided in paragraph (c) of this section, for Step 2 + 3 or Step 3 grants awarded on or after the effective date of this regulation, the maximum allowable project cost will be the sum of:

(1) The allowable cost of the following:

(i) The initial award amount of all project subagreements between the grantee and its contractors;

(ii) The initial amounts approved for force account work to be performed on the project;

(iii) The purchase price of eligible real property; and

(iv) The initial amount approved for project costs not included under paragraphs (a)(1)(i) through (a)(1)(iii) of this section, excluding any amounts approved for an allowance under § 35.2025 and for contingencies; and

(2) Five percent of the sum of the amounts included under paragraphs (a)(1)(i) through (a)(1)(iv) of this section.

(b) *Grants awarded before the effective date of the regulation.* Except as provided in paragraph (c) of this section, for Step 2 + 3 or Step 3 grants awarded before the effective date of this regulation, the maximum allowable increase in the cost for work covered by each subagreement finally advertised or, where there will be no advertisement, each subagreement awarded on or after the effective date of this regulation will be five percent of the initial award amount of the subagreement.

(c) *Differing site conditions.* In determining whether the maximum allowable project cost or increase in subagreement cost will be exceeded, costs of equitable adjustments for differing site conditions will be exempt, provided the requirements of 40 CFR part 35, subpart I, appendix A, paragraph A.1.g. and all other applicable laws and regulations have been met.

[50 FR 46649, Nov. 12, 1985]