FY 2026 QIF-DNDD NOFO: Sample Minor A/R Budget Justification and Examples of Allowable and Unallowable Costs

Note: The sample minor A/R budget justification below is provided for reference purposes only and contains estimated costs. 

QIF-DNDD Location: Health Center Site, 123 Main Street, City, State, Zip code  
Total DNDD one-time funding request = $250,000 ($90,000 for equipment; $160,000 for minor A/R)
Total funding from other sources (State Grant and Private Contributions): $15,000
Total Project Cost = $265,000 

For our minor A/R project, we propose converting an existing meeting room into a dental operatory and updating our existing dental operatory at Health Center Site— a directly operated, in-scope health center service site. The project also includes minor cosmetic work including new tile flooring in the dental area, re-painting of the walls (neutrals and light tones), new cabinetry, and new light fixtures to provide more pleasant, calming experience throughout the 600 SF space. We will also update the carpeting and design a new sensory play space in the reception area. The play equipment will be donated to our health center.

In addition, we will purchase clinical and non-clinical equipment. Minor alteration and renovation related activities are anticipated to begin within 60 days of obtaining all local approvals. We expect to complete the work within 3 months after it begins.

Sample Minor A/R Budget Justification 

  ALLOWABLE COSTS UNALLOWABLE COSTS
Line 1—Administrative and legal expenses $15,000 to pay for project manager directly related to the minor A/R and equipment project.  
Line 2—Land, structures, right-of-way, appraisals This space is owned. No additional land is required for this project.  
Line 3—Relocation expenses and payments $2,500 for storing furniture and equipment during renovation. $3,500 for moving furniture and equipment back into the dental and reception areas after the renovation.
Line 4—Architectural and engineering fees $12,000 for the architectural and engineering fees, which will cover the following: plumbing and electrical design; bid construction documents (plans and specifications); and assistance during the construction bidding (answer questions presented by the contractors).  
Line 5—Other architectural and engineering fees N/A  
Line 6—Project inspection fees $6,500 for project inspection fees. The inspections will be conducted in accordance with the local Department of Public Works standards and building codes.  
Line 7—Site work No construction site work (work outside of the building).  
Line 8—Demolition and removal $25,000 for removal and disposal of interior partitions and materials in the interior of the existing building. $7,500 for removal and proper disposal of existing asbestos floor tile.

Line 9—Construction

Alternation/Renovation of an Existing Facility

$93,500 to renovate 600 square feet of existing space to install a dental operatory and update existing operatory.

This renovation cost is derived from the following cost breakdown: structural ($15,500), architectural ($42,500), plumbing ($15,500), and electrical ($20,000). 

The structural cost of $15,500 is comprised of the following: concrete column footing and first floor walls.

The architectural cost of $42,500 is comprised of the following: metals (aluminum railings and handrails); woods and plastic (cabinets & casework, shelving, table counter tops); doors (metal windows, aluminum doors and frames, high moisture frames, wood doors, door hardware); and finishes (ceiling suspension, gypsum board (wall partitions) on metal framing, plaster on CMU, acoustical ceiling, resilient flooring, resilient wall base and accessories, and painting).

The plumbing cost of $15,500 covers the following: water, sewer, and piping systems (plumbing fixtures and equipment-lavatory, water closet, sinks, electric water heater, funnel drain); cold water, hot water, water storage tank, and piping insulation; oxygen piping lines and accessories.

The electrical cost of $20,000 includes the following: lighting system (PVC conduit, EMT conduit, lighting fixtures and wiring, light switches and lighting control, wall outlets and wiring); and communication system (PVC conduit, EMT, computer data networking system (outlet, conduit & CAT 5E cabling), telephone outlet, CA TV outlet, PA intercom system (conduit and wiring), security alarm conduit system), and fire sprinkler system (fire alarm cable, fire alarm heat detector, fire alarm control panel).

  
Line 10—Equipment

$90,000 for clinical and non-clinical movable equipment items.

See itemized Equipment List form for details.

  
Line 11—Miscellaneous   $4,000 for artwork in the dental and reception areas.
Line 12—SUBTOTAL $244,500  
Line 13—Contingencies $5,500, which is less than 5% of lines 7, 8, and 9.  
Line 14—SUBTOTAL $250,000 $15,000
Line 15—TOTAL PROJECT COSTS $265,000  
Line 16—QIF-DNDD one-time funds $250,000  

Examples of Allowable and Unallowable Costs

The following table lists examples of allowable and unallowable costs for a proposed minor A/R project. This list is not exhaustive.

Minor A/R and equipment costs are only allowable at one directly operated, in-scope health center service site.

The total federal and non-federal cost of your minor A/R project must be less than $500,000, excluding the cost of movable equipment.

Refer to the cost principles in 2 CFR Part 200, for details on allowable costs.

Equipment includes movable items that are non-expendable, tangible personal property (including IT systems) with a useful life of more than one year and a per-unit acquisition cost of $10,000 (or equal to the applicant’s capitalization threshold) or more. Movable equipment is readily portable from place to place without requiring a change in utilities or structural characteristics of the space.

Fixed equipment includes items that require modification of the facility for its satisfactory installation or removal and is included in the construction contract. For example, ductwork, generators, fume hoods, sinks, fixed shelving, built-in sterilizers, built-in refrigerators, and wiring or cabling inside walls or above ceilings.

Table for Examples of Allowable and Unallowable Costs

Cost Categories  Allowable Costs  Unallowable Costs 
Administrative and Legal Expenses 
  • Administrative and legal expenses should be less than 10% of total project costs
  • Salary and consultant fees that are directly related to the administration of the technical aspects of the proposed project 
  • Costs associated with the evaluation of the environmental and historic preservation effects of the proposed project, obtaining public input, producing the necessary studies, analysis, and resultant reports, as well as compliance with other environmental and historic preservation laws 
  • Bid advertising 
  • Costs of groundbreaking and dedication ceremonies and items such as plaques 
  • Costs related to other sources of project financing 
  • Costs for preparing grant applications 
Relocation 
  • Costs to move and store furnishings temporarily during renovations 
  • The cost of moving furnishings back into the renovated areas 
Architectural and Engineering Fees 
  • Fees associated with architectural and engineering professional services including, but not limited to, preparation of bid documents and inspections
  • Associated expenses for preparation of specifications and reproduction of design documents 
  • Costs incurred no more than 90 days before award for architect’s fees and consultant’s fees necessary to the planning and design of the project, if the project is approved and funded and the costs comply with federal procurement requirements (when applicable) 
  • Sustainable design services, such as LEED, including commissioning 
  • Costs associated with the preparation of the Environmental Assessment and SHPO consultation 
  • Architectural and engineering fees for work that is not within the scope of the approved project 
  • Elaborate or extravagant designs or projects that are above the known local costs for comparable buildings 
  • Costs of abandoned designs (i.e., costs associated with a design that will not be used) 
  • Costs for work not directly related to the project 
Project Inspection Fees 
  • Clerk-of-the-works, inspection fees, structural certification, etc., to be provided by architectural engineering firm or applicant’s staff 
  • Fees not directly related to the project 
Site Work 
  • Minor alteration at entrances and adjacent sidewalks as required for ADA compliance 
  • Fees not directly related to the project 
  • Exterior building work such as paving, retaining walls, foundations, etc.
  • Landscaping costs 
Demolition and Removal 
  • Costs of demolition or removal of structures for improvements such as wall finishings and fixtures (reduce the costs on this line by the amount of expected proceeds from the sale of salvage) 
  • Costs not directly related to the project 
  • Hazardous materials remediation/abatement 
  • Demolition and removal of debris that will not result in a usable structure 
Alteration and Renovation 
  • Costs of acquisition and installation of fixed equipment necessary for the functioning of the facility 
  • Costs for remodeling and alteration of an existing building that will be used for the project 
  • Special features for seismic code requirements (use nationally recognized codes adopted by authorities having jurisdiction) 
  • Bid guarantees and performance and payment bonds 
  • Costs of pollution-control equipment for the facility’s boilers, incinerators, wastewater treatment, etc., which may be required by local, state, or federal regulations (the facility must meet requirements of both current and future pollution abatement regulations as described in currently approved pollution plans) 
  • Abandoned projects 
  • Relocation of utilities that are off-site and off-site improvements 
  • Prorated cost of existing central utility plant and distribution systems, which serve the proposed facility 
  • Interior and exterior decorating fees and purchases (e.g., artwork, sculpture) 
  • Elaborate or extravagant materials that are above the known local costs for comparable buildings 
  • Fixed equipment if it is not part of the construction contract 
  • Bonus payments to contractors 
Equipment 
  • Movable equipment that is pertinent to the project (include details on Equipment List form) 
  • Donated equipment 
  • Leased equipment
  • Luxury furniture 
  • Vehicles for transportation 
Contingencies 
  • Contingencies are limited to 5% of the A/R, Site Work, and Demolition/Removal Lines 
  • The contingency does not include movable equipment costs 
  • Contingency costs above the allowable percentage 
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