PreAward Fundamentals

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Pre-Award Fundamentals of Research
Administration
NCURA Region I Annual Spring Meeting May 7th,
2006 Portland, Maine
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FACULTY

• Sara Clabby
• Contract Administrator, Office of Sponsored
  Programs, Brown University
• Bethanne Giehl
• Assistant Director, Research Funding Services
• University of Massachusetts Medical School
• Celia Gravely
• Project Manager
• Huron Consulting Services

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Frequently Asked Questions that will NOT be
Answered

• Why do faculty always wait until the last minute?
• Why does the government only add regulations, but
  never takes any away?
• Is it too late to find another line of work?
• Is there a profession with more acronyms than
  Research Administration?
• Why is this meeting room so hot?
• And..
• Why is this room so cold?

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PreAward Fundamentals

• Rules Requirements
• Federal Guidelines
• Sponsor Guidelines
• Institution Policies
• Sponsored Projects Administration
• What we do
• Who we are
• Central and De-central
• Why?

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Lifecycle of a Proposal/Award
Pre-Award
Post-Award
Development
Agency Review (6-9 mos)
Closeout
Project Period
1st Budget Period
2nd Budget Period
3rd Budget Period
No Cost Extension
Award
Submit Renewal /Competing-Continuation
Revised Budget
Final Reports
Submit Proposal
Pre-Award Costs
Award
Perform(Principal Investigator)
Technical Close(Principal Investigator)
Apply
Administer/Monitor(Post-Award Office)
Financial Close(Post-Award Office)
Find/Explore
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Research and development! My goodness!
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The Rules and Who Makes Them

• A Structure Based on
• Overarching Federal Regulations
• Parties to the relationship
• Sponsors and Performers
• Sponsors announce opportunities
• The formal Agreement between the parties
• Grant Contract Cooperative Agreement
• Agreements contain a set of rules, terms, and
  conditions
• Statutes regulations standard terms specific
  conditions

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Who are our Sponsors?

• Federal Government
• Departments
• Agencies
• Independent Agencies
• State Government
• Foundations and Non-Profit Organizations
• Industry
• Large Entities (over 500 Employees)
• Small Entities (under 500 Employees)

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Examples of our Sponsors

• Agencies or Sponsors
• DHHS Department of Health and Human
  Services
• PHS Public Health Service
• NIH National Institutes of Health
• NSF National Science Foundation
• DOD Department of Defense
• AFOSR Air Force Office of Scientific Research
• ARPA Advanced Research Projects Office
• ARO Army Research Office
• ONR Office of Naval Research
• DOC Department of Commerce
• NIST Nat. Inst. of Standards and Technology
• AHA American Heart Association
• JDRF Juvenile Diabetes Research Foundation
• Whitaker Whitaker Foundation
• Monsanto Monsanto Industries
• HP Hewlett-Packard
• MASS-Ed Massachusetts Department of Education
• FL-FW Florida Department of Fish and Wildlife

Federal
Non-Profit
Industry
State
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How Sponsors Announce Opportunities

• PA Program Announcement (sponsor publication,
  Federal
• Register, FedBizzOpps) (grants,
  cooperative agreements)
• RFA Request for Applications (grants,
  cooperative agreements)
• RFP Request for Proposals (contracts)
• RFQ Request for Quotation (contracts)
• RFB Request for Bid (contracts)
• BAA Broad Agency Announcement (grant,
  cooperative agreement, contract)
• Response to Announcement in Form of Proposal
• Also called application quotation bid
• Lays out general plan of work, personnel, budget
  to meet stated objectives

unsolicited
solicited
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Types of Agreements

• Most Common Types of Formal Agreements With the
  Federal Government
• Types of Award Actions

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Formal Agreements

• Most Common Types Of Formal Agreements
• Grant
• Cooperative Agreement
• Contract

Assistance Mechanisms
Procurement
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Formal Agreements Assistance Mechanisms

• Grant
• Purpose is to transfer money, property, services,
  or anything of value to recipient in order to
  accomplish a public purpose
• Idea originates with performer
• No substantial involvement is anticipated between
  sponsor and recipient during performance of
  activity
• Cooperative Agreement
• Principal purpose is to transfer funds to
  recipient to accomplish a public purpose
• Idea may originate with performer
• Substantial involvement is anticipated between
  sponsor and recipient during performance of
  activity

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Formal Agreements Procurement Mechanisms

• Contract
• Often called a procurement mechanism
• Sponsor determines that procurement contract is
  appropriate
• Principal purpose is to acquire property or
  services for direct benefit or use of the sponsor
• Idea originates with sponsor

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Contract Types

• Fixed Price Contract
• Cost-reimbursement Contract
• Time-and-Materials Contract
• Labor-hour Contract
• Plus variations and combinations of each of the
  above

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Fixed Price Contracts

• Procurement of supplies or services on the basis
  of reasonably definite functional or detailed
  specifications.
• When costs can be estimated reasonably
  accurately.
• Imposes on contractor maximum incentive to
  control costs, but with minimum administrative
  burden.

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Cost-Reimbursement Contracts

• Procurement of non-commercial items which cannot
  be based on reasonably definite functional or
  detailed specifications (i.e., RD).
• There is no incentive for contractor to control
  costs, thus government imposes tighter controls.

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CR/FP - How Do I Tell?

• Cost-Reimbursement
• Total estimated cost or not to exceed amount
• Invoicing based on expenditures
• Listed FAR clauses.

• Fixed Price
• Total Price
• Invoicing based on milestones
• Generally, POs are fixed-price
• Listed FAR clauses

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Time-and-Materials and Labor Hour Contracts

• Reimbursement of hours worked, not costs
  incurred.
• Fixed hourly rate that incorporates salary,
  fringe benefits, FA, and fee.
• Rates invoiced must match proposed rates,
  regardless of actual cost incurred.
• Audit?
• What to do about them
• Dont accept unless your financial system can
  support it.
• Argue on the basis of cost accounting standards
  or
• Negotiate a range to the allowable invoicing rates

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Grant vs. Contract

• Grant
• project conceived by
• investigator
• agency supports or assists
• performer defines details and
• retains scientific freedom
• agency maintains cognizance
• unilateral

• Contract
• project conceived by agency
• agency procures service
• agency exercises direction or
• control
• agency closely monitors
• bilateral

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Comparing the Basic Types Of Agreements

• COOPERATIVE GRANT AGREE
  MENT CONTRACT
• BASIC PURPOSE Provide assistance Provide
  assistance with substantial Procure tangible
  with few restrictions involvement between
  parties goods and services
• SOLICITATION METHOD Application kit or Request
  for Application Request for Proposal or
  guidelines Quote
• AWARD INSTRUMENT Short, may refer to Describes
  involvement, party Long, detailed specs, general
  conditions relationships clauses, regulations,
  and expected result
• INVOLVEMENT Generally none Substantial
  involvement May be extensive
• BY SPONSOR
• REBUDGETING Flexible Usually flexible More
  restrictive
• EQUIPMENT TITLE Grantee Varies Varies
• PERFORMANCE PERIOD Specified in Grant Specified
  in Coop. Agreement Specified in Contract
• PATENT RIGHTS Usually favor recipient May be
  involved Provision in contract
• PUBLICATIONS May ask to be informed May ask to be
  informed May be prior review/approval
• TECHNICAL Annual summary report No more than
  quarterly Detailed, maybe monthly

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Hierarchy of Federal Regulations
Examples

• Sources
• Statutory requirements (i.e., an Act of Congress,
  becoming Public Law)
• Presidential Executive Order
• Federal regulations
• Sponsors terms/conditions

NIH Salary cap appears as statutory language in
the HHS appropriations act
Affirmative Action
NSF regulations on Uniform Administrative
Requirements appear in 45 CFR 602
NSF grant terms and conditions appear in the NSF
Grant Policy Manual NSF Grant General
Conditions (CG-1)
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How Do Federal Regulations Happen?
ORIGIN PUBLIC LAW PRESIDENTIAL FEDERAL
AGENCY (statutory requirement) EXECUTIVE
ORDER REGULATION UNITED STATES CODE
(USC) Grants Contracts EXECUTIVE OMB-CIR
CULARS FAR Councils OMB CLEARANCE Transmittal
Memos - civilian COMMON RULE -
defense AGENCY CODE OF FEDERAL REGS
(CFR) FEDERAL REGISTER (Dept/agency
Specific) (rulemaking comment
period) IMPLEMENTATION AGENCY REGS FEDERAL
REGISTER FEDERAL REGISTER FEDERAL ACQUISITION
REGS AGENCY GRANT REGS AGENCY REGS (contracts
only) (FAR) FAR SUPPLEMENTS FAR
SUPPLEMENTS AGENCY FAR SUPPLEMENTS
(contracts) EXAMPLES CIVIL RIGHTS
(USC) DEBARMENT SUSPENSION RECOMBINANT DNA
(NIH) FOIA (USC CFR) (Common
rule-CFR) MISCONDUCT (NSF) HUMAN SUBJECTS
(Common Rule-FR) COORDINATED REVIEW CONFLICT OF
INTEREST (NSF, NIH) DRUG-FREE WORKPLACE
(USC) VIETNAM ERA VETERANS DRUG-FREE WORKFORCE
(DOD) LOBBYING (USC FR) MISCONDUCT (NIH)
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Types of Award Actions

• New Award/Competing Award
• Continuation Award/Non-competing Award
• Supplemental Award
• Modification (e.g., budgetary revision, change of
  key personnel, administrative change, termination
  notice)
• No-Cost Extension
• Amendments (usually associated with contracts)
• Subaward

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Typical Elements of an Award Notice

• Awarding entity and authority
• Award number
• Recipient (institution)
• Name of PI or project director
• Reference to proposal or project title
• Funding (total, incremental?)
• Cost basis (reimbursement, fixed?)
• Dates (start, end)
• Reports, deliverables
• Terms and conditions
• Stated in text, attached, or incorporated by
  reference

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Excerpt from Award Letter Federal

• The National Science Foundation hereby awards a
  grant of 70,411 to NAME OF UNIVERSITY for
  support of the project described in the proposal
  referenced above as modified by revised budget
  dated June 2, 2005. This project, entitled
  "Cyclic Processes Within Surface-exposed
  Fractures Affecting Evaporation and Salinization
  Mechanisms," is under the direction of PI
  Smith.
• This award is effective August 1 , 2005 and
  expires July 31, 2006. This is a continuing grant
  which has been approved on scientific / technical
  merit for approximately 4 years. Contingent on
  the availability of funds and the scientific
  progress of the project, NSF expects to continue
  support at approximately the following level FY
  2006 123,118 FY 2007 121,019 FY 2008 35,192.
• This grant is awarded pursuant to the authority
  of the National Science Foundation Act of 1950,
  as amended (42 U.S.C. 1861-75) and is subject to
  NSF Grant General Conditions (GC-1), dated
  6/15/05 available at http//www.nsf.gov/publicatio
  ns/pub_summ.jsp?ods_keygc1605.

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Office of Management and Budget Circulars

• OMB Circulars for Cost Principles Applicable To
  All Awards
• A-21 Cost Principles for Educational
  Institutions
• A-87 Cost Principles for State, Local and Indian
  Tribal Governments
• A-122 Cost Principles for Non-Profit
  Organizations
• Uniform Administrative Requirements
• A-110 Grants and other Agreements with
  Institutions of Higher
• Education, Hospitals, and other Non-Profit
  Organizations
• Uniform Administrative Requirements

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Office of Management and Budget Circulars

• OMB Circulars for Uniform Administrative
  Requirements (contd.)
• A-102 Uniform Administrative Requirements for
  Grants and
• Cooperative Agreements With State and Local
  Governments
• Regulations Applicable to Audits
• A-133 Audits of States, Local Governments and
  Non-Profit
• Organizations
• Regulations Applicable To Procurement Actions
• FAR Federal Acquisition Regulations (first
  published, Federal Register, 9/19/83 on-going
  revisions)

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The Front Page of the Newspaper Test
Contemplating any business act, an employee
should ask himself whether he would be willing to
see it immediately described by an informed and
critical reporter on the front page of his local
paper, there to be read by his spouse, children,
and friends. --- Warren E.Buffet
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Responsible Conduct of ResearchCompliance Topics

• Responsible Conduct of Research
• Research Misconduct
• Financial Conflict of Interest
• Human Subjects
• Animal Care
• Recombinant DNA
• Hazardous Materials
• Data Rights, Access, Protection

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Responsible Conduct of Research

• PHS requirement for trainees on K-30, T-32 and
  T-34 awards to complete instruction in the
  following
• Data acquisition, management, sharing, and
  ownership
• Mentor/trainee responsibilities
• Publication practices and responsible authorship
• Peer review
• Collaborative science
• Human subjects
• Research involving animals
• Research misconduct
• Conflict of interest and commitment

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About these experiments youve conducted for 12
years no one remembers hiring you.
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Research Misconduct

• Research misconduct defined
• does not include honest error or honest
  differences in interpretations or judgments
  of data.
• Government-wide policy issued by OSTP, December
  2000
• Designed to replace existing PHS and NSF rules
  and to be adopted by all federal funding agencies
  
• Changes adopted by NASA, NSF, VA, USDA, DOE, EPA,
  DHHS and DOL

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Research Misconduct

• Institutions must develop policies and procedures
  to deal with allegations of misconduct to
  include
• Definitions
• Written policy
• Description of inquiry and investigational phases
• Process for protection of whistleblowers
• Reporting to agency (process, timing)
• Retention of records
• Certification requirements
• DHHS requires Assurance Annual Report on Possible
  Misconduct

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Financial Conflict of Interest

• PHS Regulation and final NSF policy effective on
  October 1, 1995
• Regulation / policy similar in content
• Major components of the regulations
• Contractors / grantees must have adequate
  policies
• Disclosures of financial interests of faculty and
  family must be made by PIs and others having
  decision- making authority over conduct of work
• Financial interest defined as 10,000 annual
  income or 5 equity whichever is less
• Contractors/grantees have discretion over who
  reviews disclosures

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Financial Conflict of Interest

• Specific criteria for review will be at
  institutions discretion
• Management of conflicting financial interests
  must be undertaken
• Applications must contain certifications
• Institutional records are subject to federal
  review

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Financial Conflict of Interest

• Investigator Conflict of Interest versus
• Institutional Conflict of Interest
• Institutional Conflict of Interest
• Equity Interest in Company
• Licensing Interest
• Interest Held by Institutional Officers
• Human Subject Consideration
• Informed Consent
• May 2004 DHHS Guidance

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Confidentiality of Patient Records(meant to
protect patients seeking drug and alcohol
treatment)

• Applicability
• All programs funded in whole or in part by
  federal funds
• Flow-down requirement to subrecipients
• Records cannot be used to initiate or
  substantiate criminal charges
• Records can only be released with consent of
  patient except
• when identity withheld
• when authorized by court

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Confidentiality of Patient Records HIPAA

• Health Insurance Portability and Accountability
  Act of 1996 (HIPAA)
• Congress failed to pass legislation before
  8/21/99, which resulted in authorization of DHHS
  to issue regulation
• Final Rule issued on August 14, 2002
  Implementation by April 14, 2003
• http//aspe.hhs.gov/admnsimp/pvcfact1.htm
• 45 CFR Part 160

• Provisions
• Patient Education on Privacy
• Patient Guaranteed Access to Medical Records
• Patient Must Give Prior Approval Before Release
  of Records
• Release of Minimum Necessary for Health Care
  Purposes Only
• Provide Recourse if Violated Civil and
  Criminal Penalties Through the DHHS Office for
  Civil Rights
• Records for Research Purposes Oversight by IRB
  or Privacy Board

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Functions and Organization of Sponsored Projects
Administration

• Functions
• Organizational Participants
• Organizational Models

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Functions of Research Administration Examples

• Policy and procedure development, implementation
• Funding opportunity development, promotion,
  advancement
• Interpretation of guidelines, preparation and
  review of proposals
• Stewardship and accountability
• Financial and programmatic oversight
• Project performance and delivery
• Subcontracts, purchase of goods and services

May be handled by different offices
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More Examples

• Training
• Negotiation, dispute resolution
• Reports
• Progress
• Fiscal
• Final
• Certification, compliance
• Risk management
• Transfer to public benefit, economic development,
  communication of outcomes

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Organizational Participants

• Executive Administration
• Academic and Research Divisions
• Business Divisions
• Legal Office
• Other

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Friend of the administration or friend of
research?
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Organizational Models

• Unified
• Under one division at the institution
• May have other offices distributed (e.g.,
  compliance)
• Separate
• Parallel
• Under academic and business divisions

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Organizational Models

• Organizational Models Depend on
• Tradition
• Philosophy
• Size and mission of institution
• Experience
• Key to success with any model
• COMMUNICATION

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Why Sponsored Projects?(The Institutions
Perspective)
Often centered around institutions standing and
mission

• Increase Status/Prestige
• Attract New Faculty and Students
• Train Future Scientists/Teachers
• Upgrade Programs and Build Infrastructure
• Enhance Connections
• With Other Segments of Society
• Service to State/County

Institution
Sponsored Projects
Research Administration
Faculty
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Expectations Made of Our Faculty

• Take a few minutes and consider the range of
  expectations and demands placed on our faculty.
• What expectations can you identify?

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Faculty
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Common Goals Research Administrator and
Investigator

• Increase Sponsored Program Activity and
  Publication of Results to Advance Knowledge
• Enhance Educational Opportunities for Students
• Expand Research and Public Service Activities
• Streamline and Improve the Research Environment
• Protect and Minimize Risk to Individuals and
  Institution

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The Research Administration Balancing Act

• Research administrators seek a balance of
  interests that respects the shared
  responsibilities throughout the institution.
• Research administrators balance facilitating the
  research, teaching, and public service activities
  of faculty, students and other investigators
  while accommodating the priorities and
  stewardship expectations of the institution,
  governmental entities, sponsors and the public.

Internal Stakeholders
External Stakeholders
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Proposal Development
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Proposal Development

• Gather Funding Information
• Disseminate Funding Information
• Help Develop Sponsor Contacts
• Provide Proposal Assistance
• Produce Workshops and Manuals
• Proposal Preparation for Faculty
• Departmental Administrators
• Specific Sponsors
• Electronic Proposal Submission
• Budgets
• Administer In-House Grants Programs

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Types of Proposals

• Letter of Inquiry
• Letters of Intent
• Preliminary Proposals
• Concept Papers
• White Papers
• Formal Proposals

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Letter of Inquiry or Preliminary Proposal

• Letter Proposal
• Used by private foundations for screening to
  second stage
• Preliminary Proposal
• Used by both federal and non-federal sponsors
• Length
• 3 5 pages
• Format
• cover letter and 3 4 page proposal, or
• All information in 3 5 page letter

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Letter of Inquiry orPreliminary Proposal

• Elements to be covered
• Areas of research/content of project (be rather
  specific)
• Needs and purpose statement
• Unique qualifications, abilities, and facilities
• Benefits/anticipated results of the project
• Estimate of cost (no detailed budget)
• Offer to meet
• Request for response

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Concept Paper/White Paper

• Concept Paper
• Generally internal working document or used for
  informal feedback
• White Paper
• Concept paper sent unsolicited to a sponsor

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Formal Proposal

• Put together according to guidelines established
  by sponsor
• Always use forms and format required by sponsor

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Formal Proposal (continued)

• The Usual Sections
• Title/Cover Page with appropriate
  signatures
• Abstract (less than one page)
• Statement of Work
• Key Personnel CVs/Bio Sketch
• Detailed budget with Justification
• Facilities/Resources Statement
• Appendices (as needed and
• allowable by sponsor)

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Formal Proposals (continued)

• Parts
• Scientific/Program Description
• Representations and Certifications
• Budget

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Formal Proposals (continued)

• The Science
• A concise explanation of the project
• the what
• why
• how
• Usually must conform to a specified structure and
  page limitations

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Formal Proposal (continued)

• Administrative Sections
• The Reps. Certs.
• Certifications may be incorporated into the
  proposal, i.e., the Checklist Page for NIH, the
  Cover Page for NSF
• Or the certifications can be separate, i.e.,
  Certifications and Assurances for Assistance
  Agreements for the Defense Agencies and Standard
  Form 424B for DED, EPA, etc.
• May also need Certification Regarding Lobbying
  and Disclosure of Lobbying Activities

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Formal Proposal (continued)

• OMB Circular A-110
• Uniform Administrative Requirements
• for Grants and Agreements with
• Institutions of Higher Education and
• Other Non-profit Organizations
• Subpart A General
• Subpart B Pre-Award Requirements
• Subpart C Post-Award Requirements
• Subpart D After the Award Requirements
• Appendix A Contract Provisions

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Formal Proposal (continued)

• A-110 Subpart A General
• Effect of A-110 on Other Issuances
• Awards subject to A-110, all other
• administrative requirements codified
• in program regulations, manuals,
• handbooks inconsistent with this
• circular are superseded, unless
• required by statute or authorized by
• the deviations provisions of this
• circular
• Deviations
• Exceptions to A-110 are permitted in
• unusual circumstances by OMB

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Formal Proposal (continued)

• A-110 Subpart A (cont.)
• Subawards
• A-110 should be flowed down to
• sub-recipients which fall under
• this circular
• A-110 Subpart B Pre-Award
• Agency Decides on Appropriate Award Instrument
• Grant Principal Purpose is to Provide Support
  to
• Accomplish a Public Purpose
• Cooperative Agreement Same as a Grant, Except
• Substantial Involvement is Expected by the
• Awarding Agency

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Formal Proposal (continued)

• A-110 Subpart B (cont.)
• Contract Principal Purpose is
• Acquisition of Property or Services
• for Direct Benefit of Government
• Forms Used When Applying for Assistance
• Agencies must comply with 5CFR part
• 1320 Controlling Paperwork
• Burdens on the Public
• Applicants shall use SF-424 series, or
• forms and instructions prescribed by
• agency
• Programs covered by E.O. 12372
• Intergovernmental Review of Federal
• Programs applicants must complete

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Formal Proposal (continued)

• A-110 Subpart B (cont.)
• appropriate sections of SF 424 and
• send a copy of proposal to the state
• coordinating office.
• Debarment and Suspension
• Agencies and recipients must comply with
• the non-procurement common rule
• Special Award Conditions
• Additional requirements may be imposed by
• agencies if
• Recipient has history of poor
• performance

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Formal Proposal (continued)

• A-110 Subpart B (cont.)
• Recipient is not financially stable
• Recipient has management system
• that does not meet standards
• Recipient has not conformed with
• terms and conditions of previous
• award
• Recipient is not responsible
• Recipient must be notified in writing
• Special conditions removed once
• corrections are made

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Formal Proposal (continued)

• Basically, the Agency is looking for us to
  certify compliance with all of their statutory
  requirements

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Budget Development

• Include both direct and FA costs
• Should be detailed
• Include only allowable costs
• If required, include matching or cost-sharing (if
  cost-sharing is proposed it should be
  proportional between direct and FA)

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Budget Development (cont.)

• Direct Costs
• Costs that can be identified specifically
• with a particular sponsored project,
• an instructional activity, or any other
• institutional activity or that can be
• directly assigned to such activities
• relatively easily with a high degree of
• accuracy
• Examples of Direct Costs
• Salary of Researcher (including FB)
• Laboratory Supplies

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Budget Development (cont.)

• Facilities and Administrative
• (FA) Costs
• Costs that are incurred for common or
• joint objectives, and, therefore, cannot
• be identified readily and specifically
• with a particular sponsored project,
• an instructional activity, or any other
• institutional activity
• Examples of FA Costs
• Salary of Department Administrator
• Building utility and maintenance costs
• Purchasing, Controllers offices

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Budget Development (cont.)

• Composition of Total Costs
• A-21, section C.1.
• The cost of a sponsored agreement is
• comprised of the allocable direct
• costs incident to its performance, plus
• the allocable portion of the allowable
• FA costs of the institution
• Therefore, Federal sponsors reimburse
• the institution for the allowable costs
• of a project, including direct costs and
• FA costs.

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Budget Development (cont.)

• Elements of Direct Costs
• Salaries and Wages
• Fringe Benefits (FB)
• Equipment
• Expendable Supplies and Materials
• Travel
• Subcontracts
• Consultants
• External
• Interdepartmental
• Other

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Budget Development (cont.)

• Salaries and Wages
• Institutional Policy on Academic Year
• Salary Recovery
• Summer Salary
• Postdoctoral Research Associates
• Undergraduate Graduate Students
• (salaries or stipends?)
• Technical and Clerical Support
• Use Percent of Effort, Not Hourly Wage
• Include Increases for COLA and Merit-
• based Adjustments
• Follow institutional policies on FB

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Budget Development (cont.)

• Equipment
• Note the differences between the sponsors
  equipment definitions/ thresholds and your
  institutions
• General purpose equipment is not allowable as a
  direct cost unless programmatically necessary and
  used exclusively/primarily for research
• Expendable Materials/Supplies
• Must be programmatically necessary general
  office supplies should be treated as an FA cost
  unless a major program.

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Budget Development (cont.)

• Travel
• Adhere to Institutional Policy and Agency
• Guidelines
• Distinguish between Domestic and
• Foreign Travel
• Foreign Travel may require prior approval
• from sponsor prior to trip (even if in
• original budget/proposal
• Subcontracts
• Proposed costs should be Reasonable and
  Allowable (however, keep in the mind the
  sub-contractor may be under different cost
  principals)

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Budget Development (cont.)

• Consultants
• External required expertise needed for the
  project which cannot be provided by faculty or
  staff at the institution rate must be
  reasonable in most instances, consultants level
  of effort and participation should not rise to
  the level of key personnel that would imply
  substantive programmatic work
• Interdepartmental in some instances, a faculty
  or staff member may serve on a project as a
  consultant, but only if the expertise required is
  not part of this person appointment or job
  function

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Budget Development (cont.)

• Other Direct Costs
• Communications
• Publications
• Animal Care Costs
• Human Subject Costs
• Shop Charges
• Maintenance/Service Contracts
• Computer Costs
• Graphic Arts/Photographic Services
• Rental/Lease of Facilities
• Construction/Renovation/Remodeling Costs
• All of the above must be programmatically
  necessary!

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Budget Development (cont.)

• What Does Allowable Mean?
• An allowable cost must be
• REASONABLE A prudent business
• person would have purchased this item
• and paid this price.
• ALLOCABLE It can be assigned to the
• activity on some reasonable basis.
• CONSISTENTLY TREATED Like costs must
• be treated the same in like circumstances,
• as either direct or FA costs.
• If a cost cannot meet the above criteria, it is
• unallowable, no matter what it is for.

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Budget Development (cont.)

• What Does Allowable Mean? (cont.)
• An allowable cost is one that is eligible for
• reimbursement by the federal government.
• Contrast with
• PERMISSIBLE BY INSTITUTION A cost is
• permitted by institution, as outlined in
  its
• various administrative policies or
  procedures.
• ALLOWABLE BY AGENCY A cost is permitted
• by the policies of the sponsoring agency
  or
• the terms of an award.

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Budget Development (cont.)

• Assessing Whether a Cost Is
• Allowable or Unallowable
• A cost may be expressly unallowable,
• i.e., it is always unallowable as either
• a direct or indirect.
• Unallowable activities fund raising,
• alumni relations, lobbying, etc.
• Unallowable transactions alcohol,
• entertainment, fines, etc.
• A cost may be allowable but only as an
• indirect/FA cost, not a direct charge,
• e.g., proposal preparation

87
Budget Development (cont.)

• Assessing Whether a Cost Is
• Allowable or Unallowable (cont.)
• Generally, it is not the type of cost that
• determines allowability, it is the purpose
• and circumstance of the expenditure. Many
• categories of costs are allowable as a
• direct or indirect, e.g. salaries, travel,
• materials, etc.

88
Budget Development (cont.)

• Third Party Agreements
• Types of third party agreements
• Purchase Order
• Subcontract/Subgrant/Subagreement
• Consulting Agreement

89
Budget Development (cont.)

• Purchase Order
• A particular kind of agreement issued to
• enter into a legally-binding commitment
• with an outside vendor for the
• acquisition of goods and services.
• Normally the purchasing department is
• responsible for purchase orders, and
• for their negotiation or revision where
• necessary.
• Vendor Subcontracts used for the
• procurement of goods or services from

90
Budget Development (cont.)

• Purchase Order (cont.)
• an organization which provides the
• goods or services to many different
• purchasers as part of its normal
• business operations within a competitive
• environment. These subcontracts (or
• purchase orders) are not subject to
• compliance requirements of the Federal
• award (per A-133).

91
Budget Development (cont.)

• Subawards/Subcontracts/
• Subgrants/Subagreements
• Whatever you call them
• A written agreement with a third party for
• the acquisition of services or goods or
• for the conduct of prescribed activities
• or functions under an award.
• Subrecipient Subawards used to procure
• substantive programmatic work under
• a grant or contract. The sub-recipient
• has responsibility for programmatic

92
Budget Development (cont.)

• Subawards (cont.)
• decision making and measurable
• performance requirements related
• directly to the award. Sub-recipients
• must adhere to federal compliance
• requirements.
• Subaward Process Requirements
• Letter of Intent
• Statement of Work
• Period of Performance
• Budget

93
Budget Development (cont.)

• Process Requirements (cont.)
• Other Documentation
• FA Cost Agreement
• Cost Justification
• Statement of Work Approval
• Certifications/Assurances (these
• are usually part of the subaward
• agreement)

94
Budget Development (cont.)

• Consulting Agreement
• A form of subcontract
• An agreement issued for services too
• urgent, temporary, specialized, or highly
• technical to be provided by existing
• university personnel. Consulting
• agreements are not issued to procure
• substantive programmatic work.
• Consultants operate as independent
• contractors without detailed supervision,
• like subcontractors. Unlike
  subcontractors,
• they most often participate on a work-for-
• hire basis.

95
Budget Development (cont.)

• Consulting Agreements (cont.)
• Remember a consultant is not an
• employee.
• If am employee is misclassified as an
• consultant, the institution is subject to
• fines and penalties.
• Employer/employee relationships imply
• More discretion to direct or control the
• contents of work and results to be
• accomplished and means by which
• accomplished
• Continuing relationship whether full-

96
Budget Development (cont.)

• Consulting Agreements (cont.)
• time, part-time, seasonal, or short
• duration.
• Set Hours
• Guaranteed minimum pay and pay intervals
• Mutual right to terminate without liability
• Furnishing of facilities, supplies, and
• equipment needed to accomplish work
• Training supplied
• Some Possible Considerations For Consulting
• Agreements
• Prior Approval to Publish, Etc.
• Work-For-Hire

97
Budget Development (cont.)

• Consulting Agreements (cont.)
• Conflict of Interest
• Indemnification
• Flow-through Provisions from Prime
• Rate Limitation
• Sponsors May Set Allowable Rates
• Consultants
• Travel Is In Addition to Daily Rate

98
Budget Development (cont.)

• Cost-Sharing/Matching Costs
• is the portion of the cost of a project not borne
  by the sponsoring agency
• Types of cost sharing
• Mandatory
• Voluntary
• Voluntary Uncommitted

99
Budget Development (cont.)

• What Can be Used to Meet
• Cost Sharing?
• Cash
• Third Party Contributions (however,
• federal funds cannot be used as cost
• sharing on federal funds)
• Unrecovered FA costs (can be used if
• agency has approved)
• Establishing values for contributions of
• services and property (in accordance
• with applicable cost principles)
• Volunteer Services if necessary and
• integral part of project

100
Budget Development (cont.)

• Cost Sharing (continue)
• Other employee services (valued at
• regular rate of pay fringe benefits)
• Donated supplies (must be reasonable
• and at fair market value)
• Cost Sharing Considerations
• Cash and third party in-kind
• contributions must meet all of the
• following criteria
• Are verifiable from the recipients records

101
Budget Development (cont.)

• Cost Sharing Considerations
• (continued)
• Cannot be used as cost sharing on other
• federal projects
• Are necessary and reasonable for
• accomplishment of project objectives
• Are allowable under the cost principles
• Are not paid by the Federal government
• under another award
• Are provided for in the approved budget
• when required by Federal agency
• Conform to other provisions of A-110,
• as applicable

102
Budget Development (cont.)

• Potential Problems Associated with Cost Sharing
• Can we demonstrate to the funding
• agency that the cost sharing
• commitment has been fulfilled? Do
• track cost sharing on a project-by-
• project basis?
• Are we treating cost sharing consistently
• with other project costs, i.e., classify
• it as organized research?

103
Budget Development (cont.)

• Potential Problems (cont.)
• Are we overstating our FA rate by not
• capturing cost sharing?
• Do effort reports capture cost shared
• effort (both mandatory and
• voluntarily committed)?
• Are the same cost sharing funds used to
• meet the matching requirements on
• more than one project?
• Do we recover cost sharing expenditures
• through our FA rate?

104
Budget Development (cont.)

• Facilities and Administrative Costs
• Points to Consider
• FA cost recovery is the reimbursement for
  actual
• costs incurred by the institution in
  support of
• sponsored projects
• FA costs are incurred on all institutional
• activities, not just sponsored research
• FA costs are REAL COSTS!
• A significant portion of FA cost not recovered
• When an external sponsor pays less than the full
• FA rate, the unrecovered FA costs must be
• absorbed by the institution (its an
  institutional
• decision)

105
Budget Development (cont.)

• Types of FA Rate Bases
• Total Direct Costs (TDC)
• All direct costs of research
• Modified Total Direct Costs (MTDC)
• All direct cost of research less
• Equipment
• Subcontracts in excess of 25,000
• Tuition Remission
• Patient Care
• Capital Expenditures
• Rental Costs
• Scholarships Fellowships
• Other items may be excluded where necessary to
  avoid a serious inequity in the distribution of
  FA

106
Budget Development (cont.)

• FA Rate Bases (cont.)
• Salaries and Wages (SW)
• Can only be used with the Simplified
• Method
• Types of FA Cost Rates
• Provisional Estimated rate used when
• parties cannot agree on an equitable
• rate. May be replaced by fixed or
• predetermined rate before the end of
• the fiscal year.
• Predetermined Rate established for

107
Budget Development (cont.)

• FA Cost Rates (cont.)
• for period, normally 2 to 4 years. No
• carry forward provision.
• Fixed with Carryforward Rate established
• for period. Over/under recovery is
• determined and an adjustment is applied
• to a subsequent rate negotiation.
• FA Rate Versus FA Recovery
• FA is often waived or reduced for cost
• sharing
• FA rate calculation based on recoverable

108
Budget Development (cont.)

• Rate Versus Recovery (cont.)
• costs, i.e., all awards receive a full
• allocation of FA, not recovery
• In reality, institutions subsidize a
• significant portion of FA costs
• On-Campus Research Rate
• Applied to on-campus organized
• research activities
• Most frequently used rate may be the
• only rate negotiated

109
Budget Development (cont.)

• Off-Campus Research Rate
• Applied to sponsored agreements at off-
• campus facilities
• Off-Campus is usually not a university-
• owned facility
• Recovers administrative costs associated
• with sponsored agreements
• Typically is the A portion of the On-
• Campus Research Rate F costs are
• direct charged
• The A portion is generally 26 because of
  federal cap

110
Budget Development (cont.)

• Other Sponsored Programs
• Institutions with large amount of non-
• research sponsored projects may
• negotiate a separate rate for these
• projects
• Rates for Specific Facilities
• The costs of certain programs/facilities
• may be unique enough to warrant a
• separate FA rate
• Examples Agricultural Experiment Station
• Federally Funded Research and
• Development Center (FFRDC) University
• Medical Center

111
Proposal Review

• Typical Institutional Checklist
• for Proposal Review
• Correct Forms
• Internal Review Checklist/Approval Form
• Compatibility with Internal Review Checklist
• Intellectual Property
• Space Needs
• Renovation Requirements
• Cost Sharing/Matching
• Human Subject Use
• review and approval
• Animal Use
• review and approval

112
Proposal Review (cont.)

• Checklist for Proposal Review (cont.)
• Recombinant DNA
• review and approval
• Conflict of Interest Policy
• Publications/Proprietary Information
• Restrictions
• Hazardous Materials
• Undergraduate Graduate Students
• Page Limitations
• Type Size Limitations
• All Elements of Proposal Included

113
Proposal Review (cont.)

• Checklist (cont.)
• Correct Rates Used
• Budget Correct
• Signatures
• Subcontractor Commitment Letter
• All Certifications Included
• If RFP, is Exception Letter Needed
• If Foundation/Corporation, on
• restricted list
• Requirement for State Review Ascertained
• Correct Number of Copies, Deadline Date
• Mailing/Delivery Address

114
Proposal Review (cont.)

• Checklist (cont.)
• Method of Transmittal, Packaging
• Instructions
• Limitation on Number of Proposals
• from Institution
• And Youre Done!!!

115
Pre-Award Part IIProposal Submission Review

• Certifications Representations
• Routing Internal Approval Signatures
• Special Consideration
• Peer Review, Site Visits,
• Pre-Award Audits

116
Representations and Certifications for Proposals

• Civil rights, Non-discrimination
• Delinquent Federal Debt
• Drug-free Workplace
• Drug-free Workforce
• Debarment and Suspension
• Drug- and Alcohol-free Schools
• Procurement Integrity
• Small Business Utilization Subcontracting
• Lobbying

117
Debarment and Suspension (Final Rule May 1989)

• Regulations implemented by common rule (Grants)
• Federal Acquisition Regulations (Contracts)
• BACKGROUND Development of a government-wide
  system for transactions with federal agencies to
  detect fraudulent or improper use of government
  funds
• APPLICABILITY Agreements in excess of 25,000.
  Flow down required
• CERTIFICATION Applicants, their principals and
  researchers are not
• Presently debarred or suspended
• Have not been convicted or had civil judgment for
  fraud rendered within a three year period
• Are not presently charged by a Government entity
• Have not had a public transaction terminated for
  cause or default within a three year period

118
Procurement Integrity

• Applicability
• All federal contracts
• Certification required when contract exceeds
  100,000/year
• No flow-down requirement
• Requirements
• No competing contractor or any officer, employee
  or consultant of such contractor shall
• make any offer or promise of future employment
• offer any money, gratuity, or other thing of
  value to any procurement officer of such agency
• solicit any proprietary data or source selection
  information concerning such procurement
• Key to Compliance inform PI, and others, of
  requirements

119
Utilization of Small and Small Disadvantaged
Business Concerns

• Applicability
• Most contracts in excess of 100,000
• Flow-down to subcontractors
• Special requirements
• When contract is in excess of 500,000,
  subcontracting plan required and special
  reporting requirements apply
• Subcontracting means procurement of goods and
  services
• Subcontracting plan compliance and reporting can
  be handled by either purchasing office, research
  administration, or by project administrator

120
Lobbying Terms Defined

• Lobbying activities include
• Lobbying contacts
• Preparation and planning for lobbying
• Collaboration with others, such as associations
• Most public activities exempted
• Lobbying contact means
• Any oral, written or electronic communication
• Certain contact with executive officials
• Certain contacts with legislative officials
• With regard to
• Legislation
• Federal rule, regulation, policy
• Federal program (contracts, grants, loans, etc.)

121
Lobbying

• Applicability
• All federal agreements
• Flow-down to subcontractors is required
• Aspects Of Compliance
• Lobbying costs may not be paid from federal funds
• Federal funds interpreted to mean direct costs
  only
• Certification required for awards over 100,000
• Disclosure of lobbying expenses required in
  certain instances

122
Certification Signatures

• Authorizing Official
• Chief Executive or those delegated authority
• Supported by internal approvals and signatures
• PI, department, dean, business officers
• Signature is indication of assurances,
  representations and certifications
• See agency program guides and forms for summary
  of assurances that are made by signature of
  authorizing official and principal investigators

123
Typical Institutional Checklist for Proposal
Review

• Compliance with Sponsor Requirement
• Compliance with Institutional Policies
• Compliance with Statutory Requirements
• Application Completeness
• Appropriateness of Budget
• If applicable, review Guidelines of Solicitation

124
Solicitations Special Considerationat Time of
Institutional Review

• RFP Request for Proposals
• RFQ Request for Quotation
• RFB Request for Bid
• RFA Request for Applications
• Proposers must register objections to proposed
  terms and conditions, scope of work, etc., at
  the time of response. It may be the only
  opportunity to take exception.
• For example
• resist using hours for faculty and professional
  staff

125
Peer Review

• Evaluations are anonymous, and given in summary
  form to applicant on request
• Reviews usually assign scores, rankings, or
  categories
• Funding decisions are based on available funds
• Amount of award may be unilateral, or may be
  negotiated

• Primary basis for most funding decisions
• Variations some contract procurements may be
  based on a combination of qualifications and
  proposed cost (administrative and scientific
  review)
• Role of program official is a variable

If the proposal is rejected by the sponsor, the
PI should obtain the reviews from the sponsor,
address the issues, and resubmit the proposal
126
(No Transcript)
127
Negotiation of Awards, Dispute Resolution

• Negotiation Framework
• Clear channels of communication documentation
• Know institutional policies be familiar with
  scope of work and your history with the sponsor,
  project, PI,
• Terms and Conditions programmatic and business
• Negotiations with federal sponsors often include
• Budget level Project Goals Business Standards
• Negotiations with non-federal sponsors often
  include
• Academic principles (freedom, publications,
  ownership of data and reports)
• Intellectual property
• Business standards (salary basis, academic
  calendar)
• Financial reporting (level of detail)

128
Intellectual Property Bayh-Dole Act - 37 CFR
Part 401

• Allows retention of entire right, title, and
  interest throughout the world to each invention
  made with federal funding
• Government Retains nonexclusive, nontransferable,
  irrevocable, paid-up license to practice the
  invention for or on behalf of the government
• Requirements
• Disclosure within two months after inventor
  discloses to institution
• Election of title within two years of disclosure
  to agency
• Filing of initial patent application within one
  year of electing title

129
Material Transfer Agreement Considerations

• See Uniform Biological Material Transfer
  Agreement for standard model (http//www.autm.net/
  ubmta/UBMTAWord.doc)
• Ensure it is an institutional rather than a
  personal agreement
• Clearly and specifically define material involved
• Define use to which material is (and is not) to
  be put, and how to return or dispose of unused
  quantities.
• Define limitations on use and what is to be
  considered confidential
• May address use of names of organizations
  involved
• Ownership of derivatives
• Commercial/Non-commercial use
• Publications (usually requires acknowledgement,
  perhaps co-authorship)
• Indemnification

130
Clinical Trials

• The institution is usually reimbursed on a per
  patient basis often with a fixed F A rate of
  20 - 30 TDC
• Negotiation concerns
• Ownership of Data
• Ownership and Confidentiality of Patient Records
• Publication of Results
• Patent Rights
• Indemnification
• Billing of Third-party Carriers for Costs
• Liability for Subject Injury
• Informed Consent Requirements
• FA Costs

131
Electronic Research Administration

• A Definition of ERA
• What It Means for Sponsored Projects Offices
• The Future of ERA

132
NIH Mail Room at Proposal Deadline
133
ERA A Definition

• Electronic Research Administration simply means
  using electronic tools to perform the activities
  related to research administration. Keeping step
  with technology and the business world.
• Goal to work more efficiently time is money

134
ERA What It Means for Sponsored Projects

• Less Paper
• Training in multiple sponsor systems
• ERA Initiatives from Sponsors
• NEED FOR LOTS LOTS OF PATIENCE!!!

135
ERA Federal Transactions

• NSF FastLane
• Proposal Review
• Proposal Preparation Submission
• Checking Proposal Status
• Project Report Submission Progress and Fiscal
• NIH Commons
• Edison Invention Reporting now interagency
• CRISP searchable database of federally funded
  biomedical research
• Electronic Streamlined Noncompeting Award Process
  (e-SNAP)

136
ERA Today

• Improvements in Technology
• More Customized Programs
• Not Yet a Paperless Environment
• Expanded Federal Participation Grants.Gov
• http//www.grants.gov
• a common face of the government, offering all
  grantees (state and local governments,
  universities, small businesses, etc.) fu