- Research Handbook
- 1. Roles & Responsibilities
- 2. Standards for Conduct of Research
- 3. Overview of Sponsored Projects Administration
- 4. Funding Sources & Opportunities
- 5. Proposal Development
- 6. Budget Development
- 7. Procedures for the Submission of Proposals
- 8. Award Acceptance
- 9. Award Management
- 10. Research Related Regulations, Policies & Procedures
- 11. Other Conduct of Research Issues
- 12. Acronyms & Definitions
- 13. Glossary
- Procedure Library
- Regulations Library
- Export Controls
Overview of Sponsored Projects Administration
3.3 Types of Sponsored Projects
A type of financial assistance awarded to the University, on behalf of an individual, for the conduct of research or other program as specified in an approved proposal. A grant is used whenever the awarding office anticipates no substantial programmatic involvement with the recipient during the performance of the activities. The statement of work allows the principal investigator some freedom to change emphasis within the general area of work as the project progresses. A grant is a contractual document but does not carry the specific terms and conditions denoted in a "contract."
In general, the following criteria identify a grant:
- The award carries terms on the use of funds as specified budgetary restrictions; the objectives to be achieved by use of the funds; the program in which the work will be carried out; the individual responsible for completing the work; the period of performance; and the invention rights.
- The sponsor retains authority to withhold funds pending satisfactory completion of project objectives. Unused funds may be returned to grantor.
- Formal financial accounting, during the life of the project, at its termination, or both, is required and the funds must be placed in a restricted project.
- The sponsor requires reports related to the substance of the work during the life of the project and/or at its termination. Copies of published materials may also be requested.
- Periodic payments are to be made to the University so that the financing of a project is on a continuous basis.
- Facility and Administrative (F&A) costs are usually included in the funding, and there is a commitment of university facilities, personnel, or other resources.
- Generally, research-related awards from corporations, corporate foundations, and major private foundations are subject to specific restrictions and contingencies will be classified as a grant (or contract). However, the classification ultimately depends on the terms attached to the award.
A funding mechanism which can be used by federal agencies when a program requires more agency involvement and restrictions than a grant but requires less agency supervision than a contract. The principal purpose of the relationship is the transfer of money, property, services, or anything of value to the University in order to accomplish a public purpose of support or stimulation authorized by federal statute.
A mechanism for procurement of a product or service with specific obligations for both sponsor and recipient. Typically, the sponsor specifies a research topic or a service and the methods for conducting the research/service in detail, although some sponsors award contracts in response to unsolicited proposals. There is an expectation of specific deliverables within a specified time frame. There is generally less flexibility in the method used for carrying out the plan of action.
Cost Reimbursement Contracts:
This is the preferred type of contract for University research and service. This contract provides for payment of actual costs both direct and facility and administrative (F&A), for performance toward contract objectives as specified in the statement of work. This type of contract offers less risk to the University as it implies best efforts toward the completion of the task but offers no guarantee of specific outcomes.
Fixed Price Contracts:
This type of contract provides a total-sum payment or lump sum payment schedule for performance of specific tasks or delivery of a certain number of products or services. Fixed price contracts should only be used when costs for quantity and/or delivery are readily and easily definable. This type of contract offers more risk to the University and the Principal Investigator because the delivery of the product or service is still required even if there are additional costs over the contracted amount.
The Principal Investigator may move unexpended funds from a fixed price contract to a departmental operation or a development activity at the conclusion of the sponsored project. These residual funds should normally not exceed fifty percent of the total value of the fixed price contract. F&A costs will be removed from the residual amount prior to the transfer of funds.
If the residual funds exceed fifty percent of the total value of the contract, the Principal Investigator will provide to Research Accounting a written explanation as to how the project was accomplished using less than the budgeted amount. This memo will protect the University and the Principal Investigator from Unrelated Business Income Tax A A Revised February 24, 2012 Page 20 of 104 (UBIT) implications and alleviate any perception regarding the University Kickback policy.
For clarification the Uniform Guidance definitions regarding fixed rate (capitation) and fixed amount (fixed price) is:
(200.45) Fixed amount awards means a type of grant agreement under which the Federal awarding agency or pass-through entity provides a specific level of support without regard to actual costs incurred under the Federal award. This type of Federal award reduces some of the administrative burden and record-keeping requirements for both the non-Federal entity and Federal awarding agency or pass-through entity. Accountability is based primarily on performance and results. See §§200.201 Use of grant agreements (including fixed amount awards), cooperative agreements, and contracts, paragraph (b) and 200.332 Fixed amount subawards.
Further refined in NOT–OD-18-222
In a fixed amount subaward, the total value of the award is negotiated upfront. This requires the pass-through entity to know both the unit price and the total number of units that will be provided. In a fixed-rate agreement, while there is a negotiated cost per unit, e.g. per patient cost in a clinical trial (or participant in a non-Clinical Trial Human Subjects Study), the total amount of the award may be unknown when the agreement is created. Since this type of agreement is based on a “fixed rate” as opposed to a “fixed amount” as defined by 45 CFR 75.201, prior approval is not required to enter into this type of agreement provided there are no other factors that would require NIH prior approval consistent with NIHGPS.
The Principal Investigator is responsible for accurate expenditures charged to a project. Over expenditures for cost reimbursement contracts and fixed price contracts are the responsibility of the Principal Investigator and their Department. Any funds not expended on a cost reimbursable project would be returned to the agency if not required to complete the project. Under no circumstances may the Principal Investigator use residual funds from one sponsored project to help pay expenses for another sponsored project without the explicit approval of the agency.
In general, the criteria for identifying a contract are the same as those for a grant, except that:
- The award is subject to formal conditions outlined in a contractual instrument signed by both parties.
- The sponsor often places more restrictions upon expenditures allowed in the pursuit of the activity (e.g., clauses concerning "Buy American", ceiling on certain spending, etc).
- Financing may be on a cost-reimbursable basis, although the University tries to arrange some method of advance funding where necessary. Some fixed-price contracts may provide for lump sum or incremental payments as work progresses.
- The sponsor requires periodic progress reports and some array of others including invention reports, royalty reports, financial status reports, equipment inventory reports, etc.
- Often there is intellectual property, confidentiality, and/or publication conditions associated with receipt of the funds.
- A closing audit is sometimes required.
The University has developed various contracts or agreements to meet the needs of the wide variety of research interests and service commitments of the faculty. These agreements are good starting points to develop contracts with various agencies. Also, agencies may have their own agreements and wish to use those as starting points for negotiations.
It is important to remember that no two projects are the same and there will be some differences in specific agreements. The University has some flexibility in terms and conditions, but there are some specific requirements, which are governed by certain laws, that cannot be altered. The Office of Sponsored Projects (OSP) will negotiate terms, conditions, and language depending on the circumstances of the each specific project.
The following are areas in which the University has standard boilerplate agreements to begin the negotiation process:
This agreement is used when an organization wishes to advance the state of knowledge in a specific discipline area. Usually the Principal Investigator is asked to use investigative methods in studying, testing and/or proving a hypothesis. The specific outcome is unknown although the direction of the research will be narrowed as the state of knowledge becomes more advanced. Intellectual property is a logical result of this research.
This agreement is used when a Principal Investigator uses pre-existing protocols, models, methods, or software to analyze, test, opine, or draw conclusions using the collected data. Publications are the logical conclusion of this effort.
Clinical Services Agreements are used with pharmaceutical companies or other sponsors for University clinical service studies or trials. Agreements received from sponsors can have several different names including "investigator agreement", "research contract", "clinical investigation agreement," and "clinical services agreement," A sponsor may also request that the PI complete a "Confidentiality Agreement" or "Confidentiality and Non-Disclosure Agreement" before sharing a protocol or agreement for proposed clinical work.
A Master Agreement is a contract that is used to cover a number of different projects funded by one sponsor over a period of time. These types of agreements are also called "Blanket Agreements." Master Agreements are used to streamline the contracting process for both the University and the sponsors who intend to fund multiple research projects over time. The contracts are usually negotiated to cover an extended period.
Master Agreements are arranged with industrial research partners, and some federal and/or state governmental entities that contract with the University on a frequent basis. The Principal Investigator should inform OSP of potential sponsors who might be interested in negotiating a Master Agreement.
Task Orders: Task Orders are the individual authorizations to perform project specific work under the terms and conditions of a Master Agreement. Since task orders are individual contracts, each task order proposal requires a Document Summary Sheet (DSS).
This agreement is used when an international agreement, similar in nature to the research and/or service agreement, is designed to facilitate projects or collaboration with sponsors or subcontractors in the international arena.
In the event a sponsor is located outside the U.S., or a sponsored project involves the use of an international subcontractor, the PI should contact and work with OSP to negotiate the required international agreements for these situations. There are many unique contracting issues that arise in international relationships that must be considered before entering into these agreements. Some of these issues include:
- Fluctuating exchange rates and choice of currency. The University prefers to have all projects funded in and payment options provided in U.S. dollars. However, this is not always negotiable with some sponsors. The fluctuation of exchange rates must be considered when foreign currencies are used. PIs must pay close attention to the actual amount of funds available when completing a project that is funded in foreign currencies. Read about Foreign Currency in the Procedure Library.
- Payment options. In some nations, the banking system is not as flexible as the U.S. system and there are other financial considerations depending on which nation is involved in a particular project. Travel costs associated with payment options need to be considered when preparing an international project budget. If a Sponsor wishes to pay via bank wire transfer, the PI should take into consideration international wire transfer fees when preparing a sponsored research proposal budget.
- Choice of law. As a body politic of the State of Utah, the University cannot agree to be governed by the laws of a separate sovereign.
- Terms of art in international agreements. Some international contracts contain terms of art that seem benign on their surface, but can have larger legal consequences due to particular laws in different nations. Therefore, a University contract should be used for international agreements whenever possible. Each contract must be reviewed on a case by case basis by the OSP office and other University offices as needed.
- International intellectual property and patents. The PI should discuss potential intellectual property that may arise from a particular research project with the PIVOT Center. Other nations have laws that Revised February 24, 2012 Page 23 of 104 are different from U.S. laws governing the patent process, so timely interaction with TVC is crucial in international projects.
- Foreign Corrupt Practices Act. Whenever international contacts are made, a PI should be aware of the provisions of the U.S. Foreign Corrupt Practices Act ("FCPA"). This act makes it illegal to pay any foreign government official or agent to influence the outcome of a given transaction. Some fees are not illegal under the FCPA. If a PI has any questions or concerns about the FCPA, the University Office of General Counsel should be contacted as soon as possible.
An MOU is an informal agreement that serves as the basis of a future formal contract or deed and/or a brief written statement outlining the terms of an agreement or transaction. The word memorandum implies something less than a complete contract. The memorandum functions only as evidence of the contract and need not contain every term, so that a letter may be a sufficient memorandum to take an agreement out of the statute of frauds. Under the statute of frauds, the memorandum must be such, as to disclose the parties, the nature and substance of the contract, the consideration and promise, and be signed by the party to be bound by the agreement.
Requests for materials or data from the University of Utah are transferred to the requesting party only after entering into a "Confidential Disclosure and Material Transfer Agreement". This Agreement is administered and available through the PIVOT Center.
The University is also a party to the master "Uniform Biological Material Transfer Agreement" (UBMTA) implemented by NIH. For institutions that have signed the UBMTA Master Agreement, materials can be transferred under the terms of the UBMTA upon execution of a "Letter Agreement" for the particular transfer. A copy of the Letter Agreement and a list of participating institutions are available at www.autm.net.
Often times, an MTA is received when a University researcher wishes to acquire material privately owned. The researcher must forward the agreement to OSP or TVC for review and signature. OSP and TVC work together in review, modification and acceptance of outside MTAs.
Utah encourages industry, government, and University cooperation and sharing of ideas and information of mutual interest. Therefore, the University has established the Affiliate Program to foster this cooperation. The University pools resources through memberships received from the sponsors. The advantages to the sponsors are access to research developments and development methods, a common resource of knowledge and the ability to address specific industry-wide issues. Affiliate programs take significant management effort before and after establishing a program and must have advance approval before they are initiated.
3.3.3.i Other Agreements, Other Transaction Agreements (OTA’s), Technology Investment Agreements (TIA’s)
These agreements are a variation of a contractual agreement. There are fewer bid restrictions and the Bayh-Dole Act does not apply. This means that the sponsoring agency may retain all rights to the intellectual property. The agreements are extremely flexible and used infrequently.
- The Office of Sponsored Projects (OSP)
- What is a Sponsored Project?
- Types of Sponsored Projects
- Cooperative Agreement
- Research Agreement
- Service Agreement
- Clinical Services (Investigations) Agreement
- Master Agreement
- International Agreement
- Memorandum of Understanding (MOU)
- Material Transfer Agreements (MTA)
- Affiliates (or Consortium) Programs
- Other Agreements, Other Transaction Agreements(OTA’s), Technology Investment Agreements (TIA’s)