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Service CentersService Centers

RASG Presentation, August 30, 2005

Kevin MaynorDirector of Cost Analysis and Compliance

Office of Sponsored Research

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Service Center Discussion PointsService Center Discussion Points

• Definition

• Examples

• Common Terms

• Role of Cost Analysis in Service Center Administration

• Key Elements of a Research Service Center Proposal

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Service Centers DefinedService Centers Defined

• Guidance offered by A-21 and DCA Long Form Review Guide

• Refers to specialized service facilities (SSF)

• Services provided by highly complex facilities operated by the institution

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Federal GuidanceFederal Guidance

• Establishes service centers as an intermediate cost objective

• A means to identify direct costs

• Must be charged directly to awards based on actual usage on the basis of a schedule of rates or established methodology

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• Rates should be designed to recover not more than the aggregate cost of the services over a long-term period

• Rates should be adjusted at least biennially (every two years)

Federal Guidance

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• Rates or charges do not discriminate against federally supported activities

• Treating service centers that are largely used by Federal projects differently from those used by non-research functions is inconsistent and unacceptable

FederalFederal Guidance Guidance

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• Operating costs and losses cannot be included in the F&A cost rate. Should not be transferred to an administrative pool.

• Losses caused by:o Rates based on less than full costso Not billing all userso Deliberately under billing in order to remain

“competitive”

Federal GuidanceFederal Guidance

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IndustryIndustry Standards Standards

• Developed over time Based upon findings/results of Federal reviews

and F&A cost rate negotiations • General Definition: Service centers are

operating units that provide goods and services to internal users and whose output can be quantitatively measured by university users

• Services may be provided on an incidental basis to external users

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• Continuing need (going concern)

• Sufficient volume (materiality)

• Provide internal services to multiple department/units

• Long-term break-even operation

• Periodic review/monitoring required

Industry StandardsIndustry Standards

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• May not discriminate against federal projects

• Rates based upon Actual Costs• Charged in proportion to services

rendered• Surplus and deficit balances “rolled

forward” in developing future rates• Consistent application (CAS standards)

IndustryIndustry StandardsStandards

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Industry Standards – consistency issuesIndustry Standards – consistency issues

• CAS 501 - estimating, accumulating and reporting costs:o Service center costs budgeted in proposals must be reconcilable

to actual charges in the accounting system.

• CAS 502 – allocating costs incurred for the same purpose:o Costs must be charged consistently as direct or indirect and the

rate development process must be consistently applied.o Changing an indirect cost to a direct cost requires cognizant

agency approval.

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Industry Standards – Direct/indirect issuesIndustry Standards – Direct/indirect issues

• CAS 505 – unallowables:o Service centers must exclude unallowable costs from billing

rates.o Must identify the actual cost of providing services to all users,

regardless of the funding sources (subsidies).

• CAS 506 – accounting period:o Rates should be established based on the institution’s fiscal

year, unless there are legitimate reasons for using an alternative period.

o Periodic review, oversight by review body, constant monitoring by departmental management.

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ExamplesExamples

• Animal Care Facilities

• Copying/Graphic Services

• Physical Plant Operations (Electricity)

• Scientific Services

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Common TermsCommon Terms

• Service Center

• Recharge Center

• Specialized Service Facility

• Research Service Center

• Administrative Service Center

• Business Service Center

• Departmental Service Center

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Role of Cost AnalysisRole of Cost AnalysisService Center AdministrationService Center Administration

• Research Service Center (RSC) oversighto Policy, approval/periodic review

• Inter Departmental Fees and Charges Committeeo Permanent seato Director of Financial Planning and Budgetso Cross-departmental business and administrative

service centers

• Consult with other oversight bodies/departmentso Rate development and rate compliance

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ResearchResearch Service CenterService CenterKey Elements of a ProposalKey Elements of a Proposal

• Business Plan• Rate development and supporting schedules• Full disclosure• Subsidies, equipment depreciation and

maintenance, location/space, users, operating level

• Other as circumstances dictate

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Key Elements of an RSC ProposalKey Elements of an RSC ProposalSteps to CompleteSteps to Complete

• Identify serviceo Need, elements of compliance, etc.

• Determine total direct cost

• Determine output/service unit and volume

• Adjust for unallowable cost

• Add/subtract prior period variance if applicable

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Steps to Complete an RSC Steps to Complete an RSC ProposalProposal

• Identify/discuss subsidies and their proper treatmento Appropriate approval from subsidizing party

• Complete Business Plan and Rate Development Schedules

• Review, feedback and discussiono Departmental managemento Cost Analysis

• Cost Analysis approval/disapproval

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Service CentersService Centers

• Questions

• http://research.unc.edu/services/forms.php#sponsored

• http://www.unc.edu/finance/budget/fee&charges.htm

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Exceptional Research, Service Exceptional Research, Service and and UnfundedUnfunded Agreements Agreements

RASG Presentation, August 30, 2005

Hamilton Brown Director of Pre Award ServicesOffice of Sponsored Research

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• Complexity of Agreement

• Type of Agreement

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Complexity of AgreementComplexity of Agreement

• Scope of Work• Term and Termination• Ownership of Data• Intellectual Property• Publications• Insurance• Indemnification• Access to Premises

• Changes/Amendments• Recordkeeping and

Reporting• HIPAA• Confidential

Information• Notices• Publicity/Use of Names• Conformance with Law

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Types of Unfunded AgreementsTypes of Unfunded Agreements

• Master Agreement • Material Transfer Agreement• Teaming Agreement• Collaborative Agreement• Confidential Disclosure Agreement• Data Use Agreement• Memorandum of Understanding

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Master Agreement - An agreement for research services that does not procure or specify a firm quantity of services but provides the framework of pre-negotiated terms and conditions for the issuance of funded task orders during the period of the agreement.

Material Transfer Agreement - An agreement allowing UNC scientists to give materials to or receive materials from outside investigators in academia or industry the sharing of which promotes scientific discoveries. The MTA constitutes a limited non-exclusive license to use the materials in the pursuit of discoveries for the public benefit while restricting their use to non-commercial purposes.

DefinitionsDefinitions

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Definitions (cont’d)Definitions (cont’d)

Teaming Agreement - An agreement allowing UNC scientists to collaborate with an other institution’s investigators in the preparation and submission of a proposal for a sponsored research project.

Collaborative Agreement – An agreement to conduct research with no exchange of funds between the parties.

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Definitions (cont’d)Definitions (cont’d)Confidential Disclosure Agreement - An

agreement in which Confidential Information is specifically defined as disclosed information in printed, written, graphic, photographic or other tangible form which is marked as “Confidential”, Proprietary”, “Private”, “Restricted”, or “Trade Secret” by the discloser and the unapproved release of which would have an adverse impact on the disclosing party.

Data Use Agreement - An agreement in which data is shared with authorized users for research purposes in accordance with a defined Scope of Work.

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Who to ContactWho to Contact

• Master Agreement – OSR/OCT• Material Transfer Agreement - OTD• Teaming Agreement - OSR• Collaborative Agreement - OSR• Confidential Disclosure Agreement – OSR/OCT• Data Use Agreement - OSR• Memorandum of Understanding – OSR/OCT