Scope
The purpose of this procedure is to assist the Office of Sponsored Programs (OSP), principal investigators (PI) and Departmental Administrators in the preparation and administration of outgoing subawards issued under sponsored programs.
All Sponsored Awards received by the University that include collaborative sponsored research services from a third party—usually another academic institution—in support of the technical goals and outcomes of the award are required to have a subaward agreement formalizing the collaborative relationship between the University and the third party. All such subaward agreements are issued and negotiated by OSP. This procedure does not cover subawards that the University receives from other institutions (i.e., incoming subawards), procurement activities under Sponsored Awards for the purchase of goods and services, or agreements for research related activities funded by non-extramural funding sources such as an internal, non-sponsored account.
Definitions
A sponsor is an external funding source that enters into an agreement with the University to support research, instruction, public service or other sponsored activities. Sponsors include for-profit organizations, foundations and other not-for-profit organizations, other universities, and federal, state and local governments.
The sponsored award is the grant, contract or cooperative agreement document issued by the sponsor and accepted by the University that provides financial assistance and the terms and conditions under which the sponsored activity occurs.
A pass-through entity (PTE) is a non-federal entity that issues a subaward to a Subrecipient to carry out part of a sponsored program.
The National Institutes for Health (NIH) defines subaward as "an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract.”
Note: A subaward is issued by the University as the PTE to another institution or organization (Subrecipient) to perform an programmatically significant portion of the Statement of Work (SOW) in a collaborative effort with the University under a University sponsored project.
According to 2 CFR 200.93, a Subrecipient is "a non-federal entity that receives a subaward from a pass-through entity to carry out part of a federal program; but does not include an individual that is a beneficiary of such program. A subrecipient may also be a recipient of other federal awards directly from a federal awarding agency.”
Note: The Subrecipient has responsibility for programmatic decision making related to the SOW; is responsible for adherence to applicable federal program requirements specified in the federal award; and in accordance with its agreement (subaward), uses the federal funds to carry out a program for a public purpose specified in authorizing statute, as opposed to providing goods or services for the benefit of the PTE (see Checklist to Determine Subrecipient or Contractor Classification).
The Statement of Work (SOW) outlines the procedures and methods the subrecipient will use to accomplish the goals of the subaward.
Facilities and Administrative costs (F&A), also known as indirect costs, are 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. The University's F&A costs are consistent with the definitions of specific F&A cost categories in 2 CFR Appendix III to Part 200, Indirect Costs Identification and Assignment, and Rate Determination for Institutions of Higher Education (IHEs).
The Off-Grounds Rate is the University's approved F&A rate for sponsored programs for which more than 50% of professional effort will be conducted in or on land, buildings or other space not owned by the University where all operation and maintenance expenses are directly incurred by the cost objective specifically benefitted or are initially incurred by a Revenue Generating Activity (e.g., recharge center or service center) and then allocated to the cost objectives specifically benefitted based on an allocation plan approved by the Office of Cost Analysis. Off-Grounds locations may be privately rented/leased, government-owned, or owned by another university.
The On-Grounds Rate is the University’s approved F&A rate for sponsored programs for which more than 50% of professional effort will be conducted in or on land, buildings or other space owned by the University and land, buildings or other space leased by the University where the operation and maintenance expenses are incurred by non-sponsored University funding sources (e.g., state or local award types), and cannot be readily and specifically assigned to a particular project or cost objective. For the purposes of this policy, On-Grounds locations do not include leased land, buildings or other space where all operation and maintenance expenses are initially incurred by a Revenue Generating Activity (e.g., recharge center or service center) and then allocated to the projects or cost objectives specifically benefitted based on an allocation plan approved by the Office of Cost Analysis.
Note: The University charges F&A in accordance with the UVA F&A Rate Agreement and the requirements of 2 CFR 200, on each subaward under any award which allows F&A for each competitive cycle of that award. If the prime award allows F&A to be calculated on "total direct costs (TDC)," then UVA's portion of the F&A on the subaward shall be on the entire funding amount of the subaward.
A Subaward Agreement record is an agreement record within ResearchUVA, Powered by Huron (RUVA) that allows the PI or research administrators to request a new subaward or modification to an existing subaward under a sponsored award.
Note: Although the definitions below reference federally-funded subawards, they also apply to non-federal prime sponsors that are funding subawards.
Responsibilities
The Principal Investigator (PI) is responsible for:
- Requesting issuance of subawards and subsequent modifications under their Sponsored Awards.
- Monitoring technical progress of the Subrecipient.
- Reviewing and approving Subrecipient invoices for appropriateness.
School/Departmental Administrators are responsible for:
- Submitting timely, accurate information and documentation to OSP pertaining to subaward issuance, modifiction, and closeout.
- Obtaining PI approval for subrecipient invoices.
- Paying subrecipient invoices.
OSP is responsible for:
- Issuing, negotiating, accepting, and certain complaince monitoring of all outgoing subawards and modifications.
- Financial monitoring through financial reports, comparison of spending patterns against authorized budgets, invoice processing and oversight of special award conditions (e.g., cost sharing, reporting on program income, and other regulatory and statutory requirements).
- Reviewing subrecipient performance reports, audit reports, site monitoring reviews and management actions related to timely resolution of audit findings.
Procedure
Proposal Phase
The PI initiates the collaboration by determining whether the collaborator is accurately defined as a Subrecipient. Then, the PI receives a proposal with SOW, budget and budget justification from the Subricipient to incorporate in the PI's proposal to the sponsor.
The School/Departmental Administrator assists the PI with compiliing the Subaward proposal packet that includes the following:
- Subrecipient's Consortium Commitment Form;
- Clearly defined SOW to be performed by the Subrecipient's personnel using its own facilities and resources;
- Detailed budget relevant to the SOW and budget justification, including a letter of commitment when cost sharing is required;
- Biosketch for all Key Personnel;
- Certification of compliance with Publish Health Service Conflict of Interest (COI) Regulations or regulations as may be applicable for the primary funding source; and
- Copy of Human Subjects Research Training and Good Clinical Practice certificate(s), if applicable.
Note: If the Subrecipient does not have a compliant COI policy, it will have to adhear to the University's COI policy and is required to submit the Key Personnel's Annual Financial Disclosure Form.
OSP as well as School of Medicine Office of Grants and Contracts, School of Engineering and Applied Science Office of Grants and Contractions, and School of Education and Human Development Office of Grants and Contracts submit proposals to the sponsors on behalf of the University.
Award Phase
The PI initiates a subaward upon receipt of an award or an award modifcation by reviewing and approving the Subaward Agreement record in RUVA, which is set up by School/Departmental Administrators (see below). If the PI identifies the need to collaborate with another institution or organization after the prime award is received, they contact OSP to determine if sponsor approval is required and will seek sponsor approval to engage in such collaboration.
Throughout the award, the PI assesses the Subrecipient's technical progress and required reports, approves Subrecipient invoices for payment (see Subrecipient Invoices, below), provides information to OSP about the Subrecipient's performance for inclusion in the Subaward Agreement record, and notifies OSP if the Subrecipient's performance is unsatisfactory. Note: The PI has an affirmative obligation to notify OSP of unsatisfactory Subrecipient performance by emailing ospsub@virginia.edu.
The School/Departmental Administrator prepares a Subward Agreement record when a new subaward or modification to an existing subaward is required. It is necessary to complete all sections and provide the following required supporting documents:
- Subaward proposal packet;
- Note: Updated budget, budget justification, and SOW must be incorporated if the final version differs from the original documents submitted with the proposal to the sponsor.
- Confirmation the Subrecipient registerd with the University's supplier registration database; and
- As applicable, compliance approvals from the Subrecipient for:
- Institutional Review Board (IRB) approval to perform Human Subjects Research;
- Institutional Animal Care and Use Committee (IACUC) to perform research on vertebrate animals;
- Institutional Biosafety Committee (IBC) approval to perform research that involves the use of biological agents; and/or
- Export Control Management Plan.
The Subaward Agreement record must be approved by the PI and routed through the proper channels to OSP according to RUVA reference guides.
OSP will evaluate the risk with respect to the subrecipient institution and the subrecipient’s performance per the SOW. Based on the results of the evaluation, OSP may include additional terms in the subaward. The evaluation will include the following:
Subrecipient Institutional Assessment
OSP will obtain a copy of the Subrecipient’s most recent Single Audit and review the audit in compliance with Uniform Guidance. If the subrecipient does not have a Single Audit, then an alternative recurring independent audit or Mini-Audit Questionnaire will be obtained and reviewed.
Subaward (Project) Assessment
OSP will analyze a number of factors related to this issuance of a specific subaward, including the ratio of funds transferred to the Subrecipient, the SOW, COI, regulatory documentation and other factors.
Once the assessment is completed, OSP will send the draft to the Subrecipient, negotiate the terms, and execute the subaward.
Note: No subaward will be issued until the applicable Subrecipient compliance approvals have been received or their absence has been justified and appropriately documented. Further, foreign Subrecipients performing Human Subjects Research must provide a current IR approval and valid Federal-wide Assurance (FWA) number or equivalent compliance approval with an active registration. Foreign Subrecipients performing research on animals may need to comply with additional requirements (contact IACUC).
Upon receipt of a properly approved Subaward Agreement record for a new subaward, OSP creates a new Grant line in the University’s financial system and funds the Grant line once the subaward is fully executed. The Grant line is created for the same amount obligated to the Subrecipient (i.e., Subrecipient’s budget including Direct and Indirect Costs) plus any F&A the University charges on the Subaward.
Notification that the subaward has been fully executed is distributed to the PI and Department Administrator via RUVA.
A supplier contract is created in Workday based on the requirements of the fully executed agreement, thus creating an obligation for the Subaward amount committed via the subaward agreement. OSP receives all Subrecipient invoices and Financial Reports for initial review and forward documents to the appropriate departmental contact for further processing (see below).
In the event the PI notifies OSP of Subrecipient nonperformance, OSP may, at the direction of the PI:
- Provide the Subrecipient with a written notice of nonperformance and provide an opportunity to address deficiencies;
- Terminate the Subaward for nonperformance consistent with the terms of the agreement; and
- Take other action as appropriate and consistent with sponsor requirements.
Subrecipient Invoices
The Subrecipient is responsible for generating all invoices and maintaining proper documentation to substantiate charges. Invoices should adhere to the requirements included in the subaward agreement (e.g. state the subaward number, list line item detail of expenditures for the current billing period as well as the to-date cumulative total, achieved milestones, number of enrolled patients, etc.), and be sent via email to OSP at ospsubinvoice@virginia.edu.
Additionally, in accordance with Uniform Guidance 200.305 “Payment”, when UVA is the PTE of federally awarded funds and engaged in a reimbursement type agreement UVA will issue payment for Subrecipient invoices within 30 calendar days of receipt of a complete invoice. The 30-day timeframe will not begin until UVA is in receipt of a complete invoice.
A complete invoice contains all contractually required elements (e.g., UG cerfitifcation, UVA subaward number, date(s) within the period of performance, expenditure reports, cost share reports, etc.).
Please note that there may be other legitimate reasons for an invoice not being paid within 30 days, including:
- PI does not approve that the financial and/or technical aspects of the invoice accurately reflects the work completed and needs additional information.
- Subrecipient debarment or suspension by any federal department, elevated subrecipient risk level due to annual monitoring requiring remediation, etc.
Identified trends regarding invoice payments exceeding 30 days will be addressed with the responsible parties.
OSP receives Subrecipient invoices with any other required documentation and enters them into the University's financial system.
The PI reviews the invoice and confirms that the Subrecipient is performing according to the agreed upon SOW and approved budget. The PI also confirms the expenditures fall within the project period and budget as stated in the Subaward and that expeditures are reasonable and allowable according to progress. The PI will approve the invoice by taking approval actions within the University's financial system.
The Departmenal Grant Manager will review and approve the Subrecipient invoice before it is routed to PI for final approval.
Closeout Process
Upon acceptance of all deliverables, the PI approves final payments to the Subrecipient.
School/Departmental Administrators ensure the receipt of all reports required for closeout, confirms by email to OSP that all deliverables have been received, and works with the Post-Award accountant to reconcile all Subaward accounts with the Subrecipient's final financial report.
After the close of a Subaward, OSP sends an email to the Department Administrator and PI requesting confirmation that Subrecipient performance was adequate and all required technical reports were received. OSP will ensure submission of all final reports, Single Audit certifications and the final invoice. Per the terms of the Subaward agreement, OSP may withhold final payment pending receipt of all reports required at closeout, including any outstanding Single Audit certification letters.
OSP works with the department to reconcile all Subaward accounts with the Subrecipient's final financial report and close out the supplier contract associated with the Subaward agreement.
Ownership
The Executive Director of the Office of Sponsored Programs is responsible for ensuring that this procedure is necessary, reflects actual practice, and supports University policy.