1. FINANCING PHYSICAL ASSETS AT UNIVERSITIES THROUGH UTC PROGRAM (and other) FEDERAL GRANTS Amy Stearns, USDOT/OST-R University Transportation Centers Program Grants Manager June 4, 2014

2. SCOPE This presentation reflects what Federal grant regulations say in general about grants. Specific references to UTC Program grants are noted where applicable. 2

3. 3 WHICH TYPE OF FEDERAL GRANT DO YOU HAVE? Construction Grant – construction grants = complex expanded compliance aspects increased oversight because of high $ amount – research grants are rarely for construction UTC Program grants are not NSF/NOAA/DOD award a few Operational Grant – research grants are customarily operational UTC Program grants are this type

4. CONSTRUCTION GRANT 4

5. Although UTC Program grants are not for construction, points UTCs should note about construction grants: – major facility improvements are generally considered to be construction (discussion follows about minor facility alterations) – university F&A rates applied to UTC Program grants may include some construction-related costs beneficial to overall institution 5

6. OPERATIONAL GRANT 6

7. Physical assets include items that are necessary for the grantee to accomplish the purpose of the grant. May generally include: – permanent research equipment – laboratory or other specialized research facilities such as a test track – workspace alterations to house research equipment/facilities 7

8. OPERATIONAL GRANT, cont’d Under UTC Program grants that have a statutory education/technology transfer mission, necessary physical assets may also include: – permanent education, workforce development, or technology transfer equipment – specialized teaching facilities such as a computer- equipped classroom or video-conference room – workspace alterations to house education or technology transfer equipment/facilities 8

9. TREATING PHYSICAL ASSETS UNDER AN OPERATIONAL GRANT 9

10. Permanent Equipment defined as having useful life of more than one year and costing $5,000 or more – purchase requires prior approval by grantor agency above these thresholds, Federal grant regulations don’t distinguish between a $5,000 item and a $500,000 one – common sense: higher cost = better documentation if equipment is used by more than one grant, split costs appropriately 10

11. TREATING PHYSICAL ASSETS UNDER AN OPERATIONAL GRANT, cont’d Specialized Facilities generally are a combination of technological tools and physical space, customized to perform a particular task or function – such facilities are likely a key component of grant so would have been described in proposal – check with grantor agency to see if proposal language is sufficient for approval if facilities are used by more than one grant, split costs appropriately 11

12. TREATING PHYSICAL ASSETS UNDER AN OPERATIONAL GRANT, cont’d Workspace Alterations generally are services obtained in order to adapt existing space to a new purpose – alterations often are not identified at time of proposal, so check with grantor agency for approval if workspace being altered is used by more than one grant, split costs appropriately 12

13. TREATING PHYSICAL ASSETS UNDER AN OPERATIONAL GRANT, cont’d ADDITIONAL IMPORTANT NOTES: Non-Federal Funds: Federal grant requirements for the purchase and use of physical assets are the same whether the assets are paid with Federal or non-Federal matching funds. University Oversight: purchase and use of physical assets is an area that attracts auditors’ attention, so we recommend early involvement of Sponsored Research office 13

14. Questions? Amy Stearns USDOT/OST-R/UTC Program amy.stearns@dot.gov phone 202/366-4957 14