1. 1 Service Centers RASG Presentation, August 30, 2005 Kevin Maynor Director of Cost Analysis and Compliance Office of Sponsored Research

2. 2 Service Center Discussion Points Definition Examples Common Terms Role of Cost Analysis in Service Center Administration Key Elements of a Research Service Center Proposal

3. 3 Service 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

4. 4 Federal 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

5. 5 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

6. 6 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 Federal Guidance

7. 7 Operating costs and losses cannot be included in the F&A cost rate. Should not be transferred to an administrative pool. Losses caused by: oRates based on less than full costs oNot billing all users oDeliberately under billing in order to remain “competitive” Federal Guidance

8. 8 Industry 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

9. 9 Continuing need (going concern) Sufficient volume (materiality) Provide internal services to multiple department/units Long-term break-even operation Periodic review/monitoring required Industry Standards

10. 10 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) Industry Standards

11. 11 Industry Standards – consistency issues CAS 501 - estimating, accumulating and reporting costs: oService center costs budgeted in proposals must be reconcilable to actual charges in the accounting system. CAS 502 – allocating costs incurred for the same purpose: oCosts must be charged consistently as direct or indirect and the rate development process must be consistently applied. oChanging an indirect cost to a direct cost requires cognizant agency approval.

12. 12 Industry Standards – Direct/indirect issues CAS 505 – unallowables: oService centers must exclude unallowable costs from billing rates. oMust identify the actual cost of providing services to all users, regardless of the funding sources (subsidies). CAS 506 – accounting period: oRates should be established based on the institution’s fiscal year, unless there are legitimate reasons for using an alternative period. oPeriodic review, oversight by review body, constant monitoring by departmental management.

13. 13 Examples Animal Care Facilities Copying/Graphic Services Physical Plant Operations (Electricity) Scientific Services

14. 14 Common Terms Service Center Recharge Center Specialized Service Facility Research Service Center Administrative Service Center Business Service Center Departmental Service Center

15. 15 Role of Cost Analysis Service Center Administration Research Service Center (RSC) oversight oPolicy, approval/periodic review Inter Departmental Fees and Charges Committee oPermanent seat oDirector of Financial Planning and Budgets oCross-departmental business and administrative service centers Consult with other oversight bodies/departments oRate development and rate compliance

16. 16 Research Service Center Key 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

17. 17 Key Elements of an RSC Proposal Steps to Complete Identify service oNeed, 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

18. 18 Steps to Complete an RSC Proposal Identify/discuss subsidies and their proper treatment oAppropriate approval from subsidizing party Complete Business Plan and Rate Development Schedules Review, feedback and discussion oDepartmental management oCost Analysis Cost Analysis approval/disapproval

19. 19 Service Centers Questions http://research.unc.edu/services/forms.php #sponsoredhttp://research.unc.edu/services/forms.php #sponsored http://www.unc.edu/finance/budget/fee&ch arges.htm

20. 20 Exceptional Research, Service and Unfunded Agreements RASG Presentation, August 30, 2005 Hamilton Brown Director of Pre Award Services Office of Sponsored Research

21. 21 Complexity of Agreement Type of Agreement

22. 22 Complexity 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

23. 23 Types of Unfunded Agreements Master Agreement Material Transfer Agreement Teaming Agreement Collaborative Agreement Confidential Disclosure Agreement Data Use Agreement Memorandum of Understanding

24. 24 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. Definitions

25. 25 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.

26. 26 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.

27. 27 Who 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