Link to NIH Frequently Asked Questions: http://grants1.nih.gov/grants/policy/core_facilities_faqs.htm
"The purpose of these FAQS is to provide answers to common questions raised regarding NIH-funded core facilities and other applicable research related facilities that support NIH grants. These FAQs are not intended to establish new policies or interpretations of applicable Federal cost principles, nor are they meant to represent broad guidance on the costing treatment of all institutional service and recharge centers."-As published in the NIH Guide Notice NOT-OD-13-053, April 8, 2013
General Recharge Operating Principles
1. Is it really necessary that I follow these complex recharge management policies and procedures for a service activity that occurs on an infrequent basis? For example, my faculty member provides library preparation services around a half dozen times per year.
Yes, it is necessary to follow the institutional policies and procedures. The logic and steps for developing a service rate is the same no matter the volume or frequency of services. Some rate calculations will be quite complex but others may be quite simple to develop.
2. Which comes first, the RC/SSF budget or the RC/SSF rate?
Both the RC budget and rate calculation are dependent on volume so any model must start with the cost elements for an expected volume level. The fixed costs of an RC don’t change with volume levels, or at least don’t change over a certain range of volume levels. Variable costs are dependent on volume levels. See Budget / Rate Calculation Examples: Scenario Description, Worksheet - New, Gain, Loss, Subsidy.
Charge Methodologies & Subsidies
1. Is it allowable to charge different rates for equipment use during peak, non-peak and late night non-standard hours?
Charging different rates based solely on the time the service is obtained is not appropriate. The costs incurred during the different time periods would have to be different in order to charge multiple rates. For example, labor costs would need to be more/less during those periods (e.g., daytime staff = 3 FTE, but night time staff = 1 FTE).
2. Can different rates be offered to users based on different service volume levels?
Yes, the RC/SSF can offer differing rates based on volume, if, in fact, there is a real price difference. For example: Labor costs may be only twice as much when making 100 units vs. making 10 units.
3. Can we adjust our RC/SSF rates mid-year, or do we have to make the change at the beginning of the WU fiscal year, July 1st?
Yes, you can adjust your rates mid-year; they can be adjusted at any time throughout the fiscal year. At minimum, rates must be reviewed annually, but can be reviewed more often if needed. Rates should be adjusted if expenses or volume vary significantly from budget estimates. When implementing new rates it is advisable to give users sufficient notice for budget planning purposes, especially if rates are being increased. Note that the documentation requirements apply to any rate changes no matter when they occur. For additional information visit the Annual & Ongoing Review Process page.
Program Income vs. Independent Recharge Mechanism
1. What is the policy regarding when you record revenue under the program income mechanism or when it is appropriate to record the revenue and expenses in the LC 11/12 account without cost sharing through the program income mechanism?
Refer to the Charge Methodologies & Subsidies web page, which states:
2. The program income examples provided on this site refer to activity on federal awards (specifically NIH). What is the procedure if we have a non-federal grant where we bill for services/products related to the non-federal grant specific activity? Do we follow the same procedure as we would with federal awards?
- If a core facility is created by a grant award, then charges for services/products to users requires that the fee-for-service activity be tracked as program income against the grant which is funding the core facility.
- If a RC/SSF providing services/products already exists and an award is subsequently received to support a portion of the center's activity, then the fee-for-service income would continue to be recorded as standard RC/SSF re-charge activity and would not have to be tracked as program income associated with the newly-awarded grant.
The first step is to discuss the situation with Sponsored Projects Accounting to confirm program income is being earned and does need to be recorded. In general, if program income management is described in the non-federal funding agency guidelines, those guidelines would apply in conjunction with WU specific accounting practices. If no guidelines are provided by the non-federal funding agency, you would follow the same procedures as applied to federal funds.
Billings & Receivables
1. An investigator requested services from our research service center but we cannot complete the service request for two months due to our workload. The investigator’s grant expires in one month and she has asked us to bill for the services now so she can use the available grant funds by pre-paying for the services. Is this okay?
No, that is not okay. Billings should be prepared and issued on a timely basis after the service or product has been provided to the user. It is not acceptable to bill the user before the service or product has been provided to allow the user to apply charges to a grant in advance of the time the service is received
Audit and Ongoing Review Process
1. To be prepared for an audit, what level of documentation do I need regarding service rates developed for our research service center? Refer to the Annual & Ongoing Review Process web page for additional information but RC/SSF mangers must maintain, at a minimum, the following:
a. work papers supporting rate calculations
b. work papers supporting use or level of activity projections
c. billing records identifying services provided to each user
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