TOPICS
& REFERENCES 
PACE
Instructions (10/94) October
1994 September
1997
Project directors and academic units administering grants and contracts are reminded that they are ultimately responsible for the conduct of each project.
A. Agency Approval - If work is across departmental lines, or involves a separate or remote operation and the work is in addition to the regular departmental load, compensation above the base salary requires prior written agency approval. (Ref: OMB Circular A-21 Section J.8.d., Oct. 1991)
B. University Approval - The work must be approved in writing by the individual's primary department Chair, Dean or Director. The Statement of Work Memo should address, in detail, how the individual meets the above OMB Circular A-21 requirements. The compensation must be paid through the University’s payroll system either as an additional appointment, when this is appropriate, or as other pay.
The required approvals must accompany the time report form in order to process the request.
Faculty Other Compensation Procedure
Faculty Other Compensation Authorization Form
All NIH grants and cooperative agreements are subject to a legislatively mandated provision for the limitation of direct salary. Direct salary is exclusive of fringe benefits and facilities and administrative (F&A) expenses. In summary, the following reflects the time frames associated with the existing salary caps: (Please note that the cap is determined by the time within the fiscal year (FY) of the budget period. Please contact your DGCA Accountant for assistance in determining this date.)
Example for Calculating Summer Pay Rates
Federal FY2006 Awards (Executive Level I)
January 1, 2006 through September 30, 2006 $183,500 cap, $137,625 annual salary, $15,292 monthly
October 1, 2005 through December 31, 2005 $180,100 cap, $135,075 annual salary, $15,008 monthly
Federal FY2005 Awards (Executive Level I)
January 1, 2005 through September 30, 2005 $180,100 cap, $135,075 annual salary, $15,008 monthly
October 1, 2004 through December 31, 2004 $175,700 cap, $131,775 annual salary, $14,641 monthly
FY2004 Awards (Executive Level I)
January 1, 2004 through September 30, 2004 $175,700 cap, $131,775 annual salary, $14,641 monthly
October 1, 2003 through December 31, 2003 $171,900 cap, $128,925 annual salary, $14,325 monthly
FY2003 Awards (Executive Level I)
January 1, 2003 through September 30, 2003 $171,900 cap, $128,925 annual salary, $14,325 monthly
October 1, 2002 through December 31, 2002 $166,700 cap, $125,025 annual salary, $13,891 monthly
FY2002 Awards (Executive Level I)
January 1, 2002 through September 30, 2002 $166,700 cap, $125,025 annual salary, $13,891 monthly
October 1, 2001 through December 31, 2001 $161,200 cap, $120,900 annual salary, $13,433 monthly
FY2001 Awards (Executive Level I)
January 1, 2001 through September 30, 2001 $161,200 cap, $120,900 annual salary, $13,433 monthly
October 1, 2000 through December 31, 2000 $157,000 cap, $117,750 annual salary, $13,083 monthly
FY2000 Awards (Executive Level II)
January 1, 2000 through September 30, 2000 $141,300 cap, $105,975 annual salary, $11,775 monthly
October 1, 1999 through December 31, 1999 $136,700 cap, $102,525 annual salary, $11,392 monthly
FY1999 Awards (Executive Level III)
October 1, 1998 through December
31, 1999 $125,900 cap, $94,425 annual salary, $10,492 monthly
B. Distributed Throughout Project Life, Not at the End - Sponsors expect that goods and services will be consumed during the life of the project. Excessive expenditures late in the project period, as well as payments after the termination date raise questions of propriety as well as intent. Goods and services must be procured sufficiently before the termination to assure usage prior to the termination date.
C. Equitably Charged to Projects - Expenditures may be charged to projects on the basis of the relative benefits. For example, an equipment repair can be charged to a project only to the extent that the equipment is used on the project. If the equipment is used sixty percent of the time on a project, the repair of equipment charged to the project cannot exceed sixty percent of the cost.
A. A description of the equipment, including manufacturer, model, serial number, and Rutgers property tag number.
B. The name and signature of the person removing the equipment and the date it was removed. Please note: these employees and any assigned "caretaker" role are expected to take reasonable steps to safeguard any equipment removed from the premises.
C. Date equipment is to be returned. Property Management expects the equipment will be returned on or before this date unless notified otherwise.
Any other removal of equipment from the premises can be construed as theft of University property, therefore please document all removals.
A. FINDING: Consultant - There was no evidence of solicitation of quotations.
DISCUSSION: In accordance with the University policy, the project director is responsible for providing "...evidence that a selection process has been used to secure the most qualified individual available, considering the nature and extent of the services required." It is incumbent upon project directors to keep records on the individuals or organizations considered for these assignments. As a public institution, we are required to make attempts to reach out to a broad spectrum of qualified applicants who are capable of providing the required service and for keeping records on the selection process. (This agency also requires completion of THEIR FORM requesting approval to hire a consultant or subcontractor prior to engagement.)
B. FINDING: Consultant Travel and Telephone - The consultant travel and telephone expense was disallowed.
DISCUSSION: Project directors should make sure consultants or subcontractors understand that their expenses should be coming out of the fee negotiated-not in addition to it. This method reinforces independent contractor treatment rather than employee treatment, and avoids other potential problems.
C. FINDING: Commuting - Travel expense by a part-time employee for commuting was disallowed.
DISCUSSION: Commuting expense is not allowable for employees.
The changes in the Circular will effectively decrease the cost of grants and contracts to the Federal government. This will force colleges and universities to absorb more expenses because these previously allowable direct costs must be recovered as indirect costs. For Rutgers, the indirect cost rate has already been capped, making the costs unrecoverable. The impact is significant. Last year alone, Rutgers administrative and clerical salaries charged to grants and contracts exceeded $2.5 million.
The State of New Jersey applies Federal rules and regulations to its grants and contracts. Therefore these awards will be subject to the provisions of A-21. In addition, many non-Federal awards flow down from Federal sponsors. OMB Circular A-110 requires prime recipients of Federal awards to enforce Federal rules and regulations on their sub-recipients. As a result, indirect Federal awards are also subject to the provisions of A-21. Awards which are subject to the provisions of A-21 will be referred to as "applicable grants and contracts" in the following discussion.
Effective July 1, 1994, proposals for applicable grants and contracts as well as continuations or renewals, requiring sponsor budget approval, must conform to the revised A-21 provisions. By July 1, 1995 expenditures on applicable grants and contracts must conform to the revised A-21 provisions. Please read the discussion that follows for possible exceptions.
A. ADMINISTRATIVE AND CLERICAL STAFF: "Direct charging of these costs may be appropriate where a major project or activity explicitly budgets for administrative or clerical services and individuals involved can be specifically identified with the project or activity." The following examples have been provided by OMB to illustrate circumstances in which the direct charging of administrative or clerical staff may be appropriate.
Large, complex programs, such as General Clinical Research Centers, Primate Centers, Program Projects, environmental research centers, engineering research centers, and other grants and contracts that entail assembling and managing teams of investigators from a number of institutions.
Projects which involve extensive data accumulation, analysis and entry, surveying, tabulation, cataloging, searching literature, and reporting, such as epidemiological studies, clinical trials, and retrospective clinical record studies.
Projects that require making travel and meeting arrangements for large numbers of participants, such as conferences and seminars.
A project, whose principal focus is the preparation and production of manuals and large reports, books and monographs (excluding routine progress and technical reports).
Projects that are geographically inaccessible to normal departmental administrative services, such as seagoing research vessels, radio astronomy projects, and other research field sites that are remote from the campus.
Individual projects requiring project-specific database management; individualized graphics or manuscript preparation; human or animal protocol, IRB preparations and/or other project-specific regulatory protocols; and multiple project-related investigator coordination and communications.
NOTE: Unofficially OMB indicated that direct charging of clerical/ administrative salaries would be permissible when the level of effort is equal to at least fifteen percent of the employee's total effort. Effort below this level is viewed by OMB as normal departmental support which is an indirect cost.
B. TELEPHONE, POSTAGE, OFFICE SUPPLIES AND MEMBERSHIPS: Only costs specifically identifiable to a particular project may be directly charged to that project. The only telephone expenses which can be directly charged to grants and contracts are long distance costs which are itemized and include an explanation of the business purpose and reason for charging each grant or contract. Basic monthly phone charges cannot be charged to grants or contracts unless they meet the above criteria in "A".
Similarly, the costs for postage, office supplies and memberships must be specifically identified to the project and the rationale for charging each project must be provided.
C. PROCEDURE: For project directors who need to charge the costs in "A" or "B" to grants and contracts, make sure to detail the specific costs in the proposal budget at the time of application continuation or renewal, and document the connection between those costs and project purpose. These costs must be specifically included in the final award to be chargeable. They cannot be included by rebudgeting under the Institutional Prior Approval System (IPAS) after the award is in progress, but specific prior written approval may be obtained from the sponsor. NIH and NSF are an exception to the policy, however, appropriate justification must be submitted with the request to rebudget. This request is subject to disallowance by the assigned DGCA accountant. Click here for further information and full procedure regarding OMB Circular A-21 Section F.6.B. Expenses.
D. SUMMARY: This policy will be effective immediately for awards that are based on proposals submitted after July 1, 1994. Expenditures on applicable grants and contracts will be subject to this regulation by July 1, 1995, if not effected earlier. Administrative and clerical staff, telephone, postage, office supply and membership charges will be allowed if: the costs are explicitly budgeted; the charges can be identified with the project or activity; and the sponsor has included them in the final award or given specific written approval. Specific sponsor approval is not needed for administrative and clerical staff working on a major project or activity or qualifying as one of the five exemptions in "A" above.
Expenditures not meeting these criteria may not be charged to Federal, State and indirect Federal awards. (9/11/01)
Stipends may not compensate trainees for services performed. This would be considered taxable compensation, payable on an employee basis. Services may be compensated through the payroll system as other pay and paid on a time report form. Funding agencies do not have the authority to grant exceptions to this policy.
A. PROCEDURE: Trainees and fellows receive stipends on training grants
or fellowship awards only, not on research or other projects. Stipends
may be processed only one way: as type 9 payroll appointments. Trainees
must be appointed on Payroll Authorization Forms (PAF) using one of the
job classes below. Stipends may not be paid on billheads or time report
forms.
| Job Class |
|
Employee Type | Position Code* |
|
|
Graduate Fellow-Rem** |
|
|
|
|
Graduate Fellow-No Rem |
|
|
|
|
Fellow/Stipend-Rem** |
|
|
|
|
Fellow/Stipend-No Rem |
|
|
|
|
Post Doctoral Fellow(Non-Employee) |
|
|
* Position code determines subcode charged. 998 generates charges to subcode 8450; 997 generates charges to subcode 1220. Neither subcode is charged fringe benefits.
** Individuals with these job class codes will automatically receive tuition remission chargeable to the account(s) to which the stipends are charged. For individuals not entitled to tuition remission, use job classes/titles with "No Rem," which will result in the trainees or fellows being responsible personally for tuition and fees.
B. TAXABILITY: Stipends paid to trainees and fellows are taxable to the extent that they exceed qualified tuition and fees as provided in Section 117 of the Internal Revenue Code. Trainees and fellows are advised to check with their tax advisors concerning their tax liability.
These agencies do not permit the rebudgeting of funds from direct cost categories to indirect costs and vice-versa, effectively limiting rebudgeting, and increasing the importance of proposal budget categories.
For example: If a project director wished to transfer funds from supplies and the related indirect costs to equipment for the purchase of a $1,000 piece of equipment; previously, $629 could be transferred from supplies and $371 from indirect costs (59% of $629). Currently, the above agencies require $1,000 to be transferred from supplies. Effectively, this results in the total award being reduced by $590 because the savings in indirect costs is forfeited.
U.S. Department of Education and Environmental Protection Agency- Award Closeout:
On multi-year awards, the Department of Education is strictly enforcing a requirement to close each award annually and file the financial report within 90 days. In the event of unexpended funds at any year-end, the project director is responsible for requesting approval from the Department of Education Grants Officer to carryover funds to the next budget period. Failure to do so will result in loss of funds.
National Science Foundation:
Effective April 2001, all new and continuation National Science Foundation
(NSF) awards are subject to revised General Grant Conditions (GC-1).
(6/14/99)
Highlights are:
Project Directors may initiate no cost extensions up to twelve months (previously six months) using NSF Fastlane. NSF requires notification at least 45 days prior to the termination date. Any request not received on a timely basis or not containing the rationale for the extension will be required to provide additional information before fastlane will accept the request. Extensions may not be granted merely for the purpose of using available funds.
NSF will no longer routinely include a six month un funded flexibility period in their awards.
NSF will no longer routinely provide copies of grant award documents to Principal Investigators. The only copy of the award notice will be sent to the Office of Research and Sponsored Programs (ORSP), however copies of award notices are available on Fastlane.
Cost sharing requirements of NSF grants may not be met by cost sharing participation in other projects.
Public Health Service (PHS aka NIH):
The Public Health Service (PHS) must give prior written approval whenever the cumulative amount of transfers among direct cost categories for the current budget period will exceed 25 percent of the total amount awarded or $250,000, whichever is less. The request should be addressed to the PHS Grants Management Officer and countersigned by Ronald Thompson, Assistant Controller.
PHS is concerned about projects with accelerated expenditures, that is expenditures in advance of the award by virtue of their pre-approval through Rutgers IPAS system. Rutgers is required to notify PHS whenever expenditures exceed 25 percent of the estimated support for the next budget period. The agency has 30 days to question the expenditures. As a result, the DGCA will limit accelerated expenditures to 25 percent of the estimated award until approved by PHS.
Pursuant to the NIH Revitalization Act only American-made equipment may be purchased with NIH funds. This requirement is not influenced by factors of cost, convenience, or personal preference. The only acceptable explanation for the purchase of non-American-made equipment is that there is no American- made equivalent.
PHS will no longer provide Principal Investigators/Project Directors with copies of award notices. The only copy of the award notice will be sent to ORSP.
Below are the specifics of the ONR and AFOSR NCE policies which differ slightly.
Office of Naval Research: As of March 15, 1997, the Administrative Contracting Officers in the ONR regional offices can only approve NCEs if:
1. No previous extensions have been granted on the award;
2. The NCE does not exceed 90 days;
3. And no more than $50,000 of the obligated funds remain to be expended.
All other requests for NCEs must go to the ONR Program Officers, which have been rarely granting NCEs.
Air Force Office of Scientific Research: Per a letter dated March 21, 1997, NCEs will only be granted in rare instances. When they are approved, the NCE will not exceed three months except in special circumstances.
For both agencies, the penalty for failure to meet the target expenditure rate within the first twelve months of an appropriation is a potential double penalty. First, the proposed budget for any subsequent work is cut at the approval stage by the amount of the current year unexpended funds. Second, both agencies, as outlined above, are rarely granting NCEs which increases the risk of under spending the award before it is closed. As a result, if you fail to get a NCE, the current year unexpended funds are also lost.
An example will clarify how this works. Year One is awarded at $120,000. When Year Two (proposed at $150,000) is being evaluated and approved, the program manager looks at Year One’s progress. If the invoices, including advanced billings, only total $100,000, the program manager will deduct $20,000 from Year Two so that the maximum for Year Two will now be $130,000. If the program manager does not allow a NCE and the final costs for Year One are $110,000, then $10,000 of Year One’s costs would be lost.
There are several things that can be done to avoid this potential double penalty. First, to the extent possible, the spending rate must be increased. We can no longer assume that we have two years to do a one year project. Second, we must invoice more frequently, i.e. monthly versus quarterly. The DGCA has implemented this on all ONR and AFOSR awards. Third, if necessary and as allowed under the rules, we must invoice up to 90 days in advance for anticipated expenses. In order to invoice in advance, the DGCA needs your cooperation to estimate what your future expenses will be. Reasonable estimates for expenses anticipated over the next 90 days will be invoiced. And fourth, if due to internal processing problems at either agency, the program manager doesn't’t have all our invoices reflected on the their system, the DGCA, upon request from the PI, will fax the program manger all missing invoices.
If you have been contacted by the agencies or are concerned your funding may be in jeopardy, please contact the appropriate DGCA accountant. (6/14/99)
(1) PAYROLL FOR THE PERIOD: Regular appointment compensation during the six (6) months indicated and any salary reallocations processed during the period that effects the current fiscal year.
(2) PAYROLL LOCATION CODE: The current location where payroll checks are sent for the individual whose name is on the report. It is possible for the individual to have reflected on the report covered compensation at another location. If that is the case, please have the individual sign for his or her time. If the individual is no longer at your location or at Rutgers, please send the report back to the Division of Grant and Contract Accounting (DGCA) with this information noted.
AUTHORIZED SIGNATURE: The authorized signature can be the individual to the right of NAME in the upper left of the report or it can be any other responsible official who is knowledgeable about the work performed by the named individual. Subordinates of the named individual cannot sign for the named individual.
QUESTIONS: PACE report questions should be directed to the Division of Grant and Contract Accounting Office at extensions 1-732-932-0165 ext 2227.
Retroactive GA salary changes effective September 1 or February 1 require a reallocation of tuition charges, however, there is no automated system to assure this. Departments administering grants and contracts are responsible for contacting Maureen Cox in DGCA (extension 2-0165 x2219) to advise her of any retroactive salary change.
Similar to tuition charges, the cost of health insurance should be apportioned
between accounts on the same basis as fellowship charges. Because there is
no system to reallocate insurance charges retroactively to accounts charged
for stipends, administering units are responsible for contacting Maureen Cox
in DGCA
(extension 2-0165 x 2219) to advise her of changes.(4/18/06)
For FAQ
For Current Rates
DGCA is responsible for administering:
A. All research contracts, all governmental non-research contracts (except construction contracts).
B. All gifts and grants for research and/or research training.
C. General purpose and/or conference gifts and grants under the following conditions:
2. The funds are received after the event.
3. The funds are used to cost share or match other funds handled by DGCA.
General purpose and/or conference gifts and grants that do not meet the above criteria.
revised 10/2/02