Michigan State University
Controller's Office
A sponsored project is an activity defined in scope and goal generally undertaken by University faculty, often with the involvement of students and staff, utilizing University facilities and equipment and conducted with financial and/or other valuable support from an external sponsoring entity. Sponsored projects may include basic and applied research, scholarly activity, training, instruction and instructional design, public service and other creative endeavors. Sponsored projects include work which the University conducts to uncover new and different trends or facts leading to discovery. Sponsored projects, specifically research projects, are an investigation aimed at discovery and interpretation of facts, revision of accepted theories in light of new facts, development of new analytical and experimental protocols, or practical applications of such new theories, analysis, data gathering and experiments.
The sponsoring entity typically expects an outcome that either directly benefits the sponsor or serves a charitable or public purpose. The sponsoring entity usually requires the University to report on how the funds or other project resources were used and what progress was made toward accomplishing the goals of the project.
MSU is committed to full disclosure and appropriate management of conflicting interests in all of its activities, including sponsored projects. Multiple laws, regulations, and policies govern conflicts of interest, including:
All University faculty and staff who are responsible for the design, conduct or reporting of a sponsored research project must disclose conflicting interests through the Research Administration System portal by completing an Annual Disclosure and a Project-specific Disclosure. For more information, contact the Faculty Conflict of Interest Officer.
Requests for support below $20,000 from private and corporate foundations do not require routing approval by CFR, however, CFR should be made aware that the request is being submitted. To facilitate the notification all Proposal Development documents with foundation sponsors are currently being routed to CFR.
As indicated in C.1.i. above, institutionally limited proposals need to be coordinated with the Office of the Vice President for Research and Graduate Studies and this includes funding opportunities sponsored by private and corporate foundations.
Refer to the OSP Proposal Development & Submission guidelines for additional information as well as the Proposal Deadline Policy for submission timeline requirements.
Neither Advanced Accounts nor Hardship Accounts may be established until a Proposal Development document has been processed and all required regulatory approvals have been secured.
Fee-for-Service activities in academic settings generally encompass service projects for which an external client requests a deliverable generated using known practical applications of standard procedures and established theories, methods and standard experiments using special or unique MSU research capabilities. The results of such work are of specific interest to the client and normally involve a set fee according to a published rate schedule routinely charged to all potential customers, off-the-shelf tools and established protocols. Fee-for-service work does not require original, creative, or scholarly analyses or non-standard interpretation of data sets by MSU faculty, staff or students engaged in the work. Work requiring those types of analyses will continue to be considered sponsored projects subject to the guidelines in Section 1.C above. Further information concerning fee-for-service activities can be found at OVPRGS.
The University makes a distinction between individual faculty and staff who might occasionally engage in fee-for-service work with a client and groups of faculty and/or technical staff that operate a fee-for-service entity who routinely engage in, or even actively solicit, fee-for-service work with external clients. The latter activity provides a means to offset the costs of maintaining those facilities or centers for the benefit of University research.
A FSAO has limited delegated signature authority (see II.B. 2 below) to engage in the fee-for-service activity as a self-directed operation. Of particular importance is that if a project satisfies the non-intervention criteria, the FSAO is authorized to act on its own to sign an agreement for the project with a client.
If there is no agreement submitted by the client, either in the form of a PO or executable document, accompanying a fee for service project and payment for the proposed project and there are no other compliance issues, as listed on the Fee-for-Service Activity Form, the FSAO is allowed to proceed as if a standard agreement was utilized.
A FSAO must consult with Business-CONNECT, General Counsel, or CGA when a project goes outside of these criteria. Further information concerning the proper use of signature authority including the appropriate use of the authorized amount for a project is available from Business-CONNECT or CGA.
Once the DY account(s) have been established, approved billing rates need to be on file.
Any questions concerning the incorporation of fee-for-service work into a thesis or dissertation should be directed to the Associate Provost for Graduate Studies and Dean of the Graduate School.
Further information concerning operational details, including the new accounting system for fee-for-service projects, is available at OVPRGS and at CGA.
A gift is a voluntary transfer of funds or property by a person or organization to Michigan State University without any valuable consideration or compensation to the donor.
Depending on the case, it may be difficult to distinguish a gift from support for a sponsored project. See Section IX for additional guidance concerning the differences, including indicators of the two types of awards to help in classifying a questionable transaction. If after a review of definitions, the intent and expectations of the funding source, and the nature of the funding agreement there remains a question about the type of award, the question should be addressed with the appropriate dean or designated associate dean, who will, if necessary, consult with the Vice President for Research and Graduate Studies (VPRGS), the Vice President for University Advancement, and other University offices to make a final determination.
The Internal Revenue Service requires Form 8282 to be completed when the donated property over $500 has been sold, exchanged, consumed or disposed of within two years after the date the original donee received the property. The MSU Foundation must be notified of any disposition of noncash gifts within the first two years so that they may prepare the proper notification. NOTE: The donor receives a copy of this form. If the selling/disposal price is much lower than the gift value, the donor's charitable gift value could be challenged.
All University gifts, grants or contracts must be accepted by the Board of Trustees. The Office of Sponsored Programs will coordinate the preparation of the acceptance recommendation, which is presented to the Board by the VPRGS.
Expenditures of funds must be made in accordance with the more restrictive of University or Sponsor policies.
MSU Business-CONNECT serves the MSU community by assisting in building alliances between the University and industry. Part of its role is to ensure that MSU’s alliances with industry comply with University policies and with state and Federal laws. In that capacity it serves as a liaison between industry and faculty to insure that support coming to the University is properly categorized according to the policies of MSU.
If it is not clear whether a company supported project is a sponsored project - which may include research and scholarly activity, training, instruction and instructional design - or fee-for-service, request Business-CONNECT to preview the Statement of Work before cost is estimated, any draft budget is shared with a company, or the Proposal Development document is routed.
The following guidelines may help MSU investigators to understand how Business-CONNECT reviews Statements of Work associated with a proposed fee-for-service work.
Definitions: The following definitions have been accepted by many companies and universities, including MSU
“Research and Scholarship Projects, Other Sponsored Project Activities” is work which the University conducts to uncover new and different trends or facts leading to a discovery. The pathway to discovery and the creativity of new ideas is in the hands of a principal investigator and other University employees and usually starts as a proposal which outlines a promising area of inquiry. Such work is an investigation aimed at the discovery and interpretation of facts, revision of accepted theories in light of new facts, development of new analytical and experimental protocols, or practical applications of such new theories, analysis, data gathering and experiments.
“Fee-for-Service Project” is work where the deliverable requested is generated using known practical applications of standard procedures and established theories, methods and standard experiments. Another form of fee-for-service is work for which the company provides a detailed protocol for the project, which must be performed as received by the university. The results of such work are of specific interest to the sponsor and may involve off-the-shelf tools and established protocols. Fee-for-service projects do not include novel analyses or interpretation of data sets, and the deliverables are limited to the results generated using the standard procedures, established theories, methods and experiments utilized in the performance of the work.
Rules of Thumb: Business-CONNECT may ask the following questions when reviewing a Statement of Work.
Question | If "yes", this is probably |
---|---|
Is MSU executing a protocol (statement of work) that was created primarily by the company, and is MSU expected to follow that protocol without variation? | Fee-for-Service, except Clinical Trials |
Is the work restricted to the performance of previously published methods that are routinely executed by MSU and/or to methods prepared by the company and for which standardized pricing is typically appropriate? | Fee-for-Service |
Will the investigator develop any new methods to generate data for the project? | Research, Scholarship/Sponsored Project |
Is the work testing a hypothesis generated by an MSU investigator? | Research, Scholarship/Sponsored Project |
Will the investigator analyze the data generated and draw conclusions from those data that will not be used in research but will be used for outreach or extension projects or reports used for such purposes? | Fee-for-Service |
Will the investigator use the data generated to recommend additional studies or “next steps?” | Research, Scholarship/Sponsored Project |
Note: This form is available on the VPRGS website.
If a fee-for-service agreement with a client does not require Business-CONNECT, General Counsel, Regulatory Affairs, or CGA intervention (for example, the need for purchase orders, a formal agreement that differs from the Standard MSU Agreement shown below, or the special compliance situations described in Section I.C.2.c, d, e, f, and g above), an established Fee-for-Service Activities Officer that is authorized by the VPRGS to do so can act on its own to approve fee-for-service projects.
The person who has been given delegated signature authority in the FSAO can sign the Standard Services Agreement provided that the dollar amount of the project is less than an authorized amount, currently $5,000 (see OVPRGS for further details).
Note that in certain cases, the University may employ Fee-for-Service contractual arrangements other than those listed above as approved by VPRGS and MSU General Counsel. A FSAO must engage with Business-CONNECT and General Counsel for all matters for which it does not have authority.
MICHIGAN STATE UNIVERSITY | {COMPANY} |
---|---|
By:_____________________________ | By:__________________________ |
Date:__________________________ | Date:________________________ |
Put in the Who, What, Where, When, How
Then put in the How much.
Michigan State University receives monetary support from a variety of initiatives, donors, and sponsors. When the question “Is this a sponsored project or a gift?” arises, the table below may be helpful. Its various elements fall on a continuum. Placement near one side or the other, together with an understanding of the intent of the source of funds and agreement’s terms, should help to classify a questionable award.
If the source of the funds is a government agency, the funds are NOT a gift and may NOT be treated as such. Note that most private and corporation foundations refer to their funding as “grants,” so use of the word is not determinative in and of itself. The following factors are not determining factors as to whether funds are a gift or support for a sponsored project:
The following factor is an indicator of a sponsored project, but not by itself a determining factor for defining funds as a sponsored project:
The following table indicates typical features of gifts versus sponsored projects.
Gifts | Sponsored Project |
---|---|
Items of value given to the University by a donor without a requirement for something of value in return, other than recognition. | Funding for a project provided by an external sponsor that typically has defined expectations for activities (whether research, scholarly activity, training, instruction and instructional design, etc.) |
Funding does not originate from a government agency. | Funding may originate from government agencies, as well as from corporations, associations, and foundations. |
Funding for a general or specific purpose, within a general area of work. | Funding based on a specific statement of work as stipulated in the agreement conveying the award. The sponsor may also predetermine it. |
Deliverables typically limited to (at most) reports as noted below, plus use of funds as generally requested and awarded. | Deliverables defined by agreement, e.g., reports, results, IP rights, services, training, equipment prototypes, specific start and end dates, etc. |
Pre-approval of expenditures not required unless a change in circumstances requires the University to revisit the purpose of the gift with the donor. | Certain expenditures may require prior approval by the sponsor. |
No requirement for return of unexpended funds. | Funder may (or may not) require that unexpended funds be returned if funds are not approved to be carried forward to extend the project. |
No technical reports required. Non-technical reports are recommended as a courtesy. | May require technical, quarterly or annual progress reports, and detailed financial reports. May also include right of sponsor to audit project. |
No restriction on publication rights. Acknowledgement of donor support in publication is recommended as a courtesy. | Sponsor requires or restricts acknowledgement of support in publications. May request/require minor publication delays. |
Some of the material developed for Exhibit 315-C resulted from the review and use of similar policies at other research institutions. Material was used with permission.