The purchase of goods and services for a sponsored award, which includes consultants and equipment, must comply with the overall intent of the award, the specific detail of the sponsor’s regulations, and policies and procedures of the University. It is the responsibility of the Principal Investigator to initiate the purchase of all goods and services charged to a sponsored project. Upon occasion, the Principal Investigator may delegate portions of the purchasing function to a departmental administrator or support staff.
For goods and services that require competition in accordance with the thresholds established by USM policies, the PI or delegated departmental administrator or support staff should contact the Department of Procurement and Strategic Sourcing as soon as possible. This will ensure that the appropriate method of competition is utilized as well as enable timely receipt of the items or service.
It is the responsibility of the Principal Investigator to approve only those expenditures that are appropriate for an award, as well as to monitor the allowability of all expenditures actually charged against a particular award. It is imperative that the Principal Investigator knows what costs are allowable according to the regulations, restrictions, terms, and conditions associated with every award.
All persons involved in the procurement of goods and services on a sponsored project are responsible for ensuring that expenditures are adequately documented. Since the University regularly participates in both internal and external audits, the PI must be able to demonstrate through documentation the manner in which a specific expenditure directly benefited a particular project.
Most departments have a designated employee—usually an accounting associate, departmental administrator, or shared service center—who handles purchasing for the unit. The Principal Investigator should work with this individual when performing procurement activities on a sponsored project. Information about the procurement process can be found on the Department of Procurement and Strategic Sourcing website.
In some cases, a sponsored project may require the use of one or more consultants. A consultant is an individual who is not employed by the University but whose expertise is required by the Principal Investigator to perform the work of the project. Since sponsors may set limitations on allowable payment rates for consultants, the PI must carefully review the award for this information. Care should be taken that this is an approved expense for the particular project. Employees of the University of Maryland Baltimore County may not receive compensation for consulting with their colleagues within the University. (See also UMBC Policy on Conflict of Interest and Profession Commitment of Faculty). As consultants are performing necessary work for the project, it is important to establish a written contract prior to the performance of any work to clearly document the period of performance, the services to be performed, the rate of pay and total value of services, as well as any other critical aspects of the arrangement, such as travel or cost of supplies, agreed to by the University and the consultant.
To receive payment a consultant must submit an invoice in accordance with the contract to the PI that details the following:
- Name and Address
- Tax ID number (TIN) or Social Security Number (SSN) if the consultant does not have TIN
- Rate of pay and Total amount owed
- Performance period
- Description of Services provided.
Equipment is defined as an article of nonexpendable, tangible personal property having a useful life of more than one year and an acquisition cost equal or greater than $5,000. In addition, these costs must be excluded when calculating the Modified Total Direct Costs (MTDC) to determine the overall project’s F&A costs.
The sponsoring agency’s award may include provision for the acquisition of special-purpose equipment. The equipment in some cases may be supplied directly by the sponsoring agency, in which case title to the equipment generally remains with the agency, and it must be returned at the completion of the project. In the majority of cases, the approved equipment is purchased through the University. The Principal Investigator has the responsibility for:
- Assuring first that the equipment is not already available within the Campus;
- Determining the proper specifications and issuing the requisition for the equipment; and
- Assuring proper receipt, inventory identification, and functioning of the equipment prior to authorizing vendor payments by the
It should be noted that any equipment that is to be purchased which has not been specifically approved in the award notification may require prior authorized written approval by an agency official. Such requests by Principal Investigators, stating the need for the equipment and the source of funds (additional funds or budget reallocation), must be submitted to OSP for institutional endorsement. Because there may be restrictions placed on equipment received or purchased on a sponsored project, disposition must be coordinated through OSP. Contact your Contract Administrator for assistance in acquiring authorization for special-purpose equipment.
Nearly all grant agreements stipulate that title to equipment purchased with grant funds vests with the University upon acquisition. In most cases, the government retains certain rights to the equipment such as the right to direct disposition of the equipment at the end of the project, or the right to have the equipment transferred to another institution when the PI leaves the University.
Most contracts similarly stipulate that title vests with the University. However, every contract has the potential to contain specific language about title to equipment, and the contract language must be reviewed by OSP.
Normally, non-Federal grants and contracts also stipulate that title to equipment purchased with project funds vests with the University upon acquisition. Similar to Federally-funded equipment, in some cases, the sponsor may retain certain rights to the equipment such as the right to direct disposition of the equipment at the end of the project or the right to have the equipment transferred to another institution when the Principal Investigator leaves the University. In some cases, the award language states that title to the equipment vests with the sponsor until the end of the project, and then transfers automatically to the University.
UMBC is responsible for the security and protection of all equipment in its possession. All Federally-funded grants and contracts contain provisions requiring the University to properly care for and manage all government- owned equipment. This includes both equipment purchased with grant or contract funds, as well as equipment provided by the government to the University for use on the sponsored project. Equipment purchased with Federal funds, whether Federally-titled or University-titled, must follow Federal regulations that outline the requirements for property control and reporting:
- Uniform Guidance
- Federal Acquisition Regulation (FAR) Part 45
- Defense Federal Acquisition Regulations (DFAR).
In order to satisfy these regulations and accomplish effective equipment management, it is essential that all equipment-related tasks be carried out in an environment characterized by cooperation and shared effort. At UMBC, responsibility for equipment management rests collectively with:
- Principal Investigators
- Departmental property custodians
- Inventory Control.
Additional information on equipment/property management can be found on the Plant Accounting website.
The acquisition of computing devices and peripherals are allowable as a direct charge if essential and allocable, but not solely dedicated. The PI/department is responsible for determining “essential and allocable”. Documentation should be maintained that describes how the computing device meets these requirements.