Handbook of Operating Procedures > Series 300 Faculty and Academic Policies > 3.7.1 Grants, Contracts, and Sponsored Projects

3.7.1 Grants, Contracts, and Sponsored Projects

A. Purpose

The purpose of this policy is to provide procedures for assuring compliance with all federal policies that regulate the application for and expenditure of federal and other program sponsored funds as detailed in the Uniform Administrative Requirements (2 CFR Part 200 – Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards).

B. Persons Affected

This policy applies to all the University of Texas at Tyler (UT Tyler), including the University of Texas Health Science Center at Tyler, staff.

C. Definitions

1. Committed Effort – is the amount of effort proposed in a grant or other sponsored project application that is accepted by a sponsor, regardless of whether salary support is requested for the effort.
2. Cost Sharing – is the mandatory or voluntary commitment of institutional resources contained in the proposal or award. The concept of matching is synonymous with cost sharing.
   1. Mandatory Committed Cost Sharing – is required by the sponsor as a condition of the award and is included in the contract or grant proposal to receive consideration from the sponsor.
   2. Salary-cap Cost Sharing - results when an individual’s UT Tyler Institutional Base Salary exceeds a sponsor's salary cap. The prorated excess is a form of mandatory cost sharing that must be funded by an appropriate and allowable source.
   3. Voluntary Committed Cost Sharing – represents sharing costs of a sponsored project when it is not required by the sponsor but offered by the Principal Investigator subject to administrative approval in the proposal budget justification as a commitment to the project.
   4. Voluntary Uncommitted Cost Sharing – represents effort that may benefit a project but was not committed in the proposal or award.
   5. Cost Transfers – are transfers to or from a sponsored account of a charge that was previously recorded on another account or to another funding source.
3. Designated Responsible Party – is the person at UT Tyler that shall manage and be responsible for the effort reporting compliance program.
4. Effort – is the amount of time spent on any activity expressed as a percentage of total institutional activities for which an individual is compensated by UT Tyler. It is extremely important to understand that effort is not calculated on a 40-hour workweek or any other standard workweek. In addition, total effort must equal 100%.
5. Effort Certification – is a means of confirming that the effort supported or paid by the sponsor has been performed and effort expended in support of a project (but not paid by the sponsor) has been performed. Effort certification is based on total institutional activities including cost sharing. Payroll distributions and effort certification are not the same thing. Payroll distributions describe the allocation of an individual's salary, whereas effort certification describes the allocation of an individual's effort.
6. Fiscal Year – is from September 1st through August 31st.
7. Grant/Agreement– is any externally funded project with clearly stated deliverables, whether a grant, cooperative agreement, contract or other types of agreement.
8. Individual – is anyone who has paid effort and/or committed effort on a sponsored program.
   1. Primary Individual - is a person listed as principal investigator, project director, co-investigator, co-project director or those with comparable responsibilities on a sponsored project application. A primary individual typically, but not always, carries a faculty appointment.
   2. Supporting individual - is an employee other than a primary individual who has expended effort on a sponsored program. The supporting individual may or may not have been identified on the funded application and typically does not have committed effort greater than the amount paid on a specific sponsored program.
9. Institutional Base Salary (IBS) – is the total guaranteed compensation an individual receives from UT Tyler, whether the individual's time is spent on research, teaching, patient care or other activities. The IBS shall be used to compute salaries charged to sponsored programs unless sponsored policies further limit salary charges. IBS includes compensation for instruction, public services, research, and/or other activities. IBS excludes fringe benefit payments, reimbursed expenses, temporary, supplemental compensation for incidental work, income earned outside of duties to the institution and any portion of compensation deemed to be at-risk. IBS may or may not include additional payment for administrative duties per institutional policy.
   1. For research faculty and administrative staff - the institutional base salary is defined as total compensation in the annual letter of appointment or is in force based on subsequent approved salary adjustment and does not include any incentive payments. For clinical faculty the institutional base salary is defined as the guaranteed portion of compensation as set by UT Tyler, shown on the annual appointment letter, paid through payroll distribution and included in the effort reporting system. For all other staff the institutional base salary is the institutionally guaranteed base (excluding incentive compensation) salary in force at the time the grant is submitted. In no case can the institutional base salary stipulated in a grant budget exceed the salary cap designated by the sponsor. Any effort that is reimbursed at a lower level than the actual institutional base salary will be counted as salary-cap cost sharing and will be included in the monitoring and tracking process for UT Tyler cost sharing.
   2. UT Tyler is required - to retain all financial reports and supporting documents associated with the combined institutional base salary and resulting charges to NIH and other grants. This information is retained for periods of time as stipulated by the sponsors.
10. Sponsored Programs – involve a specific commitment of time and can be either: 1) externally funded activities in which a formal written agreement, such as a cooperative agreement, contract or grant is entered into by UT Tyler and by a sponsor for research, training, and other public service activities; 2) internally funded for which the activities are separately budgeted and accounted for by UT Tyler as a result of a formal application and approval process. For externally funded programs, the commitment of time can either be paid or unpaid by the sponsor (see Mandatory and Voluntary Committed Cost Sharing definitions.)  A sponsored program may be thought of as a transaction in which there is a specified statement of work with a related, reciprocal transfer of something of value.
11. Total Institutional Activities – are those activities for which an individual is paid by UT Tyler. They include such activities as administrative duties, instruction, patient care, institutional or public service, and research.

D. Policy

The University of Texas at Tyler (UT Tyler) is committed to the strict adherence to all federal policies that regulate the application for, and expenditure of federal and other program sponsored funds as detailed in the Uniform Guidance, 2 CFR Part 200.   This document outlines the responsibilities of employees, faculty, Principal Investigators and Research Administration staff in meeting these obligations. Each policy area is supported by procedures and monitoring activities.

E. Responsibilities

1. Responsible Official: The Senior Vice President for Research is the Institutional Administrative Officer with designated authority for all Sponsored Research Activities. The Office of Research, Scholarship and Sponsored Programs (ORSSP) is comprised of two (2) areas: Pre-Award Services and Post-Award Accounting. The Office of Pre-Award Services is the Institutional Administrative office responsible for proposal development and the Office of Post-Award Accounting has responsibility for grant administration.
2. Pre-Award Services:
   1. Provide administrative review and approval of proposals submitted for UT Tyler authorization.
   2. Responsible for contract negotiations, approval of proposed terms and conditions of federal grants and non-federal grants and pharmaceutical contracts in compliance with the U.T. System (UTS) Office of General Counsel requirements.
   3. Serve as the UT Tyler information source for and monitor compliance with applicable UT Tyler and funding agencies' policies.
   4. Serve as UT Tyler information resource center and liaison for external funding opportunities. Responsible for development and compliance of UT Tyler grant administration policies and procedures.
   5. Provides administrative guidance in preparing and negotiating of sponsored agreements or contracts. Authorizes budget requests in compliance with UT Tyler and funding agencies regulations.
3. Post-Award Accounting:
   1. Provides administrative monitoring and approval of grant expenditures.
   2. Responsible for income/expenditure requests from funding sources and submitting agency-required financial reports.
   3. Ensures compliance with UT Tyler, federal, state, and funding agency regulations.

F. Procedures

1. Education: The Office of Pre-Award Services will provide annual on-line training to all Primary Individuals and other faculty members, project directors and professional employees with committed effort on grants. The on-line training will also be provided to supporting individuals on a one-time basis as they begin work dedicated to a grant.
2. Approval of Proposals:
   1. External Funding – all proposals for external funding are to be submitted with a completed UT Tyler proposal transmittal form or notice of intent form to the appropriate Office of Pre-Award Services. Proposals will be reviewed and approved by the Director of ORSSP prior to final routing for further administrative action and signature.
   2. Institutional Signatures – The Director of ORSSP is the designated signature authority, except in those cases where the proposed grantor or institutional financial policy requires the signature of the President or his designee.
3. Certification of Proposals for Research and Other Sponsored Activities
   1. Certification by the Primary Individual, the Director of ORSSP, the Department Director/Chairperson, the Associate Vice President for Research Compliance / Research Compliance Officer and the Senior Vice President for Research assures that the proposal meets certain specified conditions including the appropriateness of proposed effort in relation to the already committed effort and reflects either prior approval or, if allowed by the granting agency, that just-in-time review before funding will be sought, for the following:
   2. Institutional Review Board (Human Subjects Investigation Committee) – Federal regulations make it imperative that this committee's reviews of human research be comprehensive. All human research conducted must be approved by this committee whether funding is required or not. The Director – Human Subjects Research Protection Program maintains records of disposition of submitted human subject protocols.
   3. Institutional Animal Care and Use Committee (IACUC) (Animal Research) – Federal Regulations and UT Tyler policies require that experimentation involving animals (warm/cold-blooded and vertebrates/invertebrates), must be covered by an approved current animal protocol.  These requirements apply to both funded and non-funded research.
   4. Institutional Biosafety Committee (IBC) – This committee reviews and approves recombinant DNA and experiments involving hazardous chemicals. Federal regulations and UT Tyler policies require approval by this committee when research involves the use of recombinant DNA or hazardous chemicals whether funding is required or not.
   5. Infectious Organism Research Review Committee (IORRC) – Federal regulations and UT Tyler policies require approval by this committee when research involves the use of infectious agents whether funding is required or not.
   6. Research Radiation Safety Committee (RRSC) – Federal and State regulations require all users and disposal of radioactive materials be licensed and approved by the Research Radiation Safety Committee.
   7. UT Tyler reserves the right to deny permission to submit any protocol or to accept any award that does not comply with  UT Tyler or sponsor policies; that does not serve the mission of the UT Tyler; that is submitted by a faculty member who is under notice of non-renewal of their annual contract; that involves inappropriate cost-sharing (voluntary or involuntary); that attracts indirect costs below the federally negotiated rate or that would put unreasonable or unsustainable demands on the infrastructure of the institution, UT Tyler.
4. Receipt of Notice of Award or Information as to Non-Funding
   1. If the proposal is funded, the Primary Individual or sponsor will send the original award letter to ORSSP. An Account Memorandum or Notice of Award report will be prepared which authorizes the Primary Individual to proceed in accordance with the professional and fiscal aspects of the award. At this time a review of effort commitments by all personnel listed on the award will be made by ORSSP. Any changes to committed effort that are necessary will be made (with approval of the grantor if required) and the appropriate Personnel Action Notice forms submitted before the account is set up.
   2. If the proposal will not be funded, ORSSP may request the Primary Individual send a copy of the sponsor correspondence, if not already available, indicating the unfunded status notification to ORSSP so that all pending files may reflect proper disposition.
5. Effort Reporting. Uniform Administrative Requirements requires that a federally sponsored project be charged only with costs applicable to that project.  Section 200.430 (eCFR :: 2 CFR 200.430 -- Compensation - personal services.)  requires that the payroll distribution system be incorporated into the official records of  UT Tyler, encompass all sponsored and other activities for which employees are compensated and may reflect categories of activities expressed as a percentage distribution of total activities with all effort totaling 100%. The accurate and timely completion of these reports is a requirement of employment and the responsibility of the individual employee and of the Principal Investigator of each grant. Non-compliance will result in disciplinary action and fraudulent certification may result in disciplinary action up to and including termination in addition to the possibility of criminal proceedings.
   1. Time and effort reports will be required for all employees who have committed effort on a sponsored project irrespective of whether they actually receive any portion of their salary from an extramural funding source. These effort reports will include ALL effort irrespective of the funding source. This includes effort committed to a project for which no salary is provided by the grantee (mandatory cost sharing), effort for administrative activities, effort for clinical activities, effort for clinical trials, and effort for teaching. The total effort in any given period is not based on any predefined number of hours but on the total effort expended on all UT Tyler related activities during that certification period. The maximum effort assigned to all external grants and projects for faculty will be limited to 90% unless otherwise approved by the Senior Vice President for Research. If an individual acquires extramural support of 90% or more, the Senior Vice President will be notified by ORSSP to confirm approval. On rare occasions, a Primary Individual may be appointed 100% on sponsored programs. The minimum effort on any project for which salary costs are reimbursed will be 1%. The only exception to this is in the case of clinical trials.  For industry sponsored clinical trials, effort will be charged to individual projects when the aggregate effort on multiple projects meets or exceeds 3%. The Executive Vice-President for Health Affairs, with assistance of, or delegation to the Medical Director, Center for Clinical Research, will review all active clinical trials and determine percent effort of each physician on clinical trials.   Effort review and allocation of clinical trials will be conducted on a semi-annually basis.  Reports will be submitted to ORSSP for inclusion, as cost share, on time and effort certifications for the physicians devoting time to clinical trials.
   2. UT Tyler groups total institutional activities on the effort certification form into two categories, sponsored programs and non-sponsored programs.
   3. The time and effort reports should be certified by the Primary Individual (Principal Investigator), Project Director or supervisor of each employee with reportable effort and should be a verifiable and reasonable estimate of actual work performed during the stated period. It is the responsibility of the individual employee to maintain appropriate supporting documentation; for example, lab notebooks, published papers, calendars, logs, clinical schedules, teaching schedules etc. The effort assigned to each grant by the employee should be reviewed and signed by the Primary Individuals of the grant. Effort certification will be completed at least quarterly.
   4. ORSSP has been designated the office of record for effort reporting. Effort reports will be distributed by ORSSP for certification via the time and effort system at least 30 days after quarter end.  Individuals are expected to complete the certification reports within 30 days of the notice to certify. After they are electronically signed, ORSSP will review and maintain the effort reports for audit and other purposes as needed.  ORSSP will track effort reports in excess of one month and advise the Dean or administrative head of the appropriate school and Senior Vice President for Research of those individuals who are out of compliance and will notify them of the need to promptly comply.  Failure to comply after notification may result in suspension of salary payment to the individual concerned from all sponsored accounts until the reports are submitted. Repeated tardiness will result in disciplinary action.
   5. The Senior Vice President for Research is the person with responsibility for assuring institutional compliance with all time and effort reporting requirements. To assist him in this responsibility, the Director of ORSSP and the Associate Vice President for Research Compliance / Research Compliance Officer will conduct monitoring of compliance with these rules in accordance with currently approved monitoring plans.
6. Cost-Sharing. Mandatory or voluntary committed or salary cap cost sharing that is contained in a funded sponsored program proposal becomes a binding commitment of UT Tyler upon either formal acceptance of the award document or expenditure of funds if no formal acceptance is required. This commitment creates the requirement for UT Tyler to identify, monitor and track all cost sharing.

1. UT Tyler strictly adheres to salary caps established by sponsors, validating monitoring and tracking the salary-cap cost sharing for compliance.
2. All mandatory and voluntary committed cost sharing contained in proposals are part of the review and approval process by the individual's supervisor. At the time of award acceptance, ORSSP will verify that cost sharing amounts are available, appropriate, are only used once and are not used against multiple Sponsored Programs and remain available and appropriate throughout the project period.
3. An annual report is provided to UT Tyler administration detailing cost sharing for the year. This report provides information necessary to reclassify cost sharing to the appropriate direct cost base in the facilities and administrative rate proposal.

7. Cost Transfers

Some cost transfers (the transfer to or from a sponsored account of a charge that was previously recorded elsewhere) are inevitable but frequent transfers are indicative of poor grant management. All transfers will be within 90 days of the original action and will be supported by appropriate documentation and the reason for the action. Cost transfers exceeding 90 days or 5% of the annual award must be approved by the Senior Vice President for Finance or equivalent. Cost transfers involving salary payments will not be made after effort certification for the period is completed unless the transfer benefits the sponsor. All transfers will be initiated by the Primary Individual and approved by Post-Award Accounting Services. Transfers between budget years will only be approved with the sponsor's explicit approval and no transfers will be made after the project final Financial Status Report has been submitted unless the transfer benefits the sponsor.

8. Monitoring Subcontracts

Research requires collaboration between individuals with different areas of expertise. Frequently this entails collaboration between individuals at different institutions by subaward or subcontract between the primary grantee (pass-through entity) and the subcontracting institution (subrecipient). To assure compliance with applicable federal and/or grantee policies, UT Tyler will require a signed assurance from an appropriate official at the subcontracting institution that they will abide by all applicable federal and grantee policies prior to the initiation of any subcontract.  Subcontracts will not be made with debarred entities, including Principal Investigators, which will be vetted by the Director of ORSSP.

Before any funds are transferred, the subcontracting institution will be required to submit a request for funds along with documentation to support the requested funds. The Primary Individual will also be required to submit a signed attestation that the goods or services or an appropriate portion thereof have been received and are satisfactory.

9. Ownership and Disposition of Equipment Purchased with Funds from Grants and Research

Ownership of equipment purchased with funds from grants to UT Tyler by agencies of the U.S. Government generally vests with UT Tyler. Under the provisions of the University of Texas Systems Standard Sponsored Research Agreement, ownership of equipment vests with The University of Texas system component (UTS), which is a party to the contract or grant.

10. Consulting Contracts

The consulting contracts information can be found under Contracts and Contracting Resources | University of Texas System (utsystem.edu) and at Texas Government Code, Sections 2254.021-2254.040 (GOVERNMENT CODE CHAPTER 2254. PROFESSIONAL AND CONSULTING SERVICES (texas.gov)).

G. Review

The Divisional Head for this policy is the Senior Vice President for Research and this policy shall be reviewed every five years or sooner, if necessary, by the following Stakeholders or their current equivalent:

1. Senior Vice President for Research
2. Associate Vice President for Research
3. Associate Vice President for Research Compliance
4. Clinical Research Medical Director
5. Director-Human Research Protections Program
6. Director-Office of Research, Scholarship and Sponsored Programs
7. Legal Counsel

H. Added, Amended, Reviewed On, and Next Review Dates

Added: 12/01/2002

Amended: 05/2011

Reviewed On: 06/2016

Reviewed On: 08/2019

Amended: 07/13/2021

Reviewed: 09/2021

Adopted HSC 6317899 and Amended: 04/25/2022

Amended: 10/2022

Next Review Date: Five years from the last review date or as needed