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Cost and Expenditure Policies

Cost Policy

Costs on sponsored awards for educational institutions are determined allowable based on federal regulations such as the 2 CFR Part 200; Federal Acquisition Regulations (FAR); University of Oregon (UO) and State policies and procedures; UO’s accepted Cost Accounting Standards (CAS); the awarding entity’s granting policies; and specific terms and conditions of an award.

State Laws and Regulations:

  • Oregon Revised Statutes and Oregon Administrative Rules. As a public, non-profit institution and State of Oregon agency, the UO cannot use State instructional funds for other purposes.

  • The Oregon State Board of Higher Education Policies and Administrative Rules. Policy 6.100 requires that institutions seek reimbursement for all direct and full facilities and administrative or F&A costs (formerly called indirect costs) associated with every grant and contract and that budgets include all recoverable direct costs and F&A costs at the full rate allowed.

Federal Laws and Regulations:

  • OMB 2 CFR Part 200. The UO is subject to the cost principles and methods under OMB 2 CFR Part 200, which requires that costs must be allocable to a sponsored agreement. A cost is allocable to a particular sponsored project if the goods or services involved are chargeable or assignable to the project in accordance with the relative benefits received. As a recipient of federal funds, the UO must follow policies and regulations that govern compensation for employees, including additional compensation for outside consulting.

  • Cost Accounting Standards (CAS). The UO is subject to CAS, which emphasize the importance of consistent application of cost accounting principles. Costs incurred for the same purpose in like circumstances must be treated consistently as either direct or indirect costs. Where the UO treats a particular type of cost as a direct cost on sponsored agreements, all costs incurred for the same purpose in like circumstances must be treated as direct costs for all activities of the institution.

  • Audits. Under 2 CFR Part 200: Audits of States, Local Governments and Non-profit Organizations, the UO must undergo external audits each year to ensure that the institution maintains internal controls over grant and contract funds and is in compliance with applicable federal, state, institution and award regulations. Auditors closely examine transfers between accounts, of both salary and non-salary costs, especially transfers involving budgets in a deficit condition or those having unexpended funds at the expiration date. Under 2 CFR Part 200, allocable costs cannot be transferred to another sponsored project to avoid restrictions imposed by law or by terms of the sponsored agreement. If such conditions exist, it is particularly essential to provide convincing evidence that the transfer is not for reasons of budgetary convenience.

  • Activity Reporting. Under 2 CFR Part 200, institutions receiving federal support must maintain supporting documentation of salaries and wages charged, directly or indirectly, to federally-sponsored agreements. The activity reporting system is used to meet this purpose, as well as to serve as documentation of cost sharing effort on grants and contracts. Certified by the principal investigator (PI) on a regular basis, a report must reflect that the salaries and wages charged to activities supported by federal funds are reasonably consistent with actual effort in those activities. The report applies to all professional (academic ranks including graduate research assistant), classified and student employees whose salary or wage is charged directly, in part or in whole, to federal grants and contracts, or is charged to state-fund accounts or non-federal grants and claimed by the UO as cost sharing.

Links to Reference Materials:

2 CFR Part 200

FAR (Federal Acquisition Regulation)

UO Cost Accounting Disclosure Statement-July 31, 2007 (Required for educational institutions that receive aggregate sponsored agreements totaling $25 million or more within their recent fiscal year.)
UO Institutional Information

2 CFR Part 200 establishes principles for determining costs which are:
  • Reasonable-defined as the action that a prudent person would take under the circumstances, and determined by 2 CFR Part 200, section C.3.

  • Allocable-a cost is allocable to a particular cost objective if the goods or services involved are chargeable or assignable to such cost objective in accordance with relative benefits received or other equitable relationship, and under the principles and methods described in OMB 2 CFR Part 200, section C.4.

  • Consistently Treated-costs must be given consistent treatment through application of Generally Accepted Accounting Principles (GAAP) appropriate to the circumstances as dictated by Cost Accounting Standards (CAS).

  • Conform-costs must conform to any limitations or exclusions set forth in 2 CFR Part 200, or in the sponsored agreement as to types or amounts of cost items.
The Federal Cost Accounting Standards impose on the UO general consistency in our costing practices and some of those practices are delineated below:

Selected items of direct cost to individual grants

Advertising costs (2 CFR Part 200, 200.421): Advertising in various media such as magazines, newspapers, professional journals, direct mail, exhibits, electronic media etc. for the purpose of:
  1. The recruitment of personnel required for the performance of the sponsored agreement;

  2. The procurement of goods and services for the performance of a sponsored agreement;

  3. Other specific purposes necessary to meet the requirements of the sponsored agreement; are allowable (use account code 24611).

Advertising for the purpose of public or community relations specifically required by the sponsored agreement or costs of communicating with the public and press pertaining to specific activities or accomplishments which result from performance of sponsored agreements are allowable public relations costs (use account code 24612).

Advertising for the general purpose of public or community relations and those activities dedicated to maintaining the image of the institution or maintaining or promoting understanding and favorable relations with the community or public at large or any segment of the public are unallowable.

Alcoholic beverages (2 CFR Part 200, 200.423): Costs of alcoholic beverages are unallowable.

Alumni Activities (2 CFR Part 200, 200.424): Costs for alumni activities are unallowable.

Building alterations:

Communication Costs (2 CFR Part 200, 200.439): (guidance removed from 2 CFR 200 will continue to follow A-21,J.9) are generally allowable as follows:
  1. FAX minor equipment, line connection charges and supplies are allowable provided they are necessary for the specific needs of a particular sponsored agreement, (use account code 20200 for FAX machines; use account code 22002 for line charges).

  2. Postage charges are allowable for projects that have regular need for such services (use account code 22502).

  3. Telephone charges:
  1. Costs incurred for telephone instruments (lease or purchase) will generally not be charged to grants except where the sponsored agreement is operating at an office campus location and regular campus telephone services are unavailable (use account code 22010). In general these costs are considered indirect costs per 2 CFR Part 200 section F.6.b.(3).

  2. Costs incurred for long distance telephone services are allowable provided the unit has maintained a log or other suitable means of documenting the person placing the call, and a conformation that the call is allowable to a specific sponsored agreement (use account code 22011).

  3. Cost for pagers and cell phones are allowable if the grant’s activities are of such a nature that for safety or project performance reasons such devices are essential for to conduct the sponsored agreement’s work. The unit must document need by specifically describing the purpose for which the device will be used, (use account code 22013).
Compensation for Personal Services (2 CFR Part 200, 200.430):

  1. General. Compensation for personal services covers all amounts paid currently or accrued by the institution for services of employees rendered during the period of performance under sponsored agreements. Such amounts include salaries, wages, and fringe benefits. These costs are allowable to the extent that the total compensation to individual employees conforms to UO established policies and provided that the charges for work performed directly on sponsored agreements are supported by a prescribed activity documentation either through the Activity Reporting System (ARS), a time, or hourly payroll card document.

  2. Salary rates for faculty members:

    1. Salary rates for academic year. Charges for work performed on grant by a faculty members during the academic year are allowable and will be based on the faculty member's regular compensation for the academic year (use account code 10102). Charges for work on grants during all or any portion of the academic year are allowable at the base salary rate.

    2. Faculty performing work on grants managed in other academic or administrative units are assumed to be under taking such work as a university obligation requiring no compensation in addition to full-time salary. However, in unusual cases where the work is across departmental lines or involves a separate or remote operation, and the work performed by the faculty member is in addition to his/her regular departmental load, any charges for such work representing extra compensation above the base salary are allowable provided that such work arrangements are specifically provided for in the agreement or approved in writing by the sponsoring agency (use account code 10202).

    3. Periods outside the academic year. Charges for work performed by faculty on sponsored agreements during the summer will be determined for each faculty member at a rate not in excess of the base salary divided by the period to which the base salary relates (use account code 10204).

    4. Part-time faculty. Charges for work performed on grants by faculty members having only part-time appointments will be determined at a rate not in excess of that regularly paid for the part-time assignments (use account code 10102).

  3. Fringe benefits in the form of regular compensation paid to employees during periods of authorized absences from the job, such as vacation, sick, or military leave taken by an employee is allowable to the sponsored agreement, provided such costs are distributed to all institutional activities in proportion to the relative amount of time or effort actually devoted by the employee at the time the leave is taken.

  4. Classified personnel compensation:

    1. Compensation for technical support staff is allowable if approved by the sponsoring agency, and would be at their regular rate of pay (use account code 10301).

    2. Compensation for administrative and clerical staff is limited to those sponsored agreements that contained administrative and clerical personnel in the original application which was funded, or those grants that have received subsequent approval for classified managerial and clerical personnel (use account code 10301).

    3. Overtime pay charged to grants must be proportioned to all base pay funding sources during the period of the overtime earnings (use account code 10421).

    In general, compensation for administrative and clerical staff should normally be treated as F&A costs, unless the section number 2 above is met (2 CFR Part 200).

  5. Graduate and undergraduate student compensation: May be charged at the regular rates for such personnel.

Entertainment Costs (2 CFR Part 200, 200.438): Costs of entertainment, including amusement, diversion, and social activities and any costs directly associated with such costs (such as tickets to shows or sports events, meals, lodging, rentals, transportation, and gratuities) are unallowable. However, hosting groups, guests and meals/expenditures for hosting official guests can be directly charged to sponsored project funds when hosting a speaker or other activity is appropriate to the award per 2 CFR Part 200.

Equipment and other capital expenditures (2 CFR Part 200, 200.439): (1)"Equipment" means any property having a useful life of more than one year and an acquisition cost which equals or exceeds $5000.

Fines and penalties (2 CFR Part 200, 200.441): Costs resulting from violations of, or failure to comply with, Federal, State, and local or foreign laws and regulations are unallowable. These include parking tickets, library fines, late fees etc.

Losses on other grants (2 CFR Part 200, 200.451): Any excess of costs over income under any other sponsored project of any nature is unallowable.

Maintenance and repair costs (2 CFR Part 200, 200.452): Costs incurred for necessary maintenance, repair or upkeep of property (including Federal property unless otherwise provided for) which neither add to the permanent value of the property nor appreciably prolong its intended life but keep it in an efficient operating condition, are allowable. Costs incurred for improvements which add to the permanent value of the buildings or equipment or appreciably prolong their intended life shall be treated as capital expenditures.

Maintenance agreements are limited to the duration of period of the sponsored award or to the minimum length while providing equipment coverage during the life of the award. Example: a grant has 16 months remaining during the project period and an equipment maintenance agreement for equipment used specifically for the grant can be purchased for 12, 24, or 36 months. The cost of the maintenance agreement either for 12 or 24 months are allowable. If the equipment is being used for a number of grants and departmental instructional use the cost of the maintenance agreement should be allocated based on proportional use.

Memberships, subscriptions and professional activity costs (2 CFR Part 200, 200.454):

  1. Costs of membership in business, technical, and professional organizations are unallowable as a direct cost to a sponsored agreement.

  2. Exceptions exist where the membership provides a professional journal or access to data necessary for the conduct of the sponsored agreement, and there is no provision for an institutional membership that could otherwise provide access to the publication or material.
    The principal investigator should prepare an explanation of the need for the membership, journal, or other material, and the benefit to the sponsored award.

  3. of meetings and conferences of grant personnel, when the primary purpose is the dissemination of technical information produced by the grant or directly benefiting the grant objectives, are allowable. This includes costs of meals, transportation, rental of facilities, membership in the organization, if membership is required for attendance, and other items incidental such meetings or conferences. Please note that meeting and conference costs are different than entertainment costs, which are unallowable as stated in 2 CFR Part 200.

  4. Costs of membership in any civic or community organization, country club or social or dining club or organization are unallowable.

Pre-Award costs (2 CFR Part 200, 200.458): Costs incurred prior to the effective date of a grant, whether or not they would have been allowable if incurred after such date, are unallowable unless approved by the sponsoring agency.

Prepaid services:. Prepayment of services are limited to those expenses that meet the test of reasonable, necessary and used for the benefit of the grant during the grant period. They are allowable provided that audit records are maintained to document the use of the materials or services in support of the grant. Pre-paid services such as prepaid telephone, copy, and merchandise cards are generally unallowable due to the fact that there are limited controls on their use, pose special problems for determining official versus personal use, and they typically do not have a refund capability for unused cash value. Under special circumstances and with the prior approval of SPS, special procedures may be established that would provide appropriate documentation for their use.

Proposal costs (2 CFR Part 200, 200.460): Proposal costs are the costs of preparing bids or proposals for potential federal and non-federal sponsored agreements, including the development of data necessary to support the institution's bids or proposals. Proposal costs include the personnel time, materials, and services used in the preparation of the proposal or application. Such cost are allowable as a direct grant cost only for those proposals necessary to continue an existing grant through the next budget period or non-competitive segment.

Proposal costs for new applications or competitive renewals are not an allowable grant direct cost for any new competitive grant and should be charged to departmental funds, this includes the cost of the personnel time reproductions etc.

Proposal costs associated with a new or competitive grant application or a competitive renewal are an unallowable cost to an existing grant UNLESS the grant to which the proposal expenses are charged specifically authorizes such cost.

Publication and printing costs (2 CFR Part 200, 200.461): Publication costs include the costs of printing, distribution, promotion, mailing, and general handling. Publication costs also include page charges in professional publications.

If these costs are not identifiable with a particular cost objective, they should be allocated as indirect costs to all benefiting activities of the institution.

Rearrangement and reconversion costs (2 CFR Part 200, 200.462): Costs incurred for ordinary or normal rearrangement and alteration of facilities are allowable. Special arrangement and alteration costs incurred specifically for the project are allowable if not prohibited or restricted by the sponsoring agency.

Where an agency places restrictions on the use of their funds for such purposes, contact the SPS SPA for assistance.

Recruiting costs (2 CFR Part 200, 200.463): Staff recruitment costs such as "help wanted" advertising, costs of operating an aptitude and educational testing program, travel costs of employees while engaged in recruiting personnel, travel costs of applicants for interviews for prospective employment, and relocation costs incurred incident to recruitment of new employees, are allowable to the extent that such costs are incurred pursuant to a well-managed recruitment program and are consistent with standard UO practice. Recruiting costs, for positions that have multiple sources of funding, should be allocated in proportion to the positions source of funding.

Where relocation costs were paid for the recruitment of a new employee and have been allowed either as an allocable direct or F"A cost, and the newly hired employee resigns for reasons within his/her control within 12 months after hire, the institution will be required to refund or credit such relocation costs to the Federal Government.

Rental cost of buildings and equipment (2 CFR Part 200, 200.456):
  1. Rental costs of buildings or equipment are allowable to the extent that the decision to rent or lease is reasonable in accordance with Section C.3. Rental arrangements should be reviewed periodically to determine if circumstances have changed and other options are available.

  2. Rental costs under "sale and lease back" arrangements are allowable only up to the amount that would be allowed if the institution continued to own the property.

  3. Rental costs under "less-than-arms-length" leases are allowable only up to the amount that would be allowed if the institution owned the property. For this purpose, a less-than-arms-length lease is one under which one party to the lease agreement is able to control or substantially influence the actions of the other.

  4. Where significant rental costs are incurred under leases which create a material equity in the leased property, they are allowable only up to the amount that would be allowed if the institution purchased the property on the date the lease agreement was executed. For this purpose, a material equity in the property exists when the lease:

    1. Is noncancelable or is cancelable only upon the occurrence of some remote contingency, and

    2. Has one or more of the following characteristics:

      1. Title to the property passes to the institution at some time during or after the lease period.

      2. The term of the lease corresponds substantially to the estimated useful life of the property (i.e., the period of economic usefulness to the legal owner of the property).

      3. The initial term is less than the useful life of the property and the institution has the option to renew the lease for the remaining useful life at substantially less than fair rental value.

      4. The property was acquired by the leaser to meet the special needs of the institution and will probably be usable only for that purpose and only by the institution.

      5. The institution has the right, during or at the expiration of the lease, to purchase the property at a price which at the inception of the lease appears to be substantially less than the probable fair market value at the time it is permitted to purchase the property (commonly called a lease with a bargain purchase option), except for any discount normally given to educational institutions.

Royalties and other costs for use of patents (TBA): Royalties on a patent or amortization of the cost of acquiring a patent or invention or rights thereto, necessary for the proper performance of the sponsored agreement and applicable to tasks or processes there under, are allowable unless the Federal Government has a license or the right to free use of the patent, the patent has been adjudicated to be invalid or has been administratively determined to be invalid, the patent is considered to be unenforceable, or the patent has expired.

Sabbatical leave costs (TBA): Costs of leave of absence by employees for performance of graduate work or sabbatical study, travel, or research are allowable provided the institution has a uniform policy on sabbatical leave for persons engaged in instruction and persons engaged in research. University of Oregon policy may be found in Chapter IV of the Faculty Handbook. Such costs will be allocated on an equitable basis among all related activities of the institution. Where sabbatical leave is included in fringe benefits for which a cost is determined for assessment as a direct charge, the aggregate amount of such assessments applicable to all work of the institution during the base period must be reasonable in relation to the institution's actual experience under its sabbatical leave policy.

Scholarships and student aid costs (2 CFR Part 200, 200.466):

  1. Costs of scholarships, fellowships, and other programs of student aid are allowable only when the purpose of the sponsored agreement is to provide training to selected participants and the charge is approved by the sponsoring agency. However, tuition remission and other forms of compensation paid as, or in lieu of, wages to students performing necessary work are allowable provided that (1) there is a bona fide employer-employee relationship between the student and the institution for the work performed, (2) the tuition or other payments are reasonable compensation for the work performed and are conditioned explicitly upon the performance of necessary work, and (3) it is the institution's practice to similarly compensate students in non-sponsored as well as sponsored activities.

  2. Charges for tuition remission and other forms of compensation paid to students as, or in lieu of, salaries and wages shall be subject to the reporting requirements stipulated in 2 CFR Part 200, and shall be treated as direct or F"A cost in accordance with the actual work being performed. Tuition remission may be charged on an average rate basis.

Selling and marketing (2 CFR Part 200, 200.467): Costs of selling and marketing any products or services of the institution (unless allowed under 2 CFR Part 200) are unallowable.

Severance pay (TBA):

  1. Severance pay is compensation in addition to regular salary and wages, which are paid by an institution to employees whose services are being terminated. Costs of severance pay are allowable only to the extent that such payments are required by law, by employer-employee agreement, by established policy that constitutes in effect an implied agreement on the institution's part or by circumstances of the particular employment.

  2. Severance payments that are due to normal recurring turnover and which otherwise meet the conditions of subsection a may be allowed provided the actual costs of such severance payments are regarded as expenses applicable to the current fiscal year and are equitably distributed among the institution's activities during that period.

  3. Severance payments that are due to abnormal or mass terminations are of such conjectural nature that allowability must be determined on a case-by-case basis. However, the Federal Government recognizes its obligation to participate, to the extent of its fair share, in any specific payment.

  4. Costs incurred in excess of the institution's normal severance pay policy applicable to all persons employed by the institution upon termination of employment are unallowable.

Specialized service facilities (2 CFR Part 200, 200.468):

  1. The costs of institutional services involving the use of highly complex or specialized facilities such as electronic computers, wind tunnels, and reactors are allowable, provided the charge for the service meets the conditions of subsections b through d.

  2. The cost of each service normally shall consist of both its direct costs and its allocable share of F"A costs with deductions for appropriate income of Federal financing.

  3. The cost of such institutional services when material in amount will be charged directly to users, including sponsored agreements based on actual use of the services and a schedule of rates that does not discriminate between federally and non-federally supported activities of the institution, including use by the institution for internal purposes. Charges for the use of specialized facilities should be designed to recover not more than the aggregate cost of the services over a long-term period agreed to by the institution and the cognizant Federal agency. Accordingly, it is not necessary that the rates charged for services be equal to the cost of providing those services during any one fiscal year as long as rates are reviewed periodically for consistency with the long-term plan and adjusted if necessary.

  4. Where the costs incurred for such institutional services are not material, they may be allocated as F"A costs. Such arrangements must be agreed to by the institution and the cognizant Federal agency.

  5. Where it is in the best interest of the Federal Government and the institution to establish alternative costing arrangements, such arrangements may be worked out with the cognizant Federal agency.
Student activity costs (2 CFR Part 200, 200.469): Costs incurred for intramural activities, student publications, student clubs, and other student activities, are unallowable, unless specifically provided for in the sponsored agreements.

Taxes (2 CFR Part 200, 200.470):

  1. In general, taxes which the institution is required to pay and which are paid or accrued in accordance with generally accepted accounting principles are allowable. Payments made to local governments in lieu of taxes which are commensurate with the local government services received are allowable, except for (1) taxes from which exemptions are available to the institution directly or which are available to the institution based on an exemption afforded the Federal Government, and in the latter case when the sponsoring agency makes available the necessary exemption certificates; and (2) special assessments on land which represent capital improvements.

  2. Any refund of taxes, interest, or penalties, and any payment to the institution of interest thereon, attributable to taxes, interest, or penalties which were allowed as sponsored agreement costs, will be credited or paid to the Federal Government in the manner directed by the Federal Government However, any interest actually paid or credited to an institution incident to a refund of tax, interest, and penalty will be paid or credited to the Federal Government only to the extent that such interest accrued over the period during which the institution has been reimbursed by the Federal Government for the taxes, interest, and penalties.

Transportation costs (2 CFR Part 200, 200.473): Costs incurred for freight, express, cartage, postage, and other transportation services relating either to goods purchased, in process, or delivered, are allowable. When such costs can readily be identified with the items involved, they may be charged directly as transportation costs or added to the cost of such items. Where identification with the materials received cannot readily be made, inbound transportation cost may be charged to the appropriate F&A cost accounts if the institution follows a consistent, equitable procedure in this respect. Outbound freight, if reimbursable under the terms of the sponsored agreement, should be treated as a direct cost.

Travel costs (2 CFR Part 200, 200.474):

  1. General. Travel costs are the expenses for transportation, lodging, subsistence, and related items incurred by employees who are in travel status on official business of the institution. Such costs may be charged on an actual basis, on a per diem or mileage basis in lieu of actual costs incurred, or on a combination of the two, provided the method used is applied to an entire trip and not to selected days of the trip, results in reasonable charges, and is in accordance with the institution's travel policy and practices consistently applied to all institutional travel activities.

  2. Lodging and subsistence. Costs incurred by employees and officers for travel, including costs of lodging, other subsistence, and incidental expenses, shall be considered reasonable and allowable only to the extent such costs do not exceed charges normally allowed by the institution in its regular operations as a result of an institutional policy and the amounts claimed under sponsored agreements represent reasonable and allocable costs. In the absence of an acceptable institutional policy regarding travel costs, the rates and amounts established under subchapter I of Chapter 57 of Title 5, United States Code, or by the Administrator of General Services, or the President (or his or her designee) pursuant to any provisions of such subchapter shall apply to sponsored agreements (41 U.S.C. 420).

  3. Commercial air travel. Airfare costs in excess of the lowest available commercial discount airfare, Federal Government contract airfare (where authorized and available), or customary standard (coach or equivalent) airfare, are unallowable except when such accommodations would: require circuitous routing; require travel during unreasonable hours; excessively prolong travel; greatly increase the duration of the flight; result in increased costs that would offset transportation savings; or offer accommodations not reasonably adequate for the medical needs of the traveler. Where an institution can reasonably demonstrate to the sponsoring agency either the nonavailability of discount airfare or Federal contract airfare for individual trips or, on an overall basis, that it is the institution's practice to make routine use of such airfare, specific determinations of nonavailability will generally not be questioned by the Federal Government, unless a pattern of avoidance is detected. However, in order for airfare costs in excess of the customary standard commercial airfare to be allowable, e.g., use of first-class airfare, the institution must justify and document on a case-by-case basis the applicable condition(s) set forth above.

  4. Air travel by other than commercial carrier. "Cost of travel by institution-owned, -leased, or -chartered aircraft," as used in this subsection, includes the cost of lease, charter, operation (including personnel costs), maintenance, depreciation, insurance, and other related costs. Costs of travel via institution-owned, -leased, or -chartered aircraft shall not exceed the cost of allowable commercial air travel, as provided for in 2 CFR Part 200.

Use of U.S.-Flag Air Carriers on Federally Funded Grants and Contracts (See Fly America Act (Federally Funded Travel) for additional information.

  1. Any air transportation to, from, between or within a country other than the U.S. of persons or property, the expense of which will be assisted by U.S. government funding, must be performed by a U.S.-flag air carrier if service provided by such a carrier is "available".

  2. For the purposes of this requirement, U.S.-flag air carrier service is considered "available" even though:

    1. comparable or a different kind of service can be provided at less cost by a foreign-flag air carrier;

    2. foreign-flag air carrier service is preferred by or is more convenient for NSF or traveler; or

    3. service by a foreign-flag air carrier can be paid for in excess foreign currency.

  3. The following rules apply unless their application would result in the first or last leg of travel from or to the U.S. being performed by a foreign- flag air carrier:
    1. A U.S.-flag air carrier shall be used to destination or, in the absence of direct or through service, to the farthest interchange point on a usually traveled route;

    2. If a U.S.-flag air carrier does not serve an origin or interchange point, a foreign-flag air carrier shall be used only to the nearest interchange point on a usually traveled route to connect with a U.S.-flag air carrier; or.

    3. If a U.S.-flag air carrier involuntarily reroutes the traveler via a foreign-flag carrier, the foreign-flag air carrier may be used notwithstanding the availability of alternative U.S.-flag air carrier service.
    Use of Foreign-Flag Air Carriers on Federally funded Grants and Contracts

    1. Travel To and From the U.S. Use of a foreign-flag air carrier is permissible if the airport abroad is:

      1. the traveler's origin or destination airport, and use of U.S.-flag air carrier service would extend the time in a travel status by at least 24 hours more than travel by a foreign-flag carrier; or

      2. an interchange point, and use of U.S.-flag air carrier service would require the traveler to wait six hours or more to make connections at that point, or would extend the time in travel status by at least six hours more than travel by a foreign-flag air carrier.
    2. Travel Between Points Outside the U.S. Use of a foreign-flag air carrier is permissible if travel by a:

      1. foreign-flag air carrier would eliminate two or more aircraft changes en route;

      2. U.S.-flag air carrier would extend the time in a travel status by at least six hours more than travel by a foreign-flag air carrier.
    3. Short Distance Travel. For all short distance travel, regardless of origin and destination, use of a foreign-flag air carrier is permissible if the elapsed travel time on a scheduled flight from origin to destination airport by a foreign-flag air carrier is three hours or less and service by a U.S.-flag air carrier would double the travel time.

Termination costs applicable to sponsored agreements (2 CFR Part 200, 200.471):

Termination of sponsored agreements generally gives rise to the incurrence of costs or to the need for special treatment of costs, which would not have arisen had the agreement not been terminated. Items peculiar to termination are set forth below. They are to be used in conjunction with all other provisions of this Circular in the case of termination.

  1. The cost of common items of material reasonably usable on the institution's other work will not be allowable unless the institution submits evidence that it could not retain such items at cost without sustaining a loss. In deciding whether such items are reasonably usable on other work of the institution, consideration should be given to the institution's plans and orders for current and scheduled work. Contemporaneous purchases of common items by the institution will be regarded as evidence that such items are reasonably usable on the institution's other work. Any acceptance of common items as allowable to the terminated portion of the agreement should be limited to the extent that the quantities of such items on hand, in transit, and on order are in excess of the reasonable quantitative requirements of other work.

  2. If in a particular case, despite all reasonable efforts by the institution, certain costs cannot be discontinued immediately after the effective date of the termination, such costs are generally allowable within the limitations set forth in this Circular, except that any such costs continuing after termination due to the negligent or willful failure of the institution to discontinue such costs will be considered unacceptable.

  3. Loss of useful value of special tooling, and special machinery and equipment is generally allowable, provided (1) such special tooling, machinery, or equipment is not reasonably capable of use in the other work of the institution; (2) the interest of the Federal Government is protected by transfer of title or by other means deemed appropriate by the contracting officer or equivalent; and (3) the loss of useful value as to any one terminated agreement is limited to that portion of the acquisition cost which bears the same ratio to the total acquisition cost as the terminated portion of the agreement bears to the entire terminated agreement and other Federal agreements for which the special tooling, special machinery, or equipment was acquired.

  4. Rental costs under unexpired leases are generally allowable where clearly shown to have been reasonably necessary for the performance of the terminated agreement, less the residual value of such leases, if (1) the amount of such rental claimed does not exceed the reasonable use value of the property leased for the period of the agreement and such further period as may be reasonable; and (2) the institution makes all reasonable efforts to terminate, assign, settle, or otherwise reduce the cost of such lease. There also may be included the cost of alterations of such leased property, provided such alternations were necessary for the performance of the agreement, and of reasonable restoration required by the provisions of the lease.

  5. Settlement expenses including the following are generally allowable: (1) accounting, legal, clerical, and similar costs reasonably necessary for the preparation and presentation to contracting officers or equivalent of settlement claims and supporting data with respect to the terminated portion of the agreement, and the termination and settlement of subagreements; and (2) reasonable costs for the storage, transportation, protection, and disposition of property provided by the Federal Government or acquired or produced by the institution for the agreement, except when the institution is reimbursed for disposals at a predetermined amount in accordance with the provisions of 2 CFR Part 200.

  6. Claims under subagreements, including the allocable portion of claims which are common to the agreement and to other work of the institution, are generally allowable.

Trustees (2 CFR Part 200, 200.475): Travel and subsistence costs of trustees (or directors) are allowable. The costs are subject to restrictions regarding lodging, subsistence and air travel costs provided.

Fund Accounting:

All sponsored awards received by the UO are set up in the Banner Financial System with an approved budget in a unique, identifying fund number in order to track costs for each award separately, also known as Fund Accounting. Fund accounting is a method of segregating resources into categories (funds), to identify both the source of funds and the use of funds. This practice ensures internal control over both the source and application of funds, as required in 2 CFR Part 200.

Departmental Grant Administrator (DGA) is responsible for:

  1. Assisting PI with daily monitoring of award expenditures by appropriately processing and classifying expenditures within the Banner FIS and HRIS Systems.

  2. Maintaining an encumbrance system of expected future expenditures through utilizing Banner encumbrance process or an external "shadow system."

  3. Reconcile awards monthly, and process any necessary corrections.

  4. Initiate Cost Document Forms-examples Cost Transfer Justification, Tuition Remission, Personal Service Contracts, etc.

SPS Grant Financial Coordinator (GFC) is responsible for:

  1. Providing daily assistance to departmental administrator, principle investigator, and other campus staff in the monitoring of financial transactions on sponsored awards.

  2. Providing oversight, training, and corrective action on sponsored award financial issues.

  3. Reviewing financial charges to determine if the charges fall within the parameters of 2 CFR Part 200, UO Cost Accounting Standards, and the award terms and conditions.

  4. SPS financial staff closes reviews all costs that post to a sponsored within the final 90 days the award is active to determine if, and how costs benefited an award that was at the end of its life.

  5. SPS financial staff reviews all charges that have posted to an award after the award has ended to determine if the costs were incurred while the award was active. Instruct the removal of any costs that do not apply to the active award period.

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August 20 2008