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Policy Statement
Principal investigators (PIs) must identify and appropriately document program income generated on all sponsored projects in accordance with sponsor requirements.
Reportable program income revenue will be applied to the sponsored project in one of four ways, depending on the sponsor and award terms and conditions:
- Matching - income is used to finance the non-sponsored share of the project.
- Addition - income is added to the amount provided by the sponsor for project costs.
- Deduction - income is deducted from the amount that will be covered by the sponsor.
- Add/Deduct - the addition method is used up to a sponsor dollar limit. After that point, the deduction method is used.
Non reportable program income is handled according to Administrative Policy: Selling Goods and Services to External Customers [see "exclusions" in policy].
In all cases, program income is spent before the sponsor's portion is invoiced.
Exclusions
This policy does not include program income where there is no reporting requirement to the sponsor. Examples include income received on non-federal awards that are silent on program income, royalty income resulting from patents and copyrights (unless the terms and conditions of the award indicate otherwise - see Office of Budget and Management (OMB) Uniform Guidance 200.307), or royalties or license fees for unpatented, but potentially patentable discoveries that are disclosed to the Office for Technology Commercialization.
This policy does not include revenue generated through programs funded by sources other than sponsored projects.
Special Situations
Sale of Capital Equipment Purchased with Sponsored Funds
In certain situations the sale of capital equipment purchased with federal sponsored funds must be treated like Program Income unless otherwise dictated in the award documents. Refer to Administrative Procedures: Capital Equipment Disposals: Selling Capital Equipment Purchased with Sponsored Funds (does not include NSF Grants, NIH Grants and Non-Federal Grants) and Capital Equipment Disposals: Selling Capital Equipment Purchased with Sponsored Funds from NSF Grants, NIH Grants or Non-Federal Grants for specific criteria.
Exceptions to the policy
In consultation with each other, the Vice President for Research and Innovation and the Controller may grant exceptions to this policy based on written justification. To request an exception, the PI must submit the request and justification via email to these individuals.
Reason for Policy
Sponsors provide funding to cover costs of conducting research, training, and public service-related activities. Program income may be generated as a result of these activities and in some cases must be reported to the sponsor. OMB Uniform Guidance documents the explicit processes to be used in the identification, recording, reporting, and monitoring requirements for income that is generated during the project period.
To be consistent in managing program income, the University extends the federal requirements to nonfederal sponsors where it is reportable.
This policy was implemented to comply with sponsor terms and conditions and to ensure that program income is managed in a manner consistent with the University's overall missions and goals.