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Policy: Determining if an Award is a Gift or Sponsored Project 


Date: 04/29/03 Policy ID: FIN-001 Status: Final

Policy Type: University
   
Contact Office: Sponsored Programs
   
Oversight Executive: Executive Vice President and Chief Operating Officer
Senior Vice President for University Advancement
   
Applies To: University of Virginia faculty and staff who submit proposals or process awards.
   
Table of Contents: Policy Statement
   
Reason for Policy: To establish the guidelines to determine if a revenue stream is a gift or sponsored project in order to ensure that proposals are properly submitted and awards are correctly processed.
   
Policy Summary: 
   
Definition of Terms in Statement: 

The distinction between gifts and sponsored projects can be subtle. The term “grant” is defined very differently by various corporate and foundation funders and can therefore cause confusion. For that reason, we have replaced it with the term “sponsored project.” Please note that the use of the term “grant” by a funding organization does not automatically mean that the award is a sponsored project; instead, the terms of the award should be used to determine its status.

Sponsored Project: Any externally funded research, public service or scholarly activity that has a defined scope of work and set of objectives which provide a basis for accountability and sponsor expectations. If any one of the following characteristics applies to a project, including commitments made in the proposal or required in the award agreement, it must be processed through the Office of Sponsored Programs:

Sponsor is the federal, state, or local government OR an agency that has been established simply as a flow-through of federal, state, or local government funds for accounting purposes.
Proposal or award requires a signature from an authorized official binding the University to the terms and conditions of the proposed project.
Sponsor has written policies requiring indirect cost recoveries. Note: the absence of a policy does not preclude the award from being a sponsored program.

Award contains provisions regarding ownership of intellectual properties, i.e., patents and copyrights.

Sponsor requires the delivery of specific goods or services by the University (e.g., technical assistance or training).
Award requires a detailed technical report.
Award payments are contingent upon programmatic or fiscal reporting (e.g., milestones, invoices).
Award includes budget restrictions (e.g., prior approval for re-budgeting and restrictions on certain budget categories, equipment or fringe benefits).
Award includes a provision for audit.
Award restricts or monitors publications or use of results.
Award requires protection of sponsor and/or confidential information.
Project involves the use of human subjects, vertebrate animals, radioisotopes on humans, radioactive materials, recombinant DNA, human body substances, etiologic agents or proprietary materials.

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Gifts: Activities supported by a donor that are generally not considered sponsored projects and can be processed as gifts may include the following characteristics:

Award provides support for broadly defined activities, such as professorships, endowments, building projects, instructional programs, and unrestricted research. The donor may restrict the use of funds to a specific program area or purpose.

Award contains only minimal requirements, generally relating to required donor pledge payments and the University’s commitment to effectuate the donor’s intent.

Award requires only minimal reporting to the sponsor donor in the form of a general statement of how funds were used. The unit or faculty member involved may provide the donor with a brief summary of the results of supported activities and/or a statement that expenditures were made in accord with the intent to the gift.

Award is irrevocable.

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Policy Statement: 

All projects determined to be a Sponsored Project must be processed through the Office of Sponsored Programs. Activities supported by a donor that are generally not considered sponsored projects can be processed as gifts to the University.

Questions regarding whether a proposal or an award is a gift or a sponsored project should be directed to your school’s research administrator or the corporate and foundation relations officer within your school’s development office. For schools not having their own corporate and foundation relations development officer, questions regarding whether a proposal or an award is a gift or a sponsored project should be directed to the Corporate and Foundation Relations staff in the University Development Office. In some cases, projects that do not need to go through the Office of Sponsored Programs at the proposal stage become sponsored projects at the award stage due to conditions set forth in the award agreement.

The Office of Sponsored Programs and the Office of University Development will work together to determine a project’s classification when there is a question about how it should be processed. Cases needing further clarification will be brought before a review committee composed of senior representatives from the offices of Sponsored Programs, University Development, the Vice President for Finance and the Vice President for Research.
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Procedures: 
   
Related Information: 
   
Policy Background: 
   
Major Category: Finance and Business Operations
   
Category Cross Reference: Research Administration
   
   
Process: 
   
Next Scheduled Review: 04/29/06
   
Approved By, Date: Executive Vice President and Chief Operating Officer, 04/29/03
   
Revision History: This is the first version of this policy.
   
Supersedes (previous policy):