Shared Grants: Proposal Budget Submission

For purposes of proposal submission, Shared Grants are shown as a single line item in the budget (direct + indirect) and should be located in the "Other Direct Costs" or associated budget line. This is often confusing to sponsors. It is helpful if, in the budget justification, you provide an explanation that we are separate universities/colleges within a large university system, and the distribution of project funds will be handled via a "shared grant" mechanism rather than a subcontract.

The Lead Institution should NOT charge indirect costs on the Shared Grant portion of the project budget.

The sister institution(s) receiving the Shared Grant does submit a full budget (direct + indirect), and it should be signed off on by the Authorizing Official from that institution before being submitted to the Lead Institution.

For Shared Grant transactions the following applies:

• Both institutions should establish a 144 or 133 account as appropriate;
• The institution named as the primary recipient is responsible for all reporting requirements of the granting agency and for reporting the full amount of the award to the Board of Regents;
• The primary recipient shall reimburse the subrecipient's indirect costs at the subrecipient's negotiated rate. If the shared grant was not contemplated at the time the proposal was submitted, and the primary recipient's indirect cost rate is lower than that of the subrecipient, the subrecipient must determine if they will accept the project at the rate received by the primary recipient;
• To ensure that revenues and expenditures are not double counted with respect to the UW System as a whole, class code 3301 (Legacy) or account code 3910 (Shared Financial System) should be used by the primary recipient institution to process payment to the subrecipient. The subrecipient should deposit the payment using revenue code 9910. It is important to follow these procedures so offsetting amounts can be identified by UW-System Administration.
• An "Agreement to Transfer Extramural Funds Between UW Institutions" (Attachment D) should be completed by the primary recipient institution.

Transfers of Extramural Funds that do not involve "Scope of Work" transactions should use one of the other Inter-Institutional Financial Transactions Categories covered by this Policy Paper. The Institutions will not set up a 144 or 133 account and there will normally be no passthrough of indirect cost reimbursement. The Institutions should account for the receipt as a sale or sales credit in accordance with FAP - Internal Services Charge back (F24) depending on the appropriation from which services are being provided. This will ensure that there is no double counting of revenues and expenditures with respect to the UW System as a whole except as appropriate under generally accepted accounting principles for colleges and universities.

Normally the distinction between joint participation in a sponsored project and a sales transaction should be clear. In all cases, the nature of the agreement and not the amount involved should be the determining factor. However, in cases where the distinction may not be clear, the amount involved may be a weighing factor as follows:

• Agreements involving more than $5,000 should be examined with particular care to ensure that joint projects are not inadvertently treated as sales and that the administrative requirements imposed by the extramural sponsor are met by all parties to the agreement.
• If the amount of the agreement is less than $5,000, the additional administrative cost associated with administering joint projects may weight the classification decision in favor of a sales treatment.