Budget: Subrecipients/Vendors/Consultants
If funds will flow through the grant to another entity/individual that is working in support of the grant goals, then the recipient relationship must be (1) categorized, (2) supported by appropriate documentation, and (3) vetted. Documentation and vetting can vary depending upon how the entity/individual is categorized, with categorization based on the role/scope and not budgeting. The three-step process is outlined below. Your grant coordinator will assist you with this process, as needed.
STEP 1: Review the statements in each column below to determine which category best fits the proposed recipient relationship. If the recipient is not a consultant, then the GC will document the final determination using the Subrecipient/Contractor Determination Form.
| SUBRECIPIENT (AKA SUBAWARD/SUBCONTRACT) | CONTRACTOR (AKA VENDOR) | CONSULTANT |
| An entity that has agreed to work in collaboration with the GS PI to perform a substantive portion of the programmatic effort on an award. | An individual, business, or other entity which supplies products or services to the University. | An individual or business whose expertise is required to perform the project. Services are temporary and special or highly technical. |
| Works collaboratively with the GS PI as a co-investigator at another entity to which funds are being passed. | Provides similar goods or services to different purchasers. | An individual or business whose expertise is required to perform the project. Services are temporary and special or highly technical. |
| Has authority to make administrative and programmatic decisions and to control the method and results of work. | Does not make program decisions or take actions that impact a program’s overall success or failure. | An individual or business outside the project who confers with the PI regarding research objectives. |
| Has responsibility to meet all applicable sponsor requirements Has performance measured against meeting the program objectives. | Is not subject to sponsor compliance regulations. | Does not develop the objectives of the project. |
| Are designated senior/key personnel in the proposal-may be a Co-PI. | Goods and services are ancillary to the program. | Is not responsible for the overall outcome of the project. |
| Uses sponsor funds to carry out a program rather than provide a good or a service. | Provides goods or services as part of their normal business operations. | Is not responsible in designing or developing the research. |
| Has responsibility for the end results of the research effort. | Competes with comparable entities to provide the same goods and/or services. | Is not responsible for conducting the research. |
| Services are complex and require a scope of work and budget, billing requirements, and a deliverable schedule. | Is not responsible for research results. | Is not responsible for reporting the research. |
| The entity’s statement of work may represent an intellectually significant portion of the programmatic decision making. | There is no scope of work. | Is not essential toward the shape, direction, and completion of the project. |
| The entity’s work results may involve intellectual property and/or may lead to publications. | Goods and services are billed according to the vendor/contractor’s established rates. | Receives a fee for their services not a salary. |
| Needs animal and/or human subjects approvals for its independent portion of the work. | The goods and services are secondary to the central purpose of the project. | Provides similar services to other organizations. |
| Requires a separate budget and budget justification in the application. | No potential for patentable or copyrightable technology to be created through project from activities of the entity. | Does not serve as senior personnel – e.g., Co-Investigator, Principal Investigator, etc. Will not use university resources. |
| Performs services only (no analysis or discretionary judgment). | Provides its own work area, tools, materials, and supplies. | |
| No one individual providing goods and services is identified. | GS defines the scope of work. Consultant determines how to accomplish the work. | |
| No publications. | Is not considered an employee of the University and therefore is not eligible for workers compensation, liability coverage, or unemployment. (If USG employee, see additional instructions below for intra-USG consultant.) | |
| Payment is based upon completion of specific work, rather than time worked. |
STEP 2: Generate the appropriate supporting documentation.
| SUBRECIPIENT (AKA SUBAWARD/ SUBCONTRACT) | VENDOR (AKA CONTRACTOR) | CONSULTANT |
| An entity that has agreed to work in collaboration with the GS PI to perform a substantive portion of the programmatic effort on an award. | An individual, business, or other entity which supplies products or services to the University. | An individual or business whose expertise is required to perform the project. Services are temporary and special or highly technical. |
| If the entity is an FDP Clearinghouse participant, then the GC secures a Subrecipient LOI from the authorized research office using information provided by the PI on the Subrecipient Information form. The subaward entity must also provide: (1) a scope of work/statement of work, (2) a budget and (3) a budget justification. | No additional pre-submission paperwork is necessary for vendors/contractors unless required by the solicitation. The PI should use due diligence when estimating costs (e.g. published cost rates, quote) and the cost basis should be documented in the budget justification. | For consultants with limited scope (e.g. advisory board, expert panel), the PI should complete the Consultant Information form. No additional pre-submission paperwork is necessary unless required by the solicitation. |
| If the entity is NOT an FDP Clearinghouse participant, then the GC secures a Subrecipient Commitment Form from the authorized research office using information provided by the PI on the Subrecipient Information form. The subaward entity must also provide: (1) a scope of work/statement of work, (2) a budget and (3) a budget justification. | If the solicitation requires a quote, the PI should secure the information and share with the GC for addition to the electronic proposal file (either as a separate file upload or as part of the final proposal submission package). | For consultants with a more expanded role (but not to the level of a subrecipient), a Letter of Commitment should be completed. For example, a project evaluator may fall into this category. Responsibility for securing an individual LOC falls to the PI while responsibility for an institutional LOC falls to the GC. |
| Note: F&A costs apply only to the first $25,000 of the subaward. | Note: F&A costs apply to the entire amount. | The PI will be asked to utilize the Subrecipient Information form to provide basic information for an institutional LOC. The PI should reach out to consultants to secure any sponsor-required letters of support, commitment or collaboration. |
| A USG employee that will serve as a paid consultant MUST meet the following criteria to receive payment: The work is above and beyond the employee’s regular GS/USG duties AND Services are provided outside normal work hours AND The consultant is not named as an investigator on the project AND The consultant is not an employee of the project AND The work is performed for a department, center, or academic unit other than the employee’s assigned department OR The work is performed at a remote location Note: These criteria will be vetted post-award prior to payment commitment. |
STEP 3: The GC will vet any entity/individual that will receive flow through funds from the award.
Last updated: 4/27/2021