|Applies to:||Original Policy Date:||Date of Last Review:||Approved by:|
|Faculty, Staff, and Students||January 19, 2018||March 3, 2022||Dr. Marco Carvalho
Executive Vice President & Provost
Policy Owner: Office of Sponsored Programs
To comply with Code of Federal Regulations Title 2: Grants and Agreements Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR Part 200) regarding costs that are identified as unallowable by the federal government.
This policy applies to all students, faculty, and staff having the authority, as granted by the principal investigator (PI), to charge allowable costs to a sponsored project (grant, contract, or subaward).
An unallowable cost may not be charged directly or indirectly to any federal grant or contract. All allowable costs must be charged to the appropriate accounting string associated with a sponsored project.
Unallowable costs are costs that cannot be charged to the federal government as a direct cost or indirect cost. If unallowable costs are charged to a sponsor, those costs will be transferred to the home department of the principal investigator (PI).
Following are examples of unallowable costs on federal grants and contracts unless specifically approved by the funding agency. For a complete list see General Provisions for Selected Items of Cost.
- Airfare travel costs in excess of the lowest available option
- Alcoholic beverages
- Alumni activities
- Automobile costs for personal use
- Bad debt expense
- Commencement and convocation costs
- Contingency provisions
- Debt service
- Defense and prosecution of criminal and civil proceedings, claims, appeals, patent infringement
- Depreciation reserve costs
- Donations and/or contributions
- Entertainment (includes amusement and social activities)
- Fines and penalties (including late fees)
- Food costs (except when traveling and abiding by University policy).
- Fund raising
- Goods and services for personal use, including housing and personal living expenses
- Institution-furnished automobile costs for personal use
- Insurance costs to protect against defects and medical liability (malpractice) insurance
- Investment management
- Local civil defense project costs not on institution's premises
- Losses on other sponsored agreements or contracts
- Membership, subscriptions and professional activity costs
- Patent costs
- Pre-contract costs
- Public relations
- Relocation costs
- Selling and marketing
- Student activity costs
- Principal investigators should familiarize themselves with the grant's terms and conditions as well as the agency's allowable cost policies and contact OSP with any questions on allowable costs.
- Principal investigators and administrative staff monitor the grant budget to ensure funds are available to cover expenditures. This includes knowledge of whether the grant’s budget is line specific, and funds are budgeted for the appropriate expenses, the charge is allowable, and whether the charge is within the period of performance of the grant.
- The Office of Sponsored Programs monitors all expenditures submitted to be charged to the grant.
- The PI and/or administrative staff is contacted if a charge is questionable.
- The PI works with OSP in resolving whether the cost is allowable.
- For unallowable charges, the PI and their administrative staff will work with OSP to remove the unallowable charges.
Principal Investigator (PI): Faculty or staff member serving as the lead researcher responsible for the administration and oversight of a grant, contract, agreement, or other sponsored program.
Unallowable cost: Expenses incurred by the University which are not reimbursable by the federal government.
Federal Office of Management and Budget (OMB) Guidance, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 2 CFR Part 200
Federal Office of Management and Budget (OMB) Guidance, General Provisions for Selected Items of Cost, 2 CFR Part 200 - Subpart E
Principal Investigators (PIs) are required to review this policy upon receiving each new grant.
The PI is responsible for reviewing all charges to the contract or grant, including those paid with an expense card, and ensures they are charged to the appropriate accounting string associated with a sponsored project.
OSP monitors expenses and ensures they are charged and accounted for properly.
Failure to comply with unallowable cost policy may result in financial penalties, expense disallowances, and/or disciplinary action.