HR-24: EFFORT AND COMPENSATION ON SPONSORED PROJECTS

Purpose

To promote accurate and complete commitments and confirmation of effort on Sponsored Projects in compliance with the Uniform Guidance issued by the Office of Management and Budget and codified at 2 CFR 200 et seq.

Scope

All faculty and staff on the Urbana-Champaign campus who are involved in any aspect of Sponsored Projects. This policy applies to activities related to Sponsored Projects during both the academic year and during the summer months.

Authority

Vice Chancellor for Academic Affairs and Provost, and Vice Chancellor for Research and Innovation.

Background

As a condition of receiving sponsored awards, the university must establish internal controls to confirm that the effort expended on a Sponsored Project justifies the compensation charged to that Sponsored Project and that the Actual Effort complies with the terms and conditions of the agreement for the Sponsored Project. The campus employs a system of semi-annual expenditure confirmations to demonstrate to sponsors that the Principal Investigator or other responsible university employee has verified the accuracy of the Actual Effort for the Sponsored Project. The university could be subject to financial penalties, disallowed expenditures, and harm to its reputation if university records fail to accurately document the effort expended on Sponsored Projects.

Policy

When preparing a proposal for a potential sponsor, if a portion of a faculty or staff member’s University Effort is intended to be charged or cost-shared, the Principal Investigator (PI) must include that portion of University Effort as Anticipated Committed Effort for the Sponsored Project. If the sponsor chooses to make an award, Committed Effort is the level of University Effort actually incorporated into the terms and conditions governing the Sponsored Project. As the project is conducted, Actual Effort is the work actually performed on the Sponsored Project as documented in the university’s records. The PI is responsible for resolving any variance between Committed Effort and Actual Effort for each faculty or staff member, consistent with the terms and conditions governing the Sponsored Project.

The PI is also responsible for confirming that the university’s records accurately reflect Actual Effort for each faculty or staff member for the Sponsored Project. Unit business staff and the Sponsored Program Administration’s (SPA) Post-Award Division (Post-Award) must work with the PI to complete confirmation of both direct charged and cost-shared Actual Effort in accordance with this policy. Post-Award must provide the PI with data on Actual Effort documented by the university’s payroll and cost-sharing systems through the Semi-Annual Expenditure Confirmation system. The PI must subsequently confirm the accuracy of the Actual Effort and initiate corrections if needed for each faculty or staff member listed in the confirmation report.

If Direct Salary is charged to one or more Sponsored Projects, the portion of Direct Salary must correlate to the Actual Effort (excluding cost-shared effort) expended on each Sponsored Project and must be charged to the appropriate project during the same payroll-period in which the employee performed the work. Summer salary may not be charged in exchange for work performed at other times during the academic year.

Non-Allowable Activities must not be charged to Sponsored Projects.

For faculty:

1. It is recognized that faculty members will regularly participate in activities that are not allowed to be conducted while being paid on sponsored funds (Non-Allowable Activities).
2. During the academic year, a faculty member may not devote more than 95% of his/her University Effort to Sponsored Projects during any appointment period.
3. Across the 3 summer months, faculty members must reserve at least 0.15 month for Non-Allowable Activities. The 0.15 month is a minimum amount of time and should not be assumed to be sufficient to accommodate an extensive amount of Non-Allowable Activity, nor should it be assumed to displace individual appropriate assessment of Non-Allowable Activities. It should not be assumed that the 0.15 month (or other calculated Non-Allowable Activities time) can be attributed cumulatively in a single appointment period if actual Non-Allowable Activities are conducted across all individual summer appointment months.
4. Each individual faculty member should assess their expected Non-Allowable Activities and adjust each summer appointment(s) (month) accordingly to ensure only sponsored-project activities are charged to those funds during each summer appointment month. The actual Non-Allowable Activities time may be more than 0.15 month in total and should be distributed according to Actual Effort over all summer appointment months if that is how time is spent on actual Non-Allowable Activities.
5. There is no requirement that faculty be paid summer salary on non-sponsored funding for the portion of any summer month dedicated to non-allowable activities. If faculty have access to non-sponsored funding (e.g. institutional funds such as State, ICR or gift), they are permitted to receive compensation for the Non-Allowable Activities time, provided those Non-Allowable Activities constitute university business.
6. Exception approval for summer appointments exceeding two full months would still apply under the separate policy CAM HR-82 Summer Academic Appointments for Other Than Summer Session Teaching.

For Academic professional and civil service staff, postdoctoral research associates and visiting scholars:

1. Employees in these employment groups, whose responsibilities set forth in their position descriptions are narrowly defined and solely devoted to specific Sponsored Projects, with no Non-Allowable Activities, may devote 100% of their University Effort to Sponsored Projects during any appointment period.
2. If these employees are engaged in Non-Allowable Activities, then no more than 95% of their University compensation may be charged to Sponsored Projects during any appointment period. The 5% is a minimum and should not be assumed to be sufficient to accommodate an extensive amount of non-allowable activity.

Definitions

• Sponsored Projects

  Activities supported by entities outside the university that are consistent with and enhance the teaching, research, and public service missions of the university and that include a defined scope or objective and reporting and compliance requirements. Sponsored Projects include grants, contracts, cooperative agreements, and other types of agreements.

• Principal Investigator

  The individual vested by the university with the primary responsibility to independently design, conduct, and supervise a Sponsored Project awarded to the university.

• University Effort

  An employee’s entire professional workload performed for the university, as described in the University Statutes, Article IX, Section 5, Subpart D: “The responsibilities to the University of full-time members of the academic staff are fulfilled by the performance appropriate to rank and terms of appointment of teaching, scholarly research, continuing education and public service, and committee work and special assignments.” This includes work on Sponsored Projects and Non-Allowable Activities, regardless of appointment percentage, compensation, or the source of funds.

• Anticipated Committed Effort

  The portion of University Effort for a faculty or staff member to be charged to the project or cost-shared as set forth in a proposal submitted for a Sponsored Project.

• Committed Effort

  The portion of University Effort for a faculty or staff member to be charged to the project or cost-shared as incorporated into the terms and conditions governing the Sponsored Project.

• Actual Effort

  The portion of University Effort actually performed for a Sponsored Project by a faculty or staff member as documented in university records by direct charging of salary or by cost sharing.

• Non-Allowable Activities

  Activities designated as unallowable for direct charge to sponsored projects by Federal Uniform Guidance. These activities generally include general administrative efforts, proposal development, committee work, teaching and teaching preparation, and general student advising relating to teaching responsibilities performed by an employee as part of his/her university appointment, none of which may be charged to Sponsored Projects.

• Direct Salary

  The portion of an employee’s compensation charged as a direct expense to a Sponsored Project and calculated using the employee’s Institutional Base Salary. Direct Salary may be charged during an academic year or summer appointment.

• **Institutional Base Salary or (IBS) **

  The annual compensation the university pays for activities performed (including, as applicable, research, teaching, and clinical practice) as part of an employee’s university appointment(s), specifically, including:regular salary;endowed chair or professorship stipends; andpaid professional leave (pay for sabbatical, vacation, and sick leave—not including sick leave payouts when departing from the university);and excluding:administrative stipends;summer salary for non-12-month appointees;service in excess payments;royalties paid by the university;reimbursements; andany compensation for external professional activities, such as consulting or compensated peer review activities.

• Service in Excess (SIE)

  SIE is defined pursuant to the Campus Administrative Manual HR-77 Service in Excess of 100 Percent for Academic Employees.

Processes/Procedures/Guidelines

Pre-Award Effort Guidelines

Although sponsors generally consider estimates of effort (and corresponding salary requests) in project proposals to be commitments if such proposals are subsequently awarded, the university recognizes that not all submitted proposals will be selected for funding. Therefore, the PI is expected to include in the proposal narrative and budget a realistic estimate of any portion of each faculty or staff member’s University Effort that it is anticipated will be charged to the project, either as Direct Salary or cost-sharing, the Anticipated Committed Effort.

If the proposal is selected for award negotiation, the PI should re-evaluate whether the Anticipated Committed Effort remains reasonable and can actually be provided within the project period. The unit(s) managing the proposal and accepting the award must then determine if each faculty and staff member has sufficient University Effort available to meet the requirements of Anticipated Committed Effort for the Sponsored Project. The unit may use the campus Activity Reporting System and other unit tools that summarize the current and pending project commitment to determine the amount of available effort.

If changes are needed, the PI and managing unit must notify and work with Sponsored Programs Administration (SPA) to adjust the portion of University Effort for the relevant faculty or staff member prior to execution of the terms and conditions for the new Sponsored Project and any active awards that may be affected.

Post-Award Effort Guidelines

After execution of the terms and conditions for a Sponsored Project, if a PI elects to reduce his/her direct charged or cost-shared Committed Effort on the Sponsored Project, the PI must:

• Notify SPA Post-Award of any reduction in cost-shared Committed Effort in order for Post-Award to update its cost share system accordingly.
• If needed, SPA Post-Award will assist the PI in determining whether the reduction of direct charged or cost-shared Committed Effort meets the notification threshold.
  • If the notification threshold is met, SPA Post-Award will offer the PI guidance on the steps needed to obtain prior written approval of the sponsor, as specified in Uniform Guidance, 2 CF$ 200 or as required by the terms and conditions governing the Sponsored Project or by a sponsor’s policy.
  • If the notification threshold is not met, SPA Post-Award will confirm to the PI that no approval from the sponsor is required.
• Provide documentation of the sponsor’s approval, if needed, of the reduction in Committed Effort to Post-Award, which will retain the documentation in the official project file consistent with records retention requirements.
• Work with the unit business staff to complete the necessary corrections to the PI’s related payroll appointments or distributions to reflect the reduction in Direct Salary charged to the Sponsored Project.

Exceptions

Any-exceptions to this policy should be reviewed by the Offices of the OVCRI and the Provost.

Contact

The Office of the Vice Chancellor for Research and Innovation, ovcri@illinois.edu, (217) 333-0034.