Property that Generates Income

Purpose

This document describes the procedures that are used to establish an account for property that generates income. It also describes how the revenues generated by that property are distributed.

Example

A major piece of research equipment has been purchased with Research Foundation (RF) funds or has been donated to the Research Foundation. The equipment belongs to the Research Foundation and is dedicated in large part to specific project goals. Other project directors as well as industrial and private researchers, may want to use the equipment to further their own research goals. If their use can be accommodated without interfering with the primary project goals, then shared or cooperative use may be possible. Refer to document PM-X-07 for more information about Shared and Cooperative Use of Property.

When shared use of property occurs, charges may be sought from the secondary user(s) to defray the operational, maintenance, and other costs of managing the equipment. This is an example of property that generates income. Charges may also be made for use of property purchased with government and other sponsor funds if approved by the sponsor. The accounting system and the distribution of generated revenues, in this case, must comply with sponsor guidelines.

Procedure for Establishing an Account

When Research Foundation or sponsor owned property generates income, whether the property is used on or off of the campus, that income must be accounted for. The procedure for setting up an account is described in the following table:

Step

Action

1

The project director or department chairperson contacts the operations manager indicating the need for establishing an account to record income.

2

The operations manager contacts the Office of the Secretary-Treasurer at central office and determines with that office the impact on indirect cost recoveries.

3

If the plan seems cost effective, then the operations manager establishes a Research Foundation income or service and facilities account to record the income generated by the property.

4

Checks for the services are made out to the Research Foundation and the account is managed by the office for sponsored programs at the involved operating location.

Distributing Revenues

When Research Foundation or sponsor owned property generates income, these generated revenues must be distributed and accounted for in accordance with Research Foundation and sponsor guidelines. Whether the income is generated by on-campus or off-campus use is irrelevant; all income must be reported. Generated revenues are distributed from the Research Foundation account established for the property. The procedure for this distribution depends upon property ownership and is described in the following table.

If...

Then...

property title vests with a federal sponsor subscribing to Federal Demonstration Project (FDP) guidelines,

revenues will be used by and at the discretion of the award recipient towards project goals. Records of earnings and expenditures of these funds are reported in the Financial Status Report(s) and are maintained for at least three years.

property title vests with a federal sponsor that does not subscribe to FDP guidelines,

OMB A-110 regulations for revenue disbursement will be followed; project income will be retained by the recipient to further eligible program objectives, to finance nonfederal parts of the project, or deducted from total project costs in determining net costs on which the federal share of costs will be based.

property title vests with the Research Foundation,

the revenues will be distributed pursuant to Research Foundation policies. The distribution will be a campus decision made through the operations manager.

property title vests with a nonfederal sponsor,

the sponsor's regulations will be followed through the Research Foundation accounting system. Some sponsors request that generated income should be returned to them; some request that the income should support project goals.

Responsibilities


Operating Locations

The RF operations manager is responsible for ensuring that


Central Office

The Office of the Secretary-Treasurer is responsible for

 

 

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