Director of Research

Fee Policy

Below are excerpted sections from the fee policy.  See the side bar for a link to the full policy.

Policy Statement

Woods Hole Oceanographic Institution requires suitable fees to be included on all proposals for contracts and foreign awards, and proposals for subcontracts and service center usage as appropriate. Fees are to be determined in a consistent manner. Individuals engaged in the proposal process must follow the requirements in this document for determining fee amounts, negotiating, or waiving fees. Fees are considered unrestricted income payable to the Institution to be used in the pursuit of science and engineering. At the discretion of the Director of Research and the Vice President for Finance and Administration, a portion of the fee collected may be rebated to support and enhance the research of the principal investigator.

Reason for Policy

It is advantageous for WHOI to collect the fees when allowable under government regulations. The process through which projects are proposed and the subsequent award terms can expose the Institution to various levels of risk. Fees are considered unrestricted income which can be used to offset risk and additionally provide access to a flexible source of funds to support the scientific enterprise at WHOI.

Guidelines for Fees in Proposals

It is the responsibility of the PI and/or his or her Department Administrator to determine the prime funding source and funding instrument prior to proposal submission and include fee, if applicable. Information about funding instrument is often included in the request for proposals or may be obtained from the agency’s contracting / grants officer. Upon request, the information must be made available to the Grant and Contract Services Offices in sufficient detail to allow review of the specific elements of the arrangement being proposed.

In order to provide consistency between proposals submitted to any particular agency, WHOI sets forth the following rates to be used in calculating fee when it is not specified in the call for proposals. Fee is generally calculated as a percent of the Total Direct and Indirect Costs budget line:

U.S. Entities

 

Grant Funding (Includes Federally-funded cooperative agreements)

0%

Government Contracts

5%

Non-government Cost Reimbursable Contracts

10%

Non-government Fixed Price Contracts

15%

Foreign Entities

15%

Subawards & Service Center Agreements

 

Determined based on the prime source of funding as per above.

varies

 
NOTE: Agencies can and do negotiate fees after proposal submission. If doubt remains as to whether fee applies, the fee should be listed.

Exceptions


Variations from these guidelines require approval from the Director of Research. PIs should not undertake negotiating fees without first gaining this approval. Requests for deviation from this policy should not be made routinely but may be considered in cases where risk is considered minimal and the addition of fee would add a burden that seems unwarranted.

Definitions


Cooperative Agreement.
Agreement to be used in a relationship between the federal government and a recipient whenever (1) the principal purpose of the relationship is the transfer of money, property, services, or anything of value to the state or local government or other recipient in order to accomplish a public purpose of support or stimulation authorized by a federal statute, rather than acquisition, by purchase, lease, or barter, of property or services for the direct benefit or use of the federal government; and (2) substantial involvement is anticipated between the executive agency, acting for the federal government, and the state or local government or other recipient during performance of the contemplated activity. [definition from Public Law 95-224 (1978)]

Contract. A legally binding document in which the parties make promises to deliver a product or service in exchange for consideration (usually money). There are legal ramifications or other penalties, such as obligation to return funds, if the deliverable is not produced.

Cost-Reimbursable Contract.Provides for payments to WHOI for the actual costs incurred by the institution in performing and completing the contract.

Fixed Price Contract. A firm fixed-price contract provides for a payment that is not subject to any adjustment on the basis of cost experience in performing and completing the contract. If the deliverable is accomplished for less than the fixed price, the supplier may keep the excess funds. Conversely, cost overruns in performing this type of contract must be absorbed by the supplier.

Funding Instrument.  Legal document used to formalize the terms and conditions and the nature of mutual agreements between the funding agency and extramural performers. The types of instruments further the official purposes of the awarding agency and reflect the relationships between the parties. The choice among the grant, cooperative agreement or contract award instruments in any given circumstances entail different levels of involvement by the agency andshould be made using uniform criteria.

Grant Funding. Mechanism used when one party grants funds to another party to do something in reasonable hopes that the task can be accomplished.

Prime Funding Source. The entity (person, company, agency or institution) that provides funds to accomplish a task, even if those funds are administered through another entity as in the case of subawards.

Fee Rebates


At the discretion of the Director of Research, a discretionary account will be established for each PI who has earned fees in excess of $5,000 during the previous year. In cases where significant Institution unrestricted money was used to obtain or supplement the award (for example, significant cost-sharing, or expenditures on building or renovations), the rebate may be withheld.

The discretionary account will be equal to 20% of the total fee earned over the previous year, less any amount necessary to cover cost overruns by the PI at year-end. The total fee rebate to any PI will not exceed $50,000 in any year. Any excess fee rebate will be held by the DoR in an account for discretionary use.

Fees are generally earned in proportion to project spending and booked in the month following the expenditure of project funds. Earned fees will be disbursed to PIs within the first quarter of each year.  If more than one PI is listed on an award, the fee income will be credited to the first PI listed. Likewise, the first PI will be held responsible for cost overruns involving projects with multiple PIs. Fee rebate earned on contracts in the year prior to retirement can be given to an Emeritus Scientist. All fee rebates earned from contracts to a service center will be credited to the service center and used to offset operating costs.

 Earned fees already rebated to PIs, or portions thereof, may revert to the institution to compensate for projects that are overspent by more than $2,000 if new fees are insufficient to cover the overage. In cases where the unrestricted account balance will not cover the full cost of the project(s) overrun, the institution retains the option of withholding further rebate for one year.

 Recipients have 12 months to spend the available funds. Any unexpended balance at the end of the 12 month period will revert to the institution unless written approval has been received from the Director of Research to extend the expiration date of the discretionary account. Requests for extensions must include a plan for using the funds.

Last updated: June 12, 2013