Grants and Contracts

This policy outlines the procedures through which grants and contracts are obtained and negotiated for Delta State University.

Authorizing Officials

Only designated positions have the authority to enter grant agreements and commit university resources toward an externally-funded project.

The President, Vice President of Finance and Administration, Associate Vice President of Finance and Administration, Provost/Vice President for Academic Affairs, and Director of Institutional Grants are formally charged with the responsibility to commit the University on proposal submissions, and acceptance of awards and contracts. This includes related certifications required by funding agencies during the proposal and award process. These authorizing officials must also approve all negotiations and re-allocations of funds that occur after the original proposal has been submitted.

Only the President, Vice President of Finance and Administration, and Provost/Vice President of Academic Affairs are authorized to commit university funds regardless of funding source.

There are various certifications (sometimes called assurances) required at the time of proposal submission and/or award acceptance. These are used to assure federal agencies that the University has applicable policies and procedures in place to successfully carry out the project. These certifications require authorized signatures; authorized university officials include the President; Provost/Vice President for Academic Affairs; Vice President of Finance and Administration, Associate Vice President of Finance and Administration and the Director of Institutional Grants.

A contract is a financial assistance mechanism used by a Federal and/or non-Federal funding agency for specific inquiry directed towards particular areas of research and development, instruction or other sponsored activities needed by the funding agency. A contract usually involves defined deliverables and/or services expected to be performed by the grantee within a specified project period.

Contract performance is closely monitored by the funding agency to ensure accomplishment of contract goals or deliverables.

A contract is usually issued as either a fixed-priced contract or a cost-reimbursement contract. A fixed-priced contract is used when the agency agrees to pay a “fixed amount” regardless of the actual costs of the project. That is, price adjustments are not made after the award of the contract, regardless of the actual costs of the performance of the work. Therefore, if a fixed-priced contract is under budgeted, the University must absorb the cost difference.

A cost-reimbursement contract is used when the agency agrees to pay the University for costs that are allowable, allocable and reasonable in performing the project. The agency will usually establish a “not-to-exceed cost” or a “cost ceiling” for the contract. Once that ceiling has been reached, the University stops work and incurs no further liability.

Cooperative Agreements
Cooperative agreements, as a financial assistance mechanism, are similar to grants in that they are awarded by the funding agency to assist and support research and related activities. They differ, however, in that while grants require minimal or no involvement of the awarding agency during the performance of project activities, cooperative agreements involve a substantial cooperation and/or coordination between the funding agency and the University.

External Funding
External support includes grants, contracts, and cooperative agreements.

Facilities and Administration Costs (Indirect Costs)
The name has been changed by Office of Management and Budget (OMB) to Facilities and Administrative Costs. This change more accurately reflects the pool of expenses that are used to calculate these rates. A more detailed description is listed under Facilities and Administrative Costs.

Grants, as a financial assistance mechanism, are used when the idea for the research or training project is initiated by the investigator following the conditions and criteria established in the agency guidelines; when no substantial program involvement is anticipated between the funding agency and the institution; and there is no expectation on the part of the funding agency for delivery of a specified product or service for the use or benefit of the funding agency. However, funding agencies do expect grantees to share with the public any results, products or model projects that further the knowledge of the discipline, the research community and/or society as a whole.

Office of Institutional Grants
The Office of Institutional Grant is the office that is officially charged with the oversight of all external funding processes and procedures for Delta State University.

Principal Investigator (PI) or Project Director (PD)
The Principal Investigator or Project Director has primary responsibility for ensuring that all programmatic and fiscal requirements of the grant are met. Only regular, full-time faculty and/or staff may serve as a Principal Investigator or Project Director on a grant and/or contract. Sponsors may at their discretion further define and restrict those allowed to direct projects or act as Principal Investigators. With permission of the Provost, part-time employees or non-paid representatives of the University may serve as PI.

The Office of Institutional Grants is formally charged with the responsibility of providing services to faculty and staff for securing external support from federal, state, and nonfederal sources including foundations and corporations, assisting faculty and staff in identifying, preparing, and obtaining research, educational, and service grants and other funding opportunities. It is charged with ensuring that proposals are in adherence with University policy and funder requirements; for maintaining the official grant file; and for reporting external funding to IHL and other entities as requested.

Delta State University is the legal entity for all obligations relating to contract and grant activity. All proposals which use the name and resources of Delta State University and which may result in an award to the University or an award to an individual functioning in a university capacity involving restricted funds must adhere to University policies and procedures for submitting a proposal, accepting an award and administering the project.

Internal Approval of Projects
All external funding proposals, both new and continuation, submitted by the University must go through an internal approval process via the Office of Institutional Grants Internal Approval Form. This process requires the signatures of at least the following persons: Principal Investigator, Chair/Director of Department, College Dean, Associate Vice President of Finance and Administration, Vice President for Finance, Provost/Vice President for Academic Affairs and Director of Institutional Grants. A copy of this form can be obtained from the Office of Institutional Grants.

It is the responsibility of the principal investigator/project director to attain approval for proposal submission by their department chair and dean. Once attained, all proposals, including a project budget, must be submitted to the Office of Institutional Grants at least three days prior to the due date for final institutional review for conformance with University and sponsor requirements. Once the proposal is deemed in compliance, the Director of Institutional Grants will route around for approval by the Associate Vice President of Finance and Administration, the Vice President of Finance and Administration, and the Provost/Vice President of Academic Affairs. Proposals submitted in less in than three days prior to the due date may not be reviewed and approved for submission.

The timely submission of proposals to the Office of Institutional Grants ensures sufficient time for the thoughtful consideration and review of sponsored project descriptions and budgets for compliance with University and sponsor policies.

Failure to obtain internal approval prior to submitting a proposal may result in funding being declined upon award notification.

Management of Sponsored Projects
Several offices are involved with the expenditure of restricted funds. However, the Office of Finance is responsible for approving all expenditures resulting from a restricted fund account. Upon funding award, the Principal Investigator must contact the Office of Institutional Grants, which will notify the Office of Finance to establish a restricted fund account for that grant award. That office will be involved with the principal investigator throughout the management process relating to restricted fund accounts.

All University policies and procedures relating to expenditure of funds must be followed for all contract and grant activity (i.e., purchasing rules, travel policy, property management, human resources, etc).

The Principal Investigator/Project Director is responsible for ensuring that all contractual requirements of the funder are followed including documentation and reporting requirements. Each funder is unique and has different requirements. It is the PI/project director’s responsibility to know those requirements and ensure that they are met.

Budget Revisions
It is sometimes necessary to revise the grant project budget. Most funders have regulations and mechanisms in place to make budget revisions. All budget revisions must be submitted through the Office of Institutional Grants. The Director of Institutional Grants can assist the PI/PD with the funder requirements regarding budget revisions and with developing the budget revision request.

Reporting Requirements
The Office of Finance is responsible for submitting all fiscal reports to funding agencies. Official financial reports can only come from the Office of Finance. It also is involved in all audits on restricted funds and is responsible for maintaining copies of all final technical reports for audit purposes. The Office of Institutional Grants is responsible for maintaining all records of grants, contracts and cooperative agreement activity for the purpose of reporting.

It is the responsibility of the Principal Investigator/Project Director to ensure that all programmatic reporting is submitted in a timely manner. The PI/PD should notify the Office of Institutional Grants in the event that there may be a deviation from the original grant application.

Acknowledgement of Funding Sources
Any publication, recording, performance, presentation or other scholarly activity that is the result of a sponsored project should acknowledge the resources contributing financial support. This acknowledgment should recognize all funding sources including the University’s contribution to projects. As an example, if funds were provided by the Provost for internal development efforts and the project resulted in a publication, performance, presentation, etc., the University should be acknowledged for providing this support.

Human Subjects
The Human Subjects Committee (Institutional Review Board, “IRB”) assures that adequate protection of human subjects’ rights and welfare are carried out in accordance with federal guidelines. This Committee, composed of representatives from all colleges as well as a community representative, is required to review all research projects involving human subjects before initiation of data collection. It is the responsibility of the PI/PD to ensure that IRB requirements are followed.

Cost Sharing (Matching Funds)
The University may be required to contribute to the costs of a sponsored project as stated in funding agency guidelines. In some cases, these expenses may be in the form of “in-kind” costs such as contributed effort of personnel (salary and fringe benefits) who are supported by non-sponsored funds. At other times, there may be a requirement for “cash”, particularly for equipment related projects.

When cost sharing funds are required, the Principal Investigator is required to discuss these needs with the respective chair/director and dean. Grant proposal budgets which include a commitment of matching salary funds by the institution must have the prior approval of the Provost. If these areas cannot provide the total cost share required for the project, the PI should contact the Director of Institutional Grants for assistance in determining possible cost sharing areas.

Cost sharing may also come from non-university, third-party arrangements. These arrangements must be committed and documented at the time of proposal submission.

The University is required to document all cost sharing/matching funds just as it tracks agency dollars. These become auditable expenditures and the primary responsibility for documentation rests with the Principal Investigator/Project Director.

Indirect Costs/Facilities and Administrative Costs (F & A)
Indirect Costs (sometimes referred to as Facilities and Administrative Costs or F & A) are actual costs incurred by the University that cannot be readily identified or associated with a single sponsored project or activity. These costs are normal business activities of the University such as utilities, public safety, libraries, building and equipment use and maintenance, accounting, payroll, and academic and sponsored administration. Every project has indirect costs associated with it.

The determination of F & A costs rates are based on a cost proposal submitted by the University to its respective federal cognizant agency, the Department of Health and Human Services. This proposal contains all of the “F & A” categories that relate to direct costs necessary to conduct the primary functions of the institution such as teaching, research and other activities. Rates are then negotiated and a final rate agreement is signed establishing the required rates for all projects submitted to external funding sources. DSU’s current negotiated rates are applied against salaries and fringe benefits.

Only the Provost has the authority to waive the federally-negotiated indirect rate. Any reduction of rates must be documented at the time of proposal approval.

Distribution of recovered F & A costs: F & A cost recovery partially reimburses the University for actual costs incurred for conducting sponsored projects. A portion of the F & A costs recovered is distributed to the Principal Investigator’s home department to underwrite project development costs. Each department establishes its own criteria for handling these funds so faculty/staff are encouraged to understand the departmental policies as well. Below is a breakdown of these funds:

50% – E & G Budget
35% – Dean of the College/School responsible for the grant
15% –Office of the Provost


(All policies comply fully with the OMB Circular A-21, Cost Principles for Educational Institutions.)

Faculty Course Release Time
Faculty members are encouraged to work on the grant during the academic year, if allowable by the grant and if qualified personnel are available to teach their course(s). If allowed by the grant, a faculty member may then request the granting agency “buy out” a portion or all of their course responsibilities. The faculty member must request permission from his/her department/division chair, appropriate Dean, and the Provost for a “course buy-out.” Faculty members working on federal grants may then charge a proportionate share of their base salary and fringe benefits to the grant, but faculty may not increase their total compensation by working on a grant. The salary charged to the grant is based on their regular, annual compensation. If approved, the faculty member’s proportionate salary and fringe benefits will be charged to the grant, providing the Provost the funds to pay for adjuncts or overloads to cover the teaching assignments.

Faculty Summer Salary
For periods outside the academic year OMB A-21 states: “Charges for work performed by faculty members on sponsored agreements during the summer months or other period not included in the base period will be determined for each faculty members at a rate not in excess of the base salary divided by the period to which the base salary relates…” (OMB A-21 J.10.d.(2)(a)) Consequently, faculty members may earn additional compensation for working on grants from mid-May (after graduation) until 31 August (when the summer ends). The base salary is defined as the 9-month salary the faculty member is paid over 12 months. The maximum monthly salary permitted under a grant is one-ninth of the base salary. The maximum percentage of the base salary that can be earned during the summer period will be 30%.

“Charges for teaching activities performed by faculty members on sponsored agreements during the summer months or other periods not included in the base salary period will be based on the normal policy of the institution governing compensation to faculty members for teaching assignments during such periods.” (OMB A-21 J.10.d.(2)(b))

It is the responsibility of the PI/PD to document time and effort committed towards a grant funded activity.

Administrative and Staff Salaries
Salaries and wages of current administrative and clerical staff are not normally funded as direct costs to the grant. There are some exceptions; see the Director of Institutional Grants for more information.

Fringe Benefits
Fringe benefits are actual personnel expenses associated with any salary paid by the University. Fringe rates are determined by the Office of Human Resources. Every salary (excluding students) associated with contract and grant activity has a corresponding fringe rate to be charged. These benefits include such items as workmen’s compensation, health insurance, FICA, etc. The Office of Institutional Grants will work with the PI to ensure accurate inclusion of fringe benefits in the budget request.

Responsible Party and/or Policy Owner:  Office of Institutional Grants

  • OMB Circular A-21
  • Office of Grants and Contracts’ Internal Approval Form

  • Approved by Academic Council: 04/22/2014
  • Approved by Cabinet: 05/12/2014