StepbyStep Guidance What is a Recharge Center A recharge service facility is a selfsupporting operating unit within the University that exists principally to provide research related goods or services to University faculty staff or students at no more than the cost of providing the g ID: 652435
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Slide1
Setting Up a New Recharge Center
Step-by-Step GuidanceSlide2
What is a Recharge
Center
?
A recharge service facility is a self-supporting operating unit within the University that:
exists principally to provide research related goods or services to University faculty, staff, or students at no more than the cost of providing the goods or services (break-even);
bills sponsored programs for such goods or services;
has operating costs that are funded by charges to the customers receiving the goods or services; and
has revenues between $10,000 and $1 million annually Slide3
Qualification to be treated as a Recharge Center Facility
The
activity provides goods or services to a sponsored project. In addition, goods and services may be provided to University departments, students, and/or external customers.
The
facility operates as a separate, stand-alone entity, and the
revenue and expenses are recorded
in a
separate activity number.
The
facility charges all internal customers equally for goods or services at a rate that is calculated to recover costs over a fixed period of time
.Slide4
Qualification to be treated as a Recharge Center Facility(
Cont
’)All Recharge Service
Facilities, Specialized
Recharge Service
Facilities,
Core Recharge Service
Facilities fall
within the purview of the
Office of Research and Economic
Development (
ORED)
and are covered
the
ORED
Recharge Center facilities Operating
Procedures.Slide5
What compliance regulations govern
Recharge
/Service
Centers?
Recharge Center facilities should not over‐charge
the
Federal sponsored projects. OMB Circular A-21 rules apply.
The recharge center must be one a per unit basis, which must be at cost with no markup.
Federal guidance requires that facilities break even over a reasonable period of time.
Recharge
center rates should
be approved
by the Office of Research and Economic Development on
an annual
basis
to ensure compliance with OMB Circular
A-21.Slide6
Steps to Request to Establish a Recharge Service
Facility
A Step-by-Step GuideSlide7
Step 1: Recharge facility Eligibility Form
Complete
the preliminary recharge facility eligibility form which includes the questions below. ORED will review the eligibility form and make an initial determination as to the feasibility of the proposed facility.
Will
equipment costing more
than $
5,000 be used in the center
?
Was any of the equipment over $5,000 purchased using federal funds?
Are there similar services/products available in the area that will meet the needs?
Why the services can best be provided by an internal service center rather than by an external service provider?
When will the facility begin charging for providing products and services?
How much revenue do you think the recharge center will bring annually?
You can access the form at the following link:
What is your proposed recharge center name?
What are the products or service provided?
Who will be using your facility? Please identify your internal and external users.
How much in startup funding will be needed and who will provide the funds?
Will the facility be subsidized and who will provide this external funding? (e.g., from a department in the Dean’s office.)
What portion of revenue will be from federal sources?Slide8
Step 2: Prepare a Rate Proposal
Prepare your
rate calculations using the
ORED rate
development worksheet. Your rate proposal should identify the following:
Who will be using your facility? Who are the customers?
What product(s) or service(s) are you offering?
Identify all of the personnel, supplies, maintenance agreements and other costs of operating the facility.
Will the facility be subsidized and who will provide this
external
funding? (i.e. from a department in the Dean’s office.)
When will the facility begin charging for providing products and services?
How much in startup funding will be needed, who will provide the startup funds, and if needed, who will provide resources after the facility gets up and running
?Please request rate tool template at recharge@fiu.eduSlide9
The rate is calculated by dividing the total annual cost directly chargeable to the facility by the total estimated annual usage. You may have more than one billing rate, depending on the services you provide and to whom (internal vs. external users) you provide them.
It is critical to emphasize that you should determine the “total cost” of your recharge service facility. By not including the total cost in the rate(s), you risk incurring a negative working capital fund balance (deficit) for the recharge service facility.
Components of the calculation of the rate are the estimated demand for products and services and the anticipated costs associated with providing those products and services.
Calculating the Rate Slide10
The formula used for calculating the rate for each service or product is as follows
:
Annual Rate = Annual Costs / Total Annual Usage
Calculating the Rate (cont’d…)
BUDGETED EXPENSES
±
PRIOR YEAR’S SURPLUS OR DEFICIT
USAGE BASESlide11
Unallowable Costs
The federal guidelines require consistent costing practices with the University’s federal funds. Those costs that are not allowable on a sponsored project are also not allowable in the facility and may not be charged to a federally sponsored project. Examples of these unallowable costs include costs for contingency provisions or other reserves, costs relating to other functions of the school or department that are unrelated to the facility’s operations, entertainment, bad debts, alcoholic beverages, and public relations. Federal regulations do not permit startup costs incurred to establish a new recharge facility to be included in the rate. Slide12
Unallowable Costs: Lists
Surpluses
or deficits from other service lines within the facility that do not share the same customers
Auxiliary management fee
Bad debts
Contingency provisions
Entertainment
Fines and penalties
Public relations and advertising
Interest expense on internal loans
Memberships, subscriptions, and professional activity costs of a social or individual nature
Principal payment on debt
Contributions, donations, remembrances
Goods and services for personal use of employeesAlcoholic beveragesCommencement or convocation costsDepreciation of equipment purchased by the federal governmentSlide13
Step 3: Submit your rate calculations
Your rates calculations should be submitted using the ORED Rate Development tool at
recharge@fiu.edu
. The ORED team will revise your submission and will be sending an email to schedule a meeting.Slide14
Step 4: Request a recharge center Activity number
Once your recharge center rates are approved, ORED will request a new activity number for your recharge center.
As soon as New Activity Number ID is setup
ORED will
load initial Budget based on rate tool calculations approved. Slide15
Step 5: Billing
The facility is responsible for internal and external billings and receivables. Facilities must provide all customers, whether internal (i.e., a University unit or department) or external, with a detailed billing, which can be either electronically or on paper, and which shall
identify:
• The nature of the services rendered (e.g., testing)
• The goods provided
• The number of units (e.g., pounds, hours, # of items)
• The amount charged per unit of good or service
• Total charges by department or sponsored project being charged
• Name of person authorizing the service or good (from the Service Authorization Request or Usage Log)
Note: User bills that do not carry sufficient detail to identify the services or goods provided are subject to disallowance in a federal audit. The type of invoice used depends on the service or good provided. Slide16
Step
5: Billing(Cont’d)
For Internal Billing Use:
Revenue
Internal: Account # 679110
Expenses
Internal: Account #
773911
*For
External Billing:
Revenue External: Account #
672101
Expenses
Expense: Account # 773913*All checks from external customers should be routed to the Office of Research and Economic Development, MARC 430, to be deposited into the Recharge Center’s operating activity number. All checks must be accompanied by a complete DoR Recharge Center Deposit form and copy of invoice/agreement. Slide17
Step 6: Publish your rates
Please publish your rates on recharge center website and send the website link to recharge@fiu.edu.Slide18
Important Reminders:
The
Office of Research and Economic Development will
review the rates of the facilities
every two years
to ensure compliance with OMB Circular A-21.
The facility is responsible for preparing a detailed budget including rate calculations that account for the recovery of yearly surpluses or deficits. User rates must be supported by cost calculations based on historical costs and service levels. An adjustment for known or anticipated changes in service levels or services should be clearly documented.
The
facility is also responsible for issuing invoices, properly accounting of receivables and maintaining records pursuant to the applicable records retention period.
If you need a recharge center training, please schedule an one-on-one session at
recharge@fiu.edu