Consultants and Subrecipients

Consultants

The Internal Revenue Service issued findings against UMass in an audit regarding the payment of individuals as consultants rather than employees (temporary), therefore, special consideration must be taken in the appointment of consultants. 

Please consider the following when budgeting: 

• A consultant lends their expertise and advice in their given field without actually "working" on the project. 
• A consultant does not conduct independent research. 
• A consultant is neither affiliated with UMass nor using its facilities. 
• A consultant does not use their home institution’s facilities to conduct any portion of their consultancy. For example, a consultant who is also employed by another university must not use their employer’s facilities to carry out their consulting agreement. 
• A consultant must provide UMass with a letter that describes their role and indicates the number of days/weeks charged to the grant and provide daily or weekly rate. If the letter is on their home institution’s letterhead, the consultant should email the PI or OPAS confirming that they will not be using their home institution’s facilities for any part of their proposed consultancy. 
• Intellectual property or publishing rights are not anticipated. 
• UMass and other Commonwealth of Massachusetts employees cannot be paid as consultants on UMass-sponsored projects. 
• UMass may be subjected to significant institutional tax penalties should the individual be incorrectly classified as a consultant when they are actually working on the project in a manner consistent with employer/employee relationships. 

Subrecipients

Generally a subrecipient (known in the Kuali system as an Organization), as compared to a consultant or fee for service vendor, is defined as an entity, often another university, who helps the grantee carry out the activities of the award by independently performing a portion of the research work using their own facilities. 

Documentation needed by OPAS includes: 

• UMass subrecipient form (to be filled in by subrecipient) 
• A letter of intent to establish a subaward agreement signed by the subrecipient's business official (OPAS equivalent) endorsing the work referenced in an attached statement of work and budget
• Statement of work (subrecipient specific — does not include UMass effort) 
• Subaward budget, use sponsor budget forms as applicable 
• Additional sponsor forms, including certifications as applicable 
• Most federal sponsors also require biosketches from key personnel 
• Facilities/Resources statement following sponsor format. Required by most federal sponsors and some non-federal 
• Indirect Cost Rate Agreement (if subrecipient is charging indirect costs) 
• Sole source justification (provided at award stage) 

The subrecipient's sponsored programs office should forward the items listed above to the UMass PI well in advance of the deadline. The UMass PI will review the subaward budget in the lead proposal. All other items are not typically incorporated into the proposal but forwarded to OPAS for review and held on file in case of audit. 

The UMass detailed budget should not blend subaward costs with UMass project costs. Two separate detailed budgets should be included. The UMass detailed budget will include a line item each year showing Subrecipient Total Costs (inclusive of indirect costs). 

Subaward vs. standard procurement vs. consultant: If the individual or company in question provides a service for which a flat fee is charged for the work to be done and they are not involved in the research effort but simply provide a service at a fixed fee, this transaction of services is classified as a standard procurement rather than a subaward.