See the Subaward Processing Checklist—Department/PIs and the Subaward PI Quick Guide for additional guidance.
Subrecipient Selection & Evaluation
The University Principal Investigator (PI) and department are required to evaluate the subrecipient during proposal preparation to assess technical expertise and financial viability of the organization and key personnel.
We recommend that the PI/department complete the applicable Fair and Reasonable Cost Analysis form. The information gathered on the forms below will help document information that may be requested by auditors.
- Fair & Reasonable Subaward Cost Analysis Form 1: Subawards under Grants, Cooperative Agreements, and Nonfederal Contracts is used to justify subrecipients under Grants and Cooperative Agreements and does not need to be forwarded to SPA, but should be kept in the department files.
- Fair & Reasonable Subaward Cost Analysis Form 2: Subawards under Federal Contracts is used to justify subrecipients under Federal Contracts. Form 2 must be forwarded to SPA with the complete proposal.
Subrecipient Proposal Materials
See the Guide to Proposing, Receiving, and Managing a Subaward from the University of Minnesota for additional guidance.
The University PI/department requests proposal package from potential subrecipient, including:
- Subrecipient’s statement of work
- Subrecipient’s budget and budget justification
The budget should include an itemized budget: salaries, fringe benefits, supplies, equipment, travel, other direct costs, and facilities and administration costs (where applicable). If the subrecipient intends to charge facilities and administration (F&A or indirect) costs, the subrecipient should include a copy of their federally negotiated rate agreement which will be retained in the University’s files if they do not participate in the FDP Expanded Clearinghouse.
About F&A for Subawards: There are two types of F&A costs on subawards: those earned by the subrecipient and those earned by the UMN. If a federal program has a published statutory F&A cap (e.g., USDA-NIFA caps F&A at 42.857 percent of TDC unless otherwise noted in solicitation), that rate must be used both by UMN and all of its subrecipients. For all other federal programs, if a subrecipient has a federally negotiated F&A rate, it must be applied to the base budget (i.e., the Modified Total Direct Costs). If the entity does not have a negotiated F&A rate, a de minimus rate of 10 percent of modified total direct costs (MTDC) must be used instead, or the PI/department may request that SPA negotiate an F&A rate with the subrecipient (this request may not be granted). For subawards under nonfederal prime sponsors, the F&A rate and base will vary. Please consult your GA if you have any questions.
About Modified Total Direct Costs (MTDC): All direct salaries and wages, applicable fringe benefits, materials and supplies, services, travel, and up to the first $25,000 of each subaward (regardless of the period of performance of the subawards under the award). MTDC excludes equipment, capital expenditures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support costs, and the portion of each subaward in excess of $25,000.
About Fixed Price Subawards: While NIH has now waived prior approval on fixed price clinical trial subawards, prior Federal agency approval is required to enter into new, non-NIH clinical trial fixed price subawards, which may not individually exceed the simplified acquisition threshold which was recently raised to $250K (including supplements and modifications). Use this guidance and sample proposal text if you plan to issue non-clinical trial fixed price subaward agreements.
For foreign organizations, keep the exchange rate in mind. All subaward payments are paid in US dollars. Wire payments incur a $31 processing fee that must be paid by the department from a nonsponsored chartstring.
Download a Commitment Form or Letter of Intent signed by subrecipient’s PI and subrecipient’s authorized representative. If the subrecipient is participating in the FDP Expanded Clearinghouse, you do not need to request a subrecipient commitment form. Only a letter of intent is needed. The other necessary information can be obtained from the entity profile in the FDP Expanded Clearinghouse.
If sponsor is an agency implementing Public Health Service Financial Conflict of Interest, verify Financial Conflict of Interest (FCOI) policy on the FDP FCOI Clearinghouse. If subrecipient does not participate in the clearinghouse, they must complete FCOI Forms 1 and Form 2 (if applicable). The FCOI documentation MUST be on file for all listed subawards in a proposal before it is submitted.
Any other documents required by University or Sponsor (example: financial questionnaire).