Sponsored funding can take the form of a grant, contract, cooperative agreement, or a gift. It is important to understand and clearly distinguish between various types of awards, as the processing for each is quite different. Below is a description of each type.
Through awards of funding, property, services, etc., grants enable the PI to achieve some specific goals that fit within the context of the general objectives of the sponsor. Acceptance of a grant obligates the PI and UNM to terms and conditions specified by the funding opportunity, the project as outlined in a proposal, and the policies of the funding agency. This type of agreement has the fewest restrictions on the PI and UNM of any sponsored project.
The distinct characteristics of a contract are that it emphasizes and is limited to the purposes and goals of the sponsor through the acquisition of property or services. The contract establishes and describes the rules of the relationship between the parties, setting forth the rights and responsibilities of UNM and the PI in an effort to meet the needs of the sponsor. If the contract involves federal funds, the contract (or subcontract) will also be subject to Federal Acquisition Regulations (FAR), DEARS (for DOE), or DFARS (for DOD). Please note that a solicitation for a contract is similar to that of a grant, and occasionally, a funding agency will opt to use a contracting mechanism instead of a grant award to fund a project.
Note: If a solicitation includes terms for a draft contract to be awarded, immediately contact your Contract and Grant Administrator in PreAwardPre-Award. These individuals can review the contract terms of the solicitation in parallel with the preparation of the proposal.
A contract is a binding legal document that may be issued by industrial sponsors, educational institutions, or by federal, state, or local governments. A contract involves a set of PI responsibilities that are articulated in a detailed Statement of Work, with the expectation that the PI will complete the stated deliverables, meet the cost limits and conditions of the budget, meet the stated schedule, submit interim and final reports (as applicable), and approve invoices and effort reporting. A contract requires the signatures of all parties (with UNM, not the PI, as the co-signatory) for both the initial award and for any subsequent modifications. In no instance can a PI from main campus or any branches sign or co-sign an acceptance of terms and conditions on behalf of the Regents of UNM.
Contracts are identified by various names, including:
- Basic Ordering Agreement
- Collaborative Agreement
- Confidentiality or Non-Disclosure Agreement (C/NDA)
- Consulting Agreements (CA)
- Cooperative Research and Development Agreement (CRADA)
- Industrial Sponsored Research Agreement (ISRA)
- Inter-Agency (or Intergovernmental) Personnel Agreement (IPA)
- Joint Powers Agreement
- Material Transfer Agreement (MTA)
- Memorandum of Agreement (MOA)
- Memorandum of Understanding (MOU)
- Professional Service Agreement
- Small Business Innovation Research (SBIR)
- Small Business Technology Transfer (STTR)
- Subaward Agreement (SA)
- Teaming Agreement
- Testing Services Agreement
(TSA)See the Glossary for more details on the following: CA, C/NDA, IPA, ISRA, MTA, and SA. FRSOs and CGAs in PreAwardPre-Award can provide clarification.
Contracts can be funded (such as research agreements, Inter-Agency Personnel Agreements, and incoming subawards) or unfunded (such as Material Transfer Agreements or Non-Disclosure Agreements). The most common types of funded contracts are cost-reimbursable contracts, which are based on an initial estimate of costs and paid as work is completed. Fixed-price contracts involve a single price for the stated scope of work, but can be invoiced at agreed upon intervals. Most of UNM’s contracts are cost-reimbursable, and involve the requirement to notify the sponsor when funds are nearing depletion. The project is then either extended by a contract modification for additional funding, scope or time, or the project is closed if all deliverables have been submitted at the end of the project. A cost-reimbursable contract is sometimes audited during implementation, but more typically, after the project has ended.
Important Note: Any contract committing UNM’s resources or personnel must be signed by a duly authorized individual at the University. The Office of the Vice President for Financial Services has primary responsibility for signing funded contracts or grants for the University.
Though similar to a grant, a cooperative agreement has statutory criteria that allow sponsoring agencies to have substantial involvement with the recipient in project planning and implementation. This feature in some instances will result in the award being more like a contract than a grant. Therefore, the PI will not have as much flexibility in making research-related decisions as with a grant.
A gift is not a sponsored project, but a donation or charitable contribution. It can be cash or property or equipment, and is unrestricted for accounting purposes, as opposed to grant and contract funding which is restricted. The UNM Foundation has published rules (Gift Acceptance Policies and Procedures) for accepting equipment and property. The donor retains no rights to the outcome of the use of the gift beyond knowing that it was used as designated, and the gift can be designated to support faculty or staff projects and programs. All gifts must be processed through the UNM Foundation.
Grants are usually distinguishable from donations or charitable contributions by the following characteristics:
- Funds are given to the University in response to a proposal submitted by the investigator.
- The sponsor has specific submission guidelines, forms and formats.
- The sponsor requires interim and/or a final technical and/or financial report.
- The sponsor has rules, regulations, and/or terms and conditions that govern how funds are to be spent or how the project must be managed.
- Any unspent funds are to be returned to the sponsor.
Also grants, unlike gifts, typically have regular funding cycles and budget periods.
As it may not be obvious at the time the proposal is written whether the sponsor will give a gift or a grant, the applicant is encouraged to submit the proposal through Pre-Award with the paperwork uploaded as a Cayuse424 entry, and obtain the appropriate approvals for submission. If the award is in the form of a donation, the award will be set up and administered through the UNM Foundation.
PIs do not have signature authority to sign contracts or grants for UNM (UNM Business Policies and Procedures Manual Policy 7.8, “Signature Authority for Contracts”). Sponsored projects are awarded to the institution. UNM, as the applicant institution, is responsible for strict accounting of the use of the awarded funds. Funds may not be used for any other purpose than that agreed to in the contract, grant, or cooperative agreement. Transfers cannot be made between contracts or grants. Funds are, therefore, “restricted” to a specific account or index code. Funding methods may vary by sponsor for multi-year projects. However, most contracts or grants awarded for the project period are funded annually in specified increments in accordance with the award agreement and/or the sponsor’s policy. Please note that annual increments are contingent upon the PI showing progress in achieving the proposed project goals and objectives by submitting reports or deliverables, as agreed upon, to the funding agency.
Note: Any circumstance in which a PI encounters a solicitation for a contract with (a) specific terms and conditions, and/or (b) forms or documents (such as non-disclosure or material transfer agreements) that require signature, the PI must contact Pre-Award immediately.