VI. Procedures for Classifying External Funding as a Sponsored Award of Gift
VII. Procedures for Proposals and Funding Inquiries
Policy Statement
Emerson College must manage all funds it receives from external entities in accordance with applicable federal, state, and local laws, and in accordance with the terms and conditions that accompany any gift or sponsored award. While both gifts and sponsored awards (usually in the form of a grant or contract) are often awarded in response to a proposal with a specific work plan or activity, the mechanisms used to manage these respective types of awards differ greatly, and are primarily determined by the requirements of the donor or sponsor. Consequently, it is incumbent upon Emerson to properly classify such awards as either a gift or as sponsored funding. The accurate classification of a donation (gift or sponsored award) is also essential in determining which Emerson College office – Office of Research and Creative Scholarship (ORCS) or Office of Corporate and Foundation Relations (C&F) – will facilitate the funding.
Applicability
This policy applies to Emerson College’s cognizant offices for external funding (Office for Research and Creative Scholarship; Office of Corporate and Foundation Relations); staff who administer or negotiate gifts or sponsored awards; and all other faculty, staff, appointees, students, and any other individuals who seek or receive external funding through their affiliation with Emerson College.
Reason for Policy
The purpose of this policy is to provide a framework to facilitate the appropriate classification of private support received by the College as a gift or a sponsored award. This categorization is essential for ensuring that the appropriate office or department manages the funding in a manner consistent with such classification and for ensuring that it is treated correctly for tax and accounting purposes. While ORCS is responsible for sponsored program activity in which external financial support has a defined scope of work, expectations, and expenditure of funds; C&F is responsible for charitable program activity in which external financial support is philanthropic and directed toward a donor’s area of interest. The College is also accountable to the Massachusetts Office of the Attorney General for ensuring that gifts are used in accordance with the wishes of the donor.
Definitions
Donor: A person or entity making a gift or donation.
Philanthropic Gift: A contribution with no expectation of reciprocal obligation from Emerson College to the donor. It is a gift received for unrestricted or restricted use in the advancement of the College’s mission for which the College has made no commitment of resources or services, other than to direct the funds toward the donors’ area of interest. Although donors can place stipulations on a gift, they do not retain control over gift expenditures, and the absence of “deliverables” (reports, goods, services, quid pro quos) helps define the charitable nature of this type of funding.
Within these confines, Emerson College has significant leeway in how the gift funds are used, and in determining which faculty members, staff, and students may participate in the funded activity. Gifts are managed and administered by the Office of Corporate & Foundation Relations (C&F).
Sponsor: An entity that provides funds for a distinct project or activity with the expectation of a specific outcome or deliverable.
Sponsored Award: Funding for an activity with a defined scope and purpose undertaken by the College with the expectation of an outcome that directly benefits the provider. Sponsored awards, which include grants, cooperative agreements and contracts, bind the College to a set of specific terms and conditions and indicate a related reciprocal transfer of something of value to the sponsor. The sponsor usually requires that the College submit financial and narrative reports on the use of the funds, and will place limitations on how the funds may be spent. Sponsored awards are managed and administered by the Office of Research and Creative Scholarship (ORCS).
Statement of Principles
- All funds that originate with United States government agencies, including pass-through funding subcontracted to Emerson from other organizations, must be classified as sponsored awards. Sponsored awards are managed and administered by the Office for Research and Creative Scholarship (ORCS).
- Any award that originates with a private or non-federal entity, including private foundations, non-profits, for-profit corporations, and others, that contain one or more of the following indicators will be classified as a sponsored award and managed through ORCS:
a. Statement of Work: a sponsored award is typically made to support a specific work plan or task, agreed upon by the sponsor and the Principal Investigator or Program Director with the College adhering to requirements or guidelines promulgated by the sponsor. The Statement of Work will usually be defined by a specific deliverable, a period of performance, or a detailed line-item budget of the costs necessary for completing the work.
b. Financial Reporting Requirements: the terms and conditions of the award require Emerson to track and account for the expenses incurred for the work performed, and submit scheduled invoices and/or financial reports to the sponsor. In many instances, the sponsor will require that Emerson return any unspent funds at the expiration of the period of performance. Additionally, the sponsor will often reserve the right (as stipulated in the award terms and conditions) to analyze the expenditures incurred on the award, and the right to disallow or demand repayment of costs that are deemed unallowable or unrelated to the defined activities. Award also includes F&A costs, matching requirements, cost-sharing, specific commitments of personnel effort, and agreement to terms under which funding will be accepted.
c. Technical/Progress Reporting Requirements and/or Deliverables: the sponsor requires periodic updates from the Principal Investigator on the status of the work being performed, and expects to be kept apprised of progress towards a stated goal, or changes to the scope of work. In the case of a contract, the sponsor will typically expect the disposition of a completed and specified deliverable (or multiple deliverables) from the Principal Investigator. The Principal Investigator has primary responsibility for providing these reports, which are usually due to the sponsor at set intervals or milestones identified in the award document.
- Any donation that originates with a private or non-federal entity, including private foundations, non-profits, for-profit corporations, and others, that contain one or more of the following indicators will be classified as a gift and managed through C&F:
a. The funds are irrevocable, and their use is not restricted to a specified period of performance. Gift contains only general obligations on behalf of the College and supports a purpose in which funds can be directed or restricted to areas such as endowments, infrastructure, scholarships, financial assistance, programs or general college activities/operations of interest to the donor.
b. There is an absence of reporting requirements as a condition of utilizing the funds, although the donor may request periodic stewardship updates if the gift is for a stated purpose. Gift only requires a broad proposed plan, brief budget, general stewardship reporting, and periodic progress updates; and have no contractual requirements imposed.
c. The College is not required to submit detailed financial reports that are subject to review and approval by the donor, and expenditures are not line items in a donor-approved budget. The donor may request that the College provide a general report of expenditures, but this is usually done as a gesture of good stewardship, rather than as a contractual obligation.
d. The College has a fiduciary obligation to use a gift in accordance with wishes of the donor, and the funder receives satisfaction in return for the funds donated.
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C&F serves as the College’s office for prospect clearance and repository of data for corporate and private foundation entities. Because both ORCS and C&F administer numerous solicitations and proposal submissions to external funders, faculty and staff seeking corporate and foundation funding must contact C&F for clearance prior to any external approaches. Clearance through C&F assures that college priorities and strategic relations with corporations/foundations take precedence beyond one particular project, and assures that two offices are not approaching the same entity for funding, since many corporations and foundations restrict the number of proposals allowed per institution per year. The tracking and coordination of approaches enables Emerson to provide essential management and services for corporate and foundation prospects, leading to more satisfied relations with funders and sustained giving for the College.
Procedures for Classifying External Funding as a Sponsored Award or Gift
- The Office or department that receives a Notice of Award (NOA) (usually ORCS or C&F) will perform an initial analysis of the document against the principles outlined above, and by utilizing the “Gift vs. Grant Determination Tree” document. In cases where a determination cannot be readily made, the Vice President for Administration and Finance, Vice President of Institutional Advancement, and Vice President for Academic Affairs (or designees as determined by any/all parties) will make the final classification determination, with the receiving Office and in consideration of the initial analysis. The award will subsequently be administered in accordance with the guidance outlined above in subsection IV.
- In resolving issues related to the classification of an award, Emerson personnel must maintain an appropriate balance among the interests and preferences of the donor/sponsor, and the College’s administrative policies and objectives, and compliance with law. In the process of resolving these issues, in some cases it may be necessary to contact the donor/sponsor for clarification of intent and requirements, and/or to discuss the planned use of the funds.
Procedures for Proposals and Funding Inquiries
- ORCS and C&F encourage members of the Emerson community to contact either office to discuss funding ideas and determine if external support would be sponsored or philanthropic. As a rule, ORCS handles proposals to federal, state, and local governmental agencies, while either office may handle proposals to corporations and foundations, depending upon the specific circumstances. While your inquiry will be directed to the appropriate contact, sometimes the initial development of a proposal will be managed by C&F, and the program requirements later dictate that the proposal should be facilitated by ORCS (or vice versa). Both offices will work together to ensure a smooth transition of responsibilities with minimal disruption to the faculty or staff member.
- ORCS and C&F also work closely together to leverage each office’s respective areas of expertise. For instance, C&F can provide assistance in proposal writing and editing, as well as aligning the objectives of organizations with those of the College, while ORCS works to ensure consistency with governmental, sponsor, and College policies on external funding.
- Cross References to Related Policies
- Responsible Officer: Vice President for Academic Affairs and Provost
- Key Offices to Contact Regarding the Policy and its Implementation
Office of Research and Creative Scholarship
Eric Asetta, Executive Director
617-824-3075
eric_asetta [at] emerson.edu (eric_asetta[at]emerson[dot]edu)
Office of Corporate and Foundation Relations and Institutional Advancement
Meghan Driscoll, Associate Director, Corporate and Foundation Relations
617-824-3467
meghan_driscoll [at] emerson.edu (meghan_driscoll[at]emerson[dot]edu)
Appendix: Gift vs. Grant Determination Tree
