Firm Commitment Policy

Spending Prior to the Receipt of an Award:

Spending prior to the receipt or formal acceptance of an award requires an approved “Firm Commitment” request. A Firm Commitment request is an internal University procedure that allows a PI (under the conditions described below) to obtain a Fund and charge project expenses to this Fund before the award has been received or fully processed by OSP. Once the award is set up, the same Fund then can be charged for all remaining project expenses throughout the life of the award. 

Firm Commitment Requirements

1. A completed Firm Commitment Request Form signed by the PI and the PI’s Chair/Dean/Director.
2. Written documentation from an authorized sponsor representative of the sponsor’s intent to fund the project, funding level, start date, and the sponsor’s policy on pre-award costs.
3. Total funds required in each applicable budget category, including applicable Indirect Cost. 
4. Additional certification as requested by OSP, i.e., Financial Conflict of Interest or Approved Human Subjects Protocol when applicable.

Restrictions on Firm Commitments

Approval of a Firm Commitment will not be possible if:

• It is clear that the effective start date of the project is tied to the date of final signature on the agreement. In such cases spending cannot begin until the award or contract is fully executed. This includes most State of California and UCOP awards.
• An investigator has a positive financial disclosure that requires clearance by the campus’ COI Committee prior to the expenditure of funds.

A Firm Commitment may be delayed if the anticipated award is under negotiation which includes any terms and conditions that conflict with Regental policy (e.g., publication or citizenship restrictions). A Firm Commitment will not be processed by OSP until such issues are resolved.

Managing Risk

The PI’s department/unit is responsible for any pre-award costs incurred under the Fund Advance period that are disallowed by the sponsor. The PI’s department/unit also is responsible for clearing any deficit that results if the anticipated award is never received or the University ultimately cannot accept the award due to the conditions imposed by the sponsor.