Subaward Vs. Vendor Guidance

How to distinguish between a Subaward and a contract for services

An agreement is not or is very unlikely to be a Subaward If any of the following are true:

• The contract's total expected value is less than $25,000.00 (except clinical trial sites).
• The contract is to an individual or sole proprietor. An individual cannot be a Subrecipient because:
• Individuals are not legal entities
• The federal government grants funds to an organization; it does not fund individuals
• The knowledge of an individual is considered personal.
• The vendor does not have a PI.
• The contract is for off-the-shelf services or specialized services where the vendor customarily provides such services on a commercial basis, usually at a fixed price or rate.
• The vendor provides similar kinds of goods and services within its normal business operations or to many purchasers.
• The vendor operates in a competitive environment.
• The vendor is a university and it customarily handles such transactions internally with "recharge rates" or externally through "service agreements" or "other sponsored activity" agreements.
• The goods and services to be purchased are ancillary to UCSC’s sponsored project.
• The vendor is not subject to the compliance requirements of UCSC’s sponsor.
• The vendor’s SOW does not reflect a specific, clearly defined, intellectually significant part of the research and SOW of the sponsor’s award to UCSC.
• The vendor is a professional consultant or is not significantly using its own computers and equipment and instead is advising UCSC personnel.
• The vendor's personnel are using UCSC's labs and equipment for critical parts of the contract.
• The vendor is a professor at another school who is acting as a "consultant" in that school's view (and that school will not accept a contract for the work the professor is doing.)
• The vendor is unlikely to be an “inventor” because they are working at our direction.
• The collaboration is not substantial enough for vendor to be deemed an inventor or joint-inventor.
• The vendor does not have “programmatic decision-making” responsibility.
• The vendor is providing equipment, fabrication of equipment, or components of fabricated equipment. However, a subaward SOW may include fabrication of specialized equipment to be used for the UCSC SOW as a project- related asset or as a deliverable to the sponsor. It depends in part on the purpose of the sponsor’s award, UCSC’s SOW, and whether the subrecipient is providing intellectually significant contributions to the development of the equipment.
• The vendor is conducting a survey using de-identified data, and annual IRB approval is not required.
• The vendor performs a test on data we provide to them and give us the results to analyze and/or provides routine professional services in analyzing the results (e.g, a radiologist reading an X-RAY). NOTE: if the entity provides professional expertise to contribute to generalizable knowledge in new ways, the entity could be a subaward.
• The services are routine in nature and follow established or previously invented/discovered procedures.

A subaward is likely appropriate if the answers to all of the above are “no” AND you can answer “yes” to any of the following questions:

1. Does the entity’s SOW represent an intellectually significant and clearly separable portion of the programmatic effort of the overall project?
2. Does the entity have responsibility for programmatic decision making?
3. Could the entity’s work result in intellectual property being developed or publishable results (including co-authorship)?
4. Will the entity need animal and/or human subjects approval for its portion of the work?