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Selected highlights from the many research resources online at the Smithsonian.

CHAPTER ONE

INTRODUCTION

Smithsonian staff, research associates and post doctorates are eligible to seek and receive awards from outside sources, including the Federal, State and other governments, corporations, private foundations, and not-for-profit organizations. Sponsored programs are diverse and complex at the Smithsonian; therefore, Principal Investigators planning an externally funded project and Fund Managers, who administer the project funds, will find this Guide a valuable resource.

The Office of Sponsored Projects (OSP) is the office to contact for technical and procedural questions related to sponsored projects. An organizational chart of OSP is provided in Appendix A. OSP staff provide advice and guidance to Principal Investigators to ensure that sponsor and Smithsonian policies and procedures are followed. OSP staff are ready to assist Principal Investigators in answering grant and contract related questions and finding solutions to unusual problems. Upon acceptance of a sponsored project award, OSP Grant Administrators and Financial Analysts set up an award account. Through the life of the award, they prepare financial reports, handle checks and billing, negotiate any changes to the award, and close accounts. Principal Investigators and Fund Managers conduct the day-to-day financial transactions that the project requires. OSP has many inter-relationships with other Smithsonian offices and will consult, when needed, with these other offices. These include, but are not limited to, the following: Office of the General Counsel, Office of the Comptroller, Office of the Inspector General, Office of External Affairs (Development), Office of Contracting, Office of Safety and Environmental Management, Office of Fellowships, Office of International Relations, Office of the Treasurer, and the Scientific Diving Office.

The review and approval processes for sponsored project proposals and awards are depicted in a flowchart on the following pages.

This chapter provides an overview of the sponsored project proposal and award processes, divided into the following sections:

  • Principal Investigator
  • Fund Manager
  • Sponsored Projects Overview
  • Types of Sponsored Project Awards
  • Other Types of Awards

PRINCIPAL INVESTIGATOR

A Principal Investigator (PI) is the individual responsible for proposing and directing a sponsored project. The terms "Principal Investigator," "Responsible Investigator," "Project Director," and "Program Director" all refer to that person.

When this individual takes on the task of preparing a proposal for submission to an outside source, he or she agrees to manage the ensuing grant or contract in compliance with the terms, conditions, procedures, and policies of the sponsor and the Smithsonian.

FUND MANAGER

The unit staff person providing administrative support for the Principal Investigator is known as a Fund Manager. A Fund Manager is a key member of the team of individuals providing support for the funded project. The Fund Manager typically has day-to-day responsibility for the following:

  • effecting procurement, salary, and other charges to the award account that have been approved by the Principal Investigator
  • maintaining unit records of expenditures of award funds
  • reconciling Smithsonian accounting reports with unit records and ensuring that any necessary adjustments are processed
  • assisting the Principal Investigator in monitoring and maintaining project financial and other award records through closeout

SPONSORED PROJECT OVERVIEW

A "sponsored project" is a program or project that receives partial or full funding through a grant or contract awarded from a source external to the Smithsonian. Important sources include government agencies, private foundations, corporations, and non-profit organizations.

Sponsored projects generally require the following:

  • Preparation and submission of a proposal to a sponsor
  • Negotiation and acceptance of terms and conditions
  • An approved line-item budget
  • Maintenance of both detailed financial and administrative management throughout the project
  • An external audit

See below and Appendix B for further definition of grants and contracts.

TYPES OF SPONSORED PROJECT AWARDS"

While all sponsored projects require funding, sponsors give funding in numerous ways, including the following:

  • Grants
  • Contracts
  • Government flow through grants and contracts (sub-grants and sub-contracts)
  • Government cooperative agreements
  • Interagency transfer agreements

In the case of sponsored projects from government entities, the type of sponsored project - grant, contract, or cooperative agreement - is determined by the government entity.

Grants

A grant is an agreement by a corporation, foundation, government, or non-profit organization to provide financial support for a specific Smithsonian program, project, or activity. Grants contain one or more of the following conditions:

  • The sponsor specifies a period of performance.
  • Unspent funds are to be returned to sponsor.
  • Funds must be expended in accordance with an agreed upon budget.
  • Deviations from stated grant terms require sponsor approval or modification.
  • Financial reports are required and must be provided to the sponsor.
  • The sponsor specifies additional financial terms and conditions.
  • The sponsor requires a research or performance report for informational purposes.

Note: If any of the above conditions exist, the Smithsonian treats the funds as grants.
A grant, donative in nature, is given as a form of encouragement without expectation of project control or any beneficial return to the sponsor other than appropriate acknowledgement and recognition. Upon acceptance of a grant, the Smithsonian is legally obliged to comply with its terms and conditions.

Although grant sponsored projects do not have expectations or result to meet, a grant sponsor usually has some element of control in the award process. Sponsors normally determine and announce the following:

  • Criteria for selection
  • Priorities to be accorded
  • Process of application
  • Process of selection

Since it is not always readily apparent whether awards are categorized as grants or gifts by the Smithsonian, award terms are reviewed by an OSP Grant and Contract Administrator to determine its grant or gift designation.

Contracts

A sponsored project contract is an agreement by a corporation, foundation, government, or other entity to provide financial support for a specific Smithsonian program, project, or activity. In return, the Smithsonian agrees to provide project results to the sponsor.

Contracts consists of promises made by each party, each of whom is legally obligated to fulfill all contractual terms. A contract, unlike a grant, is not donative in nature, but rather is a mutually beneficial arrangement by which the sponsor supports a Smithsonian project with the expectation of benefiting from the results of the project. The Smithsonian is required to deliver the results of the project to the sponsor. Most often, the results are in the form of a research report or copies of publications. In some cases, the results are tangible items produced as a consequence of Smithsonian research.

Contracts also consist of subcontracts and purchase orders.

  • A subcontract, like a contract, is a formal legal arrangement in which an award is made by a prime institution to a participating institution. Agreements governing this relationship include expectations of work to be performed, milestones, deadline dates, budget, reporting requirements, and other programmatic or administrative terms and conditions.
  • A purchase order is a legal document that constitutes a contract between sponsor and the Smithsonian. It must contain all pertinent details of the agreement. A purchase order may be cost reimbursable or fixed price. A cost reimbursable purchase orders provides a reimbursement of expenditures as the project progresses while a fixed price purchase order has a set fee for the work outlines.

Government Flow-through Grants and Contracts

A government flow-through grant or contract is a grant or contract to the Smithsonian from a non-government sponsor that states funding has been provided by a government sponsor, or that incorporates government award terms and conditions. Flow-through grants and contracts may also be referred to as sub-grants or sub-contracts.

Because government flow-through grants and contracts require financial and administrative time and attention similar to that required for government awards, government flow-through grants and contracts are treated as if they were awarded directly from a government sponsor.

However, when a grant from a private sponsor includes a requirement for government matching funds or program collaboration with the government, but does not indicate that funding has been provided by a government sponsor or incorporate government terms and conditions, the grant is categorized as a non-government grant.

Government Cooperative Agreements

A cooperative agreement is a type of funding arrangement between the Smithsonian and a government entity. A government entity awards a cooperative agreement when it desires active participation in the project, or when its internal procedures warrant the use of a cooperative agreement rather than a grant or contract. A cooperative agreement may have elements of both grants and contracts.

OTHER TYPES OF AWARDS

Funding usually comes in the previously mentioned forms. However, funding does come in other types of awards on occasion, including:

  • Awards to individuals
  • Gifts
  • Interagency transfers
  • Smithsonian internal award programs

Awards to Individuals

On the rare occasion when a sponsor accepts only an application from and makes an award to an individual, the PI should contact OSP prior to developing a proposal. An individual is not authorized to submit an application with an assumption that the Smithsonian’s resources will be made available for the successful completion of a project. OSP must be contacted to ensure that all necessary internal approvals are obtained and a letter of institutional support for the proposal is provided.

Gifts

A gift is a donation of materials, services, facilities, property, cash, or cash convertible assets to the Smithsonian from individuals, corporations, foundations, and other organizations. A donor gives a gift without expectation of any return other than appropriate acknowledgement and recognition.
As gifts can be easily confused with grants and contracts, the below table is intended to clarify the differences in these award types.

  Grant Contract
Donated yes no yes
Terms and conditions yes yes no


Gifts of financial support are classified either as restricted or unrestricted funds. Although the Smithsonian is legally obliged to use gifts for the purpose specified by the donor, there are no additional obligations to the donor.

Gifts to the Smithsonian of an unrestricted nature and those restricted to general or generic program use, without consideration or obligation of performance, are not viewed as sponsored projects and are not administered by OSP.

Interagency Transfers

Federal agencies on occasion propose providing financial support for a project by means of an interagency transfer. As an organization classified under section 501.C (3) of the Internal Revenue code, the Smithsonian has authority to enter into grants and contracts with Federal agencies in the same manner as other non-profit organizations so classified. The Smithsonian usually views entering into grants and contracts as the most appropriate means for receiving funds from Federal agencies.
However, in some cases, an OSP Grant and Contract Administrator works with the Principal Investigator and the potential sponsor to develop another funding mechanism, such as a cooperative agreement or purchase order. Nevertheless, if unable to receive funding as a grant or contract, the Smithsonian will enter into interagency agreements. As a recipient of a Federal appropriation, the Smithsonian has authority to enter into such agreements once the PI has obtained approval from the Chief Financial Officer (via OSP). Historically, the Smithsonian has accepted them for certain long-standing projects and for others on an exception basis. It is the policy of the Institution to recover indirect costs on interagency transfers. Refer to Appendix C for interagency transfers.

Smithsonian Internal Award Programs

The Smithsonian provides opportunities for its employees to apply for internal funding in support of their project activities at the Smithsonian. Some of the programs and the Smithsonian Institution offices involved in administering them are listed below.

Title Responsible Smithsonian Office
Atherton Seidell Grant Program Office of Fellowships
Research Associates Office of Fellowships
Scholarly Studies Program Office of Fellowships
Short-term Visitor Program Office of Fellowships
Short-term Independent Research Program Smithsonian Center for Materials Research and Education
Women's Committee Awards Smithsonian Women's Committee

Awards granted to Smithsonian staff under these internal programs are not administered through OSP.