Pre-Award

Subcontracts

A subcontract is a financial assistance mechanism used when the intent is to have another institution or party carry out an integral portion of the project’s scope of work. The subcontract is a formalized agreement that spells out the fiscal arrangements, defines the scope of work to be performed by the subcontractor, and flows down the terms and conditions of the prime award to the sub-recipient.

When an award, including the proposed subcontract, is made to the University, Contracts will draft the subcontract. The department will provide the Specialist the scope of work and budget for each specific subcontractor.

All research subcontracts are negotiated by Contracts. If the department obtains a subcontract, the department is to forward the agreement to the designated Specialist in Contracts for review.

Contracts is also responsible for performing an appropriate cost analysis in accordance with OMB Circulars A-110 and A-133 and for ensuring inclusion of appropriate terms and conditions (flowdown clauses) from the prime sponsor's award. All subcontracts in excess of $25,000 issued off of federal awards after October 1, 2010, are subject to FFATA reporting, which will be handled by Contracts.

Federal Demonstration Partnership (FDP)

UTHealth is a member of the Federal Demonstration Partnership (FDP). The FDP is a cooperative initiative among federal agencies and institutional recipients of federal funds. It was established to increase research productivity by streamlining the administrative process and minimizing the administrative burden on principal investigators while maintaining effective stewardship of federal funds. A result of the FDP is the agreement to use a common template with specific terms and conditions. This standardization can greatly reduce the length of time needed to negotiate and process subcontracts between the parties.

Whenever possible, Contracts utilizes this template.

PI Responsibilities of Subrecipient Monitoring

As the prime grantee, both the University and the PI have certain obligations for oversight of the entire sponsored project. These obligations include appropriate monitoring of a subawardee’s performance and costs. 

The subawardee is required to submit periodic invoices to the University for payment. Those invoices must be reviewed and approved by the PI authorizing payment. Prior to approval, the PI should review the invoice to determine that the amount being requested for payment is consistent with the scientific progress of the subawardee during the billing period.

Normally, the PI will be familiar with the subawardee’s performance through telephone conversations, technical meetings, progress reports, or site visits. If the PI believes there are problems with the invoice, the PI should not approve it for payment, but rather, consult with their department administration and Post Award Finance to resolve the issues. 

Final invoices should only be approved for payment if the PI is satisfied the subawardee has completed its performance under the award and that the costs incurred are appropriate for that performance. 

Should it be necessary to terminate the award early, the PI should notify PAF in writing. OSP and PAF will then coordinate the termination with the PI.

Contact Contracts if there are any questions about the PI obligations with respect to subawards issued under the grant.