Service Centers at the University have been established to execute fee-for-service (FFS) arrangements. If you are affiliated with a Service Center please visit the Service Center webpage.
What is Fee-for-service?
Outside entities or individuals sometimes ask BU researchers or departments to perform paid services, under the auspices of the University, that are not traditional research or teaching activities. These services, which are sometimes referred to as “fee-for-service” or “institutional consulting,” are typically predefined or repetitive, or may involve producing a product or report that meets predefined specifications. Fee-for-service work is not generally expected to add to the body of fundamental knowledge in a given field, although the process of creating the work product may benefit the University by adding to the efficacy of methods or processes used by researchers or departments to evaluate data. At times, fee-for-service work may be similar to work done under sponsored research projects, but generally the work is specified by the outside entity or individual.
In the typical “fee-for-service” agreement, the external entity requests ownership of the work product, results and reports, and may seek to impose obligations of confidentiality on BU, possibly including requiring prior approval for any publications. “Fee-for-service” arrangements create potential liability for the University if the terms of the agreement are not met.
Research conducted at BU should be beneficial to the general public and/or advance BU’s educational and research mission, and not solely or primarily for the commercial benefit of an external party. As a result, there should only be a limited amount of fee-for-service work (outside of Service Centers) at BU. While there may be research or scholarly benefits to a FFSFee-for-service agreement, those benefits are likely not be the primary purpose of the activity and pose risks that need to be appropriately managed.
Funds received for work that is unrelated to BU’s tax-exempt purposes, may be subject to payment of Unrelated Business Income Tax (UBIT). Although it is not inappropriate to have some UBIT, BU must monitor the income and usage that generates the UBIT, and departments must be aware that they will be responsible for paying any UBIT.
Step 1: Determining if You Have a FFS Agreement
If any of the below statements are true then you may have a FFS agreement:
- Your department/office doesn’t anticipate publication from this work
- You do not expect to own results created from this work (other than improvements to methods or processes of analysis).
- You would not expect to be considered an investigator or co-investigator on this project.
If you have already entered into an Master Service Agreement (as described below) with a particular client, then you may not need to submit a new Fee for Service checklist and summary form to obtain approval for subsequent SOW’s, if they are within the contemplated scope of the original MSA.
Note that there is a distinction between FFS agreements and personal consulting agreements. Personal consulting agreements are between an outside entity and an individual faculty member. BU is not a party to personal consulting agreements and is not involved in negotiating those agreements. Boston University cannot counsel faculty members on personal consulting agreements, but provides the following guidance [here].
Step 2: Contact the Relevant Office
Whether you are sure you have a FFS agreement or need further guidance, contact the appropriate office as soon as possible so that they can walk you through the process.
- For Service Centers: Service Center Administration(email@example.com)
- For Industry Partners: Industry Engagement
- For All Others (non-Industry): Sponsored Programs
Step 3: FFS Agreement
Once the relevant office above has determined this is a fee-for-service engagement and provided guidance on budgeting and rate setting, the department administrator should do the following:
- Complete the Fee-for-Service Agreement Form including Department Chair/Dean signature.
- Send the completed form to the relevant office from Step 2
The relevant office from Step 2 will assist with the following:
- Review the submitted FFS Summary Form
- Work with Vice President and Associate Provost for Research to obtain signatures
- Discuss contract considerations* and execute agreements
- Explain the invoicing and payment process
*If you expect to perform multiple projects for the same outside client, the appropriate agreement may be a Master Services Agreement (MSA), which contemplates that multiple Statements of Work (SOW’s) will be agreed to from time to time.
Fee For Service F&A Table
|Fee For Service Type / Sponsor||F&A Rate|
|Research Industry / Non-Industry||65%|
|Academic Non Industry||53%|
Step 4: Setting up a Fee-for-Service Account
Fee-for-service Accounts will be set up via the Budget Office (909xxxxxxx). The following process outlines steps to be taken in order to ensure timely and accurate set up once Agreement or Purchase Order is executed by Industry Engagement or Sponsored Programs.
909xxxxxxx Account Process Set Up and Management
- Department and Dean’s Office Financial Administrator is carbon copied on email to Sponsor with Executed Agreement
- Department contacts their Dean’s Office Financial Administrator to request a new Designated Account, including a copy of Executed Agreement and the Fee For Service Summary Form
- The Dean’s Office then requests the new account through the normal process, using the Fee for Service Summary Form in lieu of the standard request form and including the executed agreement. The email should include a statement confirming the Responsible Cost Center of the new account.
- The Budget Office creates a new 909xxxxxxx account, which will have the Internal Order Category of Research Fee for Service (D13), and disseminates the account information to the requestor
- Departments are responsible for ensuring expenses are appropriate following the Four Cost Principles
- Departments are responsible for billing through Miscellaneous Receivable; training and additional resources on billing can be found here
- Based on Sponsor rules, any residual direct balance will be transferred accordingly
- 909xxxxxxx accounts are not allowed to be in deficit