Special Fees and Use Charges—FAQ

A use rate is a government-approved method to recover the costs to operate the lab/equipment/facility. There are a number of requirements that must be met to get an approved use rate, so a rate is not recommended for seldom used lab/equipment/facility with low operating costs.

A calculation template is provided here and will utilize financial information from the prior five years (fewer years will be used for newer rates).  The template will take into account the total expenses over this period increased or reduced by any deficit or surplus or in the ending balance. Finally, the adjusted balance is divided by logged use from the same period.

Biennially. However, periodic rate reviews are suggested, and a new rate may be requested if needed to offset a potential surplus or deficit.

Charges to lab/equipment/facility users must be made on a monthly basis. Be aware that charges to projects over 90 days from the lab/equipment/facility use may be denied.

All lab/equipment/facility use must be logged, even if use is subsidized. Time spent for training, repair, and maintenance is a cost to operate the lab/equipment/facility and should be included in the calculation.

Each entry in the logbook must include user name, date, the total units of use, and project index. This information will be included in the inter-account bill.

Choosing not to charge for all use is an example of a subsidy. This practice may result in a deficit, which will be the financial manager/department responsibility. To avoid overcharging some users, all use must be included in the logbook and must be included in the rate calculation.

The Federal government provides guidelines for establishing and monitoring use rates in 2CFR 200 (Uniform Guidance). The University is regularly audited, and an unfavorable audit may result in significant fines and penalties. Funding agencies may demand the return of funds and/or deny future awards. Government auditors target recharge centers (use charges) for compliance with government guidelines.

A lower rate may be chosen; however, this may result in a year-end deficit which is the responsibility of the financial manager/department.

A portion of each dollar in use charges is returned to the department. It is intended that these funds be used for replacement/upgrade/repair of the lab/equipment/facility, although they may be used for other expenses related to lab/equipment/facility. To separate this overhead return from revenue, these funds will be transferred into a D99 index tied to the lab/equipment/facility use rate index.

• Staff salary for effort related to training, maintenance and repair of the equipment/lab/equipment/facility.
• Staff time spent performing/running tests for clients of the lab/equipment/facility. This staff time may also be charged directly to the client’s index. If you choose to direct charge the operator salary, however, this salary cannot then be included in the rate.
• Service contracts, parts and supplies related to the equipment/lab/equipment/facility.
• Network connections (required for use of the lab/equipment/facility).
• Computers/software (required for use of the lab/equipment/facility).
• Travel related to the lab/equipment/facility.

• Administrative costs that include clerical time, telephone, photocopies and postage.
• Computers/software that do not meet the criteria described above.
• Entertainment.
• The cost of capital equipment (see the next section for more information).

Capital equipment is defined as equipment over $5,000 in cost and these items are depreciated. Depreciate expenses are included in the facilities and administrative rate (overhead/indirect costs)

Replacement parts required to keep the lab/equipment/facility functioning are allowable in the use rate. This also applies to replacement parts with an acquisition cost over $5,000.

Yes, but those costs may not be included in the use rate calculation.

Income is defined as revenue exceeding expenses. Guidelines allow for an ending annual balance no greater than an average of 60 days operating expenses. A use rate may be denied if your balance exceeds 60 days of operating expenses.  Any balance exceeding the allowable amount must be included in the next period's rate calculation (the template automatically does this).

To avoid generating income, account balances need to be monitored and all allowable costs charged to the index during a fiscal year. For instance, it is allowable to maintain a reasonable stock of regularly use parts and supplies, but not a stockpile.

Expensive parts may be purchased when needed and expensed over four years. The cost for the part must be incurred in order to amortize the costs. In these instances a rate change may be requested.

If you are denied a rate, you may not charge for the equipment’s use. Reasons for denial include an excessive surplus balance that results from little to no expenses or an inaccurate use rate. To receive a new rate the applicant must submit a plan that details how the balance will be expended. In this instance a new rate request may be made after a minimum of six months activity. Continue to log use in the logbook.

In some circumstances, yes. A deficit up to the amount of 60 days average expenses resulting from unexpected costs, such as a repair part, may be allowed. In either case the deficit will be factored into the following rate application.

The financial manager/department will be responsible for repeated or increasing deficits. A deficit due to unexpected costs or low usage cannot be carried for more than two years.