Allocable vs Allowable

ALLOWABLE = able

A TYPE of cost that is able to be included as part of a sponsored project, such as foreign travel or PI salary.

Allowable types of costs are often outlined by a sponsor in their instructions for applying for project funding, such as 'Costs we typically fund are...' or 'Below is a list of allowable costs that can be included in the budget.' Allowable costs are also usually detailed in the project's executed agreement, budget, and/or budget justification.

ALLOCABLE = appropriate

A SPECIFIC cost that is appropriately charged to a particular sponsored project because:

1. It is an allowable costing type
2. It's a reasonable cost
3. The cost is necessary for the project
4. It benefits the project

A PI is traveling to Germany to attend the Annual Conference of the German Linguistic Society. 

The PI is planning to have the travel costs covered by the project Language Changes in the Texas German Community.

• Is TRAVEL an ALLOWABLE TYPE of expense on the project?
• Is FOREIGN TRAVEL ALLOWABLE on the project?
  
  How can you tell?
  • For U.S. travel, is there a 75 subaccount established in the account?
  • For foreign travel, is there a 76 subaccount estabished in the account?
    • Allowable subaccounts are established when the award is set up
    • It's not the case that you can just add the subaccounts you want
    • Subaccounts trace directly to the project's executed agreement, budget and budget justification
       
  • Are there any notes in the *Define CA3 notes screen of the account that state travel or foreign travel is prohibited or that sponsor advance approval is required for foreign travel?
  • Is travel and/or foreign travel included in the budget and budget narrative of the executed agreement?
    (How can I find these?)
    • If no, then this TYPE of cost is not allowable - request a different account to cover travel
    • If yes, then this TYPE of cost is allowable, and now you'll need to determine if the travel is ALLOCABLE to the specific project the PI wants to use to cover the costs
       

• To establish ALLOCABILITY, you need to know:

  1. Purpose of the travel (as it relates to the project)
  2. How the travel benefits the project

 

• Assuming that foreign travel is an allowable type of cost, let's see what this looks like.
   
  • Purpose per PI:
    ✘ Attending a conference (this doesn't relate to the project)
    ✘ Presenting research/giving a talk (what research, what topic?)
    ✘ Doing research on German language (not enough project-specific detail)

  • ✓ Presenting original research on Shifting Sounds of the German Language at the Annual Conference of the German Linguistics Society
    
     

  • Benefit per PI:
    ✘ Fulfills contract obligation to disseminate research results (which contract and how?)
    ✘ Helps achieve project goals (which project, which goals?)
    ✘ It's related to the project (how?)

  • ✓ The research being presented demonstrates shifting patterns in the German language, which is one of the goals of the project. This also satisfies our obligation to disseminate our research results.

 

• Both the PURPOSE and the BENEFIT need to make a clear and direct connection to the project and its goals. It's not enough to say it's related to the project. We need to document HOW it's related to the project --that is how you establish ALLOCABILITY.

• If the purpose and benefit to the project are not clear, ALWAYS seek clarification from the PI, check the award documents, request written sponsor approval and/or reach out for help to ensure compliance (laresearch@austin.utexas.edu).
  
  ​​​​​​The CoLA Research Support Office strongly encourages this type of communication!
  
  For more on obtaining sponsor approval, check out 'Handling Requests for Sponsor Approval.'

A PI is traveling to Croatia to present research results about Changes to Language in Spanish Heritage Speaking Offspring at the International Language Management Symposium. 

Can the PI charge this travel to the project Language Changes in the Texas German Community?

The answer is an obvious and clear NO, right? Not so fast, sparky!

You should still confirm ALLOWABILITY before contacting the PI about ALLOCABILITY by following these steps:

• Is TRAVEL an ALLOWABLE TYPE of cost on the project?
• Is FOREIGN TRAVEL ALLOWABLE on the project?
  
  How can you tell?
  • For U.S. travel, is there a 75 subaccount established in the account?
  • For foreign travel, is there a 76 subaccount estabished in the account?
    • Allowable subaccounts are established when the award is set up
    • It's not the case that you can just add the subaccounts you want
    • Subaccounts trace directly to the project's executed agreement, budget and budget justification
       
  • Are there any notes in the *Define CA3 notes screen of the account that state travel or foreign travel is prohibited or that sponsor advance approval is required for foreign travel?
  • Is travel and/or foreign travel included in the budget and budget narrative of the executed agreement?
    (How can I find these?)
     
    • If no, then this TYPE of cost is not allowable - request a different account to cover travel
    • If yes, then this TYPE of cost is allowable, and now you'll need to determine if the travel is ALLOCABLE to the specific project the PI wants to use to cover the costs

In this instance, after establishing that foreign travel is an ALLOWABLE TYPE of cost on the project, it seems as though this specific travel is not ALLOCABLE to this project because the research being presented doesn't relate to the project and its objectives.

STRONG RECOMMENDATION:

When it's obvious that a cost is not allowable, communicate that to the PI and ask for another account to cover the travel. 

Even when it's obvious to you that a cost is not ALLOCABLE to a project, or when it's not totally clear, don't assume or make the determination without consulting the expert on the project: Request the PI to supply a justification that answers the following questions:

1. What is the purpose of the travel as it relates to the project?
2. How does this travel benefit the project?
3. Which goal of the project does this travel help to achieve?

This way, you leave room for the PI to make the case that the cost is allocable, in case there are extenuating circumstances that we as Research Admins may not be aware of. 

EXAMPLE on how a PI can flip the script...
They could respond with a justification that goes something like this: 

• 'The data previously collected for the (now-expired) Spanish Heritage Speakers project demonstrates similar language shift patterns that take place in many other languages including German. The Spanish Heritage Speaker data is being used for the work being done on the German Language project, therefore, presenting these Spanish Heritage Speaker language shift patterns DOES benefit the German Language project.'
  
  Sounds pretty good, yeah? But the ONE question that remains unanswered is the ONLY one we need:
  HOW does this benefit the German language project?
   
  • While the above makes the case of a relationship between the data or even the two projects, it sounds like the research being presented is, at most, tangentially related to the German Language project.
  • A follow up question might be, 'How does presenting this other research benefit the German language project?' The data might be related, but it doesn't answer the question of how paying for the travel to present research from this other research project benefits the German language project.
     
    • An alternative to a pushback question is to have the PI seek written approval from the sponsor to confirm they are okay with covering these costs.
      
      If a PI pushes back on this request, let them know that at this point, it is the only way we will be able to move forward with the request, unless they supply a different account to use. --And if doing this makes you feel a bit nervous, just reach out. We'll help make this happen. 
      
      Please also note: This pushback activity is not at all about giving a PI a difficult time. As research admins, it is our job and we are very much obligated to ensure compliance with university funds. Though it may seem like an inconvenience, it is actually a benefit to the PI.
       
• In cases where you receive an explanation that you believe makes the case for moving forward:
   
  • Include the PI's entire explanation in the notes/comments section in the travel authorization document to create the PI's documented connection between the project goals and the travel being undertaken that, according to the PI, benefits the project.
  • AND, if applicable, include mention of having received written sponsor approval, which you'll need to provide upon processing reimbursement.

 

Again, always be sure that the purpose and benefit satisfy the level of detail outlined below.

• Purpose per PI:
  ✘ Attending a conference (not specific enough for the project)
  ✘ Presenting research/giving a talk (what research, what topic?)
  ✘ Doing research on German language (not enough project-specific detail)

• ✓ Presenting original research on Changes to Language in Spanish Heritage Speaking Offspring at the International Language Management Symposium

 

• Benefit per PI:
  ✘ Fulfills contract obligation to disseminate research results (which contract, and how?)
  ✘ Helps achieve project goals (which project, which goals?)
  ✘ It's related to the project (how?)

• ✓ The research being presented details results related to one of the goals of the project, demonstrating shifting patterns within language, and satisfies our obligation to disseminate our research results.
  
  NOTE: Generally, the follow up with the PI for additional detail should be:
   

  • Please provide a justification that makes clear to the sponsor why the sponsor is covering these costs.
  • Provide the specific goal(s) in the project's statement of work related to and benefiting from this travel.

Both the PURPOSE and the BENEFIT need to make a clear the direct connection and benefit to the project and its specific goals. It's not enough to say 'it's related to the project.' We need to document HOW it is related to the project --that is how you establish ALLOWABILITY and ALLOCABILITY.

• If the purpose and benefit to the project are not clear, ALWAYS seek clarification from the PI, check the award documents, request written sponsor approval and/or reach out for help to ensure compliance (laresearch@austin.utexas.edu).
  
  CoLA Research Support Office strongly encourages this type of communication!
   

The last stop for resolving issues with allocability is to request the PI write to the sponsor to obtain written permission to cover the specific cost.

Check out the section below about 'Handling Requests for Sponsor Approval.'
 

Whether or not project personnel costs are allocable to a sponsored award depends on the work being done. 

• When working with a PI to, for example, assign GRAs to an award, the students must be working on the goals of that specific award in order for the salary, fringe and associated costs to be allocable to that project.
  
  If the GRA's work is only tangentially related, they should not be assigned to that project. There must be a direct benefit to the project.
  
  Put another way:
  Students should never be assigned to projects based on which ones expire the soonest. Sponsored projects should never be treated like a checking account that holds funding from multiple sources in a single place.
  
  Sponsored funds are at UT for project goals to be met and should never be treated as interchangeable, even if some of the goals overlap or are related. 
   
  • If a PI mentions anything that suggests a student's work may not be directly related to the project they are to be assigned to, as someone charged with the responsibility of adminstering the funds compliantly, you are obligated to let the PI know about the allocability requirement, and to take steps to ensure that only allocable costs are being charged.
     
    • Request explanation from the PI that makes clear what the student will be working on and how it is related to and benefits the project. 
       
    • When confronted with questionable allocability, this kind of pushback should absolutely happen. It's not just for purchases and travel costs.
       
  • Costs cannot be temporarily parked on a sponsored award, knowing the work being done does not benefit the project.
     
    • Again, when it's not clear that allocability has been met:
       
    1. Request PI to supply a different account for the GRA assignment(s)
    2. Require written justification from the PI that not only makes clear how the student's work is benefitting the project, but also fully explains which of the project goals is directly related to the work the student(s) will be doing
    3. Reach out to CoLA RSO for additional guidance - we'll help make the determination!
    4. Last stop: Request that the PI contact the sponsor, have them CC you on the request, make sure the request actually matches what you've asked for and that clear detail was provided so that the sponsor confirmation is sufficient to move forward.
       
       For more on this, check out 'Handling Requests for Sponsor Approval.'

How does this benefit the project?

When requesting that the PI contact the sponsor, have them openly CC you on the request, make sure the request actually matches what you've asked for and that sufficient detail was provided IN THE REQUEST so that the sponsor confirmation is sufficient to move forward. 

This is an area that you'll need to pay attention to, given that a PI might not make clear enough what is being requested. You may need to:

• Supply the details in advance to the PI when you make the sponsor approval request
  (I need to know specifically x, y and z)
   
• Follow up with the sponsor directly to clarify
  (Dear So-n-So, to clarify: What we need to know is...).
   

Make sure the response you get back via email is WHOLE and contains ALL the information.

Copied and pasted partial responses, emails missing headers, lifted out-of-context responses --yep, that does actually happen, and it's not sufficient to accept this as sponsor approval --the ENTIRE message, headers, details, etc. are required in order for it to be a binding approval.

If a sponsor's response doesn't clarify what they are agreeing to, you also need to request proof of what the sponsor has responded to --we need the entire conversation for context and proof!

• Think of it this way:
  It's like a mini-contract with the sponsor, so we have to get it right, clear and complete in case it's the only document standing between approval and no approval if something goes wrong.
   
• If this situation plays out and starts to feel a little nutty, DO NOT BACK DOWN. DO NOT GIVE UP. Reply directly to the sponsor, copy the PI, apologize for any misunderstanding, confirm that you need to ensure we are complying with the project requirements, then make your clearly worded request. 
   
• Pull CoLA RSO Award Management in if you need help with something like this. We're happy to help steer the conversation to the needed conclusion, which is of course, compliance!

How does this benefit the project?

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