Policy on Ploughback Funds

Background

Externally funded sponsored projects will have charges associated with them called facilities & administrative costs.  These costs are charged at a rate negotiated with the Federal government once every three years.  They represent the cost of items such as utilities, computing, library, office supplies, depreciation, local telephone costs, and administrative support that are not easily identifiable to one project versus another.  It should be understood that facilities & administrative costs cover real university expenditures and the amount charged to grants represents a reimbursement of those costs.

The University has historically provided investigators with funding to continue their research during a period of time when external funding has become unavailable.  This funding is called ploughback.  The source of this funding is operating budget.  The method by which ploughback funding is calculated is to take 25% of the amount of facilities & administrative costs that were charged to the investigators external grants in the previous year. 

Distribution and Timing

Departments may choose to receive their distributions in one of two ways.  Departments can either choose to pool their ploughback into one account or distribute it to the individual faculty members who earned it.  Ploughback accounts are reflected in the 527XXX series in FRS.  Distributions are made annually in August based upon the previous fiscal year ended June 30.  Distributions will be reflected as an increase in budgeted funds.  

Allowable Uses

Ploughback funds should be used to support ongoing research.  While the department or faculty member has broad discretion, all expenditures must be made in accordance with University policies.  It is the responsibility of the department to manage expenditures from all ploughback accounts, whether individual or pooled. 

Due to the variable source of funding, salary dollars will not normally be charged to ploughback.  Upon written request, Academic Affairs may approve salary expenditures against ploughback, but only when sufficient funding exists in the account. 

Ploughback funds will be used to resolve deficits in other sponsored project accounts when no other source of funding is available.  For departments that pool their ploughback earnings, this pool will be considered as a source of funding for other deficit balances within the department as well as a source for other funding requests. 

If a ploughback account goes into deficit, grants accounting will contact the investigator and the department assistant to try and rectify the account.  This review of deficits is done on a monthly basis.  If the deficit balance exceeds $2,500, the account will automatically be frozen.  Any account with a deficit balance after the annual distribution of ploughback funds will be frozen regardless of the amount. 

Advances

Ploughback is distributed once a year.  Spending will not be allowed against anticipated ploughback earnings. 

Departures

When a faculty member departs the university, any remaining funds in their ploughback account will revert back to university central funding.  If a deficit balance exists in the account at the time of departure, it will be the responsibility of the department to find a source of funding to cover this deficit.  Departures will not affect departments with pooled funding.

(revised: 3/10/08)