When do I use a Subaward vs. a PSA (Consulting Agreement)?

When funds awarded to Brown University for the conduct of a sponsored program are to be paid to an organization/business outside (subawardee) of the University, the arrangement should be made via a subaward if:

• the scope of work to be performed utilizes the facilities, employees and/or resources of the subawardee;
• the subawardee is contributing substantively to the scholarly/scientific conduct of the project as described in the scope of work and has responsibility for programmatic decision making;
• the subawardee has responsibility for adherence to applicable Federal program compliance and performance is measured against whether the objectives of the Federal program are met;
• the subawardee will bring a unique knowledge and expertise to the project and conduct the work mostly independent of Brown’s direct supervision or control with only general technical direction and coordination exerted by the Brown Principal Investigator (PI); and
• the subawardee, as part of its primary business operations, does not provide the same goods and services to others and will be using the subaward funds to carry out a program of the subawardee organization rather than provide goods and services to complete a program for the sole benefit of Brown University (e.g. purchase, fabrication or repair of equipment, data processing, routine analytical or testing services).

Instances when a subaward is not appropriate:

• if the agreement is for the provision of goods or services within normal business operations;
• if the organization/business provides similar goods or services to many different purchasers;
• if the organization/business operates in a competitive environment for the provisioning of the goods or services to be procured;
• if providing goods or services are ancillary to the operation of the Federal program; and
• if the organization/business is not subject to compliance requirements of the Federal program.

When a subaward is not appropriate, check with the Purchasing Department (3- 2206) for further instructions on how to purchase the goods or services.