Contracts & Grants: Gifts Versus Grants
Gifts versus Grants
Acceptance of gifts and grants to the University of California.
Gifts are funds that are given to the university in support of a particular program or a particular advisor's research. With a gift the donor specifies the general program or research the money is given to support, but does not require us to adhere to a strictly defined budget or to provide any reports on how the money was spent or on the research the money supported. In short, the donor expects nothing of significant value in return, other than recognition and disposition of the gift in accordance with the donor's wishes. Therefore, a research gift is designated as such when the funds are unrestricted or as an in-kind contribution to support the research of a particular program or a particular advisor's research.
In general, classify funds as gifts when the following characteristics exist:
- donor does not impose contractual requirements;
- funds are awarded irrevocably.
In contrast, a grant is a contractual arrangement where the university agrees to do specific things with that money and report back to the grantor how we spent the money. If we do not carry out our responsibilities as we promised in the grant agreement, the grantor may demand the unspent money back. The grantor is also entitled to any funds that were not spent by the end of the project. Grants also require much more staff time to prepare legal papers, monitor expenses, provide reports, review legal obligations, etc.
In general, classify funds as grants when the following characteristics exist:
- provision for audits by or on behalf of the grantor;
- the grantor is entitled to receive some consideration such as a detailed technical report of research results or a report of expenditures;
- testing or evaluating of proprietary products is involved;
- the research is directed to satisfying specific grantor requirements (e.g., terms and conditions stating a precise scope of work to be done rather than a general area of research);
- a specified period of performance is prescribed or termination is at the discretion of the grantor;
- funds unexpended at end of period shall be returned to the grantor;
- patent rights requested by grantor.