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Government Costing

Service Activities

Service and storeroom activities (service centers) are established primarily to meet the programmatic needs of the academic community, and usually provide goods or services to multiple internal users including sponsored programs administered by the University, State of Illinois agencies, and organizations affiliated with the Universities. They are distinguished from activities that serve a single or small number of users, auxiliaries, and departmental activity accounts that are established for services provided primarily to non-University users.

Each service center must calculate and charge rates for the services and/or products they provide. These rates are charged against various University funds including sponsored projects. As a result, the Universities must comply with federal costing principles as well as State and University guidelines for service centers. These service centers, whose main customers are internal University departments, track their revenue and expenditures in Banner fund type 3E Service and Storeroom funds.

The Code of Federal Regulations (Uniform Guidance Title II CFR Part 200) provide guidelines that establish principles for determining costs applicable to grants, contracts, and other agreements with educational institutions. It also outlines the general federal requirements for calculating service center rates. Federal agency Inspector General's audit plans have recently included reviews of service center costs. 

In addition, for our Universities (UIUC and UIC only) service centers it is important to note that Section 3.2.0 of the Disclosure Statement (DS-2) requires information be completed relating to specialized service facilities and service centers. Service centers with $1 million revenue and/or $250,000 in federal sponsored project revenue are required to be reported on the DS-2. 

System Government Costing responsibilities for service centers are as follows:

  •        Establishment and maintenance of service activity policy (OBFS Policies and Procedures Manual, 22 Self-Supporting/Revenue Generating Activities - Service and Storeroom Activities )
  •        Providing training for service center personnel and our internal staff
  •        Performing service rate/fund reviews as deemed necessary
  •        Providing assistance to departments with rate calculations
  •        Monitoring the service center's adherence to University and federal policies (3E funds)

There are a wide variety of service funds at the University of Illinois System.  Each service center fund is its own business operation and many times contains multiple rates within each fund. Examples of service center rates include but are not limited to analytical testing, bundled services, utility rates, animal facility rates, machine shop rates, storeroom markup rates, carpool rates, medical center, etc.

In order for our staff to complete these rate reviews/calculations, they must work with each service center to obtain an understanding of their business operations.

System Government Costing has developed several job aids such as rate templates, Business Objects reports, web-based certification training, and general guidelines to assist service centers in performing their rate calculations. These job aids can be accessed on this web page.  See “Job Aids and Training” link in the margin.

Service Activity Basics Certification

System Government Costing has implemented a “Service Activity Basics Certification” web-based training program.  This certification is an interactive program designed to provide information and training related to performing service and storeroom rate calculations, including specific rate requirements, rate components, and considerations related to compiling service rates. The self-paced format allows you to work through the training one lesson at a time at your convenience. It only takes 3-4 hours to complete the entire program. Use this link to apply today!

Last Updated: January 11, 2019

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