U.S. Geological Survey Manual
U.S. Geological Survey Instructional Memorandum
No. APS 2003-001
Issuance Date: November 15, 2002
Expiration Date: September 30, 2003
Archive Date: October 23, 2008
Subject: Miscellaneous Business Practices Questions
Reference. This IM has been replaced by Survey Manual Chapter 501.1 and the Financial Operating Procedures Handbook Chapters 3, Bureau Science Planning and Appropriation; Chapter 4, Terms - Definitions; Chapter 7, Reduced and Special Rates; Chapter 12, Facilities; and Chapter 14, Leave Distribution.
To answer various questions raised regarding business practices, we offer the following decisions.
1. Federal Funding for the Federal-State Cooperative ProgramIn fiscal year (FY) 2003, how will U.S. Geological Survey (USGS) calculate the Federal share of cooperative work performed with States and localities in the Water Resources Federal-State Coop program?
The USGS policy is to account for the full costs of every project. For appropriated projects, the accounts tied directly to the project record the direct costs. Facilities costs chargeable to appropriated dollars, however, are recorded in a holding account in each cost center and are not distributed to accounts. Similarly, USGS uses Science Support funds to pay the appropriated share of bureau costs and does not use Federal Financial System (FFS) to distribute bureau costs to accounts funded by appropriated dollars. To calculate the full costs of a project funded from appropriated dollars, a cost center adds facilities costs and bureau costs to the costs recorded in the relevant FFS accounts.
The USGS includes all its costs when it calculates the Federal share of a cooperative project, not just the costs recorded in the accounts tied to the project. Therefore, the Federal share listed on a joint funding agreement is greater than the funding or costs recorded in the accounts tied to the project, because the accounts do not include either facilities costs or bureau costs.
2. Distribution of Facilities and Leave Costs
What costs are included in ‘labor costs’ in FFS for the purpose of distributing facilities and leave costs?
The following costs are included in ‘labor costs’ for the purpose of distributing leave costs. The list includes regular pay for full-time permanent and other than full-time permanent employees, all benefits except those related to quarters, settlements, and relocation, and leave.
|11.1A||Full Time Permanent -- Regular Civilian|
|11.1B||Full Time Permanent -- Federal Wage System and Administratively Determined|
|11.1C||Full Time Permanent -- Consultant Expert/Advisory|
|11.1E||Full Time Permanent -- Other Employees|
|11.3A||Other Than Full-time Permanent -- Regular Civilian|
|11.3B|| Other Than Full-time Permanent --
Federal Wage System and Administratively Determined
|11.3C||Other Than Full-time Permanent -- Consultant Expert/Advisory|
|11.3E||Other Than Full-time Permanent -- Other Employees|
|11.5G||Other Compensation -- Leave Assessment|
|12.1A||Contributions -- Medicare -- CSRS Employee|
|12.1E||Contributions -- Thrift Plan Basic|
|12.1F||Contributions -- Thrift Plan Match|
|12.1H||Contributions -- Accident Compensation -OWCP|
|12.1I||Lost Thrift Savings Earnings|
|12.1J||Contributions CSRS Retirement|
|12.1K||Contributions -- FERS Retirement|
|12.1L||Longevity Pay -- Park Police|
|12.1N||Allowances -- Non Foreign|
|12.1P||Contributions Park Police Retirement|
|12.1Q||Contributions Part Police Medical|
|12.1T||Contributions -- Life Insurance/Professional Liability Insurance|
|12.1W||Contributions Health Benefits|
|12.1Y||Other Employee Benefits|
|12.1Z||Employer Contribution Tax Fringe Benefits|
3. Special Bureau Rates
If a cost center receives approval from the Chief Financial Officer to apply the special bureau rate to a project, must the cost center make up the difference between the costs recovered by the special rate, 2 percent (net) in FY 2003, and the funds that would have been recovered under the normal bureau rate, eleven percent in FY 2003?
Cost centers need not compensate the bureau for bureau costs not recovered when they have received permission from the Chief Financial Off
icer to apply the special bureau rate. In
FY 2003, USGS uses a bureau rate of 11 percent to recover bureau costs. In FY 2003, the special bureau rate is 2 percent. To receive permission from the Chief Financial Officer to apply the special bureau rate, a cost center must stipulate, among other things, that USGS will not incur any costs in connection with the transfer of funds other than the administrative costs associated with the transfer itself. The special bureau rate and the comparable special common services rate applied by the cost center, therefore, recover all USGS’s cost for the project.
Projects subject to the special bureau are, in this sense, different from cost sharing arrangements. Cost sharing occurs when cost centers do not recover all USGS’s costs, particular bureau costs, but must compensate the bureau for any bureau costs not recovered. (See USGS Survey Manual 501.1 section 11 for further information about the bureau special rate.)
If a cost center receives permission from a Regional Director to continue a reimbursable agreement that does not recover all USGS’s costs, how must the cost center funds the cost not recovered?
If a cost center receives permission from a Regional Director to continue a reimbursable agreement that does not recover all USGS’s costs, that is, direct costs, facilities costs, common services costs, and bureau costs, the cost center must pay the costs not recovered from appropriated funds. It may not shift all of the costs not recovered to other customers or partners. (See USGS Survey Manual 501.1, section 14 for further information about agreements excluded from USGS cost distribution policies.) A standardized bureauwide process for recording these cost sharing arrangements will be issued in the next several weeks.
4. Work Performed By/For Other Cost Centers
How should cost centers record the costs of work done by other USGS cost centers?
The USGS Survey Manual 501.1 requires that indirect costs be charged only once for work performed by one USGS cost center for another USGS cost center. The performing cost center is to include, along with its direct costs, the appropriate common services costs and facilities costs. If the funds involved are reimbursements and are not transferred to the performing cost center, the paying cost center is to pay the appropriate amount of bureau costs. If the funds involved are reimbursements and are transferred to the performing cost center, the performing cost center is also to pay the appropriate share of bureau costs.
Cost centers that use an automated interface with FFS to bill other cost centers will continue to use the interface regardless of the dollar amounts involved. The cost centers using automated interfaces include Visual Services, National Mapping Discipline printing, Geology’s Office of Scientific Publications, the Reston Self-Service Store, Water Resources’ Hydrologic Instrumentation Facility, and Water Resources’ Water Quality Laboratory.
Otherwise, for amounts over $10,000, the paying cost center is to transfer the funds to the performing cost center. For amounts less than $10,000, the performing cost center is to charge the paying cost center using a standard voucher.
When the paying cost center does not transfer the funds to the performing cost center, the paying cost center should record the costs in a FFS account with a burden rate of zero, in the case of work funded by appropriated funds, or with a burden rate equal to the bureau rate (11 percent), in the case of work funded by reimbursements. In FY 2003, Water Resources cost centers add the Water Resources surcharge to the bureau rate (creating a burden rate of 12.3 percent). The FFS account should be linked to the appropriate BASIS+ project and funding source. Creating a separate account with the appropriate burden rates will avoid charging additional common services costs and facilities costs to the same work.
When the paying cost center transfers the funds to the performing cost center, the performing cost center records the costs in a FFS account tied to the appropriate BASIS+ project and funding source. The performing cost center applies its normal burden rate(s) to the account.
5. Distribution of Facilities Costs
How can a cost center ensure that leave costs are included in labor costs for the purpose of distributing facilities costs?
Leave recorded in the Time and Attendance System causes FFS to record costs in one of the object classes included in labor costs for the purposes of distributing facilities costs. Therefore, most cost centers may follow current procedures and have leave costs included in the basis for distributing facilities costs.
Cost centers that use Leave Allocation will have leave costs included in the basis for distributing facilities costs. Leave costs distributed by the Leave Allocation software will be in object class 11.5G, Leave Assessment. (The Leave Allocation software is scheduled for delivery before the end of the calendar year.) The facilities distribution software treats costs in object class 11.5G as labor costs.
6. Work Performed For/By Other Cost Centers
May a cost center refuse to pay the full costs of work performed by another cost center (in particular by insisting that salary costs be charged to one of their cost center’s accounts rather than one of the performing cost center’s accounts)?
The USGS policy is that cost centers will charge other cost centers the full cost of performing work, including direct costs, common services costs, and facilities costs. Cost centers may refuse to perform work if the other cost center is unwilling to pay the full costs.
7. In-Kind Services for Common Services or Facilities
If a customer or partner provides a cost center with facilities or common services as part of the compensation for work performed, that is, provides services in kind, how should the cost center factor the services provided into its administration of facilities costs and common services costs? How, for example, should in-kind services affect facilities rates and common services rates?
If a customer or partner provides common services or facilities as part of the compensation for work performed, the cost center may factor the dollar value of the services provided into its calculation of its common services rate and its facilities rate. The cost center must estimate the dollar value of the services received and adjust the common services costs and facilities costs charged to the relevant project(s) accordingly. The cost center must be able to document the basis for the adjustment in order to justify the lower common services rate or lower facilities rate. More detailed guidance on this topic is being prepared.
8. Funding Salaries
How will funding be handled at cost centers for management and administrative staff when funding was previously from appropriations only?
Under most circumstances, the costs of management and administrative staff at cost centers will be common services costs and will be funded, through the common services rate, from both appropriations and reimbursements. In cost centers that do no reimbursable work, such costs will be paid from appropriations only.
9. Work for Department of the Interior Bureaus
How will Biology cost centers fund and account for the bureau costs they do not collect from Department of Interior (DOI) partners?
When Biology cost centers do not recover bureau and other costs from DOI partners, they will fund the appropriate accounts in FFS with both reimbursements and appropriated funds. The appropriated funds will cover the costs not recovered from DOI partners. Doing so will allow Biology cost centers to account for the full costs of projects carried out for DOI partners. Financial and fiscal staff are working on the procedures that Biology cost centers will use to fund accounts from both reimbursements and appropriations.
If USGS policy remains as it is and Biology recovers no overhead from DOI partners, the Associate Director for Biological Resources will, in the initial allocation of appropriated funds, withhold sufficient funds to fund the bureau costs not recovered from DOI partners. The current estimate is roughly $2.5 million. Over the course of the FY, the Associate Director will allocate the withheld funds to the Biology cost centers that have performed work for DOI partners. The additional allocations will occur at the end of the first, second, and third quarters and during July, August, and September.
If USGS policy changes and Biology recovers some overhead from DOI partners, the Associate Director may adjust the initial allocation of funds to ensure that cost centers do not suffer because they perform work for DOI partners.
10. Funds Carried Over from FY 2002
How will FY 2002/2003 carry over be managed? Do the funds need to be in both BASIS+ and FFS?
Under normal circumstances, all work and, therefore, all funding will be included in BASIS+ projects. For FY 2003, however, funds carried over from FY 2002 need not be included in BASIS+ projects. Regions and cost centers may choose to include such funds or not.
As communicated earlier, USGS will use the existing accounts and account numbers for funds carried over from FY 2002, regardless of whether the funds are included in BASIS+ projects.
Common services costs will not be distributed to accounts funded from appropriated monies carried over from FY 2002. All such accounts should have a ‘burden’ rate of zero, whether they are included in BASIS+ or not. Facilities costs will be charged to such accounts.
Since common services costs will not be distributed to accounts funded by appropriated monies carried over from FY 2002, cost centers should not include funds carried over from FY 2002 when calculating their total FY 2003 costs and common services rate. To calculate total FY 2003 costs, cost centers with carryover funds should include whatever FY 2003-2004 funds they expect to obligate in FY 2003. They should exclude any funds carried over from FY 2002 and any funds they expect to carry over into FY 2004.