F-2) Recharge Activity – Both Internal AND External Customers

Review date
Responsible office
Budget and Resource Management

Definition

Mechanism for charging both INTERNAL customers (defined as able to be recharged via a journal) and EXTERNAL customers (defined as not able to be recharged via a journal; instead they are billed and pay by cash, check or credit) for products or services.

All of the definitions in F-1 above apply, and in addition the following conditions apply.

  • Business contracts between external customers and the Regents of the University of California are required. These should be routine if a standard agreement is used.
  • Business contracts will only be executed for recharge activities that have been approved by the Budget and Resource Management Office.
  • The University must not assume any obligation beyond delivery of a standardized University product or service at a pre-established, per-unit, uniform price.
  • External customers may not be charged less than total cost.
  • Indirect costs must be included in the rates charged for the products or services unless a formal waiver has been reviewed and approved by the Budget and Resource Management Office.
  • Unrelated Business Income Tax (UBIT) and Sales Tax review is required.
Examples

Recharges for cell growth media and tissue cultured cells prepared by the Cell Culture Facility to internal customers as well as external customers.

Overhead Consideration

For internal users, no additional overhead is assessed on top of the rate charged.

For external users, the service center rate of 26 percent applies to external sales and service agreements as of July 1, 2008. The rate is to be assessed based on revenue received.

  • Effective July 1, 2026, the service center rate applied to external sales and service agreements will increase to 33 percent.
  • Effective July 1, 2027, the service center rate applied to external sales and service agreements will increase to 39.5 percent.

Invoices should be adjusted to include the correct F&A rate for the applicable period. Indirect costs must be included in the rates charged for products or services for all users unless a formal waiver has been reviewed and approved by the  Budget and Resource Management Office, Recharge Review.

Policy
Review Department/Signature Authority

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