Type of Policy
Policy No
Effective Date
Last Revised
Review Date
Policy Owner
Office of Grants and Contracts Accounting
Contact Name
Josh Rosenberg
Contact Title
Senior Director, Grants and Contracts Accounting
Contact Email
Reason for Policy

Service centers are defined as operating units established for the primary purpose of providing specialized service to the educational and research community. Service centers are also known as Specialized Service Facilities and are subject to the terms and conditions of OMB Uniform Administrative Requirements, Cost Principles, and Audit Requirements (2 CFR 200), Section 200.468.

Policy Statement

This cost accounting policy is based on OMB Uniform Administrative Requirements, Section 200.468 (2 CFR 200) which states: "The costs of such services, when material, must be charged directly to applicable awards based on actual usage of the services on the basis of a schedule of rates or established methodology".


This policy is applicable to all Cost/Service Centers established at the Institute.

Policy Terms

Specialized Service Facilities (SSF)

Operating units which provide specialized services to the university community, with annual operating budgets in excess of $1,000,000 annually or based on management discretion. Additional procedures related to Service Center rate studies are included below.

Service Centers

Operations with greater than $5,000 in operating expenses annually or any charges to sponsored projects regardless of size where the business-case for establishing a separate service center has been properly justified and is approved in advance by the Sr. Director of Grants and Contracts Accounting and the appropriate College or Institute level officer. Costs for materials/services should constitute a pass-through of direct costs only. Service centers should be able to demonstrate that there is an advantage to the sponsor to justify its existence. Grants and Contracts Accounting is available to provide assistance in developing such pass-through rates.

Facility Usage Rates Rates established with a defined time period for the infrequent and non-recurring use by external entities of Georgia Tech lab facilities that are unique and not commercially available. Grants and Contracts Accounting will develop the appropriate Facility Usage rates in coordination with the requesting department.

Basic Requirements
Due to the administrative requirements of managing service centers, there should be a clear business-case for establishing and renewing separate service center charge rates. The requisite business-case includes the following basic parameters:

  1. Self-Supporting Revenues - Service center annual recoveries should typically be sufficient to fund the annual operating costs of the center. Any cost in excess of revenue should be posted to a discrete project so total center costs can be easily identified. Direct costs include allocable salaries, fringe benefits, supplies, equipment maintenance, and maintenance agreements. SSFs also include indirect costs such as building depreciation, equipment depreciation, and building operations and maintenance expenses (including utilities).
  2. Local Administrative and Financial Support - The unit/department must be equipped to manage the additional accounting and reporting requirements of the Center. These activities include separate accounting for expenses and recoveries and precise tracking of utilization for charge-out purposes.
  3. College and Institute Level Approval - The “Service Center Rate Study Request” form must be completed and approved by the appropriate School or Department Head and the appropriate College or Institute level officer prior to being submitted to Grants and Contracts Accounting for consideration. The form can be found on the Grants and Contracts website.

Service/recharge center rates may only be established or renewed after the above basic requirements have been met, documented, and properly approved. Thereafter, rate studies are prepared and billing rates are established and renewed based on the following procedures:

Service Center Rate Studies and Billing Rates

  1. Proposed billing rate studies are scheduled on an annual basis. Estimated rate calculations will be developed based on the most recent completed fiscal year. Estimated rate calculations for Resident Instruction and Units other than GTRI are to be submitted to Grants and Contracts Accounting annually. Rates normally become effective July 1 of the subsequent year. Prior to ONR approval, if required, rates utilized will be considered provisional until subsequently amended.
  2. Billing rates may not be based on what others charge for similar services.
  3. Service rates should include both direct and for SSFs an allocable share of Facilities & Administrative (F&A or indirect) costs. The proposal should consist of prior year historical costs all equipment depreciation costs by specific item, net square footage occupied and any over/under recovery from the prior year if required. The proposal should also contain documented utilization of the cost center from the prior period and a justification of the selected utilization base.
  4. All billings are to be invoiced to a Georgia Tech account/project. Direct expenses applicable to the service center and all offsetting billing revenues should be recorded to worktags established for purposes of reporting and accounting for center activities.
  5. Agreements to conduct services for external entities may be evaluated by the Office of Sponsored Programs (OSP) and should be based on the OSP short form contract document. Billings to external parties are coordinated through the Bursar’s Office after approval is gained via Grants and Contracts.
  6. Service Center rates are validated periodically to ensure that charge rates were at or below cost during the prior period(s). This validation work is scheduled and managed by the Grants and Contracts Accounting Office with significant assistance from the responsible Center or Unit Financial Officer. Accurate tracking and reporting (including detailed supporting documentation) for expenses and revenue entries is critical to the timely performance of service center rate studies and validations.
  7. Existing (previously approved) service centers that do not meet the basic "business-case" requirements noted above will be reevaluated as part of the annual rate validation step. In these cases, Service Center billing rates may be suspended or lapsed until the business-case is reestablished and properly approved via the "Service Center Rate Study Request” form. Grants and Contracts Accounting will notify the responsible Institute, School, Center, and Unit contacts at least 30 days prior to this action.
  8. Existing (previously approved) Service Center billing rates where a significant amount of charges were posted to sponsored projects will be suspended if this validation and renewal process is not completed in a timely fashion. Grants and Contracts Accounting will notify the responsible Institute, School, Center, and Unit contacts at least 30 days prior to this action.
  9. Existing (previously approved) service centers with costs posted to a non-DSS project will require College or Institute level officer approval of support annually.

Service center rates that are not documented, supported, validated, and renewed in accordance with this policy may not be charged to externally-funded sponsored projects.



Contact the Grants and Contracts Accounting Department at gc.ask@business.gatech.edu for additional guidance related to Cost/Service Centers at Georgia Tech.


To report suspected instances of noncompliance with this policy, please visit Georgia Tech’s EthicsPoint, a secure and confidential reporting system, at:

Policy History
Revision Date Author Description
09-20-2021 Office of Grants & Contracts Accounting Editorial Updates to align with Workday implementation.
04-2015 Office of Grants & Contracts Accounting Update with new OMB Requirements
12-30-14 Office of Grants & Contracts Accounting Align with requirements of 2 CFR 200
07-01-12 Office of Grants & Contracts Accounting Administrative review