Use of Discretionary Funds Policy

Eligible Recipients

Regular teaching and research faculty may be eligible to receive discretionary funds from the University or external donors.

Purpose

Discretionary funds awarded to a faculty member are intended to augment funds that have been restricted specifically for research and teaching activities of that faculty member. While not intended to be used directly for research and teaching purposes, discretionary funds are intended to provide recipients with resources to fund certain indirect expenditures, as described below. Such expenditures, while not integral to research and teaching activities, support the overall research and teaching activities of the individual faculty member and the University community at large.

Terms

  • Discretionary fund accounts are structured as individual restricted accounts in the year awarded. Remaining balances carry forward to the next fiscal year.
  • The accounts may not be overspent. If an account experiences a deficit balance, Research and Sponsored Programs Accounting will place a temporary hold on it to prevent additional spending. The account will not be reopened until the account holder has arranged for the deficit to be cured.
  • Purchases made through discretionary accounts are to be in accordance with all University procurement policies and procedures.
  • All items purchased with discretionary funds are the property of the University.
  • Any discretionary account recipient leaving the University may purchase items previously acquired with discretionary funds.
  • Discretionary accounts (and the related “terms” discussed above) include all facilities and administrative (F&A) recovery accounts.

Statement of Responsibility

The faculty member to whom the discretionary funds are awarded and/or the designated budget administrator must ensure expenses charged to discretionary accounts are for legitimate business purposes as defined under IRS regulations and University guidelines and policies.

Eligible Expenditures

To be considered eligible, any expenditure charged to a discretionary account must be permissible under University guidelines and must conform to IRS guidelines as an allowable employer or employee expense.

Examples of eligible expenditures:

  • Travel to meetings of professional associations or for research activities
  • Subscriptions to professional periodicals
  • Memberships in professional organizations
  • Reference books
  • Journal submission fees
  • Specialized software, other than that routinely provided by the University, for classroom use or research
  • Business-related long distance charges
  • Business-related postal or shipping charges (FedEx, UPS, Airborne)
  • Computer peripherals, all compatible with existing equipment and systems, and with installment and maintenance requirements verified through OIT
  • Specialized databases and data collection costs
  • Business-related meals or hosted professional functions
  • Professional license or certification fees

Expenses Not Eligible

Discretionary funds are not intended to supplement the salary of the faculty member to whom such funds have been awarded. In addition, personal expenses of any kind are not eligible for reimbursement through discretionary accounts.

Examples of expenses not eligible for reimbursement:

  • Home office costs such as furniture and equipment, maintenance expenses, and supplies
  • Cell phone, pager costs, or Internet and telephone line charges unless approved by the University administration as necessary for job performance (e.g., alternative work site)
  • Student graders
  • Charitable contributions made in the account-holder’s name
  • Political contributions under any circumstances
  • Postage for personal correspondence
  • Office or laboratory phone sets, or ordinary line charges
  • Memberships in social clubs or airline travel clubs, unless approved by the Administration as necessary for job performance

In no event will expenses be reimbursed that were incurred prior to the beginning of the fiscal year previous to the current year.

Discretionary Funds and Sponsored Research Endeavors

The use of discretionary funds generally does not constitute “sponsored research” as defined in Notre Dame Reports and/or national surveys. Inquiries as to whether or not specific expenditures of discretionary funds qualify as “sponsored research” should be directed to the director of Research and Sponsored Programs Accounting.

For additional information and applicable policies, please refer to:
Guide to Restricted Funds—PDF
Travel, Entertainment, and Business Expense Policies
Procard User Guide:
Tax Department Home Page
Controller’s FAQ Regarding Sponsored Project Administration