Guidance on Use of Discretionary Funds.

Summary and Purpose
To provide guidance for determining which expenses may be charged to discretionary funds which are defined as start-up funds, special faculty support funds (such as innovation funds or awards), and any Dean’s allocation funds. These funds should not include pilot funds, conference fee funds or any funds, which are intended for well-defined or restricted use only. The purpose of this guidance is to ensure sound and consistent business practices, timely and accurate recording of expenses, and compliance with tax regulations under the Internal Revenue Code.

Allowable Expenses
Faculty discretionary funds are available to pay for expenses incurred in support of professional activities performed while at SPH. These guidelines do not address expenses related to sponsored research, which are specified by the University and Federal A-133 guidelines.

Typical costs charged to discretionary funds include salary and fringe for research assistants, postdoctoral fellows, or students; professional travel; laboratory and office supplies; publication fees; costs of equipment, books, journals, and electronic resources; and services purchased from research support facilities or other professional support services. Additionally, discretionary funds can be used to clear deficits in other accounts or for faculty salary coverage if approved by the faculty member. With approval from the Associate Dean for Research and Faculty Advancement, faculty may be allowed to transfer up to $4,000 of discretionary funds per year to other faculty members (e.g., from PI to Co-PIs, from senior faculty to junior faculty, etc.). All expenses from discretionary funds need to be fully documented with reference to the professional activity being conducted.

Unallowable Expenses
Discretionary funds are not considered personal compensation and cannot be used to fund overbase payments to a faculty member. In addition, the following items/services may not be purchased using these funds: personal Items, personal travel, gifts, or donations. Cell phones are considered personal items, unless purchased to be used exclusively for a specific professional purpose (e.g., a research project). Unlike personal compensation, discretionary funds are not subject to personal income tax, and therefore may not be spent for any purpose considered personal.

Durable Assets
Durable assets are defined as tangible goods that yield service or benefits over a number of years. Durable assets purchased with discretionary funds are the property of SPH and are permanently retained by SPH. Examples of durable assets include computers, scientific equipment, printers, scanners, etc. Under certain circumstances, upon leaving or retiring from the University, a faculty member may be able to acquire equipment or other items previously purchased with discretionary funds. Items determined eligible for purchase will carry fair market value. Faculty should contact the Associate Dean for Administration to request the purchase of durable assets well in advance of the date of departure from the University.

Unallowable Durable Assets
The following durable assets may not be purchased with discretionary funds: furniture and furnishings, rare books (books with a purchase price above $500), and works of art.

Retirement or Departure of a Faculty Member
Any unspent balances, durable assets, or items of value remain with the School upon the retirement or departure of a faculty member. Individual discretionary accounts are closed upon the faculty member’s departure or retirement from SPH; however, faculty are welcome to direct their remaining funds to one or more of the following “Faculty Support” accounts that best align with their own priorities:

  • Faculty support for Student Scholarships
  • Faculty support for Staff Awards and Professional Development
  • Faculty support for Early Career Faculty
  • Faculty support for Pilot Award Program

Faculty members considering leaving the School should consult with the Associate Dean for Administration and their department administrator on the disposition of their remaining discretionary funds. In cases where Emeritus faculty require funds to support their continued engagement with SPH, they are welcome to reach out to the Dean to request the necessary support.

Roles and Responsibilities
The faculty member or their designee is responsible for:

  • Ensuring that expenses charged to discretionary funds are in accordance with this guidance.
  • Consulting with the Associate Dean for Administration on any questions related to this policy.

The department administrator is responsible for:

  • Ensuring appropriate preparation and approval of requests.
  • Raising questions about whether expenses are allowable with SPH Director of Finance.

The SPH finance office is responsible for:

  • Ensuring that expenses charged to discretionary funds are fair and equitable to the individual and the University and ensuring that expenses are made in accordance with this guidance.