Service Centers
What Are Service Centers?
A service center is any University unit charging for specific goods and services on an ongoing basis.
Service center operations conducting business at WSU are administered under Business Policies and Procedures and Executive Policy Manual guidance. Under policy, WSU must be mindful of its instruction, research, and public service mission and is required to pay Federal Income Tax on net income from activities unrelated to our mission.
Service center oversight has five aspects related to accounting and policies:
- To ensure that pricing to federal grants and the WSU research community is fair and cost-based, so that the federal government is not burdened with additional overhead through the internal billings, beyond the negotiated Facilities & Administrative Rate.
- Service centers that bill WSU sponsored programs are to develop and bill approved cost-based rates.
- WSU follows Federal costing policies at 2 CFR Part 220 (OMB Circular A-21) Appendix A and our Cost Accounting Standards.
- To ensure that WSU stays within mission under Executive Policy #17.
- To ensure that WSU has consistent and best practice standards, formats and content for billing transactions.
- To ensure service centers usage of equipment and facilities that were federally funded or financed with tax exempt debt are in compliance with federal funding or tax exempt indentures; and
- To identify and report any Unrelated Business Income and appropriate state taxes.
Some University community services qualify as an Auxiliary enterprise, such as WSU-operated student services of Housing/Residence Life and Dining offered on the Pullman campus. To qualify as an Auxiliary, an operation must: 1) meet the higher education industry standard of self-supporting and 2) be viewed as essential to academic and mission success. When the operation meets this NACUBO standard, Auxiliary oversight is separated from the Controller’s Office oversight of service centers.
The other exceptions to WSU service center BPPM 30.15 are Fund-raising, Athletic or Artistic Events.
Service centers are sometimes called ‘recharge centers’ as their internal providing of services is billed on a recharge cost-basis. Frequently, sales and services are provided to external customers, and an example is Surplus Stores. Other examples of business-type service centers are Ferdinand’s Creamery and Sports Science Lab.
Contracts Office assists approved service centers in clarifying services and binding terms of payment, as long as the type of agreement does not qualify to be routed through the Office Of Research Support Operations.
E-Commerce assists units accepting credit card payments; see merchant basics.
Service centers are required to document how the activities are related to WSU’s mission. Annually, service centers are assessed as to scope, financial health and cost-based rates. As an on-going endeavor, the operation is to be demonstrably sustainable.
FAQs
The central administrative service charge is a partial reimbursement towards centralized support services provided by accounts payable, accounts receivables, payroll, personnel, and purchasing. The assessment of ASC fees to units who sell goods and services can be seen in the expense Subobject 03-VF.
Departments directly generating sales, services or fees in conjunction with an externally funded active sponsored project, will need to work with WSU’s Sponsored Programs to establish the necessary Program Income account. The related activity is then tracked and reported to the external sponsor. The Program Income aspect is important to Research Administration. The Department may discuss with Sponsored Programs the particular net income impacts to consider.
Why have a Program Income account rather than a service center?
In essence, a Program Income account is a service center reportable to the external Sponsor during the time-period of the award. The Program Income account will be looked to continue as long as the sponsored project is active. Upon award completion, the Department can look to end and convert the Program Income activity to Service center, for the operation to continue. The launch of the service center will be facilitated by the historical revenue, expense and price history of the Program Income activity.
Contact University Receivables phone: (509) 335-9653