A subaward is a written agreement that transfers a portion of research or substantive effort to another organization. The collaboration is substantial enough that the collaborating individual or organization will participate in preparation of results, publication, presentation or other collaborative participation beyond routine analytical work. The collaborator maintains control of the work to be performed under the subaward.
The use of a third party to perform part of the approved, programmatic work requires the approval of the funding agency supporting the research. To speed up this approval, the participation of the third party should be included as part of the initial budget proposal, whether it is an incoming or outgoing subaward. Requirements for subaward documentation will vary by institution.
A purchased service is a procurement action used to obtain goods or services from a vendor who provides similar goods or services to many different purchasers within their normal business operations.
It is important to determine early in the budgeting process whether a subaward or a purchased service agreement should be used to obtain goods or services on a project. Included below is a link to a comparison of typical characteristics of both mechanisms. In unique circumstances, there may be times where a subaward mechanism may be used for a service that more traditionally fits the purchased service mechanism. These are exception based circumstances and need to be discussed with your OSR Specialist prior to inclusion in a proposal.
Determination of the appropriate mechanism should ultimately be made by the Principal Investigator with careful consideration given to the scope of work. It should not be made on a perceived financial benefit of using one over the other.