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Service Unit Basics

A. The federal regulation that governs university service units is 2 CFR Part 200, Subpart E – 200.468 – Specialized service facilities (formerly OMB Circular A-21, section J.47).

B. According to the Cost Accounting Standards (CAS) Disclosure Statement (DS-2) 48 CFR Part 9903, “Service Centers are departments or functional units which perform specific technical or administrative services primarily for the benefit of other units within a reporting unit. Service centers include ‘recharge’ centers (RC), and the ‘specialized service facilities’ (SSF) defined in 2 CFR 200.468.”

C. Goods or services are charged directly to users based on actual usage:

  • On a published rate schedule or established methodology;
  • Using rates that do not discriminate between federal and non-federal users (including internal users)
  • Federal customers must never be charged more than other customers

D. Rates must be designed to recover only the aggregate costs of the service over time.

E. Rates must be adjusted at least biennially, and must take into consideration over/under recovery of costs of the previous period(s). Federal regulations permit the carryover of a “60 day working capital reserve” (see Section 6 of the UMBC Manual/Procedures for Service Units for additional information and Appendix 12.4 for 60-day reserve calculation examples).

F. What are Service Centers (Units)? – An activity that provides goods or services:

  • Predominantly to University departments at approved rates
  • On a regular and continuing basis
  • Incidentally to sponsored agreements
  • Incidentally to the general public

These have direct operating budgets exceeding $50,000 but not greater than $500,000.  Normally, billing rates include direct costs (labor, materials and so forth) plus these may include equipment depreciation.  Examples may include: Graphics Services, Fleet services, Telecommunication Services, Physics Shop and so forth.

G. What is a Recharge Center? – Generally, these are departmental units which provide goods and services, primarily to University departments, for a fee. These have total annual budgets of $50,000 or less.  Billing rates may generally include only direct costs.

H. What is a Specialized Service Facility? – A Specialized Service Facility (SSF) provides highly complex or specialized services to a specific sub-group of users (customers). A Specialized Service Facility at UMBC is defined as any recharge activity that provides specific measurable services to users with total annual revenues in excess of $500,000, or at least $200,000 derived from charges to sponsored contracts and grants. UMBC also includes under this category service units for which 50% or more of billings are direct charged to sponsored agreements and direct charges are material in amount (i.e., greater than $100,000).