Tax Exempt Financing and Tracking of Both Qualified Use and Non-Qualified Use of Research Space
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Policy No: 6079
Effective Date: 05/11/10
Revised Date: 05/11/10
Reviewed Date: 05/11/10
Tax Exempt Financing Policy and Tracking of Both Qualified Use and Non-Qualified Use of Research Space
It is the policy of UNMC to comply with legal requirements related to the issuance of tax exempt bonds to finance a portion of any building project costs. The purpose of this policy is to specify the requirements.
UNMC has issued tax exempt bonds to finance a portion of the project costs for the following buildings:
- Durham Research Center I
- Durham Research Center II
- Michael F. Sorrell Center for Health Science Education
- Home Instead Center for Successful Aging
- Harold M. and Beverly Maurer Center for Public Health
- Center for College of Nursing Sciences (College of Nursing addition)
Having issued tax exempt bonds to finance a portion of the above project costs, the University of Nebraska Medical Center (UNMC) is obligated to limit the amount of:
- "private business use" or
- "non-qualified uses" of these building.
- Additionally, UNMC should avoid entering into "exclusive use" agreements for space in these buildings.
- "Basic research" is research conducted for the advancement of scientific knowledge under an agreement that has no specific commercial objective and conveys no exclusive rights to the sponsor.
- "Private business use" involves use of the facility in a trade or business by anyone other than the University, for example the lease of a portion of a laboratory assignment module or an office to a private entity.
- "Non-qualified uses" include activities funded by private commercial or nonprofit organizations or by the federal government where:
- the research is not basic research
- the university does not own the intellectual property
- the university is not free to (or not expected to) disseminate the research results to the public through publication
- the university grants "non-permitted licenses" (exclusive licenses that are not provided at fair market value, as determined after the product or invention that is to licensed has been created and valued)
- "Exclusive use" agreements are leases or other arrangements that grant rights of exclusive use of specified space to non-University users.
- Uses of these buildings that are not limited to above rules, include:
- basic research, including federally funded qualified basic research
- state funded activities such as the Nebraska Public Health Lab (DRC II)
- New awards to Principal Investigators whose labs are in any of the buildings listed above, that involve either "private business use" or other "non-qualified uses" will be reported by Sponsored Programs Administration to Financial Compliance and flagged in the Grants Management System maintained by Sponsored Programs Administration.
- All leases of laboratory or office space in these buildings, or other similar arrangements that give third parties "exclusive use" of space in the buildings listed above, will require prior written approval of the Assistant Vice Chancellor for Budget and Strategic Planning and will be reported to Financial Compliance. "Exclusive use" arrangements for any of the space in the buildings listed above is strongly discouraged.
- Financial Compliance will monitor the volume of "private business use" and other "non-qualified uses" and report quarterly to the Assistant Vice Chancellor for Budget and Strategic Planning and the Vice Chancellor for Research.
- Financial Compliance will separately monitor and report all "exclusive use" agreements.
- Financial Compliance will report annually on the total revenues associated with the buildings listed above, using the categories and thresholds listed in the tracking procedure (Under Construction).
- Tax Exempt Financing Monitoring and Reporting Procedure of Both Qualified Use and Non-Qualified Use of Research Space - Under Construction
- Contact the Manager, Financial Compliance and Cost Analysis.
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