HBP Part 10.3.3. General Information About Service Centers

Handbook of Business Procedures

Date published: June 19, 2012
Last revised: March 29, 2019
Issued by: Federal Reporting


A. Introduction

The primary purpose for establishing a center is to enable The University of Texas at Austin to charge and recover costs incurred for goods or services used and required in support of sponsored research programs or academic needs. A center can provide services to internal and external users.

Centers are established to obtain operational efficiencies, eliminate duplication of effort, and provide access to specialized services and/or products. Departments or units are encouraged to utilize existing centers before requesting to establish a new center.

B. Items to Consider when Managing or Proposing a Service Center

  • Services provided play a significant role in the fulfillment of the university's educational, research, public service, and support functions, without regard to profit.
  • The center results in an overall cost reduction, measured as an increase in cost effectiveness, a decline in overcapacity, or an elimination of redundant services.
  • Services must be provided at a reasonable cost to the university and cannot be provided conveniently, adequately, or economically by another center or external entity.
  • Services cannot be offered to the university community or external entities solely as a means of creating additional revenue.
  • What are the goods or services that are included or provided?
  • What procedures will be established to monitor activity and ensure the ongoing cost effectiveness?
  • Is the anticipated customer base comprised of internal users only or a mixture of internal and external users?
  • Is the demand for the services sustainable and ongoing?  
  • Is there a for-profit entity providing the same or similar service?  
  • Does the center have support from the dean or vice president and anticipated users?
  • Will the center be a fully self-supporting operation or will some of the costs be subsidized?
  • Describe the alternative methods that were evaluated prior to proposing a center and why they were rejected.
  • The records, operations, rates, and practices of all centers are subject to audit by federal, state, and internal auditors, and by the Office of Accounting and Financial Management.



Part 10. Costing - Table of Contents