A major consideration is whether fellowship/stipends are delivered through
the payroll system or through another mechanism.

Payroll system is geared up to deliver checks on time to a specific place
(often direct deposit), so it is a particularly convenient way to get to
the recipient, but in all other aspects -- taxes, benefits, etc., -- it is
designed around the concept of payment for services
rendered.  Fellowship/stipends are NOT payment for services rendered, but
payments to cover an individual's living costs while being
trained/educated.  A number of years ago our institution was delivering
fellowship/stipends -- at least some of them -- through the payroll
system.  Then, in a budget crunch, the governor cut all state employees'
salaries.  So our fellowship payments were cut!  It took a threat from our
major federal sponsor that all funds from that sponsor would be cut off to
get management's attention to the fact that fellowship/stipends are not for
services rendered.

My recommendation is that fellowship/stipends be handled completely
separately from payroll.  This will minimize the likelihood that IRS will
think these are payments for services rendered and zing you for mishandling
of payroll.  This is particularly a problem in certain areas where a
fellowship recipient and a research employee are working side by side and
doing the same things (because many fellowship activities are pretty much
like on-the-job training).

And if you do this, then you can easily implement a system that ensures
that payments for fellowship/stipends do not duplicate.  You can also
implement a centralized cross-check to ensure no salary/wage payments are
made when they are prohibited by the fellowship/stipend rules that apply in
some cases.

All of this assumes that "stipends" does not include payments for services
rendered.  Remember, most faculty and administrators do not understand the
difference between fellowship/stipends (as we use it) and work.  How often
have you heard the payment to a research assistant called a "stipend"?

Chuck

At 03:21 PM 8/13/2002 -0400, you wrote:
>We're interested in knowing if anyone has a centralized oversight
>procedure for student fellowships/stipends.  Do you have a system to
>determine if a student is receiving more than a single stipend?  How do
>you distinguish salary from stipend situations?  Is there a different
>approach if a stipend comes from a sponsored project?
>
>Thanks, as usual, for your responses.
>Susan
>
>--
>Susan B. Burke
>Sponsored Research Information Specialist
>Office of Research Services
>The George Washington University
>2121 I Street NW, Suite 601
>Washington, DC 20052
>Telephone: 202/994-9136
>Facsimile:  202/994-9137
>
>
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Herbert B. Chermside, CRA
Director, Sponsored Programs Administration
Virginia Commonwealth University
PO BOX 980568
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