I need advice on how and when to charge for the use of specialized
equipment on a grant or contract.

We have a contract with a private firm in which the professor is
doing some work that is partly research and partly testing,
and he is using some failry big and expensive equipment in an
engineering lab.  There ias adequae provision for salaries,
overhead, supplies, etc., but no rental or usage charge for
the equipment.  There is also provision for the university to
keep any intellectual property that may arise.
Another professor was asked by another company if they could
use the machine, and when he calculated and quoted the usage charge
they turned it down.  He is now upset that the first company
seems to be getting the usage for free.

Question:  At what point, or by what criteria, should specialized equip-
ment be a separate charge in a grant or contract budget?  Does
paying overhead and covering salaries and supporting research
obviate the need to pay for the equipment?  Are there accounting
rules that need to be followed consistently?

Any advice will be welcome.

Stuart A. Ross
California State University Fullerton
xxxxxx@ccvax.fullerton.edu

Thank you.