Advance payment

Advance payment is required on all research projects funded by industry sponsors.  Advance payment is required because the initial stages of a project usually incur a disproportionate share of costs in the form of equipment purchases, upfront commitments, etc.  Thus a “mobilization” or “start up” fee is assessed in order to ensure a timely start to the project.  The amount of the advance payment is usually 25% of the total project cost.  However, if the sponsor has a bad credit rating, a higher amount (up to the full project cost) may be required.  Notice of the advance payment requirement will be included in the proposal transmittal letter.  The payment clause of the Sponsored Research Agreement (SRA) will contain the amount of the advance payment, along with instructions for electronic transfer of the funds to the University’s designated bank.  The advance payment is applied against the final invoice for the project, and any funds remaining may be returned to the sponsor per the agreed upon terms of the SRA.  This policy does not apply where the industrial sponsor has a prime government contract under which UT Austin is a subcontractor.

Pertinent Office(s):