Criteria for Subrecipients, Contractors (Vendors), and Consultants (Independent Contractors)

Updated October 31, 2024

Once the DLCI has received at least a preliminary scope of work and budget from the proposed subrecipient organization, review to confirm the relationship meets the criteria of a subrecipient and determination is not based on indirect cost savings. Contact your contract administrator or RAS Subaward Team if you have questions about the proper designation. 

Subrecipients are distinguished from both contractors (also referred to as vendors or suppliers) and consultants (also referred to as independent contractors).

Subrecipient

  • Performs a substantive portion of the proposed Statement of Work incorporated into the Prime Award  
  • Has responsibility for internal programmatic decision-making and design  
  • Is responsible for assisting the prime recipient in meeting the goals of the project
  • Is responsible for adhering to applicable federal programmatic compliance requirements
  • Retains intellectual property and copyright to the work produced by the subrecipient’s personnel; may co-author an article in a professional research journal

The MIT PI on an award may not also serve as a PI on a subaward under the same award. 

MIT does not issue subawards to individual persons; only to a company or organization that is not a sole proprietorship and that has sufficient internal controls and processes to be compliant with flow down terms and conditions. 

    • Can present significant administrative burden to for-profit entities who do not have experience with receiving federal awards. 
    • Must be fully aware at proposal of the responsibility to meet federal compliance requirements as they are contrary to vendor relationships entity is likely familiar with. 
    • Federal audit and compliance requirements applicable to for-profit subrecipients vary by each federal awarding agency.  
    • Methods to ensure compliance may include pre-award audits, monitoring during the contract and post-award audits. 
    • International entities exist under different regulatory requirements, and may have difficulty agreeing to US federal terms and conditions. 
    • All subrecipients are required to have/obtain a Unique Entity Identifier (UEI) from the US federal government regardless of the prime sponsor. 
    • Assessments of international entities can take additional time, and may require PI/DLCI involvement providing training, guidance and enhanced monitoring.

Contractor

  • Provides the goods and services within normal business operations. 
  • Provides similar goods or services to many different purchasers. 
  • Normally operates in a competitive environment. 
  • Provides goods and services that are ancillary to the operation of the federal program. 
  • Is not generally subject to compliance requirements of the federal program. 

Consultant

  • An individual to perform services working on his/her own behalf rather than for a company.