UW-Madison will pay $1.5 million to the U.S. Government in a settlement agreement alleging the university overcharged federal agencies for research projects.
According to the U.S. Office of Management and Budget principles, before receiving research money universities agree to pay back the federal government the savings associated with discounts and rebates on purchases for research projects. Failure to do so results in overcharging the federal government, U.S. Attorney Scott Blader said in a statement.
The settlement agreement said UW-Madison did not pay the federal government the savings earned on some payments between 2008 and 2018.
UW-Madison spokesman John Lucas said this money accounted for rebates and credits earned by its Materials Distribution Service and by the DoIT Tech Store from reselling Apple and Dell products.
Lucas described the incident as a “technical accounting issue,” saying it did not cause financial loss to the federal government. He said the university did not knowingly participate in wrongdoing.
“The university takes very seriously its obligations to appropriately manage its federal funds and has enhanced its rebate-related accounting practices to address any areas of potential disagreement with its federal partners going forward,” Lucas said.
While the source of funding to pay the settlement is currently unclear, Lucas said the university will not use state or federal money.
