This issue of the Financial Management Office Newsletter includes information about the following:
- FMO Website Survey
- Potential Tax Implication on Renting Facility to Non-University Users
- Notification of Updates to AP 8.851 – Employee Out of State and Intra state Travel
Resources
The FMO Newsletter is distributed monthly. Should you have any questions about this newsletter, contact Amy Kunz via email at amykunz@hawaii.edu.
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FMO Website Survey
Target Audience: All
FMO is in the process of updating our website to use the UH templates supported by ITS and to comply with current accessibility guidelines. We would like to take this opportunity to get feedback on how we can improve the website. Please take a few moments to provide your comments in our survey. We would appreciate your response by 2/28/2022.
If you have any questions, please contact the Fiscal Services Office.
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Potential Tax Implication on Renting Facility to Non-University Users
Target Audience: Fiscal Administrators and Staff
When any University facility is being rented out to non-university users, please be mindful of possible unrelated business income (UBI) tax exposure. UBI tax may exist if:
- The facility has outstanding debts; or
- Additional services (e.g. e.g. hospitality services, cleaning or setup services) are rendered; or
- Any profit generated is shared between the University and the renter
When equipment (i.e. furniture, audio-visual equipment, etc.) is part of the rental of the facility, the tax considerations are different if the rental value of equipment is equal to:
- 10% or less of total rental income, then it is considered incidental and is not UBI;
- 11% to 50% of total rental income, then it is considered UBI in proportion to the percentage of equipment rental value to the total rent;
- 51% or more, then 100% of the rent amount is UBI.
UBI that falls into these categories should be included on the annual survey distributed by the tax office.
If you should have any questions, please contact Kenneth Lum at kenlum@hawaii.edu.
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Notification of Updates to AP 8.851 – Employee Out of State and Intra State Travel
Target Audience: Travelers, Fiscal Administrators and Fiscal Support Staff
On January 27, 2022, the AP for employee travel was updated to limit the use of travel advances as well as address other minor housekeeping items. The AP update affecting travel advances is part of a broader approach to reduce administrative processing of expenditures and to focus on other efficient ways for the University to pay for business expenses, like travel.
Under AP8.851, travel advances will now be limited to only student athlete or student related travel expenses. Student travel disbursed by means of DV payment type S would not be affected. We highly encourage employees to work with their business office to pay for their up-front travel costs through PCard or PO (airfare, lodging and conference fees, etc.). For out-of-pocket expenses or amounts paid using personal credit cards, the turn-around time for reimbursement currently averages 9 calendar days from the time the travel completion is submitted to UH Disbursing in UH E-Travel. For even faster reimbursement, travelers should sign up for ePayment to receive reimbursements electronically via direct deposit, which is a requirement per AP 8.802 – Requirement of Direct Deposit and/or ACH.
To give time for departments to work through an implementation plan, this new AP will be effective for travel after July 1, 2022.
The AP was forwarded to UHPA, HGEA and UPW for comments and feedback. It was also vetted through various UH departments, including Community Colleges and system offices prior to submission.
Should there be any questions regarding implementation of these changes, please email etravel-help@lists.hawaii.edu. If you have questions on the PCard process, please email pcard@hawaii.edu.