6.3 Award agreement and instalment schedule

6.3.1 Award agreement

For each approved project, the CFI prepares an award agreement with the recipient institution. Institutions are required to sign the agreement, thereby accepting the terms and conditions of the funding.

The award agreement indicates the maximum allowable CFI funding share of eligible costs (typically 40 percent) and the maximum CFI amount. It also contains the instalment schedule and financial reporting requirements which vary depending on the size and complexity of the project, as well as any additional conditions of funding.

6.3.2 Release of funding

The CFI releases funding to the recipient institution once all finalization documents have been received and satisfactorily reviewed and any specific conditions have been addressed. All instalments to institutions are subject to the CFI receiving funding from the Government of Canada, which is subject to sufficient parliamentary appropriations.

Instalment payments by the CFI to institutions are also subject to review and authorization of each instalment by CFI management and the fulfillment of any condition that may be applicable to the payment of such instalments.

The CFI reserves the right to defer or suspend subsequent instalments if transfers received from the Government of Canada are reduced or cancelled due to insufficient parliamentary appropriations, if an institution fails to comply with CFI policies or any of the terms or conditions agreed upon or if the need for funds is not demonstrated.

The CFI sends funds only to the recipient institution. For multi-institutional projects, the recipient institution is responsible for receiving and distributing the funds to other participating institutions according to the terms of the inter-institutional agreement. For large and complex projects where funding for construction or renovation is requested, it is possible that the instalment for the equipment to be located in the constructed or renovated space will be paid only when this space is ready to house the equipment. This will be determined following the CFI’s risk assessment for the project. The CFI makes electronic deposits to a pre-arranged bank account. The CFI sends the account administrator and the liaison a payment notification via email.

6.3.3 Instalment schedule

The CFI establishes the instalment schedule at the time of award finalization taking into account the expected timeline for disbursements to be made by the institution, size of the award and parameters affecting the risk of the project.

The planned instalment schedule is included in the award agreement. The CFI may subsequently revise the schedule based on monitoring activities, such as review of financial reports and other progress reports submitted by institutions. The CFI communicates any revisions to the institution.

The CFI will withhold all institutional payments when an institution does not comply with reporting requirements for any of its awards.

6.3.4 Holdback amounts

The CFI holds back a portion of the funding for each project. This amount is usually 10 percent of each instalment. The percentage of the holdback amount for large, very complex projects of longer duration may be negotiated on a case-by-case basis. The minimum holdback amount for any project is $10,000.

The purpose of the holdback amount is to ensure that the CFI’s contribution in any given period remains as close as possible to the maximum allowable CFI funding share of eligible costs. After adjustments are made to reflect actual expenditures, the holdback amount for a given period is normally released within three months of submission of the financial report. The amount of the holdback released every period for each project is based on a review of the information presented in the financial report to ensure that:

• Instalments match, as closely as possible, the expected disbursements
• There is satisfactory progress in the acquisition and development of the infrastructure.

6.3.5 Final instalment

The final instalment for the holdback is made after the project is completed and the final financial report has been received and found to be satisfactory. Upon project completion, the amount of the final CFI contribution is calculated based on the actual total eligible costs incurred for the project. The final CFI contribution is limited to the maximum allowable CFI funding share of eligible costs (typically 40 percent) or the maximum CFI amount, whichever is lower.