Contracts - Honorariums and Personal Service Agreements

Important Note: No member or group of members is empowered to enter into a contract, promise to pay or in any other way obligate their club, the SGAF, or the University without following proper procedures. All credit purchases, contracts, and other forms of purchase agreements must have the approval of the Student Activities Office and SABO.

* * All forms and guidelines related to the purchase of services can be found under the Personal Service Agreements and Honorariums link on the Purchasing web site at http://www1.easternct.edu/fiscalaffairs/purchasing/  * *

� A Personal Service Agreement (PSA) is a binding contract between the club/organization and a person or group providing a service. A PSA is used if the amount to be paid is over $3,000.00 and is not for an entertainer or lecturer. The Vice President of Student Affairs needs to sign all PSA's.

PSA's must be submitted 30 days prior to the event with the payee's signature. The Attorney General's review and signature is required, before payment will be made to the vendor or agent. You must use the State Comptroller's form, CO-802A. No photocopies of form will be accepted.
 
The PSA form is submitted along with the club minutes which must include the resolution authorizing the expense, the appropriate non-discrimination form, a W-9 for the person/company whose name is to appear on the check, and a corporate resolution, if dealing with a corporation. All of the documents should have the same name on them (the PSA, the non-discrimination form, the W-9, the corporate resolution and the club's minutes). Clubs submitting a PSA should plan to meet with a member of the Student Activities Staff to discuss their event. At the conclusion of the event, an e-mail needs to be sent to a member of the SABO office verifying that services were rendered so that a check can be mailed.
 
� An Honorarium is a binding contract between the club/organization and a person or group providing a service. An Honorarium is used when the amount to be paid for a vendor or performer is $3,000.00 or less. However, if a service provider will be cumulatively paid more than $3,000 in any rolling 12 month period, a Personal Services Agreement form C-802A must be prepared and approved in advance of the start of the services to be provided, even when the total value of such individual services being provided is for less than $3,000.00. The Vice President of Student Affairs is required to sign all Honorariums.
 
The form (which can be found online) must be submitted at least 10 days prior to the event. Club minutes need to be submitted along with the Honorarium (with all required signatures), a non-discrimination form, a W-9 for the person whose name appears on the check, and a corporate resolution, if dealing with a corporation and the amount is over $600.

Under no circumstances are any services to be performed without prior approval, and event may be subject to cancellation if paperwork is not received within the stated time frames. 

If the vendor is a state employee a Dual Employment Form is required. The individual service provider will be paid through the University's Personnel/Payroll system. Payroll Office will apply the charges to the club account for the service including fringe benefits.

Sales of advertising and sponsorships by the Campus Lantern and radio station respectively, and lifeguard services for the pool, have already been determined that an employer/employee relationship exists and will be paid through the University's Personnel/Payroll System.

Student clubs and organizations may hire ECSU students using the PSA/Honorarium process, however, student employees already on the payroll may not be hired by a club or organization for any purpose, even if it is for a one time DJ, it is not allowed.

Out of State Entertainer Withholding Tax is withheld for out-of-state vendor contracts totaling $1,000.00 or more. The vendor will receive a 1099 form at the end of the calendar year.

Due to IRS rules and penalties concerning the failure to secure social security or taxpayer identification numbers from service vendors (contractors), all PSA's or Honorariums cannot be considered "complete" until either a social security number or taxpayer identification number and a mailing address for the vendor appear. If a vendor returns a PSA or Honorarium with this block incomplete, no payment will be made. There are no exceptions to this policy as the IRS penalties are substantial. Under no circumstances will payment be made until we have this information and the contract is fully executed by the University.

Once the PSA/Honorarium is reviewed and finalized by the University, a copy is returned to the contractor (vendor) and to the agreement monitor of the club/organization.

After the engagement takes place, an authorized signature authority must verify that services have been rendered.  To request the payment, a voucher must be completed and submitted to SABO for processing.  If payment is required on or before an event, it must be noted. (NOTE: It is the responsibility of the requesting club or organization to notify SABO if the scheduled contract is not completed, and return the check if necessary).

Students should be extremely careful when verbally agreeing to the provision of services on behalf of their club. Students do not have the authority to enter into any agreement that might be binding on the organization, the SGA, or the University, only an authorized University administrator may do this. Students who enter into an agreement without going through these steps for approval could be held personally liable and possibly be sued for any debt and collection fees.