Facilities and Administrative (Indirect) Costs for Sponsored Programs

6340.1 General Policy

Facilities and administrative (F&A) cost rates applicable to sponsored research and service are negotiated by the Office of the Controller with the university's cognizant federal agency pursuant to Office Management and Budget (OMB) publication 2 CFR 200, "Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award." Appropriate federally negotiated rates for the type and location of the supported activity will be applied to all sponsored agreements unless an exception is warranted pursuant to Section 6340.3 of this policy. Changes in the university’s federally negotiated rates are widely disseminated among affected members of the university community.

Facilities and administrative costs are the costs associated with sponsored research projects that cannot be allocated to a specific project, as defined in 2 CFR 200:

 

§200.56 Indirect (facilities & administrative [F&A]) costs.

 

Indirect (F&A) costs means those costs incurred for a common or joint purpose benefitting more than one cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. To facilitate equitable distribution of indirect expenses to the cost objectives served, it may be necessary to establish a number of pools of indirect (F&A) costs. Indirect (F&A) cost pools must be distributed to benefitted cost objectives on bases that will produce an equitable result in consideration of relative benefits derived.

 

 

6340.2 Applicability

This policy applies to sponsor budgets prepared by Research and Sponsored Programs for proposals submitted on or after July 1, 2016, for new or competing external funding, or for amendment of funding agreements. This policy does not apply to gifts or charitable grants to the university or to awards solely for student aid, including student internships. In addition, this policy does not apply to restricted accounts used to hold royalties or other forms of income generated from the commercialization of university-owned technology.

6340.3 Exceptions

F&A rates that are less than the university’s federally negotiated rate may be allowed in a proposal.

  • Allowable exceptions will be made in order to be consistent with sponsor policy or indirect cost rates defined in specific RFPs or RFAs issued to solicit proposals.
  • Any other exceptions to using the federally negotiated F&A rate must be approved by the Vice President for Research and/or the Provost.
  • In all cases the difference between the allowed rate in the proposal or award and the university’s federally negotiated rate shall be budgeted as a cost-share by the university.