Facilities and Administrative (Indirect Cost) Recovery
Application of F&A Rates
It is the policy of this university to seek the appropriate, approved Facilities and Administrative Cost (F&A) recovery rate on all sponsored programs whether they are from private or public sources. Application of the standard F&A recovery rate can be waived in extenuating circumstances only (please see Waiving of F&A). F&A Grid All projects are subject to the University's Negotiated Rate Agreement unless there are instructions that specify differently. 1 Negotiated Rate Agreement dated November 15, 2007 Rates that are to be applied to a Modified Total Direct Cost (MTDC) base are calculated as follows: Subtract any costs that should be excluded from the Total Direct Cost amount to obtain the base figure. Then multiply the base figure by the appropriate F&A rate to obtain the F&A recovery. Add the F&A recovery amount to the Total Direct Cost amount to obtain the Total Costs for the project. Costs excluded from the calculation of F&A recovery:- equipment 2
- capital expenditures
- SOM animal resource center charges 3
- charges for patient care
- tuition remission
- rental costs
- scholarships
- fellowships
| 1 | If you have instructions that specify the use of a rate other than the negotiated rate, please include those instructions when you route your proposal to Grants and Contracts. |
| 2 | Equipment is defined as tangible, non-expendable personal property having a useful life of more than one year and an acquisition cost of $5,000 or more per unit. |
| 3 | Animals housed at locations OTHER THAN the School of Medicine should be INCLUDED in the calculation of F&A recovery. |
On- Versus Off-Campus The appropriate application of the on- and off-campus rates is determined by the location where a majority of the UCD work is to be conducted. If 50% or more of the UCD work is to take place at an on-campus facility, then the on-campus F&A rate should be used. If more than 50% of the UCD work is to be conducted at an off-campus facility, then the off-campus rate should be used.
Other Government and Non-Profit Sponsored Projects If a government or non-profit sponsor has a published, consistently applied policy that establishes a specific F&A rate for the project(s), that rate will be honored by the Health Sciences Center. Please include those instructions when you route your proposal to Grants and Contracts. For non-profit, charitable associations, foundations and societies that do not have an established policy, the UCD project must initially be proposed at an F&A cost rate of no less than 10%.
Clinical Trials Most sponsored clinical trials are assessed the off-campus F&A recovery rate (26%) because a majority of the activity is generally conducted off-campus, i.e., at one of the hospitals affiliated with the UCD. Non-federal on-campus clinical trials are subject to a F&A rate of 26% of Total Direct Costs.
Waiving F&A Cost Recovery The appropriate, approved facilities and administrative cost recovery rate will be sought on all sponsored programs whether they are from private or public sources. Sponsors are expected to pay full costs except where prohibited by approved legislative, regulatory, or programmatic restrictions. Examples of Federal programs with special rates are:
- Conference and travel grants
- Training grants
- Career development awards
- Clinical research center grants
- Construction grants
The Waiver Process When a deviation from the normal facilities and administrative cost rate is deemed desirable, the PI shall request approval using a Facilities and Administrative Cost Variance Request. The PI can download the Variance Request from the web; or can obtain a copy of the form from the Dean's Office or Grants and Contracts. Allow plenty of lead-time. The waiver process can take up to 4 weeks.
NOTE: It should be recognized that waiver of F&A costs results in two undesirable consequences. First, the F&A costs incurred by the UCD are not recovered for the particular sponsored project activity. Second, an undesirable impact occurs when future F&A rates are negotiated. Unrecovered F&A costs cannot be included in future negotiations of the F&A cost recovery rate.