Facilities & Administrative (Indirect) Costs

F&A Policy

The university negotiates an indirect cost rate agreement with the federal government to recover the costs of facilities and administrative support for sponsored projects. Facilities and administrative (F&A) cost recovery rates are based on actual costs the university has incurred. F&A recovery supports general institutional costs that are incurred for common and joint objectives. These are real costs that cannot be readily identified to a particular project or activity, so they are charged indirectly.

UAF maximizes full F&A recovery whenever possible; however, some sponsors have restrictions on the recovery of F&A costs. If a sponsor restricts F&A recovery, the dean or director of the department must decide whether or not to approve the proposal submission to that sponsor. If a reduced F&A rate is required by the sponsor, the sponsors' published F&A rate policy must be included with the proposal when it is submitted to the Office of Sponsored Programs for review.

Any F&A under-recovery will have to be paid according to the standing UAF F&A under-recovery procedures. Please note that while the under-recover policy is still in place, UAF now uses a 60/40 distribution plan for all research awards, regardless of the rate used.

Current F&A Rates

The university negotiates an indirect cost rate agreement with the federal government to recover the costs of facilities and administrative support for sponsored projects.

The Office of Naval Research (ONR) is the university's cognizant federal agency for indirect cost rate negotiation. The Department of Health and Human Services (DHHS) also negotiates indirect cost rates with universities; however, UAF does not have an agreement with DHHS. If you have questions about UAF's indirect cost agreement, contact the UA Office of Cost Analysis.

  • UAF's predetermined FY14-16 F&A rate for sponsored research is: 50.5%
  • UAF's predetermined FY14-16 F&A rate for other sponsored activities is: 37.2%
  • UAF's predetermined FY14-16 F&A rate for sponsored training/instruction is: 50.0%

On-Campus Organized Research 49.5% Sponsored Training/Instruction 35.0% Other Sponsored Activities (OSA) 34.2% School of Fisheries and Ocean Sciences, Ship Operations N/A Poker Flat Research Range 29.9% Arctic Region Supercomputing Center 36.8% International Arctic Research Center (IARC Rate Agreement) 28.8%

If you are preparing a sponsor's form that requires indirect cost rate information, provide the following information:

Cognizant Agency:
Office of Naval Research
Indirect Cost Branch
Code BD0242, Rm. 371
875 North Randolph Street
Arlington, VA 22203
Contact: Mr. Brian Kehoe, Government Negotiator
Phone: (703) 696-7742
Fax: (703) 696-2870
E-mail: kehoeb@onr.navy.mil

Calculating F&A

  1. Add up all project costs to get your (TDC) total direct costs.
  2. Subtract tuition, equipment with an acquisition cost of $5,000, participant support (NSF only), and subaward costs in excess of $25,000 from your TDC. F&A cannot be charged on these items. The remaining amount is known as your (MTDC) or modified total direct costs.
  3. (MTDC)(49.5%) = F&A costs
  4. F&A costs + TDC = Total Project Request

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F&A Activity Types

There are three main F&A activity types under UAF's negotiated agreement with ONR. They are: (1) "Sponsored Research," (2) "Sponsored Instruction and Training," and (3) "Other Sponsored Activities." It is important to choose the correct activity type for a proposal, since it determines which F&A rate to use. It is also important to remember that the activity is what occurs during the project period and not for what might result after the project period. The sponsor is providing support for the activity at the time of the project, and therefore the F&A activity type should reflect what occurs during the project period only. When in doubt, contact the Office of Sponsored Programs for guidance.

Sponsored Research:
"Sponsored Research" consists of "all research and development activities that are sponsored by federal and non-federal agencies and organizations," according to OMB Circular A-21, Section B.1.b.(1). This includes "activities involving the training of individuals in research techniques" where the activities "utilize the same facilities as other research and development activities and where these activities are not included in the instruction function." Sponsored research is combined with university research under the function of organized research for F&A purposes.

Some Examples of "Sponsored Research" Activities:

  • Basic and/or applied research activities;
  • Maintenance of facilities, equipment and/or operation of a facility which will be used for research;
  • Training of individuals in research techniques (research training);
  • Publishing research results; or
  • Data collection, evaluation, analysis and/or reporting.

Sponsored Instruction and Training:
"Sponsored Instruction and Training" consists of "specific instructional or training activity established by grant, contract, or cooperative agreement," according to OMB Circular A-21, Section B.1.a.(1).

Some Examples of "Sponsored Instruction and Training" Activities:

  • Instructing UAF students, faculty, or staff;
  • Instructing teachers or students in elementary or secondary schools;
  • Instructing the general public;
  • Curriculum development projects, including evaluation of curriculum or teaching methods;
  • Projects involving UAF students in community service activities for which they are receiving academic credit; or
  • Fellowship support for pre-doctoral and post-doctoral training activities, which may include grants to fund dissertation work and travel in relation to a dissertation.

Other Sponsored Activities (OSA):
"Other Sponsored Activities" consist of "programs and projects financed by federal and non-federal agencies and organizations which involve the performance of work other than instruction and organized research," according to OMB Circular A-21, Section B.1.c.

Some Examples of "OSA":

  • Performing a service (e.g., production of goods or materials) for an outside entity, unless UAF is a subawardee on the entity's prime award that is primarily for research or instruction/training;
  • Travel grants;
  • Support for conferences, seminars, or workshops;
  • Support for UAF public events;
  • Support for projects involving UAF students in community service activities for which they are *not* receiving academic credit;
  • Support for projects pertaining to museum or library collections, acquisitions, bibliographies, or cataloging;
  • Programs to enhance institutional resources, such as computer enhancements, etc.; or
  • Health services projects.

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Off Campus Research F&A Rate

Off-Campus Research is defined in the UAF's F&A Agreement as "projects or specified project segments which (1) have estimated direct costs in excess of $100,000 and (2) which require off-site research activities for a period of 180 consecutive days or the equivalent of 80% of the project term."

"Such research, exclusive of Poker Flat, shall be conducted at facilities and administrative rates agreed to by the contracting parties based on individual requirements. Unless a benefit to the project can be identified, such rates shall not contain on-campus facilities depreciation charges or operation and maintenance costs except for those costs which flow down through other cost components, nor shall there be any provisions for library or student services costs."

Projects that meet these criteria should submit proposals at a reduced F&A rate to funding entities only when the authorized administrative official or the designee at the respective MAU has reviewed and agrees that the project meets the Off-campus criteria as defined in the ONR negotiated agreement.

Only Off-campus projects that benefit from university facilities should be including the facilities component in the F&A rate for those projects. Otherwise projects meeting the above criteria should use the administrative rate of 26.0%.

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AK State Sponsored Research

For research sponsored by the State of Alaska, the F&A rate is 25% applied to the MTDC base. For instruction, training, and other sponsored activities, the F&A rate is 12% applied to the MTDC base. Please see the Memorandum of Understanding between the State of Alaska and the University of Alaska.

(Note: If UAF is a subrecipient on a State of Alaska proposal to a Federal sponsor, the Federal F&A rates still apply. This State MOU only is intended for award decisions that the State has control over. Read the MOU carefully to determine how it applies to your project.)

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Multiple MAUs (Major Administrative Unit)

For proposed projects that involve more than one MAU (UAA or UAS):

  • An MAU cannot be a subaward in another MAU's proposal. The UA System is considered one organization with a single accounting system and therefore does not have an internal subaward mechanism.
  • The prime MAU should use their F&A rate for the entire proposal, unless a non-lead MAU constitutes 10% or greater of the total project activity. However, sponsor guidelines and requirements are the primary consideration in deciding if it is appropriate to use multiple rates.
  • The proposal budget should combine all line items for the MAUs involved, with separate MTDC lines for each MAU's F&A recovery.
  • A separate spreadsheet budget for each MAU and a combined budget should be included to show the breakdown of work and funds requested.
  • For NSF proposals, the easiest and most compliant solution is to prepare a collaborative dual submission: each MAU's budget is entered separately, the proposals are linked in FastLane, and awards are made to each MAU separately for their portion of work.

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Multiple Activities

For proposed projects that involve more than one activity:

  • The F&A rate for the prime activity should be used for the entire proposal, unless other activities constitute 10% or greater of the total project activity. However, sponsor guidelines and requirements are the primary consideration in deciding if it is appropriate to use multiple rates.
  • The proposal budget should combine all line items for all activities with separate MTDC lines for each activity's F&A recovery.
  • A separate spreadsheet budget for each activity and a combined budget should be included to show the breakdown of work and funds requested.
  • For NSF proposals, there will be a separate line for each rate and base on the NSF budget form section I (Indirect Costs).

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Multiple Departments

For proposed projects that involve more than one department:

  • The prime department should use their F&A rate for the entire proposal, unless a non-lead department constitutes 10% or greater of the total project activity. However, sponsor guidelines and requirements are the primary consideration in deciding if it is appropriate to use multiple rates.
  • The proposal budget should combine all line items for the departments involved with separate MTDC lines for each department's F&A recovery.
  • A separate spreadsheet budget for each department and a combined budget should be included to show the breakdown of work and funds requested.
  • For NSF proposals, there will be a separate line for each rate and base on the NSF budget form section I (Indirect Costs).