Date Established: 8/21/2012
Date Last Revised: 12/17/2015
Sponsored Projects Services
Vice President for Research and Economic Development, Provost
Indirect costs (Facilities and Administrative (F&A) costs) are charged to externally sponsored awards, unless specifically prohibited by the funding agency. A percentage of indirect (F&A) costs recovered from sponsored projects is distributed to university entities based upon the affiliation and relative contributions of key personnel to project objectives.
The University at Buffalo (UB, university) will recover the total direct costs and indirect (facilities and administrative (F&A)) costs for each sponsored award unless specifically prohibited or limited by the funding agency. Because indirect (F&A) costs cannot be readily assigned to a particular sponsored project or activity, they must be recovered from funding agencies through the application of the federally approved indirect (F&A) cost rates. All proposals for external funding must include a budget request for indirect (F&A) costs using the appropriate federal indirect (F&A) cost rate.
When a funding agency has a published rate that differs from the federal indirect (F&A) cost rate, the funding agency’s rate will be used. In these cases, the funding agency may allow some costs normally covered under the indirect (F&A) cost rate to be charged as direct costs; these costs should be included in the direct cost budget request.
Principal Investigators (PI) may request approval of a waiver or reduction of the indirect (F&A) rate when the potential benefits are compelling and well-justified. Waivers are only considered under exceptional circumstances.
Annually, the university will determine a percentage to be applied to the indirect (F&A) costs recovered from the preceding fiscal year; the resulting amount will be distributed to the provost, appropriate vice president, or dean, based upon the relative contributions of key personnel to project objectives. The provost, vice president, or dean will determine the appropriate use or allocation of these funds.
The PI is responsible for determining the relative contributions of key personnel, and for representing those contributions as a credit distribution in the proposal. The provost, vice president, or dean must approve the credit distribution prior to proposal submission.
Indirect (F&A) cost rates are established in accordance with the federal government’s Office of Management and Budget (OMB) Uniform Guidance. These rates are negotiated between The Research Foundation for State University of New York on behalf of UB and the Department of Health and Human Services, the cognizant federal agency overseeing the administration of sponsored agreements at UB. Indirect (F&A) cost rates are applicable to all externally sponsored projects funded by federal, state, or private sponsors. The application of these rates allows UB to recover certain costs (for example, but not limited to facilities, utilities, libraries, administration, student services) associated with externally funded research and training activity.
This policy applies to all sponsored projects administered by the Research Foundation (RF) or the UB Foundation Services, Inc. (UBFS).
Allocation of an individual’s relative contributions towards project objectives outlined in the proposal; allows the university to recognize and record such contributions, and appropriately distribute recovered indirect (F&A) costs.
Indirect Cost (Facilities & Administrative (F&A) Cost)
The costs of administrative and support functions of the university including general administration and expense, operations and maintenance, building and equipment depreciation, and library expenses. Costs incurred for common or joint objectives that cannot be readily assigned to a particular sponsored project, instructional activity, or any other institutional activity.
Indirect (F&A) Cost Rate
The total indirect (F&A) costs attributable to research are compared to the total direct costs of research to derive the percentage of indirect (F&A) to direct. This percentage, the indirect (F&A) cost rate, is then applied to the direct costs of research and is the means by which the university is reimbursed for indirect (F&A) costs associated with direct cost expenditures. The application of the indirect (F&A) cost rate allows the university to recover some of the costs of doing research that are not readily identified with a particular project or activity, but are necessary for the general operation of the organization and support its research mission.
Indirect (F&A) Distribution Base
A defined group of direct cost expenditures to which the indirect (F&A) rate is applied to determine the total indirect (F&A) costs of a sponsored project. The two most commonly used distribution bases are Modified Total Direct Costs (MTDC) or Salary and Wages (S&W) however, some non-federal sponsors may have developed other distribution bases such as Total Direct Costs (TDC).
MTDC - all direct expenditure categories excluding the following: equipment, tuition remission, rental costs, scholarships and fellowships, patient care expenses, and subcontract costs over $25,000.
S&W - the direct salary and wage expenditures of the sponsored research agreement.
The Principal Investigator (PI) and other individuals who design, conduct, and report research, or who contribute to the scientific development or execution of a project in a substantive, measurable way, regardless of compensation.
Principal Investigator (PI)
A UB faculty or staff member who bears responsibility for the intellectual leadership of a project. The PI accepts overall responsibility for directing the research, financial oversight, and compliance with relevant university policies and sponsor terms and conditions.
Any externally funded research, training, evaluative testing, or public service activity directed by UB faculty or staff as part of their university work that requires the university to perform a specified program or deliver a specified product.
The indirect (F&A) distribution percentage rate is currently 12%.
|December 2015|| |
Updated the policy to:
• Reflect the current practice of distributing indirect (F&A) cost recovery in the year following the fiscal year the indirect (F&A) was charged; this replaces the previous practice that included a two-year lag