OSP -- F&A Cost

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F&A Cost Rates

Rate Matrix

HHS Rate Agreement

How to Determine the Appropriate F&A Rates for Sponsored Projects

Facilities & Administrative Costs

OMB Circular A-21 Section G 7. states the following:

"Federal agencies shall use the negotiated rates for F&A costs in effect at the time of the initial award throughout the life of the sponsored agreement. "Life" for the purpose of this subsection means each competitive segment of a project. A competitive segment is a period of years approved by the Federal funding agency at the time of the award. If negotiated rate agreements do not extend through the life of the sponsored agreement at the time of the initial award, then the negotiated rate for the last year of the sponsored agreement shall be extended through the end of the life of the sponsored agreement. Award levels for sponsored agreements may not be adjusted in future years as a result of changes in negotiated rates."

This means that the F&A rate used is determined by the award date rather than the project period of the award. The navigation bar on the left side of this page contains links to different rates with the effective approval date.

Proposals for new and competing renewal awards should use the latest set of rates in effect, while proposals for non-competing continuations should use the fixed rates that were in effect and frozen at the time of the initial award (per A-21 above). For both Endowed and Contract Colleges, F&A costs are calculated on modified total direct costs (MTDC), which equals the total direct costs less the following exclusions:

Effective July 1, 2003, the university's capitalization threshold will change to $5000 for all equipment. This means that an item with a unit cost of $5,000 or more and a useful life of two years or more will be considered capital equipment.
Cost in excess of $25,000 on each subcontract (F&A costs are charged on the first $25,000 of each subcontract), GRA exclusion (amount of GRA wage equivalent to tuition and fees), Graduate Health Insurance Leases and rental of real property.
Participant support costs for conferences and seminars.

Special note about Provisional F&A Rate(s): Provisional rates could be in effect at the time of the initial award. Provisional rates are not negotiated rates and are sometimes considered for budgeting and billing purposes to allow adequate time for negotiations. The provisional rate would be used in proposals and sponsor billings until such time that a rate (fixed or predetermined) was negotiated. Once a rate is negotiated, individual awards would be adjusted to the negotiated rate. As a general rule, if the rate is adjusted upward the award would be adjusted up to the amount of the negotiated rate if there are adequate funds budgeted or additional funds are awarded to cover the increase.