Facilities and Administrative costs are real costs incurred by the Schools/Centers and institution for common or joint objectives in support of sponsored research and activities, but cannot be directly identified with a specific grant or contract. The costs result from shared services such as libraries, physical plant operation and maintenance, utility costs, general costs, departmental, units/school and sponsored projects’ administrative expenses, and depreciation for buildings and equipment are real costs built into the University budget.
The F&A costs recovered on grants allow the institution to build, maintain and operate research facilities (as opposed to teaching facilities). It is the obligation of all researchers who use institutional facilities to bring in grant funding along with the attendant F&A costs. The F&A dollars received are not extra dollars, but are part of the budget and are fully used to make the system work. Without them, research laboratories and facilities cannot be built and maintained.
UAB’s F&A cost reimbursement is driven by its Colleges and Universities Rate Agreement (Rate Agreement) negotiated with and mutually executed with its cognizant audit agency, the Department of Health and Human Services (DHHS).
The link to UAB’s Indirect Cost (IDC) Reimbursement Policy (December 21, 1999) is provided for your convenience and among other important information it states the following:
Note: the requirement is a published and uniformly applied policy.
UAB’s Rate Agreement is applicable to and covers all sponsored research, other sponsored activities and sponsored instruction per the federal guidelines and UAB policy.
UAB has three policy exceptions to its Colleges and Universities Rate Agreement:
These three exceptions are:
Guidance is provided below to assist you in determining if an exception applies. These exceptions are (1) effective by execution and implementation of the Vice President for Research, (2) only applicable relative to the appropriate study type, and (3) only applicable when all criteria are met.
* Published as used here means a website or publicly distributed written announcement. In rare occasions a letter will be accepted, for example in the case of a small foundation that does not have a well-established grant administration program.
The following are accepted as full recovery of facility and administrative costs for the applicable kinds of grants or contracts.
For-profit entities are not eligible for an alteration of the payment of indirect costs. Therefore, the expectation is that UAB will fully recover all F&A on any project funded by such an external agency.
Under those exceptional circumstances in which a sponsor is not eligible for an alteration of the payment of indirect costs or does not have a published and uniformly applied policy a Principal Investigator has two options for recovering F&A costs.
At the end of the fiscal year an adjustment will be made to the school’s F&A distribution based on offsets granted during the previous fiscal year.
Note: All sponsored projects, other sponsored activities and sponsored instruction projects are subject to federal and other audit. Account setup, billing and other post-award financial activities are managed by UAB’s Grants and Contracts Accounting (GCA) department.