Facilities and Administrative Cost Rates
(Formerly Indirect Cost Rates)

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Click here for Facilities and Administrative Cost Rates for July 1, 2007 through June 30, 2010

BACKGROUND:

On February 28, 2007, the University of California and the United States Department of Health and Human Services (the responsible Federal audit agency) entered into a new facilities and administrative (F+A) cost rate agreement for the Los Angeles campus. This agreement establishes facilities and administrative cost rates for the period July 1, 2007, through June 30, 2010. It supersedes the agreement dated May 14, 2003.

Under the new rate agreement only the on-campus Research rate will change. The on-campus Research rate currently in effect is 54.5%. Effective July 1, 2007, the rate will decrease to 54% and remain at that level through June 30, 2010. F+A for new on-campus research projects that begin on or after July 1, 2007, will be 54%. F+A for ongoing on-campus research projects for which 54.5% is now being charged, will be decreased to 54.% as of July 1, 2007. The funds that are freed up by the decrease in F+A will be made available to the project as additional direct costs unless sponsor policy requires that these monies be returned to the sponsor. The 54% rate should be used in proposals that seek funding beyond June 30, 2007.

The other facilities and administrative cost rates will remain unchanged.  These include the off-campus Research rate, the on and off-campus Instruction rates, the on and off-campus rates for Other Sponsored Activities, and special rates negotiated for the General Clinical Research Center and the Center for Genomics and Proteomics and the Center for Molecular Medicine. Rates currently in effect will remain constant through June 30, 2010, and should continue to be used in proposals that seek funding beyond June 30, 2007.

All of these facilities and administrative cost rates are applied to a Modified Total Direct Cost (MTDC) base. MTDC consists of all salaries and wages, fringe benefits, materials and supplies, services, travel and the first $25,000 of each subaward (subgrant and subcontract) regardless of the period covered by the subgrant or subcontract. Equipment (defined as a tangible item with a useful life of at least one year and an acquisition cost of $5,000 or more per unit), alterations and renovations, charges for patient care and tuition remission, space rental costs, scholarships and fellowships, as well as the portion of each subaward in excess of $25,000 are excluded from the MTDC calculation.  Please note that if the subaward is issued to another UC campus, the full amount of the subaward is excluded from the MTDC calculation. *

Although negotiated with the federal government, these rates should be used in all contract, grant and subcontract proposals submitted to all extramural sponsors. The exceptions are those industry-sponsored studies that meet the campus definition for clinical trials and qualify for the application of a special 26% rate approved by the University of California Office of the President (UCOP). (See http://www.research.ucla.edu/ocga/ctir/faq.htm#FArate) Exceptions to the federal negotiated F&A rates have also been approved by UCOP for certain non-profit organizations. Please contact the Office of Contract and Grant Administration (OCGA) for details.

The on-campus rate should be used for all research conducted in buildings owned by or leased by The Regents of the University of California . The off-campus rate should be used only when work is either done at facilities owned or leased by other organizations, or in a building for which rent is being directly charged to the project. (See http://www.research.ucla.edu/ocga/sr2/onoffind.htm).

If a project involves work at on-campus and off-campus sites, a single rate should generally be applied. That rate, either the on or off-campus rate consistent with the location where the majority of the salary costs are expended. The use of both on-campus and off-campus rates for a given project may be justified only if the following criteria are met:

• The salaries paid to UCLA employees under the project exceed $250,000; and
• At least 25% or more of the total costs can be clearly identified with each rate

If a project involves more than one type of work (e.g., both research and training), a single rate must be applied, reflective of the type of work that makes up the majority of the project.

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Download the Facilities and Administrative Rate Agreement document dated February 28, 2007 (PDF format)

*IMPORTANT NOTE:
Although many years ago participant support costs were exempt from F&A assessment, that is no longer the case. Participant support costs are not exempt from F&A assessment and should be included in the modified total direct cost base upon which F&A is calculated.

**IMPORTANT NOTE:
The Laboratory of Structural Biology and Molecular Medicine (LSBMM) special rate is to be applied only to the U. S. Department of Energy cooperative agreements that support the Center for Genomics and Proteomics and the Center for Molecular Medicine.

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Click here for:

Information on what Facilities and Administrative cost rate should be used for clinical trials

Facilities and Administrative Rate Agreement document dated February 28, 2007 (PDF format)

Information regarding Facilities and Administrative cost waivers

Use of On- or Off-Campus Facilities and Administrative cost rates

Clarification of Participant Support Costs and the Application of Facilities and Administrative Costs (RA-NEWS 02-007)

Last Updated on 04/06/2005

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