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GIM 13 Supplement: Activity at Two or More Locations

UNIVERSITY OF WASHINGTON

Office of Research
Office of Sponsored Programs

GRANTS INFORMATION MEMORANDUM 13

November 17, 2011

When a project is supported by a single grant or contract and is conducted at two or more physical locations, the following principles should be observed for determining the appropriate F&A rate:

  1. When the total annual amount of the grant or contract direct cost is less than $250,000 in any given year, a single F&A cost rate will be applied for that year. This rate will be the one currently applicable to the location where the preponderance (more than 50%) of project University salaries is located.
  2. When the total annual amount of the grant or contract direct costs is $250,000 or more in any given year, the appropriate rate for each location will be applied using one of the following rules:
    1. Apply the F&A rate corresponding to the location to the modified total direct costs (MTDC) specifically assigned to a respective location; OR
    2. If it is not possible to specifically identify and assign costs by location, the appropriate F&A rate for each location will be applied to total project costs in the same ratio as direct University salary costs anticipated at each location during the period. As expenditures are made, the costs incurred should be assigned to the appropriate location for correct project billing or accounting. Note that under this methodology, there is still an expectation that anticipated subcontract administration can be identified and associated with a specific location, and therefore, subcontract costs that will be charged University F&A should be included in the base of that location where the subcontract is primarily administered. For example, a project that uses the on-campus rate and the off-campus rate should charge the on-campus rate to the first $25,000 of the subaward if the majority of the subaward administration (including receipt of LOI, incorporation into proposal documents, routing of eGC1, collection of invoices, confirmation of costs, collecting subaward reports, integration of reports into UW reports to sponsor, etc) will be administered by staff located at the on-campus location.
  3. If any part of the project will be carried out by the Applied Physics Laboratory (APL), that portion of the project costs must use the applicable F&A rate for APL, regardless of the total annual amount of the award. The current APL F&A rate is available on the Table of Established F&A Rates and Base Types for the University of Washington and consultation with APL prior to budget calculation of the APL component is recommended, in order to accurately calculate and incorporate the APL Direct Cost Rate.

For awards that qualify for multiple rates, after the award is made to the University, Grant and Contract Accounting (GCA) will establish two separate budget numbers for the award - one for each location. The larger of the two budgets will determine which is the parent budget. The academic department(s) responsible for post-award management of the award should ensure appropriate costs are recorded on each budget based on where those expenses take place.

Examples:

Example 1: When the direct costs will be less than $250,000 each year of the project, the location of the preponderance of University salaries is used to determine the applicable F&A rate (methodology in 1, above)

A researcher proposes a two year project in which the first year the University personnel consist of the PI and biostatistician, whose project activity is on-campus and one University Co-Investigator at an off-campus location. During the second year, the project consists of the PI and the Co-Investigator, whose activity is on-campus, and three consultants who are paid a fee at an off-campus location.

YEAR 1 On-Campus Off-Campus Total
Salaries (70% on-campus & 30% off-campus) $105,000 $45,000 $150,000
Supplies   $80,000 $80,000
Total Direct Costs $105,000 $125,000 $230,000
MTDC $105,000 $125,000 $230,000
F&A Costs (54.0% on-campus) applied to MTDC $56,700 $67,500 $124,200
Total Costs $161,700 $192,500 $354,200

Note the preponderance of University salaries is used to determine which F&A rate to use, not the location with the highest amount of total direct costs.

YEAR 2 On-Campus Off-Campus Total
Salaries (100% on-campus) $105,000   $105,000
Consultants (off-campus)   $120,000 $120,000
Supplies   $10,000 $10,000
Total Direct Costs $105,000 $130,000 $235,000
MTDC $105,000 $130,000 $235,000
F&A Costs (54.0% on-campus) applied to MTDC $56,700 $70,200 $126,900
Total Costs $161,700 $200,200 $361,900

Note the preponderance of University salaries is used to determine which F&A rate to use, even when consultant costs exceed the dollar amount of salaries.

Example 2: When the direct costs exceed $250,000 and MTDC cannot be specifically assigned to respective locations, University salary cost allocation is used as the basis to split rates (methodology in 2.b, above)

A researcher proposes a one year project consisting of $300,000 direct costs (University salaries of $150,000, other MTDC categories of $100,000 and a subcontract for $50,000) with 70% of the salaries on-campus and 30% off-campus. The subcontract is associated with on-campus project work and is administered on-campus. The F&A costs included in the proposal are calculated as follows:

  On-Campus Off-Campus Total
Salaries (70% on-campus & 30% off-campus) $105,000 $45,000 $150,000
Supplies, Materials (70% on-campus & 30% off-campus) $70,000 $30,000 $100,000
Subcontract $50,000   $50,000
Total Direct Costs $225,000 $75,000 $300,000
MTDC $200,000 $75,000 $275,000
F&A Costs (54.0% on-campus and 26% off-campus) applied to MTDC $108,000 $19,500 $127,500
Total Costs $333,000 $94,500 $427,500
Example 3: When the direct costs will be less than $250,000 in the first year of a multi-year project but more than $250,000 in the second year, then both methodology 1 and 2.a above will apply. In Year 2, the department has determined that specific costs can be assigned to specific locations.
YEAR 1 On-Campus Off-Campus Total
Salaries (70% on-campus & 30% off-campus) $105,000 $45,000 $150,000
Supplies   $80,000 $80,000
Total Direct Costs $105,000 $125,000 $230,000
F&A Costs (54.0% on-campus) applied to MTDC $56,700 $67,500 $124,200
Total Costs $161,700 $192,500 $354,200
YEAR 2 On-Campus Off-Campus Total
Salaries $105,000 $50,000 $155,000
Supplies   $120,000 $120,000
Travel $10,000   $10,000
Equipment $50,000   $50,000
Total Direct Costs $165,000 $170,000 $335,000
MTDC $115,000 $170,000 $285,000
F&A Costs (54.0% on-campus and 26% off-campus) applied to MTDC $62,100 $44,200 $106,300
Total Costs $227,100 $214,200 $441,300

Questions on how to split rates in a sponsored project proposal? Contact the Office of Sponsored Programs, (206) 543-4043 or osp@uw.edu.

Questions on how to set up sub-budgets? Contact Grant and Contract Accounting at (206) 543-8454 or gcahelp@uw.edu.