GIM 13 Supplement: A Primer on Facilities and Administrative Costs
UNIVERSITY OF WASHINGTON
Office of Research
Office of Sponsored Programs
GRANTS INFORMATION MEMORANDUM 13
November 17, 2011
Primer Index
5. How are F&A cost components calculated?
Circular A-21 spells out in considerable detail the data that must be
collected for calculating the F&A cost rate. The financial basis for the F&A cost
calculation is the set of audited data from a previous year's activity. The nine
cost pools are classified within two broad categories--"Facilities" and
"Administration"--with the F&A costs for the latter category capped at 26%. Chart II is a percentage breakdown of the
University's on-campus research rate for Fiscal Year 2000. The chart suggests that
for each $100,000 allowed for MTDC, the 2000 UW rate recovers an additional $5,000
for building and improvement costs, $4,000 for equipment, and so on.
Buildings and Improvements
Interest
Equipment
Operations and Maintenance
Library
General Administration
Departmental Administration
Sponsored Projects Administration
Student Services Administration
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The Buildings and Improvements cost pool (the first
of nine cost pools) contains three major types of costs. The first and largest
segment is the building depreciation. Depreciation is calculated on a straight-line
basis by building component, such as foundation (100 years), roof (20 years) and so
on. Building costs paid from federal funding are not included in the depreciation
calculation.
Based on an extensive "space study" carried out by the University, an estimate is
made of the fraction of building use which can be attributed to the research effort.
The building cost pool also allows for the cost of land improvements (such as
sidewalks, exterior lighting, landscaping), and the cost of off-campus rental space
(if not charged to a grant directly).
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The Interest cost pool includes interest on debt
associated with certain buildings, equipment and capital improvements. These costs
are assigned to research projects proportionally in the same manner as the
depreciation or use allowance on the items (buildings, equipment and capital
improvements) for which interest is paid.
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The Equipment cost pool includes items of equipment
not purchased with federal funds. An annual depreciation amount is computed on each
equipment item using "useful life" periods established by the State of Washington.
If the equipment is located in a room identified in the University's space study as
research space, the corresponding equipment depreciation amount is considered an F&A
cost of the research carried out in that room.
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The Operations and Maintenance cost pool includes
physical plant operations and maintenance expenses. This category recovers the cost
of utilities, maintenance, custodial services, environmental health and safety,
transportation services, campus security, and facilities management associated with
organized research. The University's space study is used to apportion the majority
of these expenses to research, instruction and other activities.
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The Library cost pool recovers centralized library
costs
incurred by the Suzzallo, Allen, and Odegaard Libraries as well as Branch Libraries.
Recoverable operating costs include administration, book acquisitions, and the cost
of periodicals. Libraries operated by academic departments are considered
departmental administration costs, and are recoverable through that cost pool. The
various groups utilizing library services must be identified and assigned a portion
of library costs when establishing what fraction of the total cost of the library
enterprise is attributable to the research activities of the University.
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The General Administration cost pool includes expenses
for general executive and administrative offices, which provide services to all
activities of the University. This category encompasses personnel, payroll, and
purchasing services, financial management, and a variety of other central
administrative functions. In addition, expenses in the offices of the President, the
Provost, and the Executive Vice President are included in this cost pool. These
expenses are distributed proportionally in relation to the many other activities
conducted at an educational institution.
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The Departmental Administration cost pool includes
expenses for program support and administration which occur at both the
college/school and departmental levels. This cost pool includes an allowance (3.6%
of MTDC) for the administrative effort of faculty and other professional personnel.
In addition, the Departmental Administration cost pool includes a calculation of the
portion of personnel costs for non-faculty and non-professional technical and
administrative staff, and for supplies, travel, telephone services, etc. which are
typically paid from general operating budgets.
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The Sponsored Projects Administration cost pool
recovers the cost of organizational units established primarily to support the
research or training effort regardless of the funding source. The primary elements
in this pool are the costs associated with the offices of Grant and Contract
Accounting, Office of Sponsored Programs, and some costs in the office of the Vice
Provost for Research.
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The Student Services Administration cost pool provides
for graduate student services. This includes a portion of the costs of graduate
student counseling, health services, the Graduate Admissions office and similar
activities. However, current DHHS practice requires the allocation of all student
services administration costs to instruction. Therefore, no student services
administration costs are included in the existing F&A rate for research.
Once all F&A costs attributable to research are identified and calculated for a
fiscal year, the sum becomes the numerator in the F&A cost rate calculation shown in
Chart I. The modified total direct
costs (MTDC) for the corresponding year are placed in the denominator. The resulting
quotient is the proposed F&A cost rate. A component rate is calculated for each of
the nine cost pools as shown in Chart
II.
