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Facilities & Administrative (F&A) Cost Recovery March 5, 2009 What is F&A? OMB Circular A-21 term for what was formerly referred to as indirect cost recovery. Also known as “overhead” Cost recovery mechanism – not a “tax” What is F&A? Facilities & Administrative (F&A) costs are
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Calculation is a ratio of:
F&A costs allocated to Organized Research
Organized Research Modified Total Direct Costs
F&A Rate ComponentExamples
General Administrative Costs Central administrative offices
(Payroll, accounting, disbursements, purchasing)
Department Administration Academic Departments/Colleges
Sponsored Administration VPR / Grants & Contracts Financial Services
Operation & Maintenance Repair & maintenance, utilities, custodial, grounds, police
Building and Equipment Depreciation Standardized asset classifications and lives
Interest Costs on Building & Equipment Debt Service on certain buildings
Capped at 26%
F&A payments as a % of total NIH awards was stable at 28.5% for FY03-05 accdg to GAO.
Recent COGR survey: F&A rates have held relatively constant at ~51% for the past 6 yrs!F&A Cost Rate Agreement
FY06 NSF survey showed that universities contribute more than $9B of their own funds to support R&D activities or nearly 20% of total R&D expenditures.
2000 Rand study estimated that universities were subsidizing between $700M and $1.5B of F&A
Administrative Costs are capped at 26%; the Facility rate component is negotiated down to less than half the computed ‘actual’ costs.
UTSA F&A Revenue - 5 Year History
F&A revenue grew by $3.1M over the last 5 years, an increase of 103%
The net effective F&A rate is computed
TOTAL F&A Recovery Revenue
Restricted Sponsored Program Expenditures (Net of F&A)
We are subsidizing ~50% of the negotiated cost of overhead for restricted research (69% of cost study developed costs)
95% of F&A is from federally sponsored activities.
29% of FY08 F&A recovery is pledged to debt
FY07 debt service paid $665,350
FY08 debt service paid $667,600
FY09 payment due $666,000
Faculty Start-Up Costs