The funding of Facilities and Administrative Costs (F&A), a.k.a. indirect costs, through a project is intended to reimburse the University for costs that the University incurs in support of a project, but which cannot be easily assigned.
On a multi-year basis, the University negotiates F&A Rates with the U.S. Department of Health and Human Services. These rates apply to all University research, training/educational, and public service activities conducted through externally funded projects.
It is the policy of the University to recover the maximum amount of F&A that is consistent with sponsor guidelines and our Federally negotiated rates.
The Office of Sponsored Programs (OSP) will make a final determination as to which of our rates is appropriate for your project (i.e. research, training/educational, or public service, etc.) and, in accordance with sponsor requirements, what rate is recoverable. Any deviation from the full allowable recovery rate must be explicitly approved by OSP in advance of submission.
For a listing of current F&A Rates go to: www.usm.maine.edu/osp/rates.html.
Agreements with the Federal Government
Generally, the University expects to recover the full amount of F&A costs consistent with our negotiated rates and allowable under the specific guidelines of the grant/contact program.
In some cases an agency may either cap the recovery rate (for example, some U.S. Department of Education programs only allow for an 8% recovery), or require cost sharing which may be met with a waiver of direct and/or F&A costs. It is only when these restrictions are noted in the sponsor guidelines that a waiver will be granted pro forma.
Agreements with the State of Maine
All proposals submitted to any State of Maine agency or department for work to be carried out under either a State/University Cooperative Agreement or an Agreement to Purchase Services will carry a F&A Rate of no less than one-half of our Federally negotiated rate for the specific type of project being proposed. This reduction in rate applies only to Agreements for which the State makes the funding decision and has control of the funds (i.e. State tax revenues or Federal block grants to the State).
For any project jointly proposed to a third-party funder, the F&A policy of that party applies. For example, projects jointly submitted to the Federal government whose guidelines allow for full recovery of F&A should be submitted as such.
Agreements with the Foundations
Many foundations have policies which disallow the recovery of F&A Costs. However, some foundations do allow for low rates of recovery. Again, we should recover whatever rate/amount is allowable.
Agreements with the Other Entities
The OSP will review the circumstances of F&A recovery in other submissions consistent with the statements above.
Fixed Price Agreements
Any unspent contract or grant balances originating from fixed-price agreements shall be used first to repay the F&A waiver of the respective agreement if one was originally authorized. Remaining balances should then be transferred to an unrestricted fund (i.e. Fund Code 00 or 10) in accordance with System and campus policy and guidelines.
F&A Waiver Requests
It is only in rare or unusual instances that a waiver will be granted. Waivers will be based upon subjective criteria such as benefit to the institution, the college, a particular program, or to a faculty/staff member’s research agenda. Such waiver requests will need the support of the College Dean/Unit Director and will be made in consultation with OSP. Requests shall be weighed against the cost to the University.
Should a faculty/staff member wish to appeal an F&A waiver decision made by OSP, such requests will be routed through the OSP to the Associate Vice President for Academic Affairs - Research, Scholarship & Creative Activity. The Provost shall, if necessary, resolve any disagreements.