Please see the announcement below regarding new Facilities & Administrative Rate changes and implementation instructions.

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From: research-bounces@lists.ucr.edu [mailto:research-bounces@lists.ucr.edu] On Behalf Of Cynthia J Wells
Sent: Friday, March 20, 2015 4:21 PM
To: research@lists.ucr.edu
Subject: [Research] New Facilities and Administrative (F&A) Cost Rates

~ Please broadly disseminate this important announcement to faculty, researchers, and contract and grant administrators in your department. ~

UCR’s Facilities and Administrative Rate Agreement

UCR recently received its new Facilities and Administrative (F&A) Rate Agreement with the Department of Health and Human Services (DHHS), UCR’s cognizant audit agency. See DHHS agreement dated February 12, 2015.

The rates approved in that agreement are predetermined for the period July 1, 2013 through June 30, 2019, and provisional thereafter.

Per UCR Policy #527-7, implementation of the new F&A Rate Agreement will be effective April 1, 2015.

The new F&A rates and applicable effective periods are as follows:

New & Renewal Proposals Submitted To A Sponsor On or After April 1, 2015

All new and renewal proposals must be submitted using these new rates. The eCAF (Electronic Campus Approval Form) system has been updated to reflect the above rates. If the Office of Research and Economic Development receives an eCAF or a budget for a new or renewal proposal that does not use the new rates, it will be returned to the submitting unit for correction.

For proposals with a budget year starting before July 1, 2015, and ending on or after that date, the budget should be calculated using the applicable rate for each budget year segment. For example, for a budget year beginning April 1, 2015, the budget for an on-campus organized research project should be calculated using an F&A rate of 52.0% MTDC for April 1, 2015 – June 30, 2015, and 54.0% MTDC for July 1, 2015 – March 31, 2016.

Supplemental & Continuation Proposals Submitted On or After April 1, 2015

For the purpose of calculating F&A costs, all supplemental and continuation proposals should use the applicable F&A rate associated with the parent award in effect at the time the supplemental or continuation proposal is submitted. However, if a sponsor’s policies or funding opportunity announcement state that a specific F&A cost rate is applicable to a supplemental proposal, then that special rate should be used. For example, supplemental awards from the National Science Foundation for its Research Experience for Undergraduate program limit the applicable F&A cost rate to 25% MTDC.

Please see below for additional information regarding how the applicable F&A rate associated with parent awards are determined.

Awards with Project Period Start Dates Prior to July 1, 2013

To comply with 2 CFR 200 (Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards) all awards with project period (i.e., competitive segment) start dates prior to July 1, 2013 will continue to use the applicable rate from the F&A rate agreement in effect at the time of the project period start date. For example, if a sponsored award for an on-campus research project has a project period of October 1, 2012 – September 30, 2017, it will continue to use the 52.0% MTDC rate until September 30, 2017. No cost extensions, approved by the Office of Research and Economic Development or the sponsor, result in the extension of the project period end date and do not change applicable F&A rate.

Awards with Project Period Start Dates of July 1, 2013 and Beyond Resulting from Proposals Submitted Before April 1, 2015

In accordance with UCR’s F&A Rate Agreement dated January 30, 2009, UCR was required to use the same rates as those cited for the fiscal year ending June 30, 2013 (“Provisional Rates”) until approval of a new rate agreement. Also, in accordance with 2 CFR 200, when an education institutions does not have an approved F&A rate agreement at the time of award, the Provisional Rate is used for awarding F&A costs. The Provisional Rate is then subsequently adjusted once a new rate agreement is approved.

Awards with project period start dates of July 1, 2013 and beyond that resulted from new and renewal proposals submitted before April 1, 2015 may be awarded additional funds by sponsors in response to UCR’s new F&A rate agreement. In such cases, the F&A rate associated with such awards will be revised to reflect the new applicable rate. In those cases where sponsors do not award additional funds, UCR will treat such awards as if they had project period start dates prior to July 1, 2013.

In the event that a sponsor intends to make an award in response to a proposal submitted before April 1, 2015 and the sponsor requests or requires submission of a revised proposal budget prior to making the award, the revised budget must use the new applicable rate. Please remember that all revised budgets require the review and approval of the Office of Research and Economic Development prior to submission to a sponsor.

Treatment of Funds Carried Forward to a New Budget Year

Since indirect costs are levied on expenditures, any balances carried forward into a new budget period will be charged at the effective rate for that budget year. If these carry-forward balances necessitate rebudgeting funds between direct and indirect costs, Extramural Accounting will notify the PI if the rebudgeting is greater than $500. If a budget is affected by less than $500, Extramural Accounting will rebudget, but will not formally notify the PI. All rebudgeting activities will be processed via the BEA application and require review via the PAN process.

Participant Support Costs

With the implementation of 2 CFR 200.245 of the Uniform Guidance (effective December 26, 2014), Participant Support Costs* are:

• Allowable with the prior approval of the Federal awarding agency. Therefore, these costs should be explicitly listed in the proposal budget or approved by the funding agency after the award is made; and
• Excluded from assessment of F&A charges. Therefore, these costs should not be included in the modified total direct costs base when calculating the indirect cost for proposal budgets. 

*Participant Support Costs means direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees, but not employees, in connection with conferences or training projects.

Inquiries and Resources

For questions regarding the new F&A rates, or assistance with determining the applicable F&A rates in, please contact the Contract and Grant Officer assigned to your unit.

A Sample Proposal Budget Justification has been updated to reflect the new on-campus organized research F&A rate.

Additional information is posted at https://research.ucr.edu/spa/lifecycle/proposal-preparation-submission/quick-reference-fa.aspx.

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