F&A Guidance
Facilities and Administrative costs (Indirect or F&A) are the actual costs of University operations that are not readily assignable to a particular project. These costs are determined per Uniform Guidance §200.412-15. F&A cost rates are negotiated with the Department of Health and Human Services Cost Allocation Services (DHHS-CAS) through the Office of Sponsored Programs (OSP) Cost Analysis and Compliance unit.
F&A funding is an essential part of operating and sustaining any large research university. Indirect costs are distributed throughout the University to cover expenses associated with the extensive and complex infrastructure and administrative systems that support sophisticated research programs.
OSP expenses indirect costs during the life of a research project. UNC’s Budget, Planning, and Analysis department then manage the distribution of F&A funds at the University.
Expenses used to determine Facilities & Administrative rates may include:
- Lab infrastructure (like fume hoods, microscopes, and lab benches)
- Service and maintenance contracts (for scientific and lab equipment)
- Research computing (data networks, research computing clusters, data storage)
- Grant Compliance and Reporting Officers
- Research building renovations (operations and upgrades)
- Building maintenance (cleaning and repairs)
- Hazardous waste disposal
- Library infrastructure (access to journals & materials)
Common expenses using Facilities & Administrative funds include:
- General Office Supplies
- Dues and memberships
- Network/telecommunication charges (internet, phone, email, software)
- IRB and IACUC review fees
- Salaries/wages and related benefits of Staff (departmental support personnel, administrators, grant, clerical and fiscal staff)
For additional breakdowns of F&A expenses, see Background on Facilities and Administrative Costs at UNC-Chapel Hill (PDF).
| Negotiated Rates - Effective 07/01/2020 | On-Campus | Off-Campus < 10-mile | Off-Campus ≥ 10-mile |
|---|---|---|---|
| ORGANIZED RESEARCH | 55.50% | 28.00% | 26.00% |
| INSTRUCTION | 50.00% | 28.00% | 26.00% |
| OTHER SPONSORED ACTIVITIES | 36.00% | 28.00% | 26.00% |
See our full Facilities and Administrative Rate Agreement (PDF) for more information.
Proposal
Defining Activity Types
*Please note that if a project involves more than one type of activity, a single rate will be applied that is reflective of the type of activity that composes the majority of the project.
Organized Research
Organized research includes all research activities conducted by the University including sponsored research, and research training programs. For example:
- Sponsored projects to support faculty research activities
- Faculty Career Development Awards to support faculty research activities
- Funding for facility, operational or equipment maintenance for a center or facility when used for research
- Sponsored projects issued to the University to support the student research activities and associated research training (research training grants)
- Clinical Trials
- Clinical trials conducted in hospital owned facilities within a 10 mile radius apply the 28% Off-Campus rate
- Clinical trials conducted in University owned facilities apply the full 55.5% On-Campus rate
Instruction
Instructional and training activities that are externally funded. This includes curriculum development (including textbook development) and other training (excluding research-based training) for degree, non-degree programs, and other academic programs.
Other Sponsored Activities
Activities funded by external sources that are not included in Organized Research or Instruction Activities. Some examples are:
- Seminar, conference, symposium, workshop or travel grants
- Funding for travel
- Community and Health services projects
- Website development
- Performance Arts (concert or plays)
Defining CHESS Codes in the RAMSeS IPF
| IPF CHESS Codes | Description |
|---|---|
| 01 - Research & Development (R&D): (CHESS 20-22) | Research activities, both basic and applied, and development activities performed by the institution. Includes activities involving the training of individuals in research techniques where such activities utilize the same facilities as other R&D activities.
(Ref: 2 CFR 200.87) Includes clinical research [that is not a clinical trial] of the following types:
(Ref: NIH OER Glossary & Acronym List) |
| 02 - Instruction: (CHESS 10-18) | All teaching and training activities, whether offered for credit toward a degree or certificate or on a non-credit basis, and whether offered through regular academic departments or separate divisions, such as a summer school division or an extension division. Includes training of professionals, including those who provide public services. Excludes research training defined under 01 - Research & Development above. (Ref: Appendix III to 2 CFR 200) |
| 03 - Public Service: (CHESS 30-35) | Activities related to the delivery of health service projects and other community service programs intended for public benefit. Does not include activities preformed for the benefit of non-public entities, including professional organizations. (Ref: Appendix III to 2 CFR 200) |
| 04 - Student Support: (CHESS 80-82) | Financial assistance provided to students in the form of scholarships, fellowships, grants in aid, trainee stipends, tuition and fee waivers and remissions, gifts, and prizes awarded and/or administered by the institution that are not contingent upon the student rendering services to the institution. Excludes assistance for research training defined under 01 - Research & Development above. |
| 05 - Clinical Trial: (no CHESS code) | A research study in which one or more human subjects are prospectively assigned to one or more interventions (which may include placebo or other control) to evaluate the effects of those interventions on health-related biomedical or behavioral outcomes.
(Ref: NIH OER Glossary & Acronym List) |
| 06 - Other: (CHESS 40-77 and 90-92) |
[Includes institutional support activities, such as library services, academic computing, and administration; physical plant operations; student recruitment and non-academic student support services; employee services and professional development; independent operations not related to the primary mission of the institution, and any other activity not described by other Activity Codes.] |
Award
Defining F&A Activity Types Assigned in ConnectCarolina
Once a proposal is funded, a PS Project ID (or several projects) will be assigned in ConnectCarolina. Each project will be set-up under a specific F&A Activity Type. Please reference the chart below to understand the different activity types and also learn where to identify the type for which the project has been set-up.
| F&A Activity Type | Description |
|---|---|
| OR – Organized Research | All research and development activities (basic or applied), that are sponsored by Federal and non‐Federal agencies and organizations, that includes activities which are focused on increasing knowledge and/or creating new knowledge for the primary purpose of producing research outcomes. |
| RT – Research Training | An extramurally-funded research or development project with a special focus on training graduate students and/or postdocs in research techniques. Research training occurs in the same spaces as organized research and usually attached to an organized research project. |
| SI – Sponsored Instruction | Specific special programs not typically part of the UNC standard curriculum, instructional and training activities (except research training) permitting knowledge and experience to be transmitted from teacher to student, curriculum development, teaching and mentoring activities, all in the university setting. |
| EQ – Capital Equipment | Primarily awarded to purchase equipment or another capital investment to support the conduct of Sponsored Research. |
| FE – Scholarship/Fellowship | Excluded from MTDC, these are student support for tuition, books, etc., and not compensation for services or training. Note: This category is different from Research Training grants that are sometimes referred to by sponsors as “Fellowships.” |
| PS – Public Service | Please see OS – Other Sponsored Activities |
| OS – Other Sponsored Activities | Defined as programs and projects financed by Federal and non-Federal agencies and organizations which involve the performance of work other than Instruction and Organized Research. OSA may include:
|
| CT – Clinical Trials, Phase 0-3 | FOR 3 or 4 LEDGER PROJECT IDs ONLY. A human‐subjects research project (usually extramurally funded) that follows a pre‐defined plan or protocol, typically related to improving human health or treatment of disease. Many clinical trials involve the testing of a new drug or invasive medical device in human participants. Phases 0‐3 goes from testing a brand new drug up to obtaining FDA approval. |
| C4 – Clinical Trials, Phase 4 | FOR 3 or 4 LEDGER PROJECT IDs ONLY. Once a drug, device, or procedure is FDA approved and made available to the public, research is continued to study its safety and determine best use. Information is gathered on the long‐term effectiveness in various populations and any side effects associated with long‐term use. |
Locating F&A Activity Types on Projects
- In RAMSeS, the F&A Activity Type is displayed on the Project Administration screen within the General Tab.
- In RAM Reports
, it is listed on the Award Summary screen as Award Purpose.
Off-Campus – Adjacent (≤10 miles from campus)
Activities conducted within a ten-mile radius of campus, but the facilities being used are not owned by the University or to which rent is directly allocated to the project. Activities occurring within the general vicinity of campus may be subject to these rates. You can discuss the ownership of the facilities with your departmental administrators and consult your OSP Sponsored Programs Specialist to identify applicability.
Off-Campus – Remote (>10 miles from campus)
Activities conducted outside a ten-mile radius of campus and the University does not own the facilities being used, or to which rent is directly allocated to the project. This can include office space located outside the ten-mile radius or fieldwork conducted in foreign countries.
UNC beyond Chapel Hill, NC
The University does operate facilities outside of the Chapel Hill campus, within the US and abroad, such as the North Carolina Research Campus in Kannapolis, NC and UNC Institute of Marine Sciences in Morehead City, NC. Consult your OSP Sponsored Programs Specialist to identify if activities are being conducted at a University owned/operated, off campus facility.
*Note that if a project involves both on-campus and off-campus sites, a single rate will generally be applied. That rate will be consistent with where the majority of the salary costs are expended. In addition, work at home is not a consideration for an off-campus rate.
Base types refer to the budget categories that are either included or excluded from F&A cost calculations. Each sponsor may have different bases for different award types and the agreement and/or sponsor website should be carefully read to determine what budget categories will be calculated with F&A.
Modified Total Direct Costs (MTDC)
Many sponsored projects use an MTDC base. It is calculated by excluding certain categories from the direct costs of a project when determining the indirect costs. Categories that are frequently included in F&A calculations are salaries and wages, applicable fringe benefits, materials and supplies, services, and travel. MTDC excludes categories such as equipment, capital expenditures, charges for patient care, long-term rental costs, tuition remission, scholarships and fellowships, participant support costs, and the portion of each subaward in excess of $25,000. MTDC is typically applied to Federal Clinical trials at the 55.5% rate.
Total Direct Costs (TDC)
There are no categories of direct costs excluded for projects using TDC. Unlike MTDC, all direct costs are included in the F&A base, resulting in associated indirect costs charged to the project. Projects that receive less than the University’s negotiated rates are charged indirect costs based on TDC. This includes some sponsors with reduced or no indirect costs as well as projects that receive internal approval for reduced or waived indirect costs. TDC is typically applied to non-Federal Clinical trials at the 28% rate.
Sponsor Defined
The indirect cost base is defined based on sponsor specific requirements. Examples include salaries and wages, or only supply and travel costs. All other types of costs would be excluded from the indirect cost calculation.
Total Project Costs (TC)
The total project costs base is used when the sponsor states that indirect rates may only be taken on a percentage of total project costs. To calculate:
- Direct Costs/(1-Allowed Indirect/F&A Rate) = Total Funds
- Total Funds-Direct Costs = Indirect/F&A Costs
OSP can consider requests to reduce or waive indirect costs in exceptional circumstances. Departments can request a reduced or waived indirect cost rate if it can be demonstrated that the project is unable to complete the scope of work if the University receives its full indirect costs. Please note that work at home is not a consideration for an off-campus rate nor adequate justification for waiving F&A.
Departments should adequately explain and justify the request using the OSP F&A waiver forms. The request must be signed by the PI, Department Chair, School Dean or Center Director, and be attached to the IPF in RAMSeS. The Assistant Vice Chancellor of Research for OSP will consider the justification to approve or disapprove the waiver request.