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Government Costing

Facilities & Administrative Rates

Facilities and Administrative (F&A), also known as indirect or overhead, costs of the University are those expenses incurred for the common objectives of the University and are not easily identifiable with a particular project or activity. There are two broad categories for these expenses, as implied by its name: Facilities expenses and Administrative expenses. The Administrative expenses include costs related to various University operations such as general university administration, sponsored projects administration, department administration, and student services administration. Facility expenses include various facility costs such as building and equipment depreciation, interest, operations & maintenance including utilities, library, etc.

Our sponsors recognize the importance of such infrastructure support and reimburses these costs through an accounting mechanism which applies an F&A rate to the direct costs of each project, so that each project (federal and non-federal) pays its fair share of these support costs.

The Code of Federal Regulations (Uniform Guidance 2 CFR 200) stipulates how these calculations are to be made and requires universities to calculate and negotiate Facilities and Administration rates for Instruction, Organized Research, Other Sponsored Activities and Specialized Service Facilities. The principles are designed to provide that the Federal Government bear its fair share of total costs including facilities and administrative costs.

Last Updated: May 5, 2016

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