What is F&A?
F&A costs, formerly known as indirect costs and overhead, are costs which are necessary to support research and other sponsored projects, but which cannot be readily assigned to individual projects.
They may include the costs of electricity to run the building, equipment shared among many researchers or administrative efforts to support research. Some researchers don’t think of F&A expenses as part of their research costs, but they make up a large portion of their total necessary resources. Because of these indirect expenses, research budgets should be calculated to include F&A costs.
The Health Sciences Center’s F&A rate is calculated in accordance with federal cost principles and is negotiated periodically with the Department of Health and Human Services. It is important to remember that the application of the F&A rate to sponsored projects actually represents a recovery of costs already incurred by Greenville Health System (GHS) in the preceding year.
Why pay F&A?
Here is a list of some of the goods and services provided by Greenville Health System (GHS) that are used by researchers but are not covered by direct costs:
- Accounting Office
- Advertising for Personnel
- Affirmative Action Monitoring
- Central Administration
- Clinical Departmental Administration
- Custodial Services
- Environmental Health & Safety
- Facilities and Space Usage
- Human Subject Reviews
- Library Services
- Payroll Office
- Personnel Office
- Purchasing Office
- Risk Management
- Security (Campus Police)
- Selected Publications
- Selected Subscriptions
- Sponsored Programs Administration
F&A Vs. Direct Costs
F&A costs are general in nature, shared by multiple users, where it is not easy to determine each user’s share. F&A costs include:
- Administrative research services
Direct costs can be assigned to a specific project with a high degree of accuracy. Direct costs include:
- Technical and Student Salary
- Scientific Supplies
- Human Subject Incentives
- Consultant pay
- And more
F&A must be calculated and included in all grant proposal budgets unless:
- Sponsor does not allow F&A costs as evidenced in the funding opportunity guidelines or a consistent policy which applies to all applicants.
- An official F&A waiver has been obtained.
F&A = Total Direct Costs (minus) Capital Expenditures (buildings, individual items of equipment, alterations and renovation) (minus) Subawards
Current Rates (FY19 and Beyond)
All Programs: 56.4%
Note: Please remember that if you have a multi-year budget, you must calculate the F&A for each year using the appropriate rate for that year (use the F&A rate in effect for the start date of each budget year).