Gustavus Facilities and Administrative Cost Distribution Policy

Background

Facilities and Administrative Costs (often referred to as indirect costs or F&A) are costs paid by agencies that enter into grant or contract agreements with Gustavus for research and other projects. They are provided to the College as a reimbursement for real costs incurred in maintaining the infrastructure for research and programming. Typically, F&A costs cannot be readily identified with a particular project, but examples of indirect costs include: maintenance of physical facilities, depreciation of buildings, insurance, utilities, information technology, instrumentation, library expenses, and accounting/grants management staff.

Gustavus Adolphus College has a federally-negotiated Facilities and Administrative cost rate. The rate is currently reviewed every four years. This rate is published by the Gustavus Grants Offices.

Philosophy for Distributing Facilities and Administrative Cost Recovery

F&A cost recovery that comes to the College is often a source of much-appreciated and much-needed reimbursement for expenses already incurred and paid for by the College. However, the College should not assume a certain level of indirect cost recovery for any fiscal year for budgeting purposes.

F&A cost recovery can also be used/invested strategically for the future rather than simply being a source of current reimbursement and/or budget relief. The following policy is based on this philosophy.

Policy

Distribution of Facilities and Administrative Costs

Gustavus Adolphus College will distribute F&A recovery in the following manner. Principal Investigators (PIs) may not negotiate special arrangements regarding F&A recovery distribution with any College official, except in extenuating circumstances.

50% to General College Budget

In order to maintain one of the intended purposes, 50% of all indirect cost recovery will be used to offset current college expenses. 

25% to PI as Program Incentive Funds

PIs expend significant effort in applying for and managing awarded grants. To promote grant activity and help departments deal with the cost of administering grants, 25% of the indirect cost recovery from an individual’s grant will be distributed to PIs and may be spent in the following ways:

  • Project-related costs not otherwise covered by the grant, including cost-share and/or matching funds
  • Research or teaching equipment and/or laboratory materials and supplies
  • Summer faculty and student stipends, including benefits, to conduct research or develop/revise a course
  • Laboratory analysis fees
  • Travel expenses related to research, conference attendance/presentation for PI or students(s)
  • Equipment maintenance
  • Student employee labor costs during academic year
  • Computer hardware and/or software
  • Up to one reassigned course per year, with prior Dean and Provost approval
  • Unspent Program Incentive Funds are available throughout the grant period but must be spent within one year from the grant end date.
  • If there are multiple PIs on a project, Program Incentive Funds will be distributed evenly among them.
  • A one-page accounting of how Program Incentive Funds were spent during the preceding year will be due to the department chair and the Grants Offices annually on May 31. 

25% to Provost’s Project and Capacity Building Fund

25% of all indirect cost recovery will be deposited into a specific research/project fund to be held and distributed by the Provost. The Provost’s Office leadership team can determine, in consultation with appropriate committees, what kind of activities the fund will support (individual research, collaborative projects, capacity building projects, program initiatives, etc.) and award funds to eligible faculty/staff initiatives. The Grants Offices can help manage and facilitate this process. The Provost’s Project and Capacity Building Fund seeks to invest in future scholarship and other scholarly activities and has three distinct benefits: 1) indirect cost recovery is internally set aside to invest in future initiatives, and does not only support the current college-wide budgets; 2) this fund demonstrates the Provost’s Office interest in and direct support for faculty scholarship and/or programmatic projects; 3) this fund helps seed faculty and staff projects seeking future external funding. 

Distribution of these funds will typically be structured as follows. However, the distribution may shift with appropriate prior approval from the Provost’s Office, Grants Offices, and the Vice President for Finance depending upon needs during a particular academic year.

  • 10% to internal capacity building grants: to help fund projects in their early stages, which can later be scaled to compete for external funding.
  • 10% to other projects and program initiatives that are in alignment with the strategic plan. For example, student/faculty research; new/pilot programming; collaborative projects, etc.
  • 5% to equipment purchase and maintenance.

Funds in each distribution category may be carried over for a maximum of three years, as calculated at the end of each fiscal year (May 31). After three years, any unspent funds will be returned to the College’s operating budget.


Approved by the President’s Cabinet: December 6, 2016