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Indirect Costs

Facilities & Administrative costs (F&A) or indirect costs (IDC),are probably the most difficult part of a proposal. Applicants are strongly encouraged to contact OGCS for assistance in preparing the budget, especially in calculating the indirect costs.

• Definition:  Indirect costs (also referred to as F&A [Facilities and Administrative] costs or overhead) are costs that are common to a number of activities and cannot be easily assigned to a specific project.  They are real costs and include areas such as: administration (University and departmental); facilities maintenance and operation (utilities, janitorial services and repairs); and depreciation and use allowance. The rates that apply for the University are negotiated with and established by the federal government (Department of Health and Human Services), and are subject to change at the end of each negotiated agreement. The last UT Arlington indirect cost rate agreement dated 8/8/2011 sets the on-campus rate for Research and Instruction at 51.5%. Please see the UTA Info Sheet

• Calculation:  The F&A costs for a project are calculated by applying a specific rate to a portion of the direct costs.  If the full F&A rate is allowed by the sponsor, the University rate is applied to the modified total direct cost (MTDC).  The MTDC is equal to the total direct costs minus equipment, tuition/stipends, and any subcontract amounts over $25,000. If the sponsor restricts the F&A cost rate, the sponsor rate is applied according to sponsor's published F&A policy.  OGCS requires that sponsor guidelines indicating restricted or prohibited F&A cost rates be included with the proposal.

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