Facilities and Administration & Fringe Benefits Rates

Facilities and Administration (F&A) Rates

These facilities and administration rates (F&A) must be charged for all sponsored programs unless a program or an agency has been granted a legislatively endorsed restriction on the F&A rate that is to be charged or, in the case of private agencies, an established written policy exists which limits F&A rates.

 

About Facilities & Administrative (F&A) Costs

Facilities and Administrative (F&A) costs (also known as “indirect costs’ or “overhead costs”) are those costs of an institution which are not readily identifiable with a particular project or activity but nevertheless are necessary to the general operation of the institution and the conduct of its activities. The cost of operating and maintaining buildings, grounds and equipment depreciation, general and departmental administrative salaries and expenses, sponsored programs and library costs are types of expenses usually considered as F&A costs.

In theory, all such costs might be charged directly; practical difficulties however preclude such an approach. Therefore, they are usually grouped into common pool(s) and distributed to those institutional activities benefited through a cost allocation process. The end product of this allocation process in an F&A rate(s) which is then applied to individual grant and contract awards to determine the amount of indirect costs chargeable to the award

F&A costs are calculated on what is called a Modified Total Direct Costs (MTDC) base. This base consists of all salaries and wages, fringe benefits, materials, supplies, services, travel and subawards up to the first $25,000, regardless of the period covered by the subaward ($50,000 beginning 7/1/2025). Modified total direct costs shall exclude equipment, capital expenditures, charges for patient care, tuition remission, rental costs of off-site facilities, scholarships and fellowships as well as the portion of each subaward in excess of $25,000.

The U.S. Department of Health and Human Services is Marshall University and Marshall University Research Corporation’s “cognizant agency” for negotiating facilities and administration (F&A) and Fringe Benefit rates to be charged on all sponsored agreements.

NOTE: Effective June 1, 2023 all proposal budgets being submitted for funding with an F&A Rate that is not in accordance with our approved rate agreement are to be calculated on the Total Direct Costs and not the Modified Total Direct Costs unless otherwise specified in the solicitation or RFP.

For example: An agency that limits the F&A to 15% would have the 15% calculated on all costs.

 

Fringe Benefit Rates

Fringe benefit rates cover the cost of employee benefits such as health insurance, retirement, and payroll taxes. MURC applies federally negotiated fringe rates to all salaries charged to sponsored projects. Rates vary by employee type (e.g., full-time, part-time, student) and are updated annually.

 

Past Fringe Benefit Rate Agreements