Any limitations by the sponsoring agency on negotiated indirect cost rates must be approved by the Vice President for Research and Economic Development VPRED , but there are instances in which that acceptance is automatic e. Please allow extra time up to 5 business days before proposal is due for this process.
Note that waivers will rarely be considered for limitations to indirect rates imposed by for-profit entities. All federal sponsors are expected to pay the federal negotiated indirect rates; exceptions should be documented in the Program Announcement or RFP. All direct nonfederal sponsors i. Please view detailed information on the current indirect rates.
Most federal sponsors use MTDC. The TPC method is unusual in that it allows indirect costs to be charged not only on direct expenses, but also on the indirect expenses themselves.
How is Research Supported? Types of Sponsored Projects. Conflicts of Interest and Commitment. Research Integrity.
Regulatory Oversight. Funding Opportunities Offered by Corporations or Foundations. Since these costs are excluded from the determination of the indirect cost rate, it is not appropriate to include them in the pool of eligible program expenditures on which to charge indirect costs. In general, there are certain criteria that must be met before equipment is considered to be capital outlay. Procedure also includes guidance on capitalizing groups of items acquired at the same time that do not meet the threshold for capitalization individually.
The CDE has been granted authority by the ED to review and approve indirect cost rates for California LEAs county offices of education, school districts, joint powers agencies, and charter schools.
An adjustment is also made for the difference between the rate approved for use in a year and the amount of indirect costs actually expended. Once all LEA year-end financial data have been collected and reviewed by the CDE, a listing of approved indirect cost rates is posted. Is there a cap or limit on the amount of indirect costs that can be charged?
An LEA may claim up to its approved indirect cost rate unless there is specific authority legislation or regulation to limit the rate. For instance, if program statutory or regulatory language limits indirect costs to 3 percent, and an LEA has an approved rate of 5.
If indirect costs are allowed, the indirect cost rate can be used to budget the maximum amount of indirect costs allowable for a program and then to claim the actual amount of indirect costs after the program expenditures have been made. Does an LEA have to charge the entire amount of indirect costs allowed by its indirect cost rate? An LEA may choose to claim less than the amount of indirect costs allowed by its indirect cost rate. Amounts not claimed under one award may not be shifted to another award, unless specifically authorized by legislation or regulation.
When indirect costs are allowed, LEAs should use their CDE-approved indirect cost rate as the basis for budgeting and claiming indirect cost reimbursements under contracts with the CDE.
Contracts that cover more than one year should be structured to allow for adjustments for any rate s not yet known. This enables non-charter schools to use the indirect cost rate approved for their district.
Because of the unique circumstances surrounding charter schools, some are able to use the rate of their approving agency and some are not, depending on how their year-end expenditures were reported to the state. Please see our separate charter school listing for details on approved rates for charter schools.
The CDE's federally approved indirect cost plan only covers kindergarten through grade twelve K—12 educational programs. In compliance with Education Code sections c , the CDE annually calculates a statewide average rate for use by LEAs to recover indirect costs from food service programs. For the latest statewide rate, please see our statewide rates listing. Can entities other than LEAs get an indirect cost rate? A non-LEA that receives funding directly from a federal agency would apply to that agency for a rate.
Examples of non-LEAs covered by this include private schools, consortia, and nonprofit entities other than charter schools. For example, we plan to hire a consultant to work on one of our projects as directly billed labr, but also have one helping with our business plan, so we have to split the total consultant category into direct vs. Travel is an interesting category. This travel, therefore, goes into the Direct column. But travel related to conference attendance goes under Indirect.
The math, as shown here is very simple:. You can use either rate in your cost proposal, just make sure that you multiply it times the right direct cost s and that you carefully read any guidance provided by the agency to which you will be submitting a proposal.
In other words, your indirect rate should not change project-by-project, but should remain constant for a year and be used consistently. The exceptions to 1 are: Some agencies allow certain costs and others do not.
Your costs may change significantly during the year, and your indirect rate may change because of this. Or your estimates of certain costs may become more accurate after you derive your indirect rate for the year.
Unfortunately, you generally cannot change your rate mid year or in the middle of a project. Therefore, your best course of action may be to adjust your expenditures to realign your costs with your original indirect rate for the year.
In the above example, you might put a moratorium on indirect travel if you see your indirect rate increasing because other costs are becoming higher than expected. Deriving your indirect rate will be challenging the first time, and therefore you may resist doing it. Finally, what we have attempted to do here is demonstrate how to generate Indirect rates in the simplest terms.
There are many rules, regulations, variations, and agency nuances, etc. But just get started with this simple approach. Indirect costs are defined as the costs of doing work for specific clients. Once calculated, an indirect rate never changes, especially for small and startup companies.
Despite there being so many unknowns about your future costs, you should do the best you can to derive an indirect rate and then make refinements as you learn more or costs become clearer over time.
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