1. INDIRECT COSTS Aka: General Operating Funds, Administrative Overhead, F&A (Facilities and Administrative), Overhead Costs

2. Indirect Costs Covers services and products essential for your overall organization, and consumed, in some small degree, by your projects

3. Indirect Costs Examples: Telephone bill Space rent or payment Electricity Insurance Equipment used by everyone, not just for your project (xerox, laboratory equipment, pencil sharpeners, file cabinets) Wear and tear on equipment

4. Indirect Costs Examples: Custodial services Security Accounting Payroll Legal support

5. Indirect Costs Calculated as a % of total direct costs Indirect Cost Pool Direct Cost Base = Indirect Cost Rate Approved rate from a state or federal agency Range – 5% of a chartered school to 75% research university Most – 48%-57% Off Campus lower – 17% to 27%

6. Indirect Costs Some grants restrict or cap the amount of indirect cost allowed, i.e. 5% or 10% of the total budget Equipment over a certain amount is excluded in the calculation - $500 to $5000 defines equipment Also excluded – off campus facility rental, patient care charges, scholarships, fellowships, tuition remission, subgrants

7. Indirect Costs Bad Idea: Waive all or part of indirect cost rate as an inkind contribution Indirect costs contribute to the university’s ability to support research and grantsmanship. It is needed: it is planned for by the granting agency. DON’T WAIVE IT!!

8. Indirect Costs Other uses: Sharing with the grant writer or principal investigator (PI) for support Sharing with the department sponsoring grant Sharing with the college sponsoring grant

9. Indirect Costs Other uses: Building a fund for special purpose – Professional development Grant solicitation travel Student travel One-time purchase Faculty recognition

10. Indirect Costs Oklahoma Higher Education Institutions Indirect cost range: 43-52% Some use only salary and fringe benefits Off campus – 13-28% Of the 25 institutions, 7 do not have an indirect cost rate established

11. Indirect costs Worksheet website http://www.ccas.com/ccasrate.html CCAS is a software company, not a government agency http://www.dau.mil/pubs/gdbks/icmguid e.asphttp://www.dau.mil/pubs/gdbks/icmguid e.asp Indirect Cost Management Guide, 1998, a whitepaper from Department of Defense

12. Indirect Costs Indirect costs are reality – all institutions should negotiate a rate