Facility and Administrative (F&A) costs are actual cash expenses of the university, related to research and other activities. Funded sponsored projects need to pay their share of these costs. It is the university’s policy that the appropriate F&A cost rate shall be used with each funded project. In rare instances, the principal investigator may feel there are extenuating circumstances that warrant an exception to the recovery of full F&A costs. A waiver may be requested and justified in writing by the principal investigator, department, and college. This justification will be reviewed and a decision will be made by the university’s Institutional Authorizing Official as to whether or not to approve the request.
There are certain programs where a sponsor either prohibits or restricts F&A costs to less than OSU’s negotiated rates. This does not require a specific waiver request. A copy of the sponsor’s published rates should be attached to the proposal when it is processed. In addition, if a new faculty member is transferring awards from their previous institution, the previous institution’s F&A rate will be honored if it is less than OSU’s federally negotiated F&A rate.
Effective January 1, 2010, F&A waivers will be approved only if the department/unit/college agrees to absorb all of the foregone F&A costs through what is returned to the requesting college/unit. The form must be approved in writing by the Vice President for Research (or designee).
When a sponsor allows for the recovery of full F&A costs, but the principal investigator wishes to request a waiver or reduction of these costs, the Request for Waiver form must be completed and submitted to OSP. The approved waiver form should accompany the proposal, but additional time should be allowed for review and approval, and the PI should be prepared to provide a revised budget based on the approval or denial of the request.
There are certain times, however, when it is necessary for the university to grant either a reduction in the amount of the F&A charged on a grant, or to alter the distribution of the non-federally-mandated portion of the F&A funds in order to meet the requirements of an opportunity. For this reason, the purpose of this policy is to delineate who has the authority to grant such deviations from normal F&A collection and distribution practices.
Prior to the submission of a proposal to a potential sponsor, the Vice President for Finance and Administration (VPFA), or his/her designees, and the Vice President for Research (VPR), or his/her designees, have the authority to grant a reduction in the amount of F&A costs to be charged against the opportunity.
The granting of such reductions will normally be limited to when a sponsor’s requirements proscribe an involuntary reduction in the amount of F&A collected. For example, if the sponsor has a published limit on the level of F&A charges they will support, or if the sponsor requires a mandatory cost share that cannot be accommodated through leveraging salary/OPE or related measures, then the VPFA, the VPR, or their designees, may grant permission to employ a reduced F&A rate without implementing the offsetting requirements described in the F&A Waiver Policy.
Similarly, the VPFA, VPR, or their designees have the authority to designate a specific allocation or special distribute of the F&A funds if such a re-distribution must be made in order to meet sponsor cost sharing or other requirements.
After a proposal has been processed through the Office of Sponsored Research and Award Administration, the VPFA has the sole authority to implement any modifications to proposed and approved F&A rates or distributions, unless the sponsor makes specific requests for reconsideration, in which case, the VPFA, VPR or their designees have the authority to negotiate an acceptable F&A rate and distribution.