Facilities & Administrative Costs

Facilities and administrative (F&A) costs are those that are incurred for sponsored programs operating expenses and costs that cannot be readily associated with a single project, account, or transaction. Reimbursements for those costs are paid by sponsors to the institution (San José State University and the San José State University Research Foundation). F&A rates for educational institutions are reviewed and approved by the U.S. Department of Health and Human Services (DHHS) every four to five years.

SJSU’s federally negotiated F&A rate will be charged unless a sponsor has a documented exception to charging full F&A. This documented exception must be provided to the Office of Sponsored Programs Pre-Award Specialist at the time of proposal for approval and should be publicly available at the sponsor’s website, contract, or in the RFA specific to the proposal.

For small agencies without such publicly available documentation, rate exceptions must be provided by a member of the organization with the authority to set such policies (such as a CFO) and these policies must be consistent for the organization and not specific to SJSU or the particular project. 

It should be noted that while rates are federally negotiated, the rates apply to all projects. The federal government acts as the audit.

Off-Campus Rate Determination Factors

As noted in the above-referenced documentation, the off-campus rate may be utilized in situations where greater than 50% of the project activities are being performed off university property. Furthermore, the work performed off-campus must not be able to be performed on-campus due to facilities limitations (e.g. SJSU does not have the appropriate equipment) or geographic limitations (e.g. recruitment and treatment for a clinical trial must include rural participants). Typically, space is being leased and charged as a direct cost to the grant for off-campus projects. 

Work being conducted in a home office that could be conducted on-campus must be treated as on-campus work.

Field Work

Field work is also a special case and should only be considered off-campus in particular situations. Specifically, field work that utilizes an off-campus rate must take place more than 50 miles away from SJSU’s property and be conducted uninterrupted for a period of time in excess of 90 days. Short-term field work, workshops, observational studies in public schools, and data collection for environmental studies are not considered off-campus. 

Sub-Awardee Examples

The 50% calculation does not include funding allocated for sub-contractors, as those costs are already limited in the F&A calculation due to the Modified Total Direct Cost (MTDC) base required in SJSU’s F&A rate agreement.

Example A

$100,000 Total Grant Award to SJSU;
$50,000 sub-contracted to other institutions;
$10,000 of SJSU’s remaining $50,000 is being conducted in an off-campus clinic leased by the PI for the project. 

In example A, the F&A rate would be on-campus, since only 20% of the SJSU portion of the award is off-campus work.

Example B

$100,000 Total Grant Award to SJSU;
$90,000 sub-contracted to other institutions;
$0 of SJSU’s remaining $10,000 is being conducted off-campus.

In example B, the F&A rate would be on-campus, since only 0% of the SJSU portion of the award is off-campus work.

Example C

$100,000 Total Grant Award to SJSU;
$50,000 sub-contracted to other institutions;
$26,000 of SJSU’s remaining $50,000 is being conducted in an off-campus clinic leased by the PI for the project. 

In example C, the F&A rate would be off-campus, since 52% of the SJSU portion of the award is off-campus work.

 

Related Resources

SJSU Research Foundation Facilities and Administrative Cost Policy [pdf]

Facilities and Administrative Cost Recovery and Distribution

Facilities and Administrative Charges and Distribution - April 2020 Memo [pdf]

Facilities and Administrative FAQs