UC Berkeley has reached a new multiyear facilities and administrative rate agreement with the federal government, which will increase the amount of money the campus will receive for research projects.
When the campus conducts sponsored research through grants or agreements, it often incurs indirect costs that are not covered by the grants. The facilities and administrative rate specifies how much of those indirect costs will be paid back by the government.
The rate of recovery for organized research from 2009 to 2011 was 53.5 percent. According to the agreement, dated July 29, the rate increased to 55.5 percent on July 1, and will increase to 56.5 percent in 2013 and to 57 percent in 2015.
Campus Vice Chancellor for Research Graham Fleming said he was pleased with the agreement, as many of the costs of research cannot be reduced. He said the money will be used to recover more of the real cost of research.
“The funds will go into the chancellor’s budget, not for any one thing,” Fleming said. “They will cover many of the costs of doing research that aren’t covered.”
Indirect costs can be incurred from maintenance and operations, library operations and administrative services, among other sources.
Paula Milano, the campus executive director for Space Management and Capital Programs, said in an email that the campus negotiates a new agreement every five years with the U.S. Department of Health and Human Services, the federal agency designated to review and settle UC rates to be applied to sponsored projects.
“The agreement is based on a cost analysis we submitted in July 2011,” Milano said in the email. “Since then, the campus has been responding to a series of questions and requests for additional information from federal staff.”
The campus had gone eleven months without a new agreement since the previous one expired on June 30, 2011. Officials had submitted a proposal for a 62.3 percent indirect cost recovery rate in July 2011.
Fleming echoed Milano’s statement, and said a great deal of information is taken into the cost of indirect research.
“We calculate and provide information for how much space is used for research, our own assessment of the costs, what fractions of buildings are used for research,” Fleming said. “It’s a great deal of effort.”
Steven Beckwith, UC Vice President for Research and Graduate Studies, said the agreement represents a substantial amount of progress toward getting money back to the campus that was being spent and not being reimbursed.
Beckwith also said the negotiation process brought national attention to the issue of the rates lagging behind those of private counterparts.
“When the rate systems went into effect, private universities didn’t have other sources (of money) so they negotiated higher rates,” Beckwith said. “Public universities were funded by states, but recently state funding has disappeared.”
Overall, campus officials agree the agreement will be beneficial.
“The campus receives over $100 million per year in F&A reimbursement,” Milano said in the email. “The new rates, which are in most cases higher than the previous rates, mean that F&A recovery from sponsored projects will be closer to the campus’s actual costs for the support of sponsored agreements.”
