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Facilities & Administrative (F&A) Cost Recovery

F&A Definition

Facilities & Administrative Costs also known as Indirect Costs are defined by the federal government:

“as those costs incurred for a common or joint purpose benefiting more than one cost objective, and not readily assignable to the cost objectives specifically benefited, without effort disproportionate to the results achieved” 2 CFR 200.56

F&A rate calculation basics

Ann Holmes of UMCP is an expert in explaining the basics of calculating the F&A rates.  A link to a short 20 minute video of her explaining F&A is found here.  When watching the video, it helps to have two documents (F&A Rate Calculation & Expense Cost Pools) on hand, which are attached for your convenience.

How does Cost Share contribute to the F&A rate calculation?

Cost Share Contributions (not including 3rd Party Cost Share) are factored into the UMBC Standard F&A Rate negotiations. The Standard F&A rate is calculated by taking the allocated F&A costs from a selected period of time and dividing them by the Direct Costs (also known as the Base) for the same period. The ratio is the basis for the Standard F&A Rate. The Cost Share commitments for that same period are added to the Total Direct Costs, which decreases the Standard F&A Rate. 3rd Party Cost Share is not included as part of this F&A Rate calculation as 3rd Party contributions are from external, and not UMBC, resources.

For example:

  • F&A Costs/Direct Costs = $50,000/$100,000 = an F&A Rate of 50%
  • Factor in Cost Share Commitments of $20,000:
  • F&A Costs/(Direct Costs + Cost Share Commitments) =  $50,000/($100,000 + $20,000) = an F&A Rate of 42%

Factoring in Cost Share Contributions reduces the computed F&A rate, which means fewer resources for UMBC.

F&A Related Links

UPDATED UMBC FY2017 – FY2020 F&A Rate Implementation & Application Memo – 03-01-2019
Final F&A Agreement FY 2016 – FY 2020
UMBC F&A Rates – Historical Summary
Link to UMBC Historical F&A Rate Agreements
Link to F&A Related Policies and Forms

 

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