Sponsored Programs Costing

POLICY NO : 6100
EFFECTIVE DATE: 06/27/02

Basis of the Policy

It is the policy of the University of Nebraska Medical Center (UNMC) to comply with the federal government’s regulations for funding of projects from external sources, including the federal government. These regulations state that direct costs must be reasonable, allocable, allowable and treated consistently in the budgeting and the actual expending of the direct cost.

Purpose of the Policy

To establish guidelines surrounding the definition of direct costs.

Definitions

Direct costs are those that can be specifically identified with a particular sponsored project or activity and can be assigned to that project or activity with a high degree of accuracy. In order for a direct cost to be allowable cost to a sponsored program, it must meet three criteria:

Reasonable - It must be necessary for the performance of the program
Allocable - It must be easily identifiable with the project and be assigned to the project only in accordance with the benefits received by the program
Allowable - Costs that are reasonable; allocable to sponsored agreements under the principles and methods outlined in OMB Circular A-21; given consistent treatment thorough application of those generally accepted accounting principles appropriate to the circumstances; conform to any limitations or exclusions set forth in OMB Circular A-21 or in the sponsored agreement as to types or amounts of cost items.

Consistently Applied - The cost must be treated consistently as either a direct cost or a facilities & administrative (F&A) cost when incurred under like circumstances.

Policy

It is the policy of the University of Nebraska Medical Center (UNMC) to comply with Section D of OMB Circular A-21 in its definition and treatment of direct costs. It is UNMC's policy to treat the following costs as direct costs in the administration of its extramural programs:

Salaries of principal investigators, research assistants, postdoctoral research associates, research associates, and technical staff
Fringe benefit costs associated with the salaries of directly charged personnel
Animal per diems
Other specialized services
Laboratory supplies including chemicals and glassware
Long distance telephone charges
Travel costs
Rental charges for off campus facilities
Equipment costing less than the capitalization threshold
Computer software and supplies
Other supplies and tools required in the conduct of the sponsored program
Tuition remission for graduate research and teaching assistants
Consulting services
Sub contracted portions of the program

Under certain circumstances, it may be appropriate to charge other costs, normally treated as F&A costs, directly to the program. These are representative of special circumstances, and, in order to be chargeable, must be specifically identified with a project or activity and approved by the awarding agency in the grant application or contract proposal.

Large complex research programs such as general clinical research centers (GCRC), cancer research centers, certain institutes, centers, and specific research activities funded by core grants
Projects requiring extensive data collection, cataloging, data entry, surveys and tabulating questionnaires
Product or reproduction of large reports, books, monographs
Programs conducted in geographic locations which are not accessible to campus and campus administrative support
Program project grants

It is the institutional policy to prohibit the following practices as they do not meet the requirements of the Circular governing acceptable assignment of costs:

Charging costs based on the budgeted amount rather than on the actual expenses incurred
Assigning costs in advance of when costs are incurred
Changing the description of costs
Charging costs incurred for joint purposes to a sponsored program
Assigning costs to grants based on available funds
Transferring costs among and between grants
Charging cost overruns from one grant to another

Any questions about this policy should be referred to Financial Compliance and Cost Analysis.

UNMC Facilities and Administrative (F&A) Cost Waiver Request Policy and Procedure /

F&A Cost Waiver Request Form

This policy contains minor revisions (Dec 6, 2005; May 7, 2007) to UNMC Policy #6100, issued on 10/27/02. This page updated on Monday, May 7, 2007, by dkp.