Direct charging of administrative costs

November 2024

The Office of Management and Budget (OMB) recently revised the Uniform Guidance framework for grants management, including allowing direct charging of administrative costs to federal awards in certain circumstances. Read on for guidance from Mizzou’s Sponsored Programs Administration. 

Administrative costs such as salaries and associated benefits expense of administrative and clerical staff, office supplies, computing devices used for administrative functions, postage, local telephone costs (including monthly service charges) and membership dues are generally treated as indirect costs. However, in certain cases, costs normally treated as indirect may be charged directly to a sponsored program. 

Direct charging of administrative costs to sponsored programs is covered in Title 2 of the Code of Federal Regulations, Part 200 (2 CFR 200) in Direct and Indirect (F&A) Costs, sections 200.412 through 200.414. The U.S. Department of Energy, National Institutes of Health and the National Science Foundation also refer to 2 CFR 200 as the authoritative source on cost accounting for grants and provide requirements for direct charging of administrative costs similar to those outlined below.  

In instances where sponsored projects require personnel expenses normally identified as administrative costs, such costs may be charged to sponsored agreements as direct costs only when ALL of the following conditions are met (per 2 CFR 200.413, section c):  

  • Administrative or clerical services are integral to a project or activity.
  • Individuals involved can be specifically identified with the project or activity.
  • The costs are not also recovered as indirect costs. 

Treatment of administrative costs as direct costs must be uniform across projects. Administrative costs may be budgeted as direct costs only if this type of cost is consistently treated as a direct cost in like circumstances for all other projects and cost objectives.  

Examples of circumstances where administrative or clerical costs may be considered essential: 

  • Large, complex programs such as environmental research centers, engineering research centers and other grants and contracts that entail assembling and managing teams of investigators from a number of institutions. 
  • Projects that involve extensive data accumulation, analysis and entry, surveying, tabulation, cataloging, searching literature and reporting. 
  • Projects such as conferences and seminars that require making travel and meeting arrangements for large numbers of participants. 
  • Projects focused on preparation and production of manuals and large reports, books and monographs (excluding routine progress and technical reports). 
  • Projects geographically inaccessible to normal departmental administrative services. 
  • Individual projects requiring project-specific database management, individualized graphics or manuscript preparation, human or animal protocols and multiple project-related investigator coordination and communications.  

These examples are not exhaustive, nor are they intended to imply that direct charging of administrative or clerical costs would be appropriate under similar circumstances.

Please contact the Sponsored Programs Administration at grantsdc@missouri.edu with questions.
 

Older news and announcements

September 2024

The Office of Management and Budget (OMB) is revising its Guidance for Grants and Agreements, now called the OMB Guidance for Federal Financial Assistance. This set of rules and regulations that govern the administration of federally funded projects — often called "Uniform Guidance" — reflects public comments received in response to the OMB Notification of Proposed Guidance published in October 2023 and comments received from federal agencies. In response, OMB is revising and updating the guidance to:

  • Incorporate recent OMB policy priorities related to federal financial assistance.
  • Reduce agency and recipient burden. 
  • Incorporate certain statutory requirements.
  • Clarify sections from the previous version of the guidance that recipients or agencies have interpreted in different ways. 
  • Use plain language, improve flow and address inconsistent use of terms. 
  • Improve federal financial assistance management, transparency and oversight through more accessible and readily comprehensible guidance.

These changes were effective Oct. 1, 2024.

More information on the updates can be found in the Federal Register. 

If you have questions, please contact Sponsored Programs Administration at grantsdc@missouri.edu.
 

Highlights: Uniform Guidance revisions

Subpart A – Definitions 

Major revisions include:

  • New thresholds for equipment from $5,000 to $10,000 and Modified Total Direct Cost (MTDC) subawards from $25,000 to $50,000; requires a revised negotiated Indirect Rate Agreement before limit goes into effect.
  • Expansion of “intangible property” to include data, websites, trade secrets and intellectual property.
  • Inclusion of “associated software” in “special purpose equipment.” 
  • New definitions for “participant” and “prior approval.”
  • Replacement of “non-federal entities” with “recipient and subrecipient.” 
  • Replacement of “F&A” with “indirect costs.”

Subpart B – General

Major revisions include:

  • Replacement of applicability table 200.101.
  • Addition of exceptions authority to agencies for “statutory” reasons.
  • Mandatory, prompt disclosure of any credible criminal violations, which must be sent in writing to the federal sponsoring agency, OIG, PTE, and include a high standard for reasonable grounds to believe, FAR 73 FR 67064.

Subpart C – Pre-award

Major revisions include:

  • Requirement for agencies to streamline the Notice of Funding Opportunities (NOFO).
  • An updated “fixed amount award policy.” The revision increases the threshold to $500,000 from $250,000, adds that grantees are entitled to any unexpended funds and confirms that “unexpended funds are not considered profit.” However, the use of fixed amount awards by the grantee still requires prior approval.
  • Clarification of the use of prohibited telecommunications and video surveillance by some Chinese companies — although the costs are not allowed on federal grants, its use is permitted if purchased with non-federal funds.

Subpart D – Post-award

Major revisions include:

  • The addition of two sections on discrimination based on sexual orientation or gender identity. 
  • No longer allowing inclusion of voluntary uncommitted cost sharing in the MTDC base for calculating the indirect rate in negotiations.
  • More flexibility on what to do with unused supplies.
  • Equipment threshold increase from $5,000 to $10,000 (requires a revised Negotiated Indirect Rate Agreement before limit goes into effect). 
  • Allowing Native American tribes to follow their own procurement rules.
  • Allowing the use of project labor agreements.
  • No longer prohibiting use of geographic preferences.
  • Addition of veteran-owned businesses and green products.
  • Fixed price award threshold increase to $500,000.
  • Elimination of termination flexibility by federal government.  

Subpart E – Cost rate principles

Major revisions include:

  • Removal of prior approval requirements for nine expenditure items.
  • Allowing report of rate disputes to OMB. For example, grantee waits for rate negotiation with DHHS. The agency wants to limit the rate. Grantee can approach OMB.
  • Reiteration of the use of federally negotiated indirect rate.
  • Raising de-minimis rate to15% of MTDC.
  • Requirement that subrecipients submit certification to pass-through entities. 
  • Elimination of DS2.
  • Unused Paid Time Off balance now allocated as General Administrative Costs.
  • Allowing conference awardees to provide dependent care for participants.
  • Allowing prizes in some situations.  
  • Allowability for “data and evaluation costs.”
  • Allowing “closeout costs” until report due dates – 120 days after project's end.

Subpart F – Audit

Single audit threshold raised from $750,000 to $1 million.

Administrative changes 

  • Changes such as prior approval requirements, new procurement standards and mandatory disclosures (with credible evidence) are effective for all federal awards that start on or after Oct. 1, 2024.
  • Revisions that require changes to institutional policies will go into effect the following fiscal year.
  • Changes to how the MTDC is calculated go into effect following the next F&A negotiated rate. Examples:
    • Recovering F&A on the first $50,000 of subaward expenditures.
    • Changing the threshold for equipment to $10,000.
  • MU is currently working to negotiate our F&A rate with DHHS. 
     

Source: “The Final Reveal” Gil Tran, Attain Partners; “Extreme Makeover” Gil Tran and Mark Davis, NCURA Magazine, Volume 56, No. 4 

September 2024

In September 2024, the University of Missouri System implemented a new research policy following a federal rule that prohibits the download and use of the TikTok application by university employees, students and volunteers who are performing services in connection with federal contracts on the same devices they use to perform federal contract work. See FAQs.

Download PDF OF THIS INFO

May 2024

This is an informational update for researchers; action may be needed for upcoming proposals. 

The National Science Foundation (NSF) has made changes to its Proposal and Award Policies and Procedures Guide (PAPPG). A detailed list of PAPPG changes is available on the NSF website. You also can contact your unit’s grant support staff or the Strategic Proposal Development Service (SPDS) at spds@missouri.edu.
 

Formatting and supplementary document changes
FORMATTINGLandscape (11 x 8.5 inches) is now allowed.
BIOGRAPHICAL SKETCHNo page limit. Key persons must generate a certified version within SciENcv, which includes a certification that they are not a party to a Malign Foreign Talent Recruitment Program.
CURRENT AND PENDING (OTHER) SUPPORTKey persons must generate a certified version within SciENcv, which includes a certification that they are not a party to a Malign Foreign Talent Recruitment Program.
MENTORING PLANOne page – now includes graduate students and postdocs.
SYNERGISTIC ACTIVITIESOne page – separate document

List up to five distinct examples that demonstrate the broader impact of the individual’s professional and scholarly activities that focus on the integration and transfer of knowledge as well as its creation. Examples may include, among others: innovations in teaching and training; contributions to the science of learning; development and/or refinement of research tools; computation methodologies and algorithms for problem-solving; development of databases to support research and education; broadening the participation of groups underrepresented in STEM; participation in international research collaborations; participation in national and/or international standards development efforts; and service to the scientific and engineering community outside of the individual’s immediate organization.

Parties to Malign Foreign Talent Recruitment Programs

Individuals who are current parties to a Malign Foreign Talent Recruitment Program are not eligible to serve as a senior/key person on an NSF proposal or on any NSF award made after March 25, 2024. See PAPPG Chapter II.D.1.e for additional information on required certifications associated with Malign Foreign Talent Recruitment Programs. (China, N. Korea, Iran, Russia) A certification will be included on the ePSRS sent by your grant support personnel. For additional resources, Email: exportcontrols@missouri.edu; Phone: 573-884-9954.

Projects Requiring Advanced Computing, Data and Analysis Capabilities

Many research projects require access to computational, data, analysis, and/or visualization resources to complete the work proposed. Typically, such resources will be noted in the proposal under Facilities, Equipment and Other Resources.

MU’s Research Support Services (RSS) group provides computing support, training, and consulting to the UM System’s research community. RSS supports two production HPC clusters and works closely with researchers to help evaluate their research computation needs and recommend solutions that allow them to take full advantage of the resources available. RSS also works to ensure that the campus’ computing, storage, and networking infrastructure meets the growing needs of the research community. For additional resources, email MU Research Support Services at muitrss@missouri.edu.

For projects that require such resources at scales beyond what may be available locally, NSF supports an array of national resources. For example, researchers can request access to the Frontera system at the Texas Advanced Computing Center (TACC) at the University of Texas at Austin. Frontera is among the largest and most powerful supercomputers ever deployed at a U.S. institution of higher education; it offers over 16,000 processors, as well as significant other processing capabilities, to advance research that would not otherwise be possible. More information about Frontera and how researchers can request access can be found at https://www.tacc.utexas.edu/systems/frontera.

April 2023

The University of Missouri Libraries provides information and resources for faculty to comply with data management and sharing plan (DMSP) requirements from sponsors of research that results in the generation of scientific data. Sponsored Programs Administration provides information on National Institutes of Health (NIH) and National Science Foundation (NSF) DMSP requirements in the Sponsored Programs Procedure Guide.

A DMSP describes what you will do with your data during and after your research project. Tips for preparing your DMSP include contacting University of Missouri Division of IT early for your research computing needs, a careful review of the sponsor’s requirements, addressing any questions with your program officer, and locating a repository for your data.

Sponsor requirements for the plan vary. Researchers applying for grants that require a DMSP can use DMPTool, a service of the University of California Curation Center, to help write the plan. The University of Missouri faculty and staff can use this resource. The tool provides templates as well as guidance for federal agencies and foundations, generating a customized DMSP for submission with a grant application. NIH also provides sample plans for investigator’s use.

Sponsors may allow direct costs for the DMSP as part of the project budget. Preparers should refer to agency-specific guidance. NIH grant applicants may include costs to execute the DMSP in the budget as line items. Examples of allowable costs include labor for the data curation, preservation, de-identification, preparation of metadata, and data deposit fees for future preservation and sharing. To prevent errors during submission, follow NIH grant proposal guidelines for budget line entry and written justification.

For more NIH-specific information, visit NIH DMSP FAQ.

As a reminder, Principal Investigators are responsible for ensuring that appropriate data use agreements are in place prior to sharing sensitive data and should contact the Sponsored Programs Administration Research Contracts team to discuss getting one in place.

Agency-Specific Guidance:

January 2023

NSF’s new PAPPG (Proposal & Award Policies & Procedures Guide), effective for new or renewal proposals for off-campus or off-site work, submitted January 30, 2023 or later, will require the university to certify that the project being proposed has a plan for creating and maintaining safe and inclusive working environments for off-campus and off-site research for that project. 

The University of Missouri recognizes and supports these collaborative efforts to eliminate sexual and other forms of harassment in science and to build inclusive scientific climates conducive to research, teaching, learning and professional growth. The University of Missouri’s Collected Rules and Regulations, including Standards of Faculty Conduct, are expected to be adhered to in accordance with the University’s mission. These expectations apply to University of Missouri faculty, staff and students and any that might be encountered while conducting off-site research. 

Specific to this NSF requirement, for any offsite or field work on a proposed NSF project, the application includes the attestation of the university that a plan is in place for that proposal. The plan must describe how the following types of behavior will be addressed: 

  1. Abuse of any person, including, but not limited to, harassment, stalking, bullying or hazing of any kind, whether the behavior is carried out verbally, physically, electronically or in written form; or
  2. Conduct that is unwelcome, offensive, indecent, obscene or disorderly; 
  3. Identify steps the proposing principal investigator(s)/project team will take to nurture an inclusive off-campus or off-site working environment;
  4. Consider how communications within the team and to the organization will be handled, minimizing singular points within the communications pathway (e.g., a single person overseeing access to a single satellite phone);
  5.  Address how any special circumstances such as the involvement of multiple organizations or the presence of third parties in the working environment should be taken into account;
  6. Account for the process or method for making incident reports as well as how any reports received will be resolved.

Currently, the PI and project team do not submit the plan to NSF for review in the proposal, but they must retain and have it in place prior to submission. If a specific NSF Directorate requires the inclusion of the plan at proposal submission, this will be indicated in the solicitation or other guidance provided by the Directorate.  

Sponsored Programs provides the following template (PDF | Word) that may be used to assist with the development of the plan.

The following University of Missouri policies should be used to guide development, planning and implementation of the plan.

https://www.umsystem.edu/ums/rules/collected_rules/personnel/ch330

 

 

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