Facilities and Administrative Cost Recovery and Distribution

Policy Title Facilities and Administrative Cost Recovery and Distribution
Policy Category Academic/Research Policies
Original Policy Approval Date April 20, 2015
Policies Superseded Distribution of Indirect Funds from Academic and Institutional Grants of December 19, 2002
Responsible Office/Vice President Office of Sponsored Research and Programs / The Provost and VP for Academic Affairs
Related Policies Interim Principal Investigator Eligibility & Assurances Policy
Frequency of Review 3 years
Date of Next Review July 3, 2021
Dates of Revision  


This Facilities and Administrative Cost Recovery and Distribution Policy (“Policy”) applies to all Sponsored Projects under Arcadia’s supervision, including, but not limited to, grants, awards, sub-award agreements, contracts, research agreements, cooperative agreements, and fellowships.


The purpose of this Policy is to ensure that Facilities and Administrative Costs (“F&A Costs”) are recovered and used effectively to support and encourage subsidized research and programs at the University by explicitly stating University policy regarding F&A Cost recovery and distribution of shares of recovered F&A Costs to those who bear the burden and workload associated with Sponsored Projects.


It is the policy of the University to seek the appropriate and approved F&A Costs recovery rate on all Sponsored Projects whether they are from private or public sources. The University’s current federally negotiated F&A Cost reimbursement rate is 60.5% (“Federal Rate”), which should be applied to all salaries and benefits for Sponsored Projects. Many Sponsors no longer allow application of the Federal Rate, but instead allow modest overhead costs to be added to grants.  It is University policy to request the maximum allowable overhead costs to Sponsored Projects.


With an understanding and appreciation that it takes the contribution and effort of many to ensure the success of Sponsored Projects, University will distribute indirect costs recovered from any Sponsored Projects to further support and stimulate University sponsored research and programs and reimburse departments that generated the F&A Cost recovery in the following way:

  • General University Fund: 25%
  • Account of the Provost: 10%
  • Account of the OSRP: 15%
  • Account of the Dean/College to which PI/PD belongs to: 30%
  • Account of the Department to which PI/PD belongs to: 15%
  • Account of the PI/PD: 5%

In special cases, the Dean/College’s amount may be distributed between Department and the PI/PD’s account. Similarly, the Department portion may be distributed between the Department and the PI/PD’s account. The exact percentage amount for distribution will be decided on a case by case basis prior to the proposal being sent for University routing approval. However, PI/PD must receive at a minimum, 5% of F&A Costs recovered from the Sponsored Project. This percentage could increase based on agreements secured before the proposal is sent for routing. Approval of distribution is indicated when signatures are affixed on the Proposal Routing and Approval Form (available on the OSRP website).

When appropriate, the indirect costs recovered from the grants and due to the Dean/College, Department and PI/PD accounts could be pooled to enhance the overall research infrastructure at Arcadia. If the University no longer employs the PI/PD, the indirect costs of the PI/PD will be returned to the Dean/College’s account.


F&A Costs recovered from Sponsored Projects will be made available in a designated account to the Dean/College, Department and PI/PD, as agreed, ninety (90)days after the end of the quarter in which the F&A Costs were accrued.

A. Use of F&A Costs

F&A Costs recovered from Sponsored Projects should be used to:

  1. Grow sponsored research and programs at the University;
  2. Facilitate faculty and students research at the University; and
  3. Cover specific expenses of the currently funded Sponsored Projects when sufficient funding to cover particular costs are not available.

Examples of the use of recovered F&A Costs include:

  • General administrative costs – expenses including clerical services, general office supplies, postage, telephone, and other general administrative expenses which could not be charged as direct costs on federal grants but could be covered by the recovered indirect costs;
  • Bridge funding costs – costs associated with salaries and benefits for key research personnel to retain them between grants and office supplies and expenses for this research personnel;
  • Voluntary uncommitted cost share – costs associated with (i) research equipment, materials, and supplies,(ii) publication and dissemination costs associated with research or Sponsored Project activities, and (iii)salaries for undergraduate students, graduate assistants, any other temporary help needed to assist with a Sponsored Project, when funds are not available from the grant;
  • Proposal development costs – costs associated with (i) hiring of grant writers, (ii) travel expenses to meet with sponsors, (iii) expenses to host a sponsor and/or prospective partner on the grant, or an influential project supporter, and (iv) seed funding to start new projects which will generate external funding;
  • Networking costs – costs associated with travel to meet with representatives of the funding agency, conference participation or university visits which will result in a submission of a collaborative proposal;
  • Sponsor required cost-sharing - expenses involved in meeting cost share requirements not available from other university sources. Please note that university policy does not allow PI/PD’s to offer cost sharing if it is not required by the Sponsor;and
  • Recruitment costs - costs associated with recruitment of research faculty who have the potential to bring research funding to the university.

Recovered F&A Costs are not to be used to augment faculty and staff salaries.  All recovered F&A Costs are to be used to generate more Sponsored Projects and research initiatives or cover the research needs not supported by the external funding.


There is no pre-determined time limit for the use of F&A Costs recovered on Sponsored Projects. These funds will roll forward from one fiscal year to the next. However, it is important that these funds are used meaningfully and purposefully. A plan for use of these funds will be requested if there is no activity on the account for a period of one year.


F&A Costs are costs which are sometimes referred to as indirect costs or overhead, and are necessary to support Sponsored Projects, but which cannot be readily assigned to or identifiable with, any individual or single project. F&A Costs cover the normal business operations of an institution. Most Sponsors recognize the existence of such costs.Examples of these costs include: (a) the costs of using the buildings and equipment;(b) accounting, personnel, standard computing, and purchasing expenses; (c) general mail, printing, and copying expenses; (d) library services; and (e) administrative costs.

  • OSRP is the Arcadia University Office of Sponsored Research and Program.
  • PI/PD is a person eligible to act as a Principal Investigator or Program Director on sponsored projects.
  • Sponsor is the organization or funding agency that funds a Sponsored Project.
  • Sponsored Projects are externally funded activities in which a formal written agreement like grant, award, sub-award agreement, cooperative agreement, contract, or fellowship is executed between Arcadia University and a Sponsor.
  • University is Arcadia University, its colleges, schools, affiliates, divisions and subsidiaries.


April 20, 2015