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MANAGING U.S. UNIVERSITY RESEARCH WITHIN OMB RATES

MANAGING U.S. UNIVERSITY RESEARCH WITHIN OMB RATES. Weldon Ihrig University of Washington July, 2008. UW Current F&A Rates (effective July 1, 2007 – June 30, 2009). Organized Research Rates: On-campus: 56% Off-campus: 26% South Lake Union: 66%

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MANAGING U.S. UNIVERSITY RESEARCH WITHIN OMB RATES

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  1. MANAGING U.S. UNIVERSITY RESEARCH WITHIN OMB RATES Weldon Ihrig University of Washington July, 2008

  2. UW Current F&A Rates(effective July 1, 2007 – June 30, 2009) • Organized Research Rates: • On-campus: 56% • Off-campus: 26% • South Lake Union: 66% • Regional Primate Center: A (44%) and A+B (75%) • Applied Physics Laboratory: 17% • Vessels: 25% (salary base) • Instruction Rates: • On-campus: 58% • Off-campus: 26% Weldon Ihrig, University of Washington

  3. UW On-campus F&A Rate Components Weldon Ihrig, University of Washington

  4. F&A costs source of revenue • For FY 2006-2007, awarded grant and contracts exceeded $1 billion(US). • For FY 2006-2007, F&A recovery was ~$189 million(US): • ~48% distributed to pay facilities costs • ~31% distributed to fund departmental RCR • ~20% used for other general administrative and library costs (from Office of Research Facilities and Administrative Rate Primer http://www.washington.edu/research/4researchers/fa.php) Weldon Ihrig, University of Washington

  5. UW negotiated vs calculated F&A rates • Negotiated on-campus rate: 56% • Calculated on-campus rate: ~61% (administrative costs calculated ~31% versus 26% cap) • If 61% rate applied in FY 2007, recovery estimated to have increased by almost $19 million(US) Weldon Ihrig, University of Washington

  6. What works for universities? • Competitive awards without politics • Single Federal indirect cost rate applied to all agencies • Rate based upon demonstrated prior indirect cost expenditures by the universities • Research opportunities enhances graduate & undergraduate student experiences Weldon Ihrig, University of Washington

  7. Areas for Improvement • Remove 26% cap on administrative costs rate • Prohibit attempts by Federal agencies to cap indirect costs they will pay • Consistent interpretations of A-21 rules among regions & reduce complexities • Exclude university cost sharing in calculating rate • Negotiations based upon cost components data, not bottom line target Weldon Ihrig, University of Washington

  8. Cautions for universities • Indirect costs recovered are for expenditures incurred, not “free money” • Risk of over investment in facilities assuming growth in research • Universities must comply with the A-21 rules to avoid political interventions • Growth in research requires investment in support services & modernization of facilities • Fully loaded charge-out rate option for private foundations/businesses Weldon Ihrig, University of Washington

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