F&A Cost Recovery Policy on Grants and Contracts

Additional Links: 

Duke Faculty Handbook 5.2.7.4

Duke Faculty Handbook Appendix P: Policies Related to Research

It is the University’s policy to require the inclusion of full facilities and administrative (F&A) cost recovery on all proposals for external funding, except for gifts and sponsors with a stated policy of limiting or eliminating the F&A rate. In these instances the Duke policy is waived.

Direct costs of externally sponsored grants and contracts may include the salaries and wages of personnel working on these projects, the cost of equipment, travel, supplies, materials, and other such project-specific expenses. In addition to these direct costs, the University incurs a significant amount of indirect costs that are associated with projects, referred to as F&A costs. F&A costs cannot be related precisely to any individual grant or contract, since they include such items as:

  1. the cost of maintenance, heating, lighting, and cleaning in buildings where sponsored research is conducted;
     
  2. the administrative costs to the University of such components as procurement, accounting, and other units that provide services to grant and contract recipients; and
     
  3. central support services and facilities, such as the libraries.

These costs are real and the collection of F&A costs ensures the maintenance of the University infrastructure necessary for carrying out sponsored research activity.

Sponsors, particularly the federal government, recognize the need to reimburse the University for the F&A costs associated with the projects they support. To facilitate this reimbursement, the federal government negotiates the F&A cost recovery rate with the University, based on a periodic review. This process uses data obtained from an annual calculation of Duke’s F&A costs applied on a pro-rata basis against certain direct costs charged to its grants and contracts.

In addition to the rate associated with most on-campus research, there are several other rates set by the federal government for Duke University, related to such things as off-campus research facilities or certain special facilities at Duke, such as the research vessels.See the F&A Agreement for a full list of Duke rates.