The Facilities and Administrative Rate (F&A Rate) is the mechanism used to reimburse the University for the infrastructure support costs associated with sponsored research and other sponsored projects. The F&A rate is essentially an overhead rate. It is calculated as a percentage of overhead associated with, and allocable to, sponsored research and other activities, divided by the direct costs of sponsored research and other activities. To collect F&A, the University adds the negotiated F&A rate to invoices or other billing instruments submitted to sponsors.
F&A costs are defined in OMB Uniform Guidance (aka 2 CFR Part 200) as “costs incurred for a common or joint purpose benefitting more than one cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved.” F&A costs are sometimes referred to as indirect costs. Utah State University (USU) negotiates the F&A rate with the Office of Naval Research (ONR), the cognizant federal agency overseeing the administration of sponsored agreements at USU.