Stephen F. Austin State University

Original Implementation: October 26, 1999
Last Revision: January 30, 2007

Indirect costs are those incurred for a common or joint purpose which benefit more than one University department/activity, and which are not readily assignable to a specific department/activity. They also are known as Facilities and Administrative (F&A) or overhead costs. In most instances, grantors and funding entities agree to reimburse the University for overhead expenses of conducting research, education and service projects. This policy establishes guidelines for the recovery, distribution, and use of such reimbursements from externally funded grants, contracts, and cooperative agreements.

Indirect Cost Recovery

The Principal Investigator or Project Director must include indirect costs in the proposed budget for all grants, contracts and cooperative agreements at the maximum rate allowed by the sponsor. Only the Associate Vice President for Graduate Studies and Research or his/her designee, in consultation with the President, is authorized to negotiate indirect cost rates with sponsors.

Indirect Cost Distribution and Use

The Texas Education Code, Section 145.001, provides that recovered indirect costs can be retained by State universities to support and encourage further research. The revenue from indirect cost reimbursements to Stephen F. Austin State University will be allocated as follows:

1. To the Office of Research and Sponsored Programs (ORSP) an amount sufficient to cover the total actual costs of operations as approved through the Academic Affairs budget process.

2. Fifty percent (50%) of any remaining revenue (after Step 1) up to $100,000 and one hundred percent (100%) of any remaining revenue in excess of $100,000 to be distributed to academic units that generated the recovered indirect costs. Such units shall expend the funds for projects encouraging further research, including:

   1. conducting pre-grant feasibility studies;

   2. preparing competitive proposals for sponsored programs;

   3. providing carryover funding for research to provide continuity between externally funded projects;

   4. supporting new researchers pending external funding;

   5. purchasing capital equipment directly related to expanding the research capability of the institution; and

   6. research or project administrative costs not covered by the funding entity.

3. All funds shall be expended to support research and sponsored programs at Stephen F. Austin State University according to the provisions of the Texas Education Code, Section 145.001. Additionally, the University shall report the actual amounts of money retained and expended under this policy and the estimated amounts for the next biennium in its report to the Legislative Budget Board as part of the biennial budget reporting process.

The ORSP shall make distributions to academic units as recommended by the University Research Council and approved by the Provost and Vice President for Academic Affairs. The distributions will be made at the close of each fiscal year, based upon the previous year's indirect cost reimbursements. No allocations will be made to academic units in any year in which the total indirect costs recovered are less than the actual amount expended by the ORSP.

 

Cross Reference: None

Responsible for Implementation: Provost and Vice President for Academic Affairs

Contact for Revision: Associate Vice President for Graduate Studies and Research

Forms: None