This procedure applies to grants and contracts, and other self-supporting accounts. The objectives of this procedure are as follows:
- Ensure that adequate indirect costs are allocated to appropriate College programs.
- Provide for process that records and reports indirect cost contributions.
Impacted self-supporting accounts will be charged an indirect rate, administered by the Budget and Planning Office and Accounting Services. The rate for grants and contracts will be the federally-approved indirect cost allocation, unless the specific grant/contract agreement specifies a different rate. The current federally-approved rate is 38%, consisting of institutional support, student services, and facilities support. Other self-supporting accounts will be charged an indirect rate determined by the College.
The College will use the federally-approved rate as the base, and may decrease the rate based on the use for College resources by the self-supporting account.
When preparing self-supporting budgets, the Budget and Planning Office will notify account managers if their self-supporting accounts are subject to an indirect rate, and the amount of the rate.
The rate for FY2015-FY2021 is 16.12% of expenses for institutional support. This will be assessed to departments on a quarterly basis. See Policy 1015: Indirect Cost Contributions.
The financial office will encumber funds for the estimated indirect expense during the fiscal year. At fiscal year-end, the financial office will adjust the encumbrance as necessary to reflect the actual expenses incurred. Accounts subject to the indirect cost rate will be listed on the Budget and Planning Office website, and will be updated for each annual budget cycle.