2022-2023 F&A Rate Announcement

Every few years the University is required to negotiate Facilities and Administrative (F&A) rates with the Federal Government (see University Policy 601.16 for a full description). Late last week we received our new agreement (dated July 1 , 2022) from the Department of Health and Human Services’ Cost Allocation Services (CAS) group containing the updated rates that will go into effect immediately for the new fiscal year (FY2023) through FY 2025 (June 30, 2025). These new rates are applied against the Modified Total Direct Costs (MTDC) of a contract or grant to partially reimburse the University for costs incurred to support research.

Under this new agreement, the rate for on-campus Organized Research increased from 51% to 54%, Instruction increased slightly from 51.5 to 52%, and Other Sponsored Activities increased from 35% to 37%. All rates for off-campus activities remained the same, as listed in the prior rate agreement.

These new rates are based on a proposal submitted by the University documenting the actual costs for research-related items (space, utilities, salaries, benefits, equipment, etc.) that we incurred during FY20 (July 1, 2019-June 30, 2020). Since the costs of many of these items have increased in recent years, an increase in the F&A rate was expected.

The rates will apply to all new or new-continuing contracts and grants awarded for funding on or after July 1, 2022. Existing contracts/grants may still use the old rates as originally awarded. Effective immediately, new supplemental funding, competitive proposals, just-in-time (JIT) information, and industry contracts and proposals should apply the new rates.

Below are a few detailed responses to some of the questions that we anticipate from researchers as we move forward with implementing these new rates. Please feel free to reach out to Darlene Booker at 704-687-1873 or dbooker4@uncc.edu if you have any additional questions not covered here.

Frequently asked questions (FAQs)

General

Why are the F&A rates increasing?
The Facilities and Administrative (F&A) rate is negotiated between UNC Charlotte and the Federal Government’s (Department of Health and Human Services) Cost Allocation Services (CAS). At the outset of the negotiations, we submitted a detailed proposal that listed the full, actual costs incurred during FY20 (July 1, 2019 – June 30, 2020) for research-related items. The study indicated that the costs of supporting research have increased significantly since our previous F&A rate negotiation in FY15. Therefore, the new rates will enable us to recoup more of the expenses associated with supporting and administering research. Nevertheless, even with the current rate increases, the University will not recover the full costs for these items.

Does the new rate agreement apply to both Federal and Non-Federal projects?
Yes, the new rates apply to all extramurally sponsored projects (see University Policy 601.16 for a full description).

New and Submitted Proposals

When do I need to start using the new rates in my proposals?
The new rates apply to all new awards and new-continuation grants and contracts received after July 1, 2022. All new proposals should use the new rates.

What rate should I use for competitive renewal proposals?
Competitive renewal proposals should use the new F&A rates, regardless of the rate that was used in the previous award.

What happens if I’ve recently submitted a proposal using the old rate that includes a start date or budget year after July 1, 2022?
Budgets for proposals previously submitted and approved using the old rates will need to be updated at the time of the award to reflect the new F&A rates. Please check with the Office of Research Services for additional guidance and assistance.

How will the new rates affect my project’s overall budget?
Most budgets will increase slightly – typically less than 2%.

Will the change in rates impact the F&A waiver process?
No, the University’s guidelines and process for granting adjustments to the University’s applicable F&A rates will remain the same under the new agreement.

Existing Awards

How will the new F&A rates impact my existing awards?
The rates currently in effect on existing/active awards will stay the same until the end of the current award period or competitive segment. There is no need to rebudget existing funds or request additional funds from the sponsor.

What F&A rate should be used when requesting supplemental funding for an existing award?
Unless otherwise indicated by the sponsor, supplemental funding will be treated as new funding. Therefore, any application for new uncommitted funding or supplemental funding should utilize the new rates.