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Budgets - Indirect Costs (IDC)

Find links and information on indirect costs in budget preparation.

About IDC

Indirect costs (IDC) - also called Facilities and Administrative (F&A) Costs - are costs not specifically identifiable for any one project or program, but are valid expenses of conducting research, instruction, and other sponsored activities at UC San Diego. IDC covers activities such as building use, equipment depreciation, operation and maintenance of UC San Diego facilities, student services, departmental administration, or administrative support offices.

Federally Negotiated IDC Rate Agreements

UC San Diego’s IDC rates are determined through negotiation with the US Department of Health and Human Services (DHHS), the cognizant agency for our Facilities and Administrative rate agreement. UC San Diego has completed negotiations with DHHS, resulting in multi-year increases through FY 2022 to our indirect cost rates.

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UC San Diego IDC Rates

UC San Diego Indirect Cost (IDC) Rates: FY 2018 - FY 2022

*Rates apply to Modified Total Direct Costs (MTDC) except where noted.

FY 2018

July 1, 2017 to

June 30, 2018

FY 2019

July 1, 2018 to

June 30, 2019

FY 2020

July 1, 2019 to

June 30, 2020

FY 2021

July 1, 2020 to

June 30, 2021

FY 2022

July 1, 2021 to

June 30, 2022

Sponsored Research

On-Campus

Off-Campus

 

56%

26%

 

57%

26%

 

57.5%

26%

 

57.5%

26%

 

58%

26%

Instruction

On-Campus

Off-Campus

 

53%

26%

Other Sponsored Activity

On-Campus

Off-Campus

 

45%

23.4%

 

47%

23.4%

 

48%

23.4%

 

48%

23.4%

 

48.5%

23.4%

Federal Flow Through1

Sponsored Research and Clinical Trials

 

56%

 

57%

 

57.5%

 

57.5%

 

58%

Federally Funded Clinical Trials

56%

57%

57.5%

57.5%

58%

Industry Sponsored Research2

56%

57%

57.5%

57.5%

58%

PI-Initiated Industry Funded Clinical Trials


Sponsor-Initiated Industry Funded Clinical Trials

 

30% TDC4

Non-Profit Sponsors

Based on sponsor-written policy. See the Non-profit IDC Blink page.

State of California Sponsors3

On-Campus

Off-Campus

 

25%

25%

 

25%

25%

 

30%

25%

 

35%

25%

 

40%

25%

Nimitz Marine Facility and Marine Physical Laboratory

18%

SIO Ship Operations (SSF)5

8.34%

1 Federal Agency as Prime/Original Sponsor. Funding that is flowed from a federal agency through a non-federal sponsor is subject to the federally negotiated IDC rate, based on the on-campus or off-campus location. Federal funding as the prime determines the applicable IDC rate and trumps the rate that would apply to the flow-through entity.

2 UC Policies on Industry Agreements. For more information go to Indirect Costs for Industry in Blink.

3 Use of multiple rates for State of California awards. The rate in effect for the first year of a multi-year project will be the rate used for the entire project in proposed and awarded budgets. If additional funds (not previously appropriated or budgeted) are awarded by a State agency, the proposed budget for these additional funds would use the UC-approved state rate in effect at the time the new budget request is submitted.

4 Total Direct Costs (TDC). More information on Direct Costs in Blink.

5 Modified Total Direct Costs (MTDC) plus exclusion of fuel and MOSA expenses. (SIO)

Modified Total Direct Costs (MTDC)

Uniform Guidance (2 CFR 200) requires that indirect costs be allocated on the basis of modified total direct costs (MTDC).

For sponsored proposals and agreements using the federally negotiated rate, the following budget items are excluded from the MTDC:

  • Equipment
    • Tangible personal property with an acquisition cost of $5,000 or more and a useful life of more than one year
  • Capital Expenditures
    • Buildings, alterations, renovations, etc.
  • Patient Care Costs
  • Graduate Student Tuition Remission
  • Participant Support Costs
    • Stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees (but not employees) for conferences or training projects.
  • Rental Costs of Off-Site Facilities
    • Does not include costs for hotel rooms, equipment, or automobile rental
  • Scholarships and Fellowships
    • Financial aid paid directly to university students as stipends or dependency allowances.
  • The portion of subawards that exceeds $25,000
    • IDC is assessed only on the first $25,000 of any subaward, regardless of how many years the subaward is for.
    • When a grant/contract requires a new fund number, IDC will be re-assessed.
    • If the subaward is for another UC campus, the entire amount is exclude
  • Cloud Computing Costs via UCSD Contracts/ ITS/ SDSC
    • Includes: Amazon Web Services, Microsoft Azure, SDSC Cloud, Triton Shared Computing Cluster (TSCC), SDSC Project Storage and Sherlock Cloud.
    • New account codes assigned to these costs will ensure these charges are exempt from IDC.
    • Note: Cloud computing costs acquired directly, or through purchase of equipment/licenses, will be subject to the assessment of IDC.
    • See Cloud Computing Services: Exemption from Indirect Costs for more information.

On-campus and Off-campus Rates

New Resource! List of Buildings (Excel) and their On/Off Campus classification

On-campus OR Off-campus Site

Use the On-campus Rate

  • When projects are conducted in buildings owned by the University regardless of where they are physically located.
  • When rent is paid by the campus, but not charged directly to the project.

Use the Off-campus Rate

  • When projects are conducted at buildings not owned or leased by the University.
  • When rent is charged directly to the project.

Combination of On-campus AND Off-campus Sites

Either On-campus and Off-campus Rate

  • Either the on-campus or off-campus rate is generally applied, consistent with the location where the majority of the work is to be performed.
  • For this purpose, salary costs are generally accepted as the measure of work performed.

Both On-campus and Off-campus Rate

  • The use of both on-campus and off-campus rates for a given project may be justified if both of the respective rates can be clearly identified with a significant portion of salaries and wages for a given project.
  • For the purposes of this provision, significant is defined as approximately 25% or more of the total costs, and a project's total salary and wage costs exceed $250,000.

Budget Justification

Standard Budget Justification

The budget justification should include the following language concerning indirect costs:

UC San Diego’s indirect costs are calculated based on Modified Total Direct Costs (MTDC) as defined in 2 CFR Part 200.68 using Facilities and Administration (F&A) rates approved by the U.S. Department of Health and Human Services (DHHS).

Rates established by UC San Diego’s F&A rate agreement dated May 23, 2018 are as follows:

  • July 1, 2017, to June 30, 2018: 56.0%
  • July 1, 2018, to June 30, 2019: 57.0%
  • July 1, 2019, to June 30, 2020: 57.5%
  • July 1, 2020, to June 30, 2021: 57.5%
  • July 1, 2021, until amended: 58.0%

Detailed Budget Justification

If the sponsor requires a more detailed justification, the following optional language, which includes details of MTDC, subawards, and place of performance, may be used:

UC San Diego’s indirect costs are calculated based on Modified Total Direct Costs (MTDC) as defined in 2 CFR Part 200.68 using Facilities and Administration (F&A) rates approved by the U.S. Department of Health and Human Services (DHHS).

MTDC is comprised of total direct costs less capital equipment, alterations and renovations, patient care costs, off-campus rent, tuition and fee remission, scholarships and fellowships, participant support costs, and that portion of subcontract costs in excess of $25,000. Additionally, the total amount of subawards to other University of California campuses are excluded. This project will be located on-campus.

Rates established by UC San Diego’s F&A rate agreement dated May 23, 2018 are as follows:

  • July 1, 2017, to June 30, 2018: 56.0%
  • July 1, 2018, to June 30, 2019: 57.0%
  • July 1, 2019, to June 30, 2020: 57.5%
  • July 1, 2020, to June 30, 2021: 57.5%
  • July 1, 2021, until amended: 58.0%

Understanding IDC

The Cost of Research

Did you know the IDC collected does not fully cover the true cost of conducting research at UC San Diego? For more information go to the Office of Research Affairs (ORA) website: research.ucsd.edu.


4 minutes

Resources

Additional information about IDC and F&A:

Link to YouTube video
20 minutes

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