UC San Diego SearchMenu

Budgets - Indirect Costs

Find links and information on indirect costs in budget preparation.

Updated to reflect new rates effective on all proposals submitted on or after December 1, 2017.

UC San Diego’s IDC rates are determined through negotiation with the US Department of Health and Human Services (DHHS). UC San Diego has completed negotiations with the Department of Health and Human Services (DHHS), the cognizant agency for our Facilities and Administrative rate agreement, resulting in multi-year increases to organized research indirect cost rates.  While the approved rate agreement is pending finalization, DHHS has authorized the use of these rates for organized research in upcoming proposals.

Implementation of this new rate is encouraged for all proposals being prepared and submitted effective December 1, 2017, however a grace period will be allowed so that the new rates are not required to be incorporated into budgets for proposals until proposals due January 3, 2018 or later.  Additional information can be found in the Notification of Changes to Research Indirect Cost Rates (PDF) sent to campus research administrators on 11/7/17 and 11/13/17, and the Notification sent to All Academics on 12/4/17.

More information and a link to the previous rate agreement can be found on the Institutional Information and Codes.

Expand all

UC San Diego Indirect Cost Rates - Updated with NEW Federal Research Rates

UC San Diego Indirect Cost (IDC) Rates (includes new negotiated rates)

Rates are applied 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

56%

57%

57.5%

57.5% 58%

Instruction

53%

53%

53%

53% 53%

Other Sponsored Activity

43%

43%

43%

43% 43%

Marine Physical Laboratory

18%

18%

18%

18% 18%

SIO Ship Operations (SSF)

8.34%

8.34%

8.34% 8.34% 8.34%
Off-Campus (all functions) 26% 26% 26% 26% 26%

Federal Flow Through (Federal Agency as Prime/Original Sponsor) Sponsored Research or Clinical Trials

56%

57%

57.5%

57.5% 58%

Federally Funded Clinical Trials

56%

57%

57.5% 57.5% 58%

Non-Profit Sponsors

Based on sponsor written policy, please see the Non-profit IDC Blink page

Industry Sponsored Research2

56%

57%

57.5%

57.5% 58%

Industry Funded UCSD PI Initiated Clinical Trials

30% TDC4

30% TDC4

30% TDC4

30% TDC4 30% TDC4

Industry Funded Sponsor Initiated Clinical Trials

30% TDC4

30% TDC4

30% TDC4

30% TDC4 30% TDC4

State of California Sponsors- On-Campus

25%

30%

35%

40% 40%
State of California Sponsors - Off-Campus 25% 25% 25% 25% 25%

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 is the driver for determining the IDC that applies (federal funding as the prime trumps the rate that would apply to the flow-through funding source). 

For more information on industry sponsored research and IDC please see the UC Policies on Industry Agreements Blink page.

3 For State 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.

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

On-campus rate applies to projects:

  • 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

 Off-campus rate applies to projects:

  • Conducted at facilities not owned or leased by the University
  • When rent is charged directly to the project

 Both on-campus and off-campus sites:

  • 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.
  • 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

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

UC San Diego has completed negotiations with the Department of Health and Human Services (DHHS) resulting in multi-year increases to the on-campus research MTDC indirect cost rate.  While the final approval date is pending, DHHS has instructed UC San Diego to start using the new rates.  The new rates are effective July 1 of each fiscal year and 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%

Contact Janet Turner at DHHS Cost Allocation Services, Western Field Office, 415-437-7859 or CAS-SF@psc.hhs.gov, with questions about UC San Diego’s F&A rate.

If the sponsor requires a more detailed justification, the following optional language 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. While UC San Diego’s F&A rate agreement is pending DHHS has instructed UC San Diego to start using the new rates. The rates 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%

Contact Janet Turner at DHHS Cost Allocation Services, Western Field Office, 415-437-7859 or CAS-SF@psc.hhs.gov, with questions about UC San Diego’s F&A rate.

Facts about Facilities and Administrative Costs

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

Additional information about Indirect Costs and F&A:

Indirect Costs 101

Learn all about Indirect Costs & how they work with this 28 minute video by NIH Deputy Director Sally Rockey

Link to YouTube video

Expand all