Research IDC

Budget Development Resources

Indirect Costs (IDC) or Facilities & Administrative Costs (F&A)

The resources required to undertake a sponsored project are determined by accumulating the associated direct as well as the F&A or indirect costs.

  • Direct costs are those costs that can be specifically identified with a sponsored project, such as salaries, project travel, project supplies, etc.
  • Facilities and Administrative (F&A) costs or Indirect Costs (IDC) are incurred for common or joint objectives, and therefore cannot be readily identified with a particular sponsored project. To overlook such costs within the area of sponsored projects would inaccurately attribute applicable facilities and administrative costs to other activities of the University. In 2006, the federal government (MSU’s largest sponsor of research) decided to change the name from indirect costs (or overhead), to better clarify what it was designed to cover. Hence the term Facilities and Administrative costs (F&A) was born.

The F&A rate represents the proportion that F&A costs are to direct costs, and is the basis for recovering those costs from grants and contracts. The F&A rate is negotiated periodically by Contract & Grant Administration and MSU's cognizant federal agency, i.e., the US Department of Health and Human Services (DHHS). The negotiation process is subject to a detailed review by federal auditors.

Current Facilities and Administrative Cost Rates

The rates, which are charged against all direct costs except equipment, the amounts in excess of the first $25,000 of each subcontract, and graduate tuition & fees, (see MTDC definition below) can be found here on the Office of Sponsored Programs CGA website. You will find:

Applying for an F&A/IDC Waiver

Under certain circumstances it may be possible to request and be allowed a waiver of the current established F&A/IDC rate. Contact Bart Moore if this is the case for your project.