Facilities and Administrative Costs & Waivers

Indirect costs for university research, also known as Facilities and Administrative (F&A), or indirect/overhead costs, are expenses that support the overall research infrastructure but are not directly attributable to specific research projects. These include costs for utilities, administrative support, building maintenance, and library services, which are essential for conducting research but cannot be directly linked to any single project. F&A does not cover the entire cost of conducting research. 

Process for Requesting an F&A Rate Exception (aka F&A waiver): 

At Georgia Tech, every sponsored project has an F&A rate that is documented in the eRouting system.  Any requests for unusual or reduced rates should be initiated in eRouting. Process details are as follows: 

Rate Requested Approver InstructionsConsiderations 
Other Sponsored ActivitiesOSP Select “OSA” as the F&A rate in eRouting Determined by SOW 
Off-CampusOSP Select “Off-Campus” as the F&A rate in eRouting See the Off-Campus F&A Rate Guidance available here
Reduced Rate as Mandated by a Federal Sponsor OSP Select “Other” and then “Federally Mandated Published Rate” as the F&A Rate in eRouting  The rate must be published in the RFP and/or on the sponsor’s website and consistently applied to all funding recipients 
Reduced Rate as Mandated by a Domestic Non-Profit Sponsor OSP Select “Other” and then “U.S. Non-Profit Published Rate” as the F&A Rate in eRouting The rate must be published in the RFP and/or on the sponsor’s website and consistently applied to all funding recipients
Reduced Rate for Industry SponsorEVPRSelect “Other” and then “Other Rate” as the F&A Rate in eRoutingWaivers for corporate sponsors are almost never approved. GT cannot use state funds to subsidize industry research. 
Reduced Rate for International Sponsor EVPRSelect “Other” and then “Other Rate” as the F&A Rate in eRouting Waivers for international sponsors are rarely approved. GT cannot provide services to a foreign sponsor at a lower rate than we charge the U.S. Government. 
Reduced Rate for All Other Scenarios EVPRSelect “Other” and then “Other Rate” as the F&A Rate in eRouting All fields in the waiver request must be completed in detail for the request to be reviewed. 

Tips for Successfully Requesting an F&A Rate Exception 

  • All requests to apply for a reduced F&A rate must include a thorough justification addressing the elements detailed above.  Assume that the reader has no prior knowledge of the sponsor or relevant circumstances; start at the beginning and carefully explain what you are requesting and why.  
  • Upload or link to all relevant documentation, including the RFP, within eRouting to expedite your request.  
  • Correspondence directed solely to Georgia Tech from a sponsor does not constitute sufficient proof of a consistently applied standard policy.
  • Include the actual unrecovered overhead in eRouting, not a placeholder. Calculate what the F&A would have been at the appropriate rate and subtract the proposed amount to determine this number.
  • There is no such thing as a fringe benefit waiver.  Fringe benefits are a cost that must be paid at the time the work is completed. Typically, if a sponsor will not cover fringe benefits, it is paid by the unit.  Should the unit be unable to cover the fringe, it should initiate a Cost Share and Institutional Support Request.  

The following elements do not have any bearing on the institute’s ability to issue an F&A waiver:  

  • Size of the proposal budget  
  • Significance of the work  
  • Potential for future funding  
  • Authorization of a waiver for similar projects in previous years  
  • The PI’s preference for allocating budget to direct costs rather than indirect costs  
  • The sponsor’s policies on F&A rates (unless they are a federal or domestic non-profit sponsor, in which case an F&A waiver is not necessary)   

GT-Specific Resources  

 External Resources

Additional Information

Georgia Tech goes through an extremely rigorous process every two years to calculate the total of the current costs associated with research.  These costs, often referred to as Facilities and Administrative (F&A), indirect, or overhead costs, must be covered for every research project.  To streamline the payment of these costs, Georgia Tech negotiates specific rates with the federal government that apply to the majority of the projects sponsored by a federal agency.   

Georgia Tech's Facilities & Administrative (F&A) rates are established and approved by the Office of Naval Research (ONR).  The research capped rate applies to federal grants and contracts except Department of Defense (DoD) contracts (it does apply to DoD grants).  Because the amount that we can recover for administrative costs is capped at 26%, this rate does not fully cover Georgia Tech’s costs for federal research projects.  Therefore, Tech must contribute the difference on each project.   

The research uncapped rate is the only rate under which the sponsor fully covers the cost of the research.  This rate is applied to DoD contracts as well as projects with non-profit and industry sponsors, to ensure that we do not subsidize industry work with taxpayer dollars. 

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