Indirect Costs >>>

Christopher Newport University 's indirect cost rate was recently re-negotiated and established by the Department of Health and Human Services in a rate agreement document dated January 5, 2006. The new agreement period is July 1, 2006 through June 30, 2009. It establishes an on-campus rate of 45.7% and an off-campus rate of 25%. If more than 50% of the research/program activity takes place “on-campus” the 45.7% rate is applied. If more than 50% of the research/program activity takes place “off-campus”, the 25% rate applied.

Indirect Costs are the “indirect costs” incurred in the execution or performance of sponsored research activity (grants, contracts, cooperative agreements). Indirect Costs, also known as Facilities and Administration (F&A) costs, are shared expenses related to university facilities and administration. Facilities Costs are defined as allowances for depreciation and use of buildings and equipment; interest on debt associated with buildings and equipment; operation and maintenance expenses, and library. Administrative Costs are defined as general administration and general expenses such as the central office of the university president, financial management, general counsel, and management information systems; departmental administration; sponsored programs administration.

Indirect cost rates are established through negotiations between the federal government and individual institutions as outlined in Office of Management and Budget (OMB) Circular A-21, Cost Principles for Educational Institutions. CNU uses the simplified method as it expends less than $10 million per year in sponsored program funding. This simplified method produces an indirect cost rate based on salaries, wages, and fringe benefits only, as opposed to Modified Total Direct Cost (MTDC). MTDC is equal to direct costs minus exclusions (such as equipment and subcontracts).