Facilities (F) & Administrative (A)

Costs Rate

UH Manoa MEC November 14, 2013

Office of Research Services

Reimburse University for facilities and administrative costs (Indirect Costs) incurred to

support grants and contracts.

Based on incurred expenditures during the “base year”.

Negotiated every three (3) years with the HHS Division of Cost Allocation.

FY 2016 ( July 1, 2015 – June 30, 2016) – Next Base Year

Purpose of F&A Rate

2

Facilities Costs

On Campus Research

Base (MTDC) + Cost

Sharing

Administrative Costs

On & Off Campus Research Base (MTDC) + Cost

Sharing

= Research F & A Rate

+

F & A Research Rate Formula

3

Last 5 Negotiated F & A RatesManoa Research On Campus

FY 1996 FY 1998 FY 2003 FY 2007 FY 2011

Facilities 14.6 15.1 17.2 15.5 17.5

Administrative 20.3 21.2 21.2 21.2 24.0

Approved Rate 34.9 36.3 38.4 36.7 41.5

FY 1996 FY 1998 FY 2003 FY 2007 FY 2011 -

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

14.6 15.1 17.2 15.5 17.5

20.3 21.2 21.2

21.2 24.0

34.9 36.3 38.4

36.7

41.5

Administrative componentFacilities componentNegotiated F&A Rate

4

Last 3 Negotiated F & A Rates for Kaka‘ako Research On Campus

FY 2003 FY 2007 FY 2011

Facilities 32.3

29.8

28.0

Administrative 21.2

20.2

26.0

Approved Rate 53.5

50.0

54.0

FY 1998 FY 2003 FY 2007 FY 2011 -

10

20

30

40

50

60

-

32.3 29.8 28.0

-

21.2 20.2 26.0

-

53.5 50.0

54.0

Administrative componentFacilities componentNegotiated F&A Rate

5

Last 5 Base Years F & A Costs For Manoa Research On Campus

FY 1996 FY 1998 FY 2003 FY 2007 FY 2011

Facilities pool N/A 10,536,013 11,446,027 12,991,454 18,013,972

Administrative pool N/A 17,518,193 21,237,619 26,779,076 35,264,642

Pool costs N/A 28,054,206 32,683,646 39,770,530 53,278,614

FY 1996 FY 1998 FY 2003 FY 2007 FY 2011 -

10,000,000.0

20,000,000.0

30,000,000.0

40,000,000.0

50,000,000.0

60,000,000.0

Administrative poolFacilities pool

6

Last 3 Base Years F & A Costs for Kaka‘ako Research On Campus

FY 2003* FY 2007 FY 2011

Facilities pool 3,541,813 2,845,349 7,670,850

Administrative pool 2,324,657 1,928,727 6,785,113

Pool costs 5,866,470 4,774,076 14,455,963

* Figures are based on DCA adjustments of forecasted data.

FY 1998 FY 2003* FY 2007 FY 2011 -

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

16,000,000

Administrative poolFacilities pool

7

Last 5 Base Years F & A and Base Costs For On Campus Research Rate

FY 1996 FY 1998 FY 2003 FY 2007 FY 2011

Facilities pool N/A 10,536,013 11,446,027 12,991,454 18,013,972

Administrative pool N/A 17,518,193 21,237,619 26,779,076 35,264,642

On campus N/A 69,455,504 66,546,670 83,815,831 102,936,981

Off campus N/A 13,468,402 33,630,780 42,610,394 43,999,029

Research base N/A 82,923,906 100,177,450 126,426,225 146,936,010

Research Base = System wide (Excluding Kaka‘ako) MTDC Research Expenditures + Cost Sharing

8

FY 1996

FY 1998

FY 2003

FY 2007

FY 2011

-

20,000,000.0

40,000,000.0

60,000,000.0

80,000,000.0

100,000,000.0

120,000,000.0

140,000,000.0

160,000,000.0

Facilities poolOn campus Research BaseOn & Off Research BaseAdministrative pool

Last 3 Base Years F & A and Base Costs Costs for Kaka‘ako Research On Campus

FY 1998 FY 2003* FY 2007 FY 2011

Facilities pool N/A

3,541,813

2,845,349

7,670,850

Administrative pool N/A

2,324,657

1,928,727

6,785,113 * DCA adjustments of forecasted data.

On campus N/A

10,965,365

9,548,151

19,064,799

Off campus N/A N/A N/A N/A

Kaka‘ako base N/A

10,965,365

9,548,151

19,064,799

FY 1998 FY 2003* FY 2007 FY 2011 -

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

Facilities poolAdministrative poolKakaako base

Kaka‘ako Base = Kaka‘ako MTDC Research Expenditures + Cost Sharing

9

MTDC Calculation

Salaries

Fringe benefits

Materials & supplies

Services

Travel

First $25,000 of each Subaward

Equipment

Capital expenditures

Patient care

Tuition remission

Rental costs (non-UH space)

Scholarships & fellowships (Stipends)

Portion over first $25,000 of each subaward

Specialized service facility charges

10

Not MTDC

Research•Research & development•Research training (esp. if code

space as research)•University Research Council seed

grants (competitive)

Training•Teaching or training•Curriculum development•Student services•Service learning

Other Sponsored Activities•Performances & exhibitions•Workshops; conferences; travel•Evaluations; clinical trials•Operations of clinics, extension

services•Inter-personnel Agreements

(IPAs)•Equipment acquisition (no R&D);

infrastructure development•Vessel operations

Sponsored Activities A-21 Functions

11

Instruction/Dept Research•Credit classes•Non-credit classes•Departmental research

•Faculty research and scholarly activity

•Faculty start-up funds•Faculty travel

•Non-competitive awards of university funds

Other Institutional•Athletics•Bookstore•Housing•Parking•Transportation services•Recharge centers•Unallowable activities (e.g.

alumni affairs)

SSF’s•SOEST Computing•SOEST Engineering•SOEST Ship Operations•IFA Job Order Services•IFA Mauna Kea Mid-level

Facility•Laboratory Animal Services

Non-Sponsored Activities OMB A-21 Functions

12

Memberships in Civic, Commercial or Social

Organizations

Alumni Activities

Fundraising

Lobbying

Public Relations

Student Activity Costs

Unallowable Costs Under A-21

13

Unallowable

14

Functional Space Survey

• Depreciation• Offices, labs, meeting rooms• Equipment

• Interest Expense• O & M• Utilities, Custodial Services,

Repairs

FTE Count and FTE by Functional Salaries &

Wages

• Library Books, Periodicals, & Services

Facilities Costs Allocation Bases

15

Administrative Costs Allocation Bases

Functional MTDC Ratio

• General Admin - Chancellor’s Office, GALC, OHR, Disbursing, Payroll, ITS

• Dept. Admin – Dean or Director’s Office, FAs

• Sponsored Projects Admin – ORS, VPRI, VCR

Functional MTDC Ratio

• Statewide Cost Allocations

• RCUH administrative expenses

FTE Count or FTE by

Functional Salaries &

Wages

• Admissions, Financial Aids,

• Student Health Services,• Graduate Division

General Administrative Costs MTDC Allocation Bases

16

16%2%

7%

4%

41%

12%

2%3%

5%1%General Administration

ResearchKakaako ResSpons InstrucOther Spons ActInstruc/Dept ResOther Instit ActSpec Svc FacLibraryStud SvcsSpons Proj Adm

Dept/School Administrative Costs MTDC Allocation Bases

17

27%

4%

10%

6%

47%

6% Departmental Administration

ResearchKakaako ResSpons InstrucOther Spons ActInstruc/Dept ResOther Instit Act

Sponsored Project Administrative Costs MTDC Allocation Bases

18

55%

7%

24%

14%

Sponsored Projects Administration

ResearchKakaako ResSpons InstrucOther Spons Act

Additional Costs that Increase the Research

Base

Cost Sharing

Researcher effort – Key Personnel, PIs, not paid from grants

Amounts in excess of NIH salary cap

Intramural, competitive awards

19

FY 2013 & FY 2017 Rates

FY 2013

Research on-campus (36.7%)

Training on-campus (27.5%)

Other sponsored activities on-campus (25.0%)

Kaka'ako research (50.0%)

FY 2017

Research on-campus (41.5%)

Training on-campus (40.0%)

Other sponsored activities on-campus (32.0%)

Kaka'ako research (54.0%)

20

Maximus CRIS F&A software increase admin (20.6% 24.0%)

Updated F&A Space Survey for UH Manoa Campus

Claim selected O&M costs by building

New C-MORE Hale – Research intensive building

Primary Reasons for Rate Increases FY 2011

21

Accelerated depreciation for building components – Useful Life not supported by actual experience

Equipment depreciation by room for moveable equipment – often not found in room per inventory

Vacant lab space had no concrete plans for extramural research

Space survey adjustment for student use of space

Not permitted or “corrections” made by our HHS Region Negotiators

22

23

HIGP - HIG Building

Institute for Astronomy - IFA Woodlawn

Physics & Astronomy - Watanabe Hall

Mechanical Engineering- Holmes

CTAHR - Agricultural Engineering

CTAHR - Gilmore Hall CTAHR - St. John

CTAHR - Agricultural Science Facility

Most labs - Post

Units/Labs Selected By DHHS Space Site Audit

HIGP - HIG Building

Institute for Astronomy - IFA Woodlawn

Physics & Astronomy - Watanabe Hall

Mechanical Engineering - POST

Oceanography - Marine Sciences Building

ALL Labs C-MORE

Cell & Molecular Biology - Biomedical Sciences Building Kaka‘ako

All Labs- Biomedical Sciences Building Kaka‘ako

ALL labs Cancer Center building at Kaka‘ako

FY 2003 FY 2011

23

Peer Rate Comparison

24

Institution To Type RateFY 2011 NSF Total R&D Rank

Arizona State University 6/30/2016Research 54.50% 62

University of California - Irvine 6/30/2016Research 54.50% 64

Oregon Health Sciences University 6/30/2013Research 54.00% 66

Colorado State University 6/30/2014Research 48.70% 67

University of Hawaii 6/30/2017Research 41.50% 70

F&A Cost Reimbursement FY 2013 for Research

Actual Reimbursement $ $34.29 M Full rate is approximately $49.18 MEstimated unrecovered $ 14.88 M

25

34.29

49.18

14.88

ActualFullUnrecovered

F&A Cost Reimbursement FY 2013 for Non-Research

Actual Reimbursement $15.04 M Full rate is approximately $34.18 MEstimated unrecovered $ 19.15 M

26

15.04

34.18 19.15 Actual

FullUnrecovered

Timeline

Next rate proposal is due December 31, 2016

The expenditures are based on FY 2016

Any major non-capital renovations must be expended during July 1, 2015 – June 30, 2016.

Space Survey must be completed by 9/30/16

Physical inventory of the research equipment must be completed by FY 2016

New Building should be occupied within next rate agreement period (July 1, 2017 to June 30, 2021)

27

Key Factors At UH Base

Federal sequestration and sunset of ARRA may lower the FY 2016 research expenditures base

General funds or RTRF research expenditures are included in the base; avoid putting Non-extramural funds

in base

Most UH research faculty are not paid from grants. Thus, lower S & W to allocate or justify research use of space.

In addition, we get penalized by having to impute a minimum effort for research faculty in the base

28

29

Facilities component• Maintain UHM space survey & expand to other campuses• Prioritize major, non-capitalized repairs for research intensive buildings in FY 2016• Identifying major fixed equipment by room (e.g., fume hoods) in research intensive buildings

Admin component• Look at possibilities to get over the 26.0% admin cap

• For example: Increase research admin support in the field

Short Term Strategy

29

New research building investment and/or reconfiguration plans (e.g., concentrate extramurally funded research in high cost buildings)

Follow renewal and replacement plan for existing facilities, which would support accelerated depreciation

Maintain and update space usage plan and space survey as usage changes

Invest in Research Admin Support Staff in the field

Long Term Strategy

30

Spending on numerator (a.k.a. “pool”) costs tends to increase rates. (Facilities and Administrative Costs Pool)

Spending on denominator (a.k.a. “base”) costs tends to

decrease rates

How spending impacts the rate

31

Description Where it goes

Faculty or technical staff paid from G-funds or RTRF

Instruction/Departmental Research Reduce MTDC Allocation for Organized Research

Research administrative faculty & staff paid from G-funds or RTRF

Departmental Administration Pool

Faculty, technical or administrative staff paid from grants or cost shared from G-funds or RTRF

Organized Research Base

Examples of Cost Impact (Personnel)

32

Description Where it goes

Scientific supplies or conference travel purchased on G-funds or RTRF

Instruction/Departmental Research Reduce MTDC Allocation for Organized Research

Scientific supplies or conference travel purchased on grants or cost shared from G-funds or RTRF

Organized Research Base

Research administration conference travel paid on G-funds or RTRF

Departmental Administration Pool

Examples of Cost Impact (Supplies & Travel)

33

Description Where it goes

Scientific equipment purchased on G-funds or RTRF

Equipment Depreciation Pool

Scientific equipment purchased on grants or cost shared from G-funds or RTRF

NOT RECOVERABLE

Examples of Cost Impact (Equipment)

34

Description Where it goes

Administrative buildings Recoverable, if used mostly for sponsored projects administration

Athletic facilities NOT RECOVERABLE

Classrooms, including class labs Mostly UNRECOVERABLE

Dormitories NOT RECOVERABLE

Libraries Mostly UNRECOVERABLE

Parking structures Mostly UNRECOVERABLE

Research buildings Recoverable, if used mostly for extramural research

Examples of Cost Impact (Buildings or Major

Renovations)

35

Mahalo!

36