What’s MTDC What’s MTDC Mean To Me?Mean To Me?

Alexia LewisAlexia LewisOffice of Research & Sponsored ProgramsOffice of Research & Sponsored ProgramsSeptember, 2006September, 2006

The FactsThe Facts

Costs of sponsored programsCosts of sponsored programs Direct CostsDirect Costs

Can be identified specifically with a Can be identified specifically with a particular project relatively easily with particular project relatively easily with a high degree of accuracy a high degree of accuracy

F&A, Indirect Costs, OverheadF&A, Indirect Costs, Overhead Incurred for common or joint Incurred for common or joint

objectives, cannot be specifically objectives, cannot be specifically attributed to an individual project attributed to an individual project

New F&A Rate Agreement New F&A Rate Agreement What Changes?What Changes?

DHHS rate agreement approvedDHHS rate agreement approved Was SWF base Was SWF base

Salaries, Wages, FringesSalaries, Wages, Fringes Now MTDC baseNow MTDC base

Modified Total Direct CostsModified Total Direct Costs Changes F&A CalculationChanges F&A Calculation

F&A = Base x RateF&A = Base x Rate Rate: Rate:

43.5% On Campus43.5% On Campus 26% Off Campus26% Off Campus

New F&A Rate Agreement New F&A Rate Agreement What Changes?What Changes?

CAS now appliesCAS now applies Cost Accounting StandardsCost Accounting Standards Administrative costs included in Administrative costs included in

F&A rate negotiationF&A rate negotiation Now recovered in F&ANow recovered in F&A

Result: Administrative costs now Result: Administrative costs now in F&A portion of budget instead in F&A portion of budget instead of direct cost portion of budgetof direct cost portion of budget

F&A CalculationF&A Calculation

MTDC - key word is ModifiedMTDC - key word is Modified Start with TDC (total direct costs)Start with TDC (total direct costs) Modify by subtractingModify by subtracting

EquipmentEquipment TuitionTuition Patient CarePatient Care LeaseLease All but the first $25,000 of each All but the first $25,000 of each

subcontractsubcontract Result is the MTDC Base Result is the MTDC Base

Apply the F&A rate to this base Apply the F&A rate to this base

ExampleExample

Salary & Fringe $60,000

Consultant $5,000

Subcontract $30,000

Equipment $3,000

Travel $3,000

Tuition $5,000

Supplies $14,000

   

Direct Costs $120,000

Direct $120,000

Less Equipment ($3,000)

Less Tuition ($5,000)

Less Subcontract ($30,000)

Sub - Plus 1st $25K $25,000

   

MTDC $107,000

F&A @ 43.5% $46,545

Direct Costs $120,000

F&A $46,545

Total Costs $166,545

1st – Build Budget2nd – Figure the Base & Apply the Rate

3rd – Add Direct + F&A Costs

How MTDC Affects CASHow MTDC Affects CAS

Due to change to MTDC baseDue to change to MTDC base Costs that UNF was charging as Costs that UNF was charging as

direct costs are now charged as direct costs are now charged as indirect costsindirect costs Called CAS items or expendituresCalled CAS items or expenditures

What’s that mean?What’s that mean? No longer can include the following No longer can include the following

as line items on budgetsas line items on budgets

What are CAS expenditures?What are CAS expenditures?

Administrative or Clerical Administrative or Clerical Salaries Salaries Technical salaries can be directly Technical salaries can be directly

chargedcharged PostagePostage

Overnight/Shipping costs can be Overnight/Shipping costs can be directly chargeddirectly charged

Local Telephone Local Telephone Long distance can be directly Long distance can be directly

chargedcharged

What are CAS expenditures?What are CAS expenditures?

Office Supplies Office Supplies Research/Lab supplies can be Research/Lab supplies can be

directly chargeddirectly charged Data Processing or Computer Data Processing or Computer

Supplies Supplies General Purpose Software General Purpose Software

Technical software can be directly Technical software can be directly chargedcharged

Memberships / SubscriptionsMemberships / Subscriptions

How do these get paid for?How do these get paid for?

So… how do PI’s pay for these So… how do PI’s pay for these real and necessary costs?real and necessary costs?

Use of F&A return to cover Use of F&A return to cover administrative costsadministrative costs New ORSP positions New ORSP positions Department resourcesDepartment resources PI’s IPD accountsPI’s IPD accounts

CAS Exemptions PolicyCAS Exemptions Policy

In specific cases, it may be In specific cases, it may be allowable to directly charge CAS allowable to directly charge CAS itemsitems

UNF PolicyUNF Policy Full federal F&A rateFull federal F&A rate

May or may not be allowable to direct May or may not be allowable to direct charge CAS itemscharge CAS items

CAS exemption form neededCAS exemption form needed Less than full federal F&A rateLess than full federal F&A rate

Allowable to direct charge CAS itemsAllowable to direct charge CAS items CAS exemption form neededCAS exemption form needed

CAS Exemptions PolicyCAS Exemptions Policy

Policy Bottom LinePolicy Bottom Line No CAS expenditures allowed No CAS expenditures allowed

without approved form on file for without approved form on file for each projecteach project

Policy Based OnPolicy Based On Consistency (OMB Circular A-21)Consistency (OMB Circular A-21) Avoiding disallowed costs / audit Avoiding disallowed costs / audit

findings & finesfindings & fines

CAS Exemption ProcedureCAS Exemption Procedure

Procedure: Procedure: CAS Exemption Form completed CAS Exemption Form completed

at proposal stageat proposal stage ORSP providesORSP provides PI completes and routes for approvalPI completes and routes for approval

Dr. Ebong reviews Dr. Ebong reviews Dawn reviews only in Dr. Ebong’s Dawn reviews only in Dr. Ebong’s

absenceabsence No one else authorized to make No one else authorized to make

decisiondecision

Is a CAS Exemption Is a CAS Exemption Reasonable to request?Reasonable to request?

ORSP role is to provide ORSP role is to provide guidanceguidance

Direct or indirect?Direct or indirect? Is it specific to this project?Is it specific to this project? Is it necessary to perform the Is it necessary to perform the

research?research? How does the university How does the university

consistently treat the cost?consistently treat the cost?

CAS Exemption FormCAS Exemption Form

See last page of hand-out for See last page of hand-out for CAS Exemption FormCAS Exemption Form