New facilities and administrative rate in effect

Towson, Md. (October 27,2010) Towson University, through the Division of Administration and Finance, has renegotiated its federal facilities and administrative (F&A) rate agreement with the United States Department of Health and Human Services.  The negotiated rates are recognized by all federal agencies and should be used for all proposals to all external entities, unless the prospective funder imposes a cap, beginning immediately. 

The new rates, effective through June 30, 2014, are:

  • 45 percent modified total direct costs for on-campus projects*
  • 25 percent modified total direct costs for off-campus project**

Formerly known as “indirect costs,” facilities and administrative costs are intended to cover the costs of carrying out sponsored projects that are not easily allocable to individual projects – costs such as office and laboratory space, utilities, maintenance, general use equipment and furniture, electronic infrastructure and support, administrative support (such as that provided by Procurement, Accounts Payable, Human Resources, and Payroll), and grants administration.  The negotiated rate is an estimate of the costs involved with carrying out sponsored projects, and recovered F&A costs are considered reimbursement for expenses incurred.  It is, therefore, vital that the negotiated rate be applied to all external funding proposals.

Because of its commitment to building the sponsored project and research infrastructure at Towson University, a portion of F&A costs are redistributed to the originating unit(s) as follows, as they are recovered:

  • 5 percent to the principal investigator(s)/project director(s) for reimbursable expenses
  • 10 percent to the principal investigator’s/project director’s(s’) department(s)
  • 15 percent to the principal investigator’s/project director’s(s’) college(s)

F&A that is redistributed for the principal investigator’s(s’)/project director’s(s’) may be used for any state allowable expense, paid according to university policies and procedures, other than salary.  Redistributed F&A is a great way to cover expenses that generally cannot be charged to grant budgets, including membership dues and general use equipment such as laptop computers, and to cover travel that is not budgeted as part of the project. 

For information on applying the new F&A rates, or to discuss a proposal budget, please contact the Office of Sponsored Programs & Research at extension 4-2236 or at

*”Modified total direct costs” are defined as all project costs exclusive of subcontracts and capital expenditures (alterations/renovations/construction and individual pieces of equipment with a useful life of more than one year and an acquisition cost of $5,000 or more). 
**”Off-campus” projects are defined as those on which rent is budgeted as a direct cost.

Office of Sponsored Programs & Research
212E Administration Building

Phone: 410-704-2236
Fax: 410-704-4494




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