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Office of Sponsored Awards Management

Facilities & Administrative Costs

Facilities and administrative costs (F&A) are also known as indirect costs or overhead. USC's F&A rate is the federally approved percentage applied to sponsored projects to recover the costs associated with performing the activities of the project and managing research projects. These costs include expenditures for administrative personnel, facilities, operations and maintenance costs.

Facilities and administration (F&A) costs, also known as indirect costs, are different from direct costs because, while they are necessary to carrying out a grant-funded project, they are not attached specifically to that project. Expenses such as utility costs, grant administrators’ salaries, office supplies, costs to maintain labs and buildings and other costs that are incurred for joint objectives of the sponsored project and the institution at which the project is being conducted, fall into the F&A costs category.


Incorporating F&A costs into a grant budget

Allowable F&A rate

When preparing a grant proposal, the total budget consists of the total direct costs, which are costs identified specifically with the project being proposed, plus the allowable F&A costs. USC has negotiated with the US Department of Health & Human Services, our federal cognizant audit agency to determine an allowable F&A cost rate for the USC System from FY2014 through FY2017, including different rates for the School of Medicine, USC Columbia and USC system campuses.  


Applying F&A costs

F&A costs are applied to the Modified Total Direct Costs (MTDC) base in a grant budget. MTDC costs include all salaries and wages, fringe benefits, materials, supplies, services, travel expenses, and up to the first $25,000 of each subgrant/subcontract (regardless of the period covered by the subgrant/subcontract). MTDC costs exclude equipment, capital expenditures, charges for patient care, tuition remission, rental costs of off-site facilities, scholarships and fellowships and the portion of each subgrant/subcontract in excess of $25,000. Read more about applying F&A costs in USC Policy FINA 9.10 - Cost Accounting Standards (CAS) [pdf].


Exceptions and variations for F&A rates

  • There are on-campus and off-campus rates for different types of sponsored project activities.
  • The F&A rates differ for USC Columbia, senior and regional system campuses, and the School of Medicine.
  • When preparing a budget that encompasses budget periods with different rates, use the rate that is in effect at the beginning of each budget period.
  • Researchers using a F&A rate other than the USC approved indirect cost rate in a sponsored project proposal must have supporting documentation justifying the alternate rate.
  • For federally funded non-research projects over $200,000 per year, indirect costs must be requested at the allowable rate. The indirect costs for these projects must be remitted to the State of South Carolina and are not available for University use. No waiver of allowable indirect costs is allowed.


F&A Rate Tables

On-Campus Rates FY2014 through FY2017

Rate Type USC Columbia Rate School of Medicine Columbia Rate System Campus Rate
Research 46.5% 33.5% 37%
Training and Service 35% 35% 35%
Instruction 49.5% 49.5%


Industry Sponsored Clinical Trials 25% 25% 25%


Off-Campus Rates FY2014 through FY2017

Rate Type USC Columbia Rate School of Medicine Columbia Rate System Campus Rate
Research 26% 26% 26%
Training and Service 26% 26% 26%
Instruction 26% 26% 26%

These rates are applicable for sponsored projects conducted at all University of South Carolina Campuses as well as related off-campus work when applicable.

For more information on implementing these rates or assistance in applying them to sponsored agreements, please contact the Office of Sponsored Awards Management.

Download the F&A rate tables for USC Columbia, the School of Medicine Columbia and USC System campuses [pdf].