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grants and cooperative agreements |
Definition
Defined under 2 CFR § 200.56 Indirect (facilities and & administrative (F&A)) costs. Indirect Indirect (F&A) costs means those costs incurred for a common or joint purpose benefitting more than one cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. To facilitate equitable distribution of indirect expenses to the cost objectives served, it may be necessary to establish a number of pools of indirect (F&A) costs. Indirect (F&A) cost pools must be distributed to benefitted cost objectives on bases that will produce an equitable result in consideration of relative benefits derived.
The Uniform Grant Guidance allows any non-Federal entity that has never received a negotiated indirect cost rate to elect to charge a de minimis rate of 10% of modified total direct costs (MTDC) which may be used indefinitely. If a non-Federal entity chooses to charge the 10% de minimis rate, then the non-Federal entity must use this rate consistently for all Federal awards until such time as the non-Federal entity chooses to negotiate for a rate. There are some non-Federal entities that are exempted from charging the 10% de minimis rate. This information is provided in Appendix VII to 2 CFR Part 200 Appendix VII (D)(1)(b).
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2 CFR 200.412 Classification of costs
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(e) Requirements for development and submission of indirect (F&A) costs rate proposals and cost allocation plans are contained Appendices III-VII and Appendix IX as follows:
(3) Appendix V to Part 200—State/Local Governmentwide Government and Indian Tribe-Wide Central Service Cost Allocation Plans;
(4) Appendix VI to Part 200—Public Assistance Cost Allocation Plans ;
(5) Appendix VII to Part 200—States and Local Government and Indian Tribe Indirect Cost Proposals; and
(6) Appendix IX to Part 200—Hospital Cost Principles.
(f) In addition to the procedures outlined in the appendices in paragraph (e) of this section, any non-Federal entity that has never received a negotiated indirect cost rate, except for those non-Federal entities described in Appendix VII to Part 200—States and Local Government and Indian Tribe Indirect Cost Proposals, paragraph D.1.b, may elect to charge a de minimis rate of 10% of modified total direct costs (MTDC) which may be used indefinitely. As described in §200.403 Factors affecting allowability of costs, costs must be consistently charged as either indirect or direct costs, but may not be double charged or inconsistently charged as both. If chosen, this methodology once elected must be used consistently for all Federal awards until such time as a non-Federal entity chooses to negotiate for a rate, which the non-Federal entity may apply to do at any time.
Appendix VII to 2 CFR
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Part 200 (D)(1)(b) Submission and Documentation of Proposals
A governmental department or agency unit that receives more than $35 million in direct Federal funding must submit its indirect cost rate proposal to its cognizant agency for indirect costs. Other governmental department or agency must develop an indirect cost proposal in accordance with the requirements of this Part and maintain the proposal and related supporting documentation for audit. These governmental departments or agencies are not required to submit their proposals unless they are specifically requested to do so by the cognizant agency for indirect costs. Where a non-Federal entity only receives funds as a subrecipient, the pass-through entity will be responsible for negotiating and/or monitoring the subrecipient's indirect costs.
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Yes. As long as the State fish and wildlife agency has never had an indirect cost rate approved by its cognizant Federal agency and it meets the requirements established under 2 CFR 200 Appendix VII to Part 200—States and Local Government and Indian Tribe Indirect Cost Proposals (D)(1)(b).
What entities are not allowed to charge the 10% de minimis rate for indirect?
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