Under certain circumstances, your DLC may accept a sponsored agreement that includes a reduced rate for recovery of facilities and administration (F&A) costs.

Understand F&A definition

Facilities and Administrative (F&A) costs are also referred to as overhead or indirect costs. You may find that that those terms are used interchangeably throughout MIT documents and various sponsor guidelines and program specifications. MIT prefers the term F&A, which is consistent with federal government usage. The SAP system, however, uses the term “overhead.”

Confirm underrecovery conditions

Underrecovery is the difference between the current negotiated F&A rate that MIT charges to a sponsored research project and the rate that a sponsor is willing to pay. Underrecovery may occur when a sponsor dictates a rate and/or base that are less than the F&A recovery that would result using the standard federal research rate.

Follow OSP policies and procedures

If your DLC identifies a potential underrecovery condition when you are developing a research proposal, follow the MIT policy on research underrecovery described on the Office of Sponsored Projects website.

The Details

Understand F&A definition

Facilities and Administrative (F&A) costs are also referred to as overhead or indirect costs. You may find that that those terms are used interchangeably throughout MIT documents and various sponsor guidelines and program specifications. MIT prefers the term F&A, which is consistent with federal government usage. The SAP system, however, uses the term “overhead.”

Confirm underrecovery conditions

Underrecovery is the difference between the current negotiated F&A rate that MIT charges to a sponsored research project and the rate that a sponsor is willing to pay. Underrecovery may occur when a sponsor dictates a rate and/or base that are less than the F&A recovery that would result using the standard federal research rate.

Follow OSP policies and procedures

If your DLC identifies a potential underrecovery condition when you are developing a research proposal, follow the MIT policy on research underrecovery described on the Office of Sponsored Projects website.

Did You Know?

When a sponsor’s F&A (facilities and administration) costs are less than the current MIT negotiated research rate, Institute policy requires you to treat the difference as underrecovery.
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