Guidelines for Determining Independent Contractor vs. Employee Status for External Service Providers
University Departments that engage external service providers must submit the required documentation for determination of a service provider’s status before any services are performed or payment requests are processed. See the guidelines here.
Facilities and Administrative (F&A) Waiver
Facilities and Administrative (F&A) costs, also known as Indirect Costs (IDC), are critical because they support the operation, maintenance and administration of our research infrastructure. BU’s policy is to charge full F&A costs on all grants, unless the sponsor limits or disallows it. On rare occasions, a reduction in or waiver of F&A may be requested and approved.
If requesting an F&A waiver or reduction, please fill out the relevant section on the PSF form and provide a justification in the PSF comments section. F&A waiver requests originally required a separate form, but it has now been incorporated into the PSF. Please be aware that requesting an F&A waiver/reduction will require Provost approval and will increase proposal review time. Proposals making these requests should be submitted to CAS 115 at least 10 business days before sponsor deadline.
If a sponsor limits or disallows F&A, please indicate the limitation in the PSF comments section and provide documentation of the sponsor’s IDC policy in the proposal package for CAS 115. It is not necessary to submit an F&A Waiver request in these situations.
To summarize, an F&A waiver is not needed when a sponsor limits or disallows F&A costs and you adhere to their guidelines. Approval is required when a sponsor allows F&A and you wish to request less than what could be requested.
BU has standard F&A rates that have been negotiated with the federal government. The ones most commonly used are 64.5% (valid through June 30, 2018) or 65% for on campus projects. It’s 26% for off campus projects. These rates are for federal opportunities. When 50% or more of a project’s time is on campus, use a rate of 64.5% or 65% of the direct costs to calculate F&A costs. When 50% or more of the work is done off campus, use a 26% rate to calculate costs. There are separate rates for training and other types of research proposals. You can find a complete list of F&A rates, including those for non-federal opportunities, here.
Not all direct costs can be used in F&A cost calculations, per BU policy. In addition, sponsors can have their own restrictions. Please review the sponsor’s proposal guidelines and see a budget specialist for questions. For further information regarding BU’s policies, please visit the OSP’s website.
Cost Sharing
Cost sharing refers to costs (e.g., salary for time spent on a grant-funded project) normally funded through a grant that a researcher instead requests that BU pays. There are multiple reasons why cost sharing might be requested; For example, a sponsor may require it, or the sponsor might have a salary cap that necessitates it.
Cost sharing may or may not require approval by the Provost’s office. You can learn about the Provost’s Office policy, and download their forms, here.
Cost share requests should be specified in the Cost Share section on the PSF. Please be aware that it is no longer necessary to fill out a separate cost share signature sheet, since that information is now incorporated within the PSF. However, it is still necessary to fill out a cost share budget form. Proposals with cost share requests should be sent to CAS 115 at least ten business days prior to sponsor deadline to allow for additional review.
Please be aware that there are two kinds of cost sharing: direct and indirect. These correspond to direct and indirect costs on your budget. A direct cost is whatever you are requesting funds to cover, such as salary or a piece of equipment. Indirect costs refer to BU’s overhead, as explained in the F&A Waiver section above. Indirect cost sharing refers to one of the following: 1) the amount of indirect costs that correspond to the direct cost sharing, 2) the amount of indirect costs that BU is waiving under an approved F&A Waiver form, or 3) the difference between a sponsor’s maximum allowed F&A rate and BU’s rate.
This is how to calculate cost share for $10,000 worth of one person’s salary:
Cost Share Request
Base salary: $10,000
Fringe: $2,760 (if using a 27.6% fringe rate)
Total salary: $12,760
Indirect costs: $8,128 (The indirect costs were calculated by multiplying the F&A rate (63.7% in this case) by $12,760, the total direct costs.)
Total direct costs: $12,760
Total indirect costs: $8,128
Total cost share: $20,888
It is important for BU to track cost sharing because it could impact our federally negotiated indirect cost rate. The first year’s worth of both direct and indirect cost sharing must be indicated on the PSF. Cost sharing should also be indicated on your budget and discussed within the budget justification section of your proposal. For more information on cost sharing, visit the Office of Sponsored Programs Handbook.
Compliance
Projects need compliance review if using human subjects (IRB), animals (IACUC), specific scientific research equipment (like lasers) and/or performing underwater research.
For information about the IRB, see www.bu.edu/irb/
For information about the IACUC, see www.bu.edu/orccommittess/iacuc/
For information about all compliance issues, see www.bu.edu/orc/