Page 1 CRAD F&A Waiver Process Change November 15, 2007.

CRADF&A Waiver Process Change

CRADF&A Waiver Process Change

November 15, 2007

Issues

Large amounts of foregone F&A limit institutional capabilities

Institutional risk exists due to inconsistent treatment F&A Waiver process needs to be streamlined

UMN is more generous with F&A waivers than other top research universities

UMN is more generous with F&A waivers than other top research universities

Minnesota Waiver Volume July 2007 – October 2007 (4 month) Total amount waived: $1,875,382 Total # of waiver requests: 76

Dollar value (direct costs) # of waivers $ waived<50K 40 $ 346,89950K - $100K 12 $ 166,222>$100K 16 $1,362,262

Federal Projects 26 $ 808,190Non-Federal 19 $ 393,680State 6 $ 305,183Business & Industry 18 $ 194,443Foreign 2 $ 26,527Other 2 $ 148,079

Peer Positions F&A Waivers not granted to for-profits (UC all campuses,

Stanford, Michigan, Washington, MIT, Michigan State, Purdue)

F&A Waivers not granted to foreign entities (UC all campuses, Stanford, Penn State, MIT, Michigan State, Purdue)

Minnesota F&A Rates are Competitive U of Washington 56.0% UC San Diego 54.5% UC San Francisco 54.0% UC Los Angeles 54.0% UC Berkeley 53.5% U of Illinois 53.0% (UIC at 57%) U of Michigan 52.0% U of Minnesota 51.0% Ohio State 50.0% Wisconsin 47.0% (FY08 under

negotiation) North Carolina 46.0% (FY08 under

negotiation)

SPA•PI Transfers• Non-profits with published policy• Special governmental programs•Projects which move from off-campus to on-campus.

New Strategy (Part 1)

F&A WaiverRequests

AdministrativeWaivers Strategic

WaiversRegularWaivers

Deans

• Small Project Waiver(<$50K year)

• Other Reductions above minimums

VPR• Waivers or reductions below minimums

Tracked Tracked

Proposed F&A Rate Minimums (awards over $50K direct costs/year)

Federal ……………………………… Federally negotiated rate* Foreign government ………………... Federally negotiated rate* For-profit …………………………… 34% State of Minnesota ………………….. 0% (for now) Non-profit/foundations ……...…….. Lower of 10% TDC or

published policy Corporate affiliate programs ……….. 10% TDC Industry-funded clinical trials** …… 26% TDC

* or as approved by SPA** sponsor-initiated protocols only

New Strategy (Part 2) Waivers No Longer Available for:

Projects that did not receive institutional endorsement prior to submission to Sponsor

F&A waivers or reductions of rates negotiated by PIs with Sponsors

If reduced F&A is needed in these instances, theUnit must set up a cost-sharing account to pay the

difference between the Sponsor-approved rate and the federally negotiated rate or approved minimum

for this type of project.

Potential Reasons to Approve Waivers Seed grants which may attract larger awards Hardship for new PI Awards which include equipment or building funds Community relations or library projects Student services projects (or increase funding to pay for students) Capped awards Department committed to undertake the research regardless of external

funding (e.g, any dollar gained is better than nothing) Small cost Junior faculty or incoming faculty member Enhance cultural/artistic activities (small projects only) Only available source of funds in an area Strategic partnerships

Potential Reasons to Disapprove Waivers

Precedent setting Grounds on which the waiver might be justified to other

faculty whose projects carry full overhead Consistency with similar sponsors or programs Large total cost to the University Any IP rights granted to the sponsor Past history of PI requesting waivers Profit-making entities Foreign entities

New Strategy: Part 3 F&A Waiver Process Improvements

1. Administrative waivers and waivers for small projects (less than $50K) will no longer require use of the formal waiver process

2. SPA has created a list of agencies with pre-approved rates (based on policy); proof of agency policy is no longer required to accompany PRFs when submitting to these entities

3. SPA has new “Foregone F&A calculator” to help Deans and SPA better understand and track foregone amounts

4. Waiver requests must be submitted in advance (4 business days for regular waivers, 7 business days for strategic waivers)

5. CRAD will be updated twice yearly on the amount of F&A waived for regular and strategic waivers Waived amounts will not be tracked for small & administrative waivers

Proposal for New Waiver Strategy RolloutProposed for January 1, 2008 Streamlined waiver approval process implemented Dean’s approval for small waivers implemented SPA endorsement for administrative waivers implemented No waivers granted for proposals submitted without endorsement Reductions for for-profits and foreign governments beyond pre-set

minimum level requires VPR approval Other F&A minimums considered “targets” PIs informed that they may not negotiate F&A rates

Proposed for January 1, 2009 F&A minimum levels for all categories implemented

Questions?

Page 1 CRAD F&A Waiver Process Change November 15, 2007.

Documents

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