Indirect costs (F&A)

Indirect costs, also called facilities and administrative (F&A) costs, are a research institution's shared costs, such as buildings, utilities, and administration that can't be charged to one project, and they're recovered at the institution's federally negotiated rate.

How it works in a university-industry collaboration

A university's subaward budget adds indirect costs to direct costs such as salaries. On a grant, the agency's terms usually apply the Uniform Guidance (NSF's solicitation, for example, requires pass-through entities to follow 2 CFR 200.332), which requires the pass-through entity, here the small business, to use the subrecipient's federally negotiated rate where it has one, and bars it from requiring the de minimis rate instead (2 CFR 200.332(b)(4)). Contracts follow the Federal Acquisition Regulation.

Indirect costs count inside the award. NSF's Phase I, for example, is up to $305,000, inclusive of indirect costs, fee, and TABA (NSF 26-510). If your agency measures the work split by dollars, agree which costs count on the university's side (SBA Policy Directive).

Why can't the professor waive it?

The rate belongs to the institution, not the lab. The university negotiates it with the federal government, and its sponsored programs office signs the subaward. The institution can choose to charge less, and some universities, or schools within them, have published reduced or waived Phase I SBIR and STTR rates.

Translation Box: indirect costs

On the academic side: F&A, a negotiated rate that recovers the facilities and administration costs their research depends on.

On the industry side: overhead, often read as a negotiable markup on the professor's budget.

In this glossary: the academic meaning. On a federal grant, the rate is usually fixed by a prior negotiation with the government before you ask.

What Helikon does with it

On the Helikon platform, set up a project with the SBIR/STTR agreement type, your specific aims, and a budget. You can track your SBIR/STTR proposals and project execution by creating timelines, milestones, file and contract sharing, and discussion threads, and invite your collaborators to a shared workspace.