Implementation Guidance of the New Indirect (F&A) Cost Rates
Senior Vice Chancellor for Research and Innovation and Dean of Institutes, Massimo Ruzzene, and Senior Vice Chancellor for Business, Finance and Infrastructure, Todd Haggerty, announced that 麻豆免费版下载Boulder has a new federal negotiated Indirect (Facilities and Administrative (F&A)) Cost Rate Agreement between 麻豆免费版下载Boulder and the U.S. Department of Health and Human Services (DHHS). This agreement was successfully negotiated with new rates through fiscal year 2028 and is based on 麻豆免费版下载Boulder鈥檚 proposal submitted to DHHS from fiscal year 2022 data. The negotiation process followed the regular requirements of the 2 CFR 200 Uniform Guidance, Appendix III Indirect (F&A) Costs Identification and Assignment, and Rate Determination for Institutions of Higher Education (IHEs). Read the memorandum.
Implementation of the new rates will follow 麻豆免费版下载Boulder鈥檚 Indirect Cost (F&A) Recovery Policy and the Application of Indirect Cost (F&A) on Sponsored Projects Procedural Statement. These documents are being updated to reflect new rates approved by DHHS for Department of Defense contracts and new thresholds for capital equipment and subawards. Following is initial guidance on implementation of IDC and fringe benefit rates.
Implementation of the New Indirect (F&A) Cost Rates
Existing Proposals
Proposals submitted by OCG prior to December 9, 2025 will carry the indirect (F&A) cost rate and MTDC base that was originally proposed, should they result in an award.
New Proposals
For proposals with Proposal Submission Request (PSR) forms received on or after December 9, 2025, proposal budgets must use the new indirect (F&A) cost rate.
Under the new rate agreement:
- 麻豆免费版下载Boulder has an 鈥渦ncapped鈥 Department of Defense (DOD) rate, which applies to DOD contracts. The rate is 鈥渦ncapped鈥 in accordance with DFARS 2231.303, which allows institutions of higher education to be reimbursed for full allowable costs, overriding the limit of 26% for the administrative portion of Facilities and Administrative (F&A) costs imposed by 2 CFR 200 Uniform Guidance (Appendix III. C.8.a.); and
- Capital equipment thresholds differ depending on award mechanism, contract or non-contract (see Capital Equipment below).
Proposal Analysts will make the best determination possible at proposal to determine applicable indirect (F&A) cost rate and capital equipment threshold.
Existing Awards
Grants, contracts and other agreements currently in effect will continue with the indirect (F&A) cost rate and MTDC base originally proposed for the duration of the award.
New Awards
New awards proposed prior to December 9, 2025 will carry the indirect (F&A) cost rate and MTDC base stipulated in the approved proposal and award agreement from the initial budget period through the project period awarded. For example, an award for a three-year grant based on a three-year proposal will carry the rate in the approved proposal for all three years, unless the sponsor issues an award using the new rate agreement. Subsequent competitive renewals or continuation periods will be assessed the new rate and MTDC base in effect at that time.
New awards proposed after December 9, 2025 will carry the new indirect (F&A) cost rate and MTDC base in effect at time of proposal.
Subagreements
As stated above, the threshold for charging IDC on subagreements will be based on the rate agreement used for the original proposal.
- Current awards under the old (pre-2025) rate agreement will carry indirect (F&A) costs on the first $25,000 of a subaward.
- New awards made under the 2025 rate agreement will carry indirect (F&A) costs on the first $50,000 of a subagreement.
- Subagreements added during the course of an award will carry indirect (F&A) costs according to the rate agreement in effect at time of proposal.
Capital Equipment
Capital equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and per-unit acquisition cost, which equals or exceeds:
- For all awards, including federal contracts, beginning 6/30/2025 and earlier, $5,000
- For all awards except federal contracts beginning 7/1/2025 and later, $10,000
- For all federal contract awards after 7/1/2025, $5,000
Implementation of New FY 2026 Fringe Benefit Rates
On December 8, 2025, 麻豆免费版下载Boulder鈥檚 proposed fringe benefit rates were approved effective July 1, 2025 (see Federally-negotiated Indirect Cost Rate Agreement, 搁补迟别蝉听and Rate History).
Proposals
For proposals with Proposal Submission Request (PSR) forms received on or after December 9, 2025, proposal budgets must use the new fringe benefit rates.
Awards
All current awards must use the new fringe benefit rates with effective date of July 1, 2025. During December 2025 month end close, the fringe benefit rates will be updated in the finance system, and an adjustment will be recorded to update the July through November 2025 fringe benefit expense from the provisional rates (FY25 approved rates) to the FY26 proposed and approved rates.
For awards that closed during the provisional rate period, Research Financial Services (RFS) will investigate and determine whether these additional fringe benefit expenses can be invoiced to sponsors. Any amounts that cannot be invoiced on ended awards will be funded by central campus.
Determining which Rate Agreement and Thresholds Apply to an Award
The rate agreement that applies to an award can be determined by looking at the indirect (F&A) rate type indicated in PeopleSoft.
- Awards issued under the new rate agreement will have the indirect (F&A) rate with a FY26 indicator. For example, On Campus Research rate will have abbreviation of 鈥26RES鈥 and description of 鈥淔Y-26 Research On-Campus.鈥 New indirect (F&A) rate types appear as:
| FA Rate ID | Description |
| 26DOD | FY-26 DOD |
| 26INS | FY-26 Instruction On-Campus |
| 26IPA | FY-26 IPA |
| 26LSP | FY-26 LASP |
| 26OFC | FY-26 Research Off-Campus |
| 26OTH | FY-26 Other Sponsored Activities |
| 26RES | FY-26 Research On-Campus |
- Previous indirect (F&A) rate types will continue to be used on all awards that were proposed under the previous indirect (F&A) cost rate agreement. Previous indirect (F&A) rate types appear as:
| IPA | Off Campus - IPA |
| OFC | Off Campus |
| OFINS | Off Campus - Instruction |
| OFOTH | Off Campus Other |
| ONC | On Campus |
| ONINS | On Campus - Instructional |
| ONLSP | On Campus - LASP |
| ONOTH | On Campus Other |
| ONRES | On Campus - Research |
- For awards with capital equipment that falls under the new threshold ($10,000), budget account codes are 鈥810001 鈥 Fixed Assets $10K Threshold.鈥
- For awards issued under FAR and/or under the previous indirect (F&A) cost rate agreement with the lower threshold ($5,000) for capital equipment, the current budget account code 鈥810000 鈥 Fixed Assets General Budget鈥 is used.
- For awards with subagreements carrying indirect (F&A) costs on the new $50,000 threshold, the new account codes are:
Applicable thresholds for subagreements and capital equipment can be distinguished by the budget account codes for these cost items.
- 492502 -- SUBCONTRACT $50K threshold BUDGET
- 492602 -- SUBCONTRACT 0 - 1ST $50000
- 492603 -- SUBCONTRACT 0 - > $50000
Office of Contracts and Grants (OCG) Budget Templates
The Office of Contracts and Grants (OCG) posted updated budget templates incorporating changes from the new negotiated rate agreement. Budget templates can be found on OCG鈥檚 Forms page.
Questions
- Proposals: If you have questions regarding proposal budget preparation and implementation of the new rates for proposals, contact your department鈥檚 OCG Proposal Analyst.
- Awards: If you have questions about current awards and changes in the finance system related to the new negotiated rate agreement, contact the RFS Grant Accountants.