Direct or F&A Costs?

There are two categories of expenses which may be either direct or F&A costs depending upon the anticipated use of the items or work of the staff to be charged to the sponsor. If either of these types of expenses are included in a proposal budget as a direct cost, they require a detailed justification.

If awarded by the federal government (or a federal flow-through award from another organization), inclusion of these costs will require the department to submit either one or both of the following forms: Direct Cost Exception Form I: Administrative and Clerical Expenses Salaries or Direct Cost Exception Form II: Non-Labor Direct Costs

Administrative and Clerical Salaries

Federal regulations state that clerical and administrative salaries should generally be treated as an indirect cost, but allows that it may be appropriate to charge them as direct costs if certain general criteria are met. The charges in questions must be easily and clearly identified with a specific project in order to be treated as direct costs. Federal awards may not be used to support a secretarial pool providing routine services for an academic department.

The following list illustrates circumstances under which charging administrative and clerical salaries may be appropriate:

• * Large, complex programs, such as primate centers, program projects, engineering research centers, and other grants and contracts that entail assembling and managing teams of investigators from a number of institutions.
• * Projects that involve extensive data accumulation, analysis and entry, surveying, tabulation, cataloging, searching literature, and reporting, such as epidemiological studies, clinical trials, and retrospective clinical records studies.
• * Projects that require making travel and meeting arrangements for a large number of participants, such as conferences and seminars.
• * Projects where the principal focus is the preparation of manuals and large reports, books and monographs (excluding routine progress and technical reports).
• * Projects that are geographically inaccessible to normal departmental administrative services, such as seagoing research vessels, radio astronomy projects, and other research field sites that are remote from campus.
• * Individual projects requiring significant amounts of project-specific database management; individualized graphics or manuscript preparation; animal or human protocol, IRB preparations and/or other project-specific regulatory protocols; and multiple project-related investigator coordination and communication.

While federal agencies provide no specific guidelines regarding an acceptable level of effort of administrative and clerical personnel, it is clear that the level should be large enough to be identified with the project and large enough to be considered substantial. It would be difficult to justify a level of effort of less than 10-15%.

These restrictions do not apply to salaries for technical personnel, graduate students, postdoctoral associates or senior programmatic personnel.

General Purpose Supplies, Equipment & Local Telephone Services

The University is to provide general office and data processing equipment and supplies to its faculty and staff. Only supplies and equipment which will be used primarily or exclusively for grant activities can be considered a direct cost and the expense must be clearly justified.

Local telephone service is a departmental administrative cost, however, if a phone or line can be identified exclusively with a project and will only be used for research or project activities, permission may be secured to charge the line as a direct cost. Examples of services which would meet the criteria are:

• * a modem used for twenty-four hour collection of seismic data from around the country
• * a hot-line reserved for callers
• * special phone service required by a sponsor such as the ship-to-shore lines on the NSF-owned research vessels operated by Duke's Marine Lab.

By contrast, providing a phone for a new member of a research staff is an expense which the university should cover with revenue from its F&A cost recoveries.