F & A Distribution Change
The University of Cincinnati has seen a significant decline in Facilities and Administrative (F & A) revenue from sponsored activity; along with a significant increase in the cost of doing research over the past years due to increased compliance and federal regulations. This decline is, of course, reversible as we find new and innovative ways to increase external funding for research at UC which carries with it F & A support. For now, however, the result is a decrease in funding available to Research Support Units despite a significant decrease in both workforce (-30%) and cost (-24%) within the Units.
After discussion with the President’s Executive Committee, the Council of Deans and the Fiscal Coordinating Committee the university will realign the distribution of F & A revenue to sustain our research infrastructure centrally and within affected colleges. The effort is to have sustainability in essential support, even in periods of decline in the future. To this end, the Office of Research’s approved budget will no longer be at a percentage of F & A, but rather will become a fixed budget through an annual budget process. There will be no change in the percentage of funds allocated to general funds or research cost share. The remainder of the revenue will be distributed to the appropriate college to be used to support research infrastructure in that college.
A fixed annual budget holds the Office of Research accountable to provide needed services to the university community and NOT accumulate additional funds through F&A allocation based on a percentage as was possible in prior years. Rather the Office of Research will maintain services under a fixed annual approved budget and will not share in any increased F & A revenue as the university increases its research funding in the future. In contrast, the college’s return of F & A will increase as the college increases its research funding. Please see attached example.
The attached policy change codifies the F & A Distribution policy, articulates how to apply UC’s federal negotiated F & A rates and provides guidance on the use of F & A recovery funds.
Summary of changes to the F & A Cost: Application, Distribution and Use include the following:
F & A Distribution Policy 7115 Distribution example FY16 projection
- Current policy distribution is:
- General Funds 52%
- Research Support 21%
- Research Cost Share 1.5%
- Deans 3.5%
- Departments 22%
- New policy distribution is:
- Research Support, annual approved budget to be funded (FY16 approved budget is $6.8 M)
- General Funds, 52% of total F & A revenue
- Research Cost Share, 1.5% of the remainder of F & A revenue
- College receives remaining F & A revenue