Dear ORPA News & Communications Subscribers,

Princeton’s Facilities & Administrative (F&A) Rate Agreement governs new/competing awards that started on or after 7/1/2022, as outlined in this communication from August 16, 2022. Please note that the charging of the new 64% F&A/indirect cost rate will begin on 7/1/2024 (FY25) as explained below. Proposals submitted on/after 7/1/2022 have been budgeted accordingly for the rate change. 

The Office of Research and Project Administration (ORPA) and Sponsored Research Accounting (SRA) have worked together, with the help of Finance Technology in the Office of Finance and Treasury, to automate PeopleSoft so there will be no chartstring changes. A project-based report enhancement is in progress to enable the segregation of indirect costs within projects using the Information Warehouse (IW). This enhancement uses an IW prompt titled "Subtotal F&A Rate." Further details about this enhancement will be provided once it becomes available in production prior to 7/1/2024. 

Please note:

• Awards that were proposed, budgeted, and awarded at 62% remain at the proposed rate with no changes for the life of that award. Competing renewals must apply the appropriate indirect cost rate at the proposal stage. 
• Awards that were proposed on/after 7/1/2022, with both indirect cost rate periods incorporated, will begin to apply the 64% rate on all applicable charges beginning 7/1/2024. These awards will have the indirect cost rate of 62% automatically calculated for FY23 & FY24 and then 64% for FY25 & thereafter. 
• Research funding for (1) non-competing continuations, (2) supplemental funding within a funded period and (3) incremental funded awards will include in the budget an amount for indirect costs computed at the indirect cost rates used by the sponsor and University when establishing the recommended funding level for the period.

The Costing Office in Finance & Treasury routinely negotiates a rate agreement with the government to establish our Indirect cost rate, which we are required to use when costing/proposing and charging the government and other sponsored research projects. The new 64% rate is a reflection of significant investments in research facilities/space by the University over the last several years. Indirect cost rate components can be found here.