F&A Waiver Requests

The University seeks to recover all Facilities & Administrative (F&A) allowed by the sponsor per Montana University System Board of Regent Policy 404 – Indirect Cost Recovery Rate.  

The University of Montana's applies its full negotiated F&A rate (also known as indirect cost) to all externally-sponsored projects. The fiscal management of sponsored projects, including the application of appropriate F&A in proposed project budgets and management of awarded projects within budget and funding limitations, is the responsibility of the Principal Investigator (PI).

In certain circumstances, the Vice President for Research may consider full or partial waivers of the Facilities & Administrative costs normally incurred by sponsored projects. However, such waivers are seldom approved if the sponsor is a: 

• U.S. government agency that allows F&A;
• for-profit organization, either U.S. or international;
• U.S.-based non-profit foundation that does not explicitly limit F&A as a matter of policy; or, 
• an office or agency of a foreign government, including organizations funded by that government.

Pre-Approved Exceptions

Some programs or sponsors are pre-approved for a waiver of a portion or all of the normal F&A cost recovery. In most cases, these programs or sponsors require such a waiver as a condition of the award.

UM recognizes that many non-profit foundations have their own policies regarding the use of their funds for overhead expenses. In cases where such entities have an official written and publicly disclosed policy that is applied on a consistent basis, or where a public solicitation for proposals defines a limit on indirect cost recovery as a condition of the program, UM will normally accept those requirements. Documentation of the entity's policy statement or program solicitation must be submitted as an attachment to the ORSP Checklist for Proposal Approval as part of the completed proposal package.

Note: If UM agrees to accept a reduced F&A cost rate based on an understanding of the sponsor's policy, and later becomes aware of a higher indirect cost rate paid by that sponsor to another recipient, UM reserves the right to apply the higher rate to that sponsor's projects.

Keep the following in mind when preparing a proposal to a non-profit foundation:

• For some foundations, UM requires clearance through the UM Foundation prior to submission of any proposal. Contact a member of your departmentally-assigned ORSP team for assistance.
• In the case of foundations based outside of the United States, or those established as an arm of a for-profit organization, F&A waivers will not be pre-approved; such requests will be considered only on a case-by-case basis (see below). In these cases, care must be taken to determine the non-profit status of the sponsor, and the PI should confer with ORSP in advance to determine the applicability of F&A.
• F&A costs will not normally be waived solely because a foundation has expressed a desire to limit the use of its funds for a particular award to UM. Unless the program solicitation includes such a limitation for all recipients, or the foundation has an official written and publicly disclosed policy, a waiver will not be pre-approved. In such cases, a case-by-case waiver may be requested.

Case-by-Case Exceptions

The Vice President for Research may occasionally consider waiver requests.  Submit such requests via the F&A Cost Waiver Request form.  

Initiated by the PI, such requests must be approved by the PI's chair/director and dean prior to routing to the Vice President for Research (VPR). Approval of such requests is at the sole discretion of the VPR who may take into consideration:

• the equity of granting the waiver when the projects of other faculty carry full overhead;
• the total cost to UM;
• the likelihood that an award would be seriously jeopardized without a waiver, and the potential effect of the loss on the faculty member's overall research program;
• the benefit of the waiver to new or junior faculty members or in support of research efforts in new directions which otherwise might not be sufficiently developed to attract typical peer-reviewed awards;
• the effect of a waiver to increase direct costs available for student support.