All federal awards issued on or after December 26, 2014 must comply with OMB 2 CFR Part 200 (also known as Uniform Guidance). Awards issued prior to that date must comply with OMB Circulars A-21 and A-110, but may incorporate elements of the Uniform Guidance when appropriate. If an agency issues a new funding increment under Uniform Guidance to an existing award, then all activity incurred on or after December 26, 2014 will also be subject to Uniform Guidance. Activity incurred prior to this date will continue to be subject to OMB Circulars A-21 and A-110.

For the purposes of this policy, please note a general reference to "federal regulations" is being used, in lieu of specific references to each of the following CFRs: 2CFR Part 200 (Uniform Guidance), 2 CFR Part 215 (Circular A-21) and 2 CFR Part 220 (Circular A-110). Please read the Notice of Award and the agency's terms and conditions regarding the applicability of these federal regulations.

Direct Charging Administrative or Clerical Salaries and Other Departmental Expenses

The direct charging of administrative or clerical salaries may be appropriate where the nature of the work performed under a particular award requires an extensive amount of administrative or clerical support which is significantly greater than the routine level of such services provided by the academic department.

The requirements for direct charging administrative or clerical salaries to federal awards will differ depending upon which federal regulation is in effect for a particular award (i.e. OMB A-21 or Uniform Guidance). 

Requirements Under OMB Circular A-21

On July 13, 1994, OMB issued an interpretation of Circular A-21, Section F.6.b that states:

“...direct charging of these costs may be appropriate where the nature of the work performed under a particular project requires an extensive amount of administrative or clerical support which is significantly greater than the routine level of such services provided by academic departments. The costs would need to meet the general criteria for direct charging in section D.1. -- i.e., be identified specifically with a particular sponsored project relatively easily with a high degree of accuracy, and the special circumstances requiring direct charging of the services would need to be justified to the satisfaction of the awarding agency in the grant application or contract proposal.”

OMB Circular A-21 Exhibit C provides examples of circumstances where the direct charging of salaries of administrative or clerical staff may be appropriate. They are as follows:

• Large complex programs, such as general clinical research centers, primate centers, program projects, environmental research centers, engineering research centers, and other grants and contracts that entail assembling and managing teams of investigators from a number of institutions.
• Projects which 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 large numbers of participants, such as conferences and seminars.
• Projects whose principal focus is the preparation and production 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 research vessels, radio astronomy projects, and other research field sites that are remote from campus.
• Individual projects requiring project-specific database management; individualized graphics or manuscript preparation; human or animal protocols; and multiple project-related investigator coordination and communications.

These examples are not exhaustive nor are they intended to imply that direct charging of administrative or clerical salaries would always be appropriate for the situations illustrated in the examples.

Federal regulations require that costs incurred for the same purpose in like circumstances must be treated consistently as either a direct or F&A cost. PIs and department administrators must exercise caution in applying the guidelines contained in this policy.

Requirements Under OMB Uniform Guidance (2CFR Part 200.413)

The Uniform Guidance eliminates the major project criteria from A-21 for the direct charging of administrative and clerical salaries, and now requires adherence to the all of the following conditions in order to direct charge these costs:

1. Administrative or clerical services are integral to a project or activity;
2. Individuals involved can be specifically identified with the project or activity;
3. Such costs are explicitly included in the budget or have the prior written approval of the Federal awarding agency;
4. The costs are not also recovered as indirect costs.

Direct Charging Computers

The Uniform Guidance classifies computing devices under $5,000 per unit as supplies that can be treated as direct costs if essential and allocable, but not solely dedicated to the performance of a Federal award (2CFR Part 200.453).

The following OMB guidance should be used for determining allocability when computing devices will benefit two or more chartstrings: (ex. a sponsored project and an instructional activity)

Direct Cost Allocation Principles

If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost must be allocated to the projects based on the proportional benefit.   If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefited projects on any reasonable documented basis.

1. Proportional Benefit Allocation: An example of a proportional benefit allocation may be a computing device that is purchased specifically for two projects. The computing device will be used 40% for Project A and 60% for Project B. Therefore, 40% of the cost is allocated and directly charged to Project A, and 60% of the cost is allocated and directly charged to Project B.
2. Reasonable Basis Allocation: Examples of any reasonable basis allocation methods may include some common characteristics such as head count, square feet, or other criteria that can be used as a basis for determining how to allocate the cost across the benefitted chartstrings.

Documentation that supports how costs for computing devices were allocated should be retained by the department.