Research Cost Recovery

Category: Research
Number: RCH-030-005
Audience: All University employees and external research sponsors
Issued: October 02, 2006
Revised: March 31, 2015
Owner(s): VP (Research)
Approved by: Board of Governors
Contact: Director of Research Office - 306-585-4775

Introduction

This policy sets out the authority, responsibility and procedures for the recovery of all costs related to externally sponsored research projects at the University.

Policy

A 2013 study by the Canadian Association of University Business Officers (CAUBO) and the Canadian Association of University Research Administrators (CAURA) concluded that universities incur indirect costs at a rate of 40-60% of the direct costs of research.

Research is one of the three fundamental pillars of the University, along with teaching and public service. The University undertakes research and scholarship to expand human knowledge and support social, environmental, and economic development. The intent of this policy is to support research by providing some relief to the 40-60% of real costs by moving to a lesser but reasonable and competitive Indirect Cost Recovery Rate (ICRR).

Indirect Cost Recovery Rate

  • All research funding agreements must include an allowance for the University Indirect Cost Recovery Rate at a minimum rate of 25% of direct costs. Wherever possible, the ICRR should be incorporated into each line item, and not displayed separately.

The ICRR rate shall not apply to:

  • Tri-Council grants, as these funding agencies have made alternative arrangements with the University to reimburse its indirect costs not including the matching portion of partnership programs where a partner commits a cash contribution to the research; and
  • Sponsors that have specific published indirect costs rates that are applied to all Canadian universities.

Indirect Cost Distribution

  • The indirect costs recovered pursuant to this policy will be distributed as follows:
    • Office of the Vice-President (Research) – 50%
    • Principal Investigator’s Faculty/Research Centre or Institute – 50%

If more than one Faculty is involved in a research project, the Faculty portion of the indirect costs recovered will be shared in proportion to the proposed allocation of work.

A Faculty/Research Centre or Institute may choose to allocate a portion of its percentage of the indirect costs recovered to the Principal Investigator or other researchers on the project.

The Vice-President (Research), Faculties, and Research Centres or Institutes will regularly report on the use of indirect costs recovered.

Roles and Responsibilities

Individual Researchers

  • Individuals who are seeking external research funding must include the applicable indirect cost recovery in cost estimates for the proposed project.

Research Office

  • The Research Office will serve as the procedural office for this policy.

Vice-President (Research)

  • The Vice-President (Research) will oversee this policy and be will the final arbiter for ICRR exceptions.

Consequences for Noncompliance

If a faculty member negotiates an agreement with an ICRR less than 25% without the reduced rate having been approved by the Research Cost Recovery Review Committee, the University may withhold support and approval of any future research funding agreement with that faculty member named as Principal Investigator. Other administrative sanctions may be imposed, as appropriate. These sanctions could include the faculty member being required to personally reimburse the University for the amount of the overhead shortfall and being subject to disciplinary action per the Collective Agreement.

Processes

Applying the Indirect Cost Recovery Rate

  • For any externally funded research activity, researchers must include the applicable indirect cost recovery rate in the project’s cost estimate.

For all funding applications and agreements, researchers must provide the proposal and budget to the Research Office for review.  If all requirements of the University and the sponsor are met, including the recovery of indirect costs, the Research Office will provide the institutional signature(s) required on the funding application or the finalized contract.  In addition, the Research Office is responsible for the negotiation of terms of the agreement with the sponsor.

The Research Office submits a request to Financial Services to create a new research account or to allocate the funds to an existing account. The request will include the applicable distribution of the indirect costs recovered.

Exceptions to the minimum indirect cost rate may be considered for unusually favourable terms.  Considerations may include, but are not limited to, ownership of equipment, overall support or high volume of research funding from sponsor, high level of student training, competitive pricing compared with other research institutions.

Requesting an Exception to Indirect Cost Recovery Rate

All exceptions require prior written approval from the Vice-President (Research).  An “Exceptions to Research Cost Recovery” form must first be completed and signed by the Principal Investigator, with accompanying signatures by the Dean or Director, and submitted to the Vice-President (Research).  The Vice-President (Research) will then request that a standing Research Cost Recovery Review Committee review the waiver request with the intent to make recommendations to the Vice-President (Research).  The standing committee will consist of the Council Committee on Research Chair, the Associate Vice-President (Finance), and the Associate Vice-President (Academic and Research).

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