Understanding Indirect Costs
Indirect costs, often referred to as Facilities and Administrative (F&A) costs or overhead, support the infrastructure necessary to conduct research and creative activities at UNO. These costs cover essential expenses such as building maintenance, utilities, IT support, administrative services, and research compliance.
Unlike direct costs, which are easily tied to a single project (e.g., salaries, supplies, or travel), indirect costs support multiple projects and activities across the university.
To recover these costs, UNO applies its federally negotiated indirect cost rate to all federally funded projects, whether UNO is the prime recipient or a sub-recipient of the funds. Additionally, the same negotiated rate applies to projects funded by business, industry, and foundation partners.
The appropriate indirect cost rate for each project is determined in coordination with the Principal Investigator (PI) and the Office of Sponsored Programs (OSP), with OSP making the final determination to ensure compliance with sponsor guidelines, university policies, and federal regulations under Uniform Guidance (2 CFR Part 200).
UNO's Current Indirect Cost Rates
| Indirect Cost Rate Category | Rate | Description (follows Uniform Guidance Appendix III to Part 200) |
| Instruction | 48.50% |
Instruction means the teaching and training activities of an institution. Except for research training as provided in subsection b, this term includes all teaching and training activities, whether they are offered for credits toward a degree or certificate or on a non-credit basis, and whether they are offered through regular academic departments or separate divisions, such as a summer school division or an extension division. Also considered part of this major function are departmental research, and, where agreed to, university research. (1) Sponsored instruction and training mean specific instructional or training activity established by grant, contract, or cooperative agreement. For purposes of the cost principles, this activity may be considered a major function even though an institution's accounting treatment may include it in the instruction function. |
| Organized Research | 48.50% |
Organized Research means all research and development activities of an institution that are separately budgeted and accounted for. It includes: (1) Sponsored research means all research and development activities that are sponsored by Federal and non-Federal agencies and organizations. This term includes activities involving the training of individuals in research techniques (commonly called research training) where such activities utilize the same facilities as other research and development activities and where such activities are not included in the instruction function. |
| Other Sponsored Activities | 34.00% |
Other sponsored activities mean programs and projects financed by Federal and non-Federal agencies and organizations which involve the performance of work other than instruction and organized research. (1) Examples of such programs and projects are health service projects and community service programs. |
| Off-Campus | 26.00% | Off-Campus means at least 50% of activities are conducted in space, buildings, or property that is not owned by UNO, and the facility-related costs (rent, utilities, & other maintenance) are either directly charged to the project or occur without a cost to the university. |
UNO’s indirect cost rates are federally negotiated with the Department of Health and Human Services (DHHS) and follow federal regulations under Uniform Guidance (2 CFR Part 200). To view the official agreement, see the UNO Indirect Cost Rate Agreement.
Carnegie Community Engagement Rate (26.00%) (Internally Determined)
This rate applies to sponsored projects funded by local government or non-profit agencies within the Omaha Metro Area. Unlike UNO’s federally negotiated rates, the Carnegie Community Engagement Rate is an internal UNO decision to align with the university’s strategic mission. To qualify, projects must meet specific criteria regarding the sponsor type and location.
Need More Information? Visit the Indirect Costs FAQ
Understanding indirect costs is essential for properly budgeting sponsored projects. To help faculty and staff navigate UNO’s indirect cost policies, we’ve created a comprehensive FAQ covering:
- How indirect costs support research and creative activities.
- How UNO’s rates are determined and applied.
- What to do if a sponsor has restrictions on indirect costs.
- How to know which rate applies to your project.
- Expectations for non-federal sponsors, including industry and foundation partners.
💡 For detailed answers to these and other common questions, visit our Indirect Costs FAQ.