In most cases, administrative and clerical costs (including clerical salaries, office supplies, postage, local telephone costs, and memberships) may not be charged as direct costs on federally funded projects.

If, however, a federal sponsored project will require an extensive amount of administrative or clerical support and the project falls within the definitions allowed by A-21, then it may be possible to directly charge these costs to the project. These administrative expenses must be:

1. incurred for the performance of a “major project or activity,”
2. specifically identified and directly benefiting the project,
3. specifically budgeted,
4. approved by the sponsor, and
5. supported by a budget justification.

Find guidance on how to determine whether a Federal project meets the criteria that allows it to be treated as a "Major Project or Activity" and how to proceed in cases where your project is “major”.

Proposal Review

Pre-award offices (OSR, RMG, or ERA) will review proposals to ensure that these procedures are being followed, and they may ask departments or PIs to add additional justification or clarification (or, if not allowable, removal of the costs), before endorsing a federally-sponsored proposal. Under no circumstances may PI judgment be the sole criteria for adding administrative charges to a proposal.

Non-federal projects that do not incorporate OMB A-21 within their terms and conditions may include administrative and clerical costs, provided that such costs are otherwise allowable, reasonable, and allocable to the project being funded. Such costs should be clearly described in the proposal budget and in the budget justification.

Audit

For audit purposes, the department must keep evidence of the time worked on the project, and explanations of how materials or other costs specifically benefited the project being charged.  

Rebudgeting

Departments may not rebudget or charge administrative costs to federal projects other than those specific charges included in the approved budget. If new costs are identified during the course of the award, these must be specifically approved by the funding agency.  Normally, such approvals require the authorization of the grants management official or contracting officer in addition to the program official. To date, NIH is the only sponsor that allows this specific rebudgeting authority.

Resources

The following resources are available to help PIs and departments determine whether a federal project may be considered "major", and how to determine whether a given cost may be charged to a project:

• Cardinal Curriculum "Administrative Charging"
• Administrative Charging Implementation Guidelines
• Flowcharts to guide you through the administrative charging process

If you have any questions, please don't hesitate to contact the OSR Contract and Grant Officer, Research Process Manager, or ERA Research Administrator serving your unit.