Stanford Rates - Implementing Infrastructure

Implementing Infrastructure
Implementing the Revised Infrastructure Charge (ISC) Policy

August 31, 2005

The Board of Trustees of Stanford University approved a revised infrastructure policy in October 2004.The revised policy, effective September 1, 2005, increases the infrastructure charge from 6% to 8% for both new and existing funds. For designated funds, the infrastructure charge will be applied at the time funds are received from all external revenue sources. For restricted funds (expendable gift funds, endowment income funds and sponsored project funds that carry an F&A rate of 0%), the infrastructure charge will be applied at the time funds are expended or transferred.

Gifts for building projects are waived from the infrastructure charges. Gifts of donated capital equipment are waived from infrastructure. However, restricted funds used to purchase capital equipment will be assessed ISC.

The infrastructure charge collected from non formula schools will be credited 75% to a central university PFOO (controlled by the budget office) and 25% to a central PFOO owned by the budget unit involved in the transaction. The infrastructure charge collected from formula schools and auxiliaries will be credited directly to a central PFOO belonging to the formula school or auxiliary.

Any exceptions to the policy require approval of both the Provost and the CFO and are to occur rarely, if at all.

This guide provides additional detail implementing Administrative Guide Memo 37.3 Infrastructure Charges .

Infrastructure Charge

Awards are subject to the revised infrastructure policy as follows (see additional guidelines concerning sponsored projects below):

Designated funds are assessed the infrastructure charge on revenue in General Ledger codes 43xxx, 44xxx and 46xxx. The charge will appear on the fund statement only in General Ledger codes 48990 or 48992.
Expendable gift and endowment income funds are assessed the infrastructure charge on expenditures and fund transfers including transfers to operating budgets and designated funds. The charge on expenditures will appear in expenditure types 58915 or 58935 on the expenditure statement. The charge on fund transfers will appear in General Ledger codes 49710 or 49720 on the fund statement only.

Expendable gift and endowment income funds marked "Donor Exempt" prior to September 1, 2005 are waived from infrastructure. All other expendable gift and endowment income funds are subject to the revised infrastructure policy.
Non-government and foreign government sponsored project awards are assessed the infrastructure charge on expenditures. The charge on expenditures will appear in expenditure types 58915 or 58935.
Operating budgets, budget pools, service centers, auxiliaries, miscellaneous receivables, reserves, pending funds, U.S. government sponsored projects, University Research, plant, student loans, agency and living trust funds/awards and Stanford Linear Accelerator Center (SLAC) organization codes AHYA, AHZA, AHZH and AHZO are waived from infrastructure by the revised policy.
The utility charge is discontinued.

The following schedules define the revised infrastructure process in detail:

The schedule APPLICATION OF REVISED INFRASTRUCTURE (ISC) POLICY BY AWARD TYPE AND PURPOSE defines the categories of awards subject to the revised policy and the infrastructure charge they are assessed.
The schedule APPLICATION OF REVISED INFRASTRUCTURE POLICY TO FUND TRANSFERS defines the types of fund transfers that are assessed the infrastructure charge.
The schedule FUND TRANSFERS AND INFRASTRUCTURE defines the fund transfer General Ledger codes subject to the infrastructure charge.
Example – Fund Transfer and Infrastructure – An example of a fund transfer from a gift to an operating budget.
The schedule BURDEN EXPENDITURE TYPE MAPPING SCHEDULE defines the expenditure types subject to the infrastructure charge. The new ISC charge is applied to most expenditure types.
The schedule INFRASTRUCTURE CHARGE EXPENDITURE TYPES/GENERAL LEDGER CODES defines the expenditure types and general ledger codes where the infrastructure assessment will appear.

Infrastructure Exemptions and Waivers

Any exceptions to the revised ISC Policy require approval of both the Provost and CFO and are to occur rarely, if at all. If the source of funds, typically a donor or sponsor, will not pay the infrastructure charge, the department or office may request to pay the charge themselves by applying to the Budget Office for permission to use an alternate PTA (project/task/award). Departments must use the "Request for Infrastructure Exemption" form. The alternate source of funds must be able to support an expense of this nature. Designated, endowment income or expendable funds may be used. Sponsored projects may not be used. See additional guidelines concerning sponsored projects and exemptions below. If the exemption is not granted by the Provost and the Chief Financial Officer, the funds must be refused.

Any questions about requesting a waiver to the revised ISC Policy should be directed to Dana Shelley in the Budget Office at ext 5-1256.

A waiver of F&A (indirect costs) granted by the Dean of Research does not waive infrastructure.

Infrastructure and Sponsored Projects

The revised Infrastructure Charge Policy applies to sponsored project awards assessed an F&A rate of 0%. Awards with F& A rates between 0% and 8% are not charged infrastructure but instead are charged their negotiated F&A rates.

However, all sponsored projects awards with award start dates prior to 9/01/05 and awards made in response to previously-submitted sponsored projects proposals will continue to be subject to the prior ISC policy until the end of their competitive segment. The prior ISC implementation guide can be found at Implementing the Infrastructure Charge (ISC) Policy dated May 11, 1998. At the time these projects are renewed, funding must be requested using the revised ISC guidelines.

Sponsored project awards are subject to the revised Infrastructure Charge Policy as follows:

The infrastructure charge is waived on all U.S. government - funded sponsored project awards. This includes awards directly funded by a federal, state or local governmental agency and awards that are funded on a “flow-through” basis using government monies.
The infrastructure charge is automatically exempted (e.g., an alternate PTA is provided by the PI/department to pay the ISC charge) on all non-government sponsored project awards where the sponsor has a written policy stating that it does not pay indirect costs, and the sponsor/program is on the Office of Sponsored Research’s (OSR’s) pre-approved IDC Waiver List for sponsors who pay zero IDC.
Effective 9/1/05, if a sponsor/program is not waived or exempted under the rules listed above, the PI/administering department must include the infrastructure charge in their proposal/budget request to the sponsor. Institutional officials are responsible for reviewing proposals to make sure that the charge has been included, prior to endorsing the proposal on behalf of Stanford, or that an approved “exemption” (see below) is on file.
If a sponsor/program is not on the automatic exemption list outlined above, the department may request to pay the infrastructure via an alternate PTA by submitting a "Request for Infrastructure Exemption" form to the Provost Office. Exemptions must be approved in advance of submission of a proposal.
Unobligated funds remaining at the expiration of a fixed price sponsored project that are transferred to a departmental PTA on or after September 1, 1999, are not subject to the infrastructure charge provided the funds were assessed an F&A rate of 8% or greater. These funds are transferred to a departmental PTA, less the facilities and administrative costs (formerly referred to as indirect costs) that would have been assessed on additional project expenditures.
Institutional allowances associated with fellowships are exempt from infrastructure. Best practices recommend the institutional allowance should be spent on the sponsored award. However, the schools and departments may transfer the allowance to an existing PTA where the expenditure will not be assessed infrastructure. Please contact your OSR representative for additional guidance.

For questions about infrastructure charge policy, exemptions or waivers, contact Dana Shelley . For questions related to sponsored projects please contact your OSR representative or (650) 723-2883 in the Office of Sponsored Research. For all other inquiries, please call your Fund Accounting representative or Jean DeMartini, Manager Fund Accounting at (650) 723-3013 in the Controller's Office.