PRINCETON UNIVERSITY


To:                Members of the Faculty

Date:             June 30, 2008

From:           Christopher L. Eisgruber, Provost
                    A.J. Stewart Smith, Dean for Research

Subject:        Update: Allocation of 3% increase in federal research overhead rate

Reference:    Memorandum dated February 29, 2008


On February 29, 2008, we made two announcements regarding the University’s federal research overhead rate that will take effect July 1, 2008.  First, the on-campus overhead rate will be adjusted to 61% for the next four fiscal years, FY2009-FY2012, up from 58%.  Second, all incremental revenues generated by this increase will be returned to the research enterprise.  We asked the University Research Board (URB) to determine how best to flow the incremental dollars back to the research enterprise, and it convened an ad hoc subcommittee to make recommendations about how to allocate the dollars among Principal Investigators, Centers, Institutes and Departments.  

This memo reports the URB’s recommendations, which we have adopted.  The principal goal of the ad hoc committee was to ensure that these dollars are distributed in a way that increases the ability of Princeton’s researchers to meet compliance obligations associated with their grants.  The URB unanimously agreed with the subcommittee’s recommendation, as do we.  Pursuant to that recommendation, those funds will be managed as follows:  

The additional 3% of incremental revenue will be returned to faculty investigators to support their research efforts.  More specifically, effective July 1, 2008, on all sponsored projects with an on-campus overhead rate of 61%, the faculty research rebate account will increase from 1% to 4%, and the Departmental research rebate account will remain at 2%; therefore, the total research rebate will be 6%.  For those projects still subject to the previous sponsored project overhead rate of 58%, the total research rebate will remain at its current percentage of 3% (1% to the faculty rebate account and 2% to the Departmental research rebate account).  The research rebate account will continue to be distributed by the Treasurer’s Office with the same procedures already in place.  

We are both available to discuss any general questions or concerns you may have.  To discuss implementation or any concerns related to operational details, please contact Jeffrey Friedland in ORPA or Kate Braunstein in the Treasurer’s Office.

Cc:
Shirley Tilghman
Chris McCrudden
Katherine Rohrer
Jeffrey Friedland
Steven Gill
Rebecca Hunninghake
Academic departmental managers