200 CFR Part 400
Determining Allowability of Costs
UNALLOWABLE
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Advisory Councils (§200.422)
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Unless authorized by statute, the Federal awarding agency, or as an indirect cost where allocable to Federal awards
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Alcoholic Beverages (§200.423)
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Alumni/ae Activities (§200.424)
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Bad Debts (§200.426)
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Including losses arising from uncollectible accounts and other claims and related collections costs, and related legal costs, arising from bad
debts after they have been determined to be uncollectable
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Commencement and Convocation Costs (§200.429)
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Contributions and Donations (§200.434)
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Defense and Prosecution of Criminal and Civil Proceedings, Claims, Appeals, and Patent Infringements (§200.435)
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Unless the costs are reasonable and necessary in relation to the administration of a Federal award and activities required to deal with the
proceeding and underlying cause of action
Entertainment Costs (§200.438)
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Including cash, property, and services
Including amusement, diversion, and social activities
Fines, Penalties, Damages, and Other Settlement (§200.441)
Fundraising and Investment Management Costs (§200.442)
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Unless the costs are related to physical custody and control of monies and securities
UNALLOWABLE
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Goods or Services for Personal Use (§200.445)
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Idle Facilities and Idle Capacity (§200.446)
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Unless necessary to meet fluctuations in workload or were necessary when acquired and now idle due to program requirements (must not
exceed one year)
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Organization Costs (§200.455)
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Selling and Marketing Costs (§200.467)
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Student Activity Cost (§200.469)
Advertising and Public Relations (§200.421)
Allowable only for:
• Recruitment of personnel required for performance of a Federal award
• Procurement of goods and services for the performance of a Federal award
• Disposal of scrap or surplus materials acquired in the performance of a
Federal award (unless reimbursed for disposal)
• Costs specifically required by the Federal award
• Costs of communicating with the public and press pertaining to specific
activities or accomplishments which result from performance of the Federal
award
• Costs of conducting general liaison with news media and government public
relations officers necessary to keep the public informed on matters of public
concern
Must have documentation detailing to prove allowability (i.e., not just an
“advertising”, “public relations”, or “”marketing” line item on an invoice
Compensation (§200.430)
Allowable but must be:
REASONABLE: Total compensation must be under the Federal
Acquisition Regulation (FAR) compensation cap (Cost Analysis
ensures we aren’t claiming more than allowed)
ALLOCABLE: Direct employees must charge time to projects they
are working on and there must be system for establishing an
estimate of unallowable effort for indirect employees
ALLOWABLE: Time spent on any unallowable activities in the CFR is
unallowable
Example: John Doe spends approximately 40% of his time on
Alumni and Development activities and 60% of his time on
strategic planning – 40% of this salary, benefits, perquisites, travel,
bonus, and any other related costs are also unallowable
Must have an offer of employment letter and/or personnel action
forms, job descriptions, work orders (for direct employees), and
completed daily timesheets (for direct employees)
Conferences (§200.434)
Allowable only for:
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Meetings, retreats, seminars, symposiums, workshops or events where the primary purpose is the
dissemination of technical information and is necessary and reasonable for successful performance,
including the rental of facilities, speakers fees, costs of meals and refreshments, local transportation, and
other items incidental to the conference unless restricted by terms of a contract or made unallowable by
another section of the CFR
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Example: The costs of having a staff meeting to inform employees of current issues and strategies is allowable;
however, any costs of entertainment (i.e., a band) or alcohol are not unallowable
Must have documentation for the purpose of the conference,
list of attendees, and receipts, agreements, and proof of
payment for all items related to the conference
Insurance and Indemnification
Allowable for costs of insurance required or approved and maintained and costs in connection with the general conduct
of activities
Unallowable for:
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Management fees in connection with business interruptions
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Cost of insurance on the lives of trustees, officers, or other similar employees when the University is identified as the
beneficiary
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Costs to correct defects in materials or workmanship
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Actual losses which could have been covered by permissible insurance
Must have proof of insurance (invoice) and proof of payment
Intellectual Property (§200.448)
Patent Costs
Allowable only if:
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Costs of preparing disclosures, reports, and other documents required by the Federal award, and of
searching the art to the extent necessary to make disclosures
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Costs of preparing documents and any other patent costs in connection with the filing and prosecution of a
US patent application where title or royalty-free license is required by the Federal Government to be
conveyed to the Federal Government
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General counseling services relating to patent and copyright matters (advice on patent and copyright laws,
regulations, clauses, employee intellectual property agreements)
Royalties and Other Costs for Use of Patents and Copyrights
Allowable only if:
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Royalties on a patent or copyright or amortization of the cost of acquiring by purchase a copyright, patent, or
rights thereto, necessary for the proper performance of the Federal award (unless the Federal Government
already has a license or the patent/copyright has been determined to be invalid, unenforceable, or expired)
Lobbying (§200.450)
Allowable only if:
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Technical or factual presentations on topics directly related to the performance of a grant, contract, or other agreement in
response to a documented request (must have documentation of the request)
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Lobbying to influence state legislation to directly reduce the cost or avoid material impairment of the authority to perform
the grant, contract, or other agreement (must have a cost impact)
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Activity specifically authorized by statute to be undertaken with funds from the Federal award
Time logs, calendars, or similar records required when the employee engages in
lobbying more than 25 percent of compensated hours of employment during the
calendar month
Maintenance and Repair Costs (§200.452)
Allowable …
To the extent the costs are not paid through rental or other agreements
Note that costs for improvements that add the permanent value of building and
equipment or appreciably prolong their intended life must be treated as capital
expenditures
Memberships, subscriptions, and Professional
Activity Cost (§200.454)
Allowable only if:
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Membership in business, technical, and professional organizations
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Subscriptions to business, professional, and technical periodicals
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Membership in any civic or community organization with prior approval by the Federal
awarding agency or pass-through entity
Unallowable if:
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Membership in any country club or social dining club or organization
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Membership in organizations whose primary purpose is lobbying
Professional Service Costs (§200.459)
Allowable only if:
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Reasonable in relation to the services rendered
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Not contingent upon recovery of the costs from the Federal Government
Must have an agreement that clearly defines the nature and scope of the activity performed,
an invoice that describes the services performed and the amount of time spent on each
activity with the rate of compensation, and proof of payment
Publication and Printing Costs (§200.461)
Allowable only if:
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Publication costs for electronic and print media, including distribution, promotion, and general
handling
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Page charges for professional journal publications
Rearrangement and Reconversion (§200.462)
Allowable only if:
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Costs incurred for ordinary and normal rearrangement and alteration of facilities
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Costs for restoration or rehabilitation of facilities to approximately the same condition existing
immediately prior to commencement of Federal awards, less costs related to normal wear and
tear
Recruiting Costs (§200.463)
Allowable only if:
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Size of the staff recruited and maintained is in keeping with workload
requirements
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Costs of “help wanted” advertising
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Operating costs of an employment office necessary to secure an maintain an
adequate staff
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Costs of operating an aptitude and educational testing program
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Travel costs employees while engaged in recruiting personnel
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Travel costs of applicants for interviews for prospective employment
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Travel visa costs (must be critical and necessary for the conduct of the project
and meet the definition of a “direct cost”)
Note that if the employee is recruited and resigned for reasons within the
employee’s control within 12 months after hire, we are required to refund or credit
the Federal share of the relocation costs to the Federal Government
Relocation Costs of Employees (§200.464)
Allowable only if:
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Incident to the permanent change of duty assignment for an indefinite or stated period not less
than 12 months of an existing employee or upon recruitment of a new employee
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Benefits the University
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Reimbursement is in accordance with University written policy
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Does not exceed the employee’s actual (or reasonably estimated) expenses
May only include:
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Cost of transportation of the employee, members of his/her immediate family and household,
and personal effects to the new location
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Costs of finding a new home (i.e., advance trips by employee and spouse to locate living
quarters and/or temporary lodging during the transition period up to 30 calendar days)
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Continuing costs of ownership of the vacant former home after the settlement or lease date of
the employee’s new permanent home (i.e., maintenance of buildings and grounds, utilities,
taxes, property insurance) up to 6 months
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Other necessary and reasonable expenses normally incident to relocation (i.e., costs of
canceling an unexpired lease (limited to 3x monthly rental), transportation of personal property,
insurance against loss of or damages to personal property)
Relocation Costs of Employees (§200.464) (continued)
Unallowable if:
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Fees and other costs associated with acquiring a new home
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Loss on the sale of a former home
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Continuing mortgage principal and interest on home being sold
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Income taxes paid by an employee related to relocation costs
Rental Costs of Real Property and Equipment (§200.465)
Allowable only if:
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Rates are reasonable to comparable property, market conditions in the area, alternatives available, and the
type, life expectancy, condition, and value of the property leased
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“Sale and lease back” up to the amount that would be allowed had the University continued to own the
property, including depreciation, maintenance, taxes, and insurance
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“Less-than-arm’s-length” leases (one party to the lease agreement is able to control or substantially
influence the actions of the other) up to the amount that would be allowed had the University continued
to own the property, including depreciation, maintenance, taxes, and insurance
Unallowable if:
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Profit, management fees, and taxes that would not have been incurred had the University purchased the
property
Scholarships and Student Aid Costs (§200.466)
Allowable only if:
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Costs of scholarships, fellowships, and other programs of student aid when the purpose of the Federal
award is to provide training to selected participants
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Tuition remission and other forms of compensation paid as (or in lieu of) wages to students performing
necessary work
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Individual must conduct activities necessary to the Federal award
Tuition remission and other support are provided in accordance with University policy and consistently provided
in a like manner to students in return for similar activities conducted under Federal awards
During the academic period, the student is enrolled in an advanced degree program and the activities of the
student in relation to the Federal award are related to the degree program
The tuition or other payment(s) are reasonable compensation for the work performed and conditioned explicitly
upon the performance of the necessary work
It is University practice to similarly compensate students under Federal awards
Specialized Service Facilities (§200.468)
Allowable only if:
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The costs of services provided by highly complex or specialized facilities operated by the University (i.e.,
computing facilities, wind tunnels, and reactors) take into account any items of income or Federal
financing that qualify as applicable credits
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The costs are charged directly to applicable awards based on actual usage of the services on the basis of a
schedule of rates or consistent, established methodology
Cost of training and education provided for employee development is allowable
Center For Workplace Learning & Performance (CWLP)
Transportation Costs (§200.473)
Allowable only if:
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Costs for freight, express, cartage, postage, and other transportation services relating either to
goods purchased, in process, or delivered
Note that if the cost can be readily identified with the items involved, it can be charged directly as
transportation costs OR added to the cost of the items
Outbound freight (if reimbursable under the terms and conditions of the Federal award) should be
treated as direct cost
Travel Costs (§200.474)
Allowable only if:
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Expenses for transportation, lodging, subsistence, and related items for employees who are in travel
status on official business
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Costs are consistent with the University's travel policy
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Costs do not exceed General Service Administration (GSA) per diem rates
Note that for air travel by other than a commercial carrier, costs cannot exceed the cost of commercial air
travel
Must document the purpose for travel and receipts for expenses claimed
Trustees (§200.475)
Allowable for travel and subsistence costs of trustees