Indirect Rates
Iowa County Agricultural
Extension Offices
Key Points of the training




Understand the concepts of indirect costs,
direct costs and allocated costs
Understand the general guidance contained in
OMB Circular A-87
To learn how to construct a basic indirect cost
rate proposal (single rate)
To be aware of issues that might increase
“audit exposure risk” for non-compliance
SCHEDULE
Training on Indirect Cost Rate Proposals
Quick overview of basic concepts of cost and
indirect rates
OMB Circular A-87 and ASMB C-10 overview
Over view of sample forms and Instructions
Lunch
Walk-thru instructions and do some sample
exercises
Wrap up (2:30 – 3:00)
Who is MAXIMUS, Inc?
National firm that specializes in various
consulting services to State/Local Governments
(NYSE MMS)
Cost Services Division specializes in cost
accounting, cost allocation, fees, federal grant
cost recovery
Cost Services Offices in the Midwest include
Illinois, Iowa, Minnesota, Indiana, others
Springfield Illinois office:

Robert Antrim or Kurt Sames (217-789-0041)
robertantrim@MAXIMUS.com
How much do you know about ...?
INDIRECT COST? Can someone give a
one sentence definition?
DIRECT COST? Can someone give me a
one sentence definition?
INDIRECT COST RATE? Can someone
tell me the two basic factors (Ratio of “A
“divided by “B”)
EXPERIENCE? How many have had
experience in using indirect cost rates?
How much do you know about . ..?
WHY do we use indirect cost rates?


To recover some of the “overhead cost” related to the
administration of federal and state grants
Rates make it relatively easy, since no extensive
tracking of costs to every indirect activity
WHEN should we use an indirect cost rate?



When we have a timely rate on file that is completed
in accordance with OMB Circular A-87
And when award allows reimbursement of indirect
costs
And when we choose to claim (use as match)
Basics – Indirect cost rates
INDIRECT costs are those costs that cannot be
readily assigned (without disproportionate effort).
DIRECT costs are basically all other costs.

Except for some “flow thru” or unallowable costs which are
neither direct or indirect
An INDIRECT COST RATE is a practical (easy) way
to assign indirect cost to various “cost objectives”

For example, to grant activities or other direct activities
Rates are ESTIMATES for a future period


Calculated using one FULL FISCAL YEAR of actual costs
Applied as ESTIMATES for recovery in some future fiscal year.
Rate are calculated on “ORGANIZATION-WIDE” basis

The rate is NOT focused on individual grants
Basics – Indirect cost rates
INDIRECT COSTS
Divided by
DIRECT COSTS (chosen base)
Equals
INDIRECT COST RATE
(% Ratio)
Basics – Indirect cost rates
EXCLUDABLE costs are left out of the
indirect rate ratio altogether


Excludable costs may not require “material
administrative effort”, and their inclusion
could unfairly distort the rate calculation
Considered “flow-through costs” like sub
grants, debt service, capital, client payments
UNALLOWABLE costs are specifically
defined in OMB Circular A-87 (discuss later)

Unallowable costs may or may not be
included in the BASE (discuss later)
Basics – Indirect cost rates
DIRECT COSTS – “BASE”
Denominator in the Indirect/Direct ratio
Direct costs are also known as the
“BASE” for computation of indirect rates
Several options exist for which “cost
elements” are chosen for the Base



“All Direct Salary and Wages” (S&W)
“Total Direct Cost”, less excludable (TDC )
“ Modified Total Direct Cost” (MTDC)
Typically includes first $25K of each sub-grant
Basics – Indirect cost rates
DIRECT COST BASE - Other key points
CONSISTENTCY is important
Same TYPE of “cost elements” included year-to-year

Rate should be APPLIED to same cost elements as used to
CALCULATE the rate
Example: An indirect rate calculated using a S & W base should
not be applied to the “Total Direct Costs” of a grant

EXCLUDABLE COSTS


Both Total Direct Cost (TDC) Base and Modified Total
Direct Cost (MTDC) base, should exclude certain
“flow-through” expenditures that might distort the rate
calculation - like capital, debt service client payments
MTDC excludes amount over the first $25K of each
sub-grant (typically)
Basics – Indirect cost rates
OMB Circular A-87
Indirect cost and direct cost guidelines are
discussed in Federal OMB Circular A-87
Why is the Federal government interested?



Because the federal government provides significant
grants to states and local governments
Federal reimbursement is sometimes based on
documented ACTUAL COST of providing services
The Federal government determined that it was
necessary to define what ACTUAL COST means!
Next we will review some of the OMB Circular A87 “Actual Cost” Principles
OMB CIRCULAR A-87
COST PRINCIPLES FOR STATE
LOCAL AND INDIAN TRIBAL
GOVERNMENTS
OMB CIRCULAR A-87
KEY POINTS OF THIS SECTION OF
TRAINING




To discuss the importance of and the general
guidance contained in OMB Circular A-87
To learn some of the important cost principles as
defined in the Circular
To learn basics on allowable and unallowable cost
To introduce the A-87 “ASMB C-10 Guide”
Published by U. S. DHHS
ASMB C-10 is the “Implementation Guide for OMB
Circular A-87”
OMB CIRCULAR A-87
General
“COST PRINCIPLES FOR STATE,
LOCAL, AND INDIAN TRIBAL
GOVERNMENTS”
ORIGINAL VERSION IN 1968
MAJOR REVISION IN 1995

“Tightened up” the documentation requirements for
claiming personal services cost
AVAILABLE ON THE WEB:

http:/www.whitehouse.gov/omb/circulars/
a087/a87_2004.pdf
A-87 ORGANIZATION
Highlighted items are relevant to Locals
ATTACHMENT A - GENERAL PRINCIPLES FOR DETERMINING
ALLOWABLE COSTS
ATTACHMENT B - SELECTED ITEMS OF COST
ATTACHMENT C - STATE/LOCAL-WIDE CENTRAL SERVICES
COST ALLOCATION PLANS (NEW)
ATTACHMENT D - PUBLIC ASSISTANCE COST ALLOCATION
PLANS (NEW)
ATTACHMENT E - STATE AND LOCAL INDIRECT COST
PROPOSALS
THE PURPOSE OF
OMB CIRCULAR A-87:
SETS POLICIES/PROCEDURES FOR IDENTIFICATION OF
COSTS OF PROGRAMS
IDENTIFIES ALLOWABLE AND UNALLOWABLE COSTS
SPECIFIES COST ALLOCATION CRITERIA/REQUIREMENTS
STIPULATES DOCUMENTATION REQUIREMENTS
MANDATES COGNIZANT AGENCY APPROVAL/APPEAL
CONCEPT
BRINGS “ORDER AND RATIONALITY” TO THE COST
DETERMINATION AND APPROVAL PROCESS
A-87 DOES NOT OVERRIDE A PROGRAM’S SPECIFIC LAWS
OR REGULATIONS
OMB CIRCULAR A-87
Application
The Circular does apply to



Cost-reimbursement contracts
Grants and cooperative agreements
Sub-grants or subcontracts awarded to governmental
units under grants awarded to the Federal recipient
(grants to states for example)

Costs presented as required program “match”
Match refers agreements that stipulate a “cost-sharing ratio”
between the funding source and the grant award recipient
Total overall “allowable program cost” is shared
OMB CIRCULAR A-87
Summary
The Circular summarized in one sentence
The Circular is all about:





ACTUAL COSTS incurred by
STATE (and Local) GOVERNMENTS, and
documenting the BENEFITS RECEIVED and the
ALLOWABILITY of the costs, when
the costs are presented for REIMBURSEMENT by
FEDERAL agencies, under
“COST REIMBURSEMENT” type arrangements
OMB CIRCULAR A-87
Summary
More specifically, A-87





Defines the concept of actual cost, and
reimbursable cost
Describes direct vs. indirect costs
Requires consistent treatment of cost
elements
Many other specific rules about cost
documentation standards
Does not supercede specific federal programs
that may limit reimbursement of indirect costs
OMB CIRCULAR A-87
Summary
General vs. Specific Guidance



OMB A – 87 provides GENERAL Guidance
Other documents provide more specific
guidance related to administration and audits
of federally funded programs
(next slide)
OMB CIRCULAR A-87
Summary
Other specific guidance





ASMB C-10 “Supplemental Guide” published by
DHHS to provide procedural guidance for
implementation
Specific program legislation may supersede A-87
“Single Audit Act” and OMB Circular A-133
established uniformity among federal audit
requirements
GAAP - Audit guides, such as Federal Acct Stds
Board
Finally, the auditor’s judgment regarding compliance
OMB CIRCULAR A-87
Summary
ASMB C-10: Implementation Guide for OMB Circular A87. The Organization of Guide follows A-87
Available on the web at “http://www.hhs.gov/grantsnet/state/asmbc10.pdf”
Section relevant to LOCAL governments include:
 Part 1: Basic Information
 Part 2: General principles for determining allowable
costs
 Part 3: Selected items of cost
 Part 6: State and Local IDC Rate Proposals, with
Illustrations
OMB CIRCULAR A-87
Summary Review
HIGHLIGHT in Manual
Manual page 1


Beginning at bottom of page one, last paragraph: “The Circular
addresses the key concepts of ….
End: To the end of the paragraph (on page 2)
Manual page 2

Highlight the web address for OMB A-87 and also ASMB C-10
READ in Manual
Manual page 2 – the section “STAGES of GRANT
ASSISTANCE and the APPLICABILITY of CIRCULAR
A-87”
Composition and Allowability of
COST
Factors affecting the allowability of COST


Necessary and reasonable
Allocable to Federal awards. This means
joint costs must be allocated to ALL benefiting
activities, including non-federal and unallowable
All allocated cost elements must at least have
some POTENTIAL BENEFIT to Federal awards

Authorized and not prohibited under State or
local laws or regulations
Composition and Allowability of
COST
Factors affecting the allowability of COST
continued:



Costs must conform to any limitations or exclusions,
including terms and conditions of federal awards
Costs must be CONSISTENT with policies and
regulations that apply uniformly to both Federal
awards and other (non-grant) activities
Costs must also be accorded CONSISTENT
TREATMENT
Example: Same type of cost elements can’t be assigned as
direct in one circumstance and indirect in another!
Composition and Allowability of
COST
Factors affecting the allowability of cost
continued:




Conform to GAAP
Must not be included as cost or match for some other
federal award (unless provided by award)
Net of applicable credits (Like ISU reimbursements
for cost for Extension Services)
Costs must be adequately documented
Composition and Allowability of
COST
Some costs are specifically UNALLOWABLE
under OMB A-87
Selected items of cost are A discussed in
ATTACHMENT B of the Circular
 The list discusses the ALLOWABILITY of certain
items and discusses DOCUMENTATION
REQUIREMENTS
 Some common “unallowable” items are shown on the
next slide
Ref: OMB Circular A:87 Attach B: Selected Items of Cost

Composition and Allowability of
COST
Examples of unallowable costs (whether direct
or indirect) continued:
Advertising, except for recruitment or procurement,
unless specifically required by the grant award
 Most public relations, unless specifically required by
the award
 Most legal defense costs (legal expense required in
the administration of federal awards is allowable)
 Equipment o r other capital expenditures (a “use
allowance” or “depreciation” may be computed and
is allowable)
Ref: OMB Circular A:87 Attach B: Selected Items of
Cost

Composition and Allowability of
COST
Examples of unallowable costs continued:






Fund raising and investment activities
Lobbying
Unused facilities and “idle capacity” (normally)
Losses that could have been covered by insurance
Interest, but exceptions are made for interest on
financing of allowable equipment or buildings
Others – see Attachment B for discussion
Ref: OMB Circular A:87 Attach B: Selected
Items of Cost
Composition and Allowability of
COST
DIRECT vs. INDIRECT costs
No universal rule for determination of Direct vs.
Indirect
Direct costs are those that are readily assignable
to specific “cost objectives”

For example staff that keep an activity timesheet
Indirect costs benefit multiple cost objectives,
but are not readily identified to any particular
cost objective

Indirect costs in one agency may be direct in another
agency – but should be consistent within own agency
Composition and Allowability of
COST
HIGHLIGHT in Manual
The first sentence of each “allowability factor”
(starts on p. 4)
Highlight the definition of Direct Costs (first
sentence only under “Direct Costs”, page 5)
Highlight the definition of Indirect Costs,
including two points (Under Indirect Costs on
page 6)
Ref: Manual pages 4 and 5
Composition of Cost
Salaries and Wages
Documentation of Salaries and Wages
A-87 contains strict requirements for
documenting personal services costs where
employees split their time between DIRECT
and INDIRECT activities
Important points (suggest highlighting in Manual):

Costs to be based on “standard payrolls”, whether
direct or indirect employees
Ref: Manual pages 6 and 7

Composition of Cost
Salaries and Wages
Important points on Salary and Wages continued

For employees who work SOLELY on a Federal grant
award:
At least a semi-annual Certification signed by the employee
that confirms their assignment

For employees who work partially INDIRECT and
partially DIRECT
Must keep a Personnel Activity Report (PAR) to support the
split between indirect and direct
A “PAR” is basically an ACTIVITY TIME SHEET with two
categories (DIRECT time vs. INDIRECT time)
Ref: Manual page 6 -7
Composition of Cost
Salaries and Wages
Important points on Salary and Wages continued




The PAR requirements are especially important to agencies that
have employees who split their time between direct and indirect
Example: If a PA spends some time working on a an indirect
activity (like general agency-wide accounting work) and spends
some time working in particular program areas: He or she must
keep a record of this activity on a PAR with at least two
categories:
Category 1: Estimate of % of time on all INDIRECT activity
(combined)
Category 2: Estimate of % of time on all DIRECT activity
(combined)
Composition of Cost
Salaries and Wages
MAXIMUS has designed a simplified Personnel
Activity Report (PAR) that may be used by the
County
See Handout – PAR examples


Jane Jones signed entered her estimated hours each
month and signed the form.
Note: If for the first year “Jane Jones” did not keep a
monthly time estimate, suggest she completes her
percentage of time for the FULL YEAR and sign
Manual pages 6 and 7
Also, refer to “PAR form” handout
Depreciation or use
allowances
Depreciation or “use allowances” are a means of
allocating the cost of equipment or building assets
Depreciation is possible if the formal accounting records
of the county record depreciation under a standard fixed
assets policy
A “use charge” can be used instead of depreciation
(optional)


Building use charges are calculated at 2% of the acquisition
value, including improvements
Equipment use charge are calculated at 6 2/3% of original
acquisition value
Refer to “Use Charges” handout, and Manual pages 21-22
Depreciation or use
allowances
Depreciation or use charges are normally charged as indirect in
the indirect rate proposal (ICRP( calculation worksheet
Exception: The County may choose to charge occupancy space as
direct certain programs, including depreciation.
If the County chooses to identify some of the building space as
direct (or as “match”)


Requires a square footage cost allocation method be applied to all
direct and indirect space to determine the appropriate cost
Then only the INDIRECT office space can be included in the
indirect rate proposal
For Equipment Use, we recommend that only the indirect
equipment items be included in the use charges or depreciation
Refer to OMB A-87, Attachment B (11) for more information on
Depreciation and Use Charges, and pages 20 and 21 of MANUAL
Review of A-87 and Cost Principles
So far we learned:




The basic elements of cost are INDIRECT, DIRECT
and also EXCLUDED and UNALLOWBLE
Indirect costs are defined as costs that are NOT
READILY identified to specific purposes
An indirect cost rate is the ratio of INDIRECT to
DIRECT (or BASE)
That the provisions in OMB Circular A-87 is important
(and also the Guide ASMB C-10)
Review of A-87 and Cost Principles
So far we learned (continued):

Basic concepts in OMB A-87:
Like elements of cost are to be treated CONSISTENTLY
Documentation of Personal Services costs is important
There are certain costs that are UNALLOWABLE or have
special documentation requirements
ATTACHMENT B of OMB A-87 provides a useful discussion
of cost, and documentation standards
“Building use or equipment use charges may be included as
indirect costs. Special allocation procedures required if
County chooses to include space costs are DIRECT
INDIRECT COST RATE
PROPOSAL (ICRP)
HOW TO DEVELOP A RATE &
DOCUMENTATION
REQUIREMENTS
Indirect Cost Rate Proposals Basics
Mechanism to easily estimate the full cost
of providing direct services

Based upon costs for a full fiscal year
“Organization wide”


Provides a ceiling up to which the county may
recover a portion of its allowable indirect costs
Indirect costs may be used to satisfy matching
or cost sharing requirements if not claimed
Manual page 7
Indirect Cost Rate Proposal Basics
Types of approvals for rates
“Provisional/Final”

Requires an retroactive adjustment to actual cost
reimbursement claims once final costs are known
“Fixed with Carry Forward”
This type will probably to be used by the Counties
 The cost adjustment is “carried-forward” and is
embedded in the newly proposed rate
Predetermined rate (probably not used)
Manual page 8

Indirect Cost Rate Proposal Basics
Types of Direct Cost Base


Direct salaries and wages
Modified total direct cost (MTDC)
Excludes distorting items such as capital, debt service,
subawards, assistance payments, and provider payments
This type of base is illustrated in our Example IDC forms

Other bases might be chosen such as
S&W including fringe benefits
Total direct cost (if no material distorting items)
Manual page 9
Indirect Cost Rate Proposal Basics
Format of the ICRP

“Simplified Method” is recommended as
illustrated in ASMB C-10 (Section 6.2.3)
 The simplified method is used where each of the
agency’s major functions benefit from its indirect
costs to approximately the same degree
 If not, a more complex cost allocation plan is
necessary (not covered in this training)
Manual page 10
Indirect Cost Rate Proposal - Basics
Under the SIMPLIED METHOD, a
determination is made as to which
activities are DIRECT COST and which
are INDIRECT costs
A set is Schedules is prepared based
on one full year of agency cost

to estimate a proposed rate to be used in
some future year
Manual page 10
Indirect Cost Rate Proposal – Steps
“Simplified Method”
Step 1 – Adjust INDIRECT costs for the period:

Eliminate any indirect costs directly reimbursed
through a federal award specifically for that purpose
For example, if a construction grant was received than no
depreciation or use allowance (rare)
Eliminate administrative salaries in the indirect pool
that were funded as direct by a grant
 Eliminate any A-87 unallowables and capital
improvements, and “applicable credits”
 Add use allowances if this option is chosen
Manual page 10

Indirect Cost Rate Proposal –
Steps
Step 2 – Adjust DIRECT costs for the period:

Eliminate any flow through funds and capital
expenditures
Step 3 – Divide the total allowable indirect
costs by an equitable direct cost base

Usually Salaries or Wages, or Modified Total
Direct Cost
Manual Page 10 and see also page 9 (Direct Cost Base)
ICRP Instructions and Schedules
Introduction
Please note:
There is not single, uniform approach that will
satisfy the needs of all counties
Various counties may have their won particular
needs and circumstances
Various options will be addressed
It may be necessary for counties to tailor the
worksheets to meet their own particular needs
Manual page 11
ICRP Instructions and Schedules
Introduction
“ISU Allocated Costs” - Discussion
ISU employees are located on-site
Logically they should receive their share of some of the
indirect costs – This complicates the rate computations!
These activities are identified on Schedule 2, and the
ISU share of cost is then transferred to a separate
column entitled “ISU allocated Costs” on Exhibit 1 (Col
8)
The basis for the County/ISU allocation on Schedule 2 is
the number of FT Employees (County vs. ISU
employees)
Example: 10 employees total, of which 2 are ISU. Therefore the
ISU allocated share is 20% of certain indirect costs.
ICRP Instructions
Exhibit 1 – ICRP Summary
Exhibit 1 is the ICRP SUMMARY SCHEDULE
Explanatory “Notes to ICRP Exhibit 1” are
contained in a MS Word document
Some Column entries are made directly from the
Expenditures Worksheet 2 (explained later)
Some Column entries are transferred from
Schedules 2 through 8 (explained later)
Ref: See Manual page 12 for a discussion of Exhibit 1; see
also “Exhibit 1” of sample forms, and “Sample IDCR
Proposal Notes” (MS Word Document)
ICRP Instructions
Exhibit 1 – ICRP Summary (cont’d)
Column 1 contains the TOTAL COSTS, and then
assigns all cost to 6 additional columns:
 Col 2: Excludable costs (flow-through)
 Col 3: Expenditures not allowable (may also included
in base if it either generated or benefit from the
indirect cost)
 Col 4: Indirect costs – all must meet A-87 cost
allowability requirements
 Col 5: Direct Salary and Wages - chosen BASE for
example
 Col 6: All other Direct Costs
 Col 7: ISU Share Allocated costs
ICRP Instructions
Exhibit 1 – ICRP Summary (cont’d)
Expenditures that are exclusively direct can be entered
directly from the Summary Worksheet 1

Example: By policy, the Director’s salary is considered 100%
direct and is entered in the DIRECT column
Other expenditures are entered from Worksheets 2
through 8, and are transferred to the appropriate
columns
The rate is calculated at the bottom of the worksheet,
and is based on the following:
The sum of the “Indirect” column (A)
divided by
The sums of the “Direct S & W” col. plus the “Other Direct” col. (B + C)
ICRP Instructions
Worksheet 1–Expenditures Summary
Worksheet 1 is the initial SUMMARY OF
EXPENDITURES
Expenditures are transferred from the most
recent annual financial statement (AFR 4)
The purpose of the worksheet is to help
organize the expenditure date for easy entry in
other worksheets
The total costs should reconcile to Column 1
total on Exhibit 1
Ref: Worksheet 1 in Sample Forms packet
ICRP Instructions
Worksheet 2 – Allocation of Costs to ISU
Personnel
Enter number of ISU and total employees in Line A & B
Enter the salary for any indirect employees that partially
benefit ISU employees
Enter fringe benefits for the same employees, which is
transferred from Worksheet 3
Janitor salary and fringe and building occupancy costs
may be entered
Other costs are transferred from Worksheet 3 through
Worksheet 8 (see instructions for Worksheets 2 – 8)
The final column totals are entered on Exhibit 1 in the
INDIRECT and the ISU ALLOCATED SHARE columns
Ref: Worksheet 2
ICRP Instructions
Worksheet 2 – Allocation of Costs to ISU
Personnel (cont’d)
Special note on employees who are split: DIRECT and
INDIRECT salary expenditures



Some employees may split their time between direct and indirect
(based on their PAR %’s)
IF so, only the INDIRECT share of the salary is entered on
Worksheet 2; the DIRECT share is entered on Exhibit 1
Julie Smith in our example has $2,221 entered on Exhibit 1 and
$8,882 entered on Schedule 2
Similar process for fringe benefits

see Worksheet 3 instructions next slides
Ref: to Manual page 13 and 14 for a discussion of Options
for entering salary and wages cost
ICRP Instructions
Worksheet 3 – Summary of Employee
Benefits
Enter all benefit amounts, by employee, in the
appropriate “benefit type” columns. Include all
employees.
Employees that partially benefit ISU staff are entered in
Section I; Others are entered in Section II
Transfer the benefit type totals to one of three columns:



Col 1 Indirect: Enter amounts here if employee is indirect, but
does NOT benefit ISU staff
Col 2 Direct: Enter amounts here if employee is direct
Col 3 ISU Allocated: Enter amounts for INDIRECT employees
that PARTIALLY benefit ISU staff.
Ref: Worksheet 3 and Manual page 15
EXERCISE
Exhibit 1 and Worksheets 2 and 3
The purpose of this exercise is to:


Understand Worksheet 3 (Benefits)
Lean to post the entries from Worksheet 3 to:
WORKSHEET 2 if indirect costs are to be
allocated to ISU/NonISU employees, OR to
EXHIBIT 1 if no allocation is required
Refer to the exercise instructions on the bottom
of WORKSHEET 3
I will show you the completed exercise
worksheets after you do the work
ICRP Instructions
Worksheet 3 – Summary of Employee
Benefits (cont’d)
Special note on employees who are split: DIRECT and
INDIRECT fringe benefit expenditures
 Some employees may split their time between direct
and indirect (based on their PAR %’s)
 The total of all of the benefit cost is entered on
Worksheet 3
 However, the DIRECT share is entered in the
“Direct” column, The INDIRECT share is entered in
the “INDIRECT” column OR the “ISU ALLOCATED”
column on Worksheet 3
 Julie Smith in our example has $292 entered in the
DIRECT column and $1,166 entered in the ISU
allocated column on Schedule 2
ICRP Instructions
Worksheets 4 - 8
These similar worksheets provide an allocation of the
other operational costs that might be indirect or
partially indirect
Worksheet 4 – Travel expenses
Worksheet 5 – Communications expenses
Worksheet 6 – Supplies expenses
Worksheet 7 – Equipment (non-capitalized) expenses
Worksheet 8 – Insurance, Legal and Bonds expenses

The posting instructions:



Col 1 Indirect – Transfer sum to Exhibit 1 INDIRECT column
Col 2 Direct – Transfer sum to Exhibit 1 DIRECT column
Col 3 Allocable to ISU – Transfer sum to the appropriate
column in Worksheet 2
Ref: Manual pages 16 and 18
ICRP Instructions
Building Occupancy Costs
Building occupancy costs are discussed on pages 16
through 18 of the manual (please read)
In general - options are available:



If all costs partially benefit ISU staff, and the County does not
choose to charge any as direct costs can be entered on
Worksheet 2
If the County desires to charge some building costs directly to
grants (or used as match) it will be necessary to allocate the
costs based on sq footage or FTE counts (see manual page 17
and 18)
If allocated, the costs may be entered on Schedules as follows:
Directly to Exhibit 1 (and assigned to direct or indirect columns)
Or to Exhibit 2 if some to be allocated to ISU/non-ISU personnel
Ref: Manual pages 16 through 18 for complete discussion
Calculating Equipment Use
and Building Use Charges
See manual page 20 and 21 if you wish to charge a use
allowance for either buildings or equipment.
We recommend equipment use be calculated only for
“indirect” equipment (like accounting office or Director’s
Office Equipment
When calculated the use charges can be entered as
follows:
Building Use – Enter on Worksheet 2 to be allocated to ISU/non
ISU personnel; or directly on Exhibit I Indirect column if no ISU
benefit

Equipment Use – Enter on Worksheet 2 also, assuming indirect
equipment benefits both ISU and non-ISU personnel
Ref: Manual pages 20 and 21; also see examples handouts of
Equipment Use and Building Use calculations

FINAL COMPLETION of ICRP
Follow instructions in Manual pages 22 -23
Make sure the required certification is signed by
the Board chairperson
Assemble all the Exhibits, Worksheets and
supporting documents
Normally the ICRP package should not have to
be submitted for federal approval (local
governments are exempted unless requested)
The State funding source may choose to review
The documents should be kept on file at least 3
years
QUESTIONS
for
MAXIMUS
Robert Antrim, or Kurt Sames
217-789-0041
Robertantrim@maximus.com