Pat,

We too had a situation several years ago where our negotiated rate (actually rates) escalated over the four-period of our Rate Agreement. As such, we did budget subsequent year awards in line with the escalation. No Federal agency raised it as an issue.

Keep in mind that Section G.7 recognizes for the escalation: "Federal agencies shall use the negotiated rates for F&A costs in effect at the time of the initial award throughout the life of the sponsored agreement."

I would also expect that if your negotiated agreement has a de-escalating rate, you should follow that down!

Larry

~~~~~~~~~~~~~~~~~~~~~~~
Larry Waxler, Director
Office of Sponsored Programs
University of Southern Maine
1 Chamberlain Avenue
P.O. Box 9300
Portland, ME  04104-9300
Telephone: 207-780-4413
Telefax: 207-780-4927

>>> Patricia Ann Turner <xxxxxx@UARK.EDU> 6/19/2014 11:58 AM >>>
For the first time our current DHHS negotiation produced F&A rates that escalate 0.5% each year for 3 years.

This month we received 2 NIH awards in which the annual budgets were recalculated by NIH to reflect the changing rates each year instead of remaining constant as in OMB Circular A-21, G.7. Has anyone else received an NIH award budget with escalating F&A rates?

Thanks for any thoughts.

Pat

Patricia Turner
Grants Specialist
210 Administration Building
1 University of Arkansas
Fayetteville, AR  72701-1201
(479) 575-8482
xxxxxx@uark.edu

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