Classification of Sponsored Projects

OMB's Uniform Guidance2 CFR Part 200 Appendix III Indirect (F&A) Costs Identification and Assignment, and Rate Determination for Institutions of Higher Education (IHEs) requires the institution to organize its sponsored expenditures into certain defined functional activities. These costs are then used to develop the Facilities & Administrative (F&A) rates, negotiated with the federal government, to reimburse F&A costs for the activity.

Major functions of an institution, according to the Uniform Guidance, are:

  • Organized Research – all research and development activities of an institution that are separately budgeted and accounted for. Organized Research includes:
    • Sponsored Research – all research and development activities that are sponsored by federal and nonfederal agencies and organizations. This term includes activities involving the training of individuals in research techniques (commonly called research training) where such activities utilize the same facilities as other research and development activities and where such activities are not included in the instruction function. Examples of sponsored research include:
      • awards to MIT faculty and principal investigators (PIs) to support research activities
      • external Faculty “Career Awards” to support the research efforts of the faculty
      • external funding to maintain facilities or equipment and/or operation of a center or facility that will be used for research
      • external support for writing of books, when the purpose of the writing is to publish research results
    • University Research – all research and development activities that are separately budgeted and accounted for by the institution under an internal application of institutional funds. For purposes of the Uniform Guidance and development of the F&A research rate, University research shall be combined with sponsored research under the function of Organized Research.
  • Instruction –  Except for research training, as described above, the term instruction includes all teaching and training activities of an institution whether offered for credits toward a degree or certificate or on a noncredit basis, and whether they are offered through regular academic departments or separate divisions, such as a summer school division or an extension division.
    • Sponsored Instruction and training means specific instructional or training activity established by grant, contract, or cooperative agreement. For purposes of the cost principles, this activity may be considered a major function even though an institution’s accounting treatment may include it in the instruction function. Sponsored Instruction includes:
      • any project for which the purpose is to instruct any student at any location; recipients of this instruction may be MIT students or staff, teachers or students in elementary or secondary schools, or the general public
      • curriculum development projects at any level, including projects that involve evaluation of curriculum or teaching methods; such evaluation may be considered “research” only when the preponderance of activity is data collection, evaluation, and reporting
      • projects that involve MIT students in community service activities for which they are receiving academic credit
      • activities funded by awards to departments or schools for the support of students
      • dissertation work funded by grants, including grants for travel in relation to a dissertation
      • upward Bound Program, bringing local students on campus for classes
      • general support for the writing of textbooks or reference books, videos, or software to be used as instructional materials
  • Other sponsored activities – programs and projects financed by federal and non-federal agencies and organizations that involve the performance of work other than instruction and organized research.