Developing a Usage Rate

Directive Statement

Costing requirements place numerous limitations on rates charged by the Fee-for-Service Educational Activity (FSEA).  FSEA units at the University of Florida must meet the following criteria:

  • Billing rates or fees for internal users must be designed to recover no more than the costs of the goods or services being provided
  • Costs must be consistently applied to all users and allocations based on actual use
  • The departments that recharge costs must develop cost data supporting the unit costs charged.  Recipients of Federal funds are not to recover more than the aggregate cost
  • Recharge to a sponsored project or other funding source may be applied only when there is a direct relationship to the project being charged
  • Only costs that are reasonable, allowable, allocable and consistently treated should be charged to a service center project and included in the rate calculation.  Per OMB Uniform Federal Guidance, direct costs charged to projects must adhere to the following fundamental principles Section §200.403 Allowability of costs, §200.404 Reasonable costs, and §200.405 Allocable costs

In rare cases, if faculty salaries are to be included in Fee-for-Service Educational Activity rates due to direct effort towards the FSEA, they must be budgeted and paid from the approved FSEA ChartField.   Effort reports, where required, should agree with salary expenditures charged to a FSEA and expenditures must be supported through the documented annual University effort certification process.

Reason for Directive

All fee-for-service educational activities, no matter the size, are subject to the cost principles set forth in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards 2 C.F.R. §200 Subpart E §200.468 (“Uniform Guidance”).

Units must go through a rate development process to ensure an accurate composition of allowable costs on a cost recovery basis.  Although units may vary in size, complexity, and services provided by the units, they are required to follow common administrative practices.

Remember: Fee-for-Service Educational Activities classified as Auxiliary Enterprises are not part of this rate setting process.  The charges from Auxiliaries are defined as income to the University of Florida and are not considered a recharge of costs.  The rates set by the Auxiliary Enterprises are not subject for review of the Auxiliary Advisory Committee.

Who must comply?

All UF departments with fee-for-service educational activities.

Procedures & Best Practices

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