Department of Defense (DOD) F&A Announcement and Additional Guidance for BU Faculty and Staff

Late last week, the Department of Defense (DOD) released an internal memo instructing DOD Directorates to immediately implement a 15% F&A cap on proposals and awards to institutions of higher education.

On June 16th, the Association of American Universities (AAU), with the American Council on Education, the Association of Public and Land-grant Universities, and 12 leading universities, filed a lawsuit in the United States District Court for the District of Massachusetts seeking to block the DOD rate cap. The University submitted a strongly worded written statement in federal court supporting the lawsuit. Details can be found here.

On June 17th, the Court granted the plaintiff’s request for a Temporary Restraining Order (TRO) prohibiting the DOD from implementing a 15% F&A cap for all awards issues on or after June 12th, including but not limited to rejecting or treating adversely proposals for DOD funding submitted at the universities’ negotiated rates rather than the 15% rate.

Sponsored Programs has started to receive inquiries about this memo and the impact on awards and proposals.

With the TRO in place, please continue work as normal.

  • For proposals, include the University’s full negotiated F&A rate with this caveat included in the budget justification: “Boston University requests our current federally negotiated rate, but we will accept the rate approved at the time of award.”
  • For current awards, there will be no change in the F&A rate until further guidance is received. Please notify your SP Pre-Award Officer if the DOD reaches out to negotiate a lower F&A rate.
  • The University will not be making any changes to outgoing subawards during this time.
  • For incoming subawards, if you receive a modification from the Prime awardee reducing the F&A rate to 15%, please notify your Pre-Award Officer so that we may inquire further from the Prime awardee before acceptance.
  • For new awards, we will monitor budgets before acceptance if the F&A rate has been reduced to 15%.

If you have any additional questions, please reach out to ospera@bu.edu.

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