Administrative and Clerical Costs

Grant and Contract Procedures


The university policy is to comply with all rules, regulations and restrictions imposed in any grant or contract that the university accepts. Therefore, as a general university policy, F.6.b. expenses will be treated as indirect costs, except for the important exceptions noted below. Indirect costs are recovered by charging the negotiated indirect cost rate on the modified total direct cost base on each sponsored agreement. These are not recovered by direct charging the grant or contract.

OMB Circular A-21 is a Federal document that applies to all direct and pass-through Federal grants and contracts. Certain other grants and contracts through the State of New Jersey selectively apply the Federal rules and regulations. All awards that apply 0MB Circular A-21 are considered covered awards for this procedure. Each award should be read carefully to determine if the Federal rules apply.


The purpose of grant and contract procedure is to help project directors and administrators understand the guidelines for applying OMB Circular A-21, Section F - Identification and assignment of indirect costs, Part 6 - Departmental administrative expenses, Paragraph b, which discusses secretarial/clerical salaries and certain other office-related expenses. For easy reference these are referred to as F.6.b. expenses.

The pertinent sentences of F.6.b. are: "The salaries of administrative and clerical staff should normally be treated as indirect costs. Direct charging of these costs may be appropriate where a major project or activity explicitly budgets for administrative or clerical services and the individuals involved can be specifically identified with the project or activity. Items such as office supplies, postage, local telephone costs, and memberships shall normally be treated as indirect costs."


In order to directly charge any F.6.b. expenses to covered awards, certain conditions and processes must be followed as outlined below.

Administrative & Clerical Salaries

Administrative and clerical salaries may be treated as direct costs, if all of the following criteria are met:

  • The project/proposal must require an extensive amount of administrative services that is significantly greater than the routine level of such services provided by academic departments.
  • The costs must be identifiable, specifically with a particular project with a high degree of accuracy.
  • The costs must be explicitly budgeted and justified in the grant application or proposal.

If the above conditions are met, the project director would be justified in submitting the direct charges in his/her proposal. Upon the agreement of Research and Sponsored Programs agrees, they will sign the proposal for the university and send it to the appropriate agency for consideration.

Occasionally, the project director will not anticipate the need for F.6.b. salaries on covered awards until after the award is received and work has begun. With the exception of the National Institute of Health (NIH) and the National Science Foundation (NSF), F.6.b. salaries may not be charged to covered awards without prior agency approval. The project director must write to the sponsor’s grant/contract officer for approval of an exception. Any such request must be countersigned by Research and Sponsored Programs.

NIH and NSF will allow re-budgeting of F.6.b. salaries under expanded authority, provided that the salaries meet the first two criteria mentioned earlier or meet the exceptions provided by the OMB. Project directors must document and justify the need for the F.6.b. salaries in writing and send it to Research and Financial Services for approval. Our team will review the request for reasonableness. If the reviewer has a question on the document's technical merit, it will be sent to Research and Sponsored Programs for approval. The project directors will be notified promptly by Research and Financial Services of acceptance or rejection (and reasons why).


Expenses such as telephone, office supplies, postage and memberships generally are allowable if they are directly associated with the administrative and clerical salaries that meet the criteria listed above or if they have prior sponsor approval. Directly associated costs are those that would not have been incurred had the original expense not been incurred. For example, if an award requires extensive telephone polling and data entry into a database and has sponsor approval for the administrative and clerical support required, but has no approval for other expenses; then charging to the award of long distance telephone costs as well as costs for telephone and data entry forms would be allowable and consistent with the award’s purpose.

Charging award supplies and postage not directly associated with polling and data entry may be allowable, but would need to be separately justified and approved. Membership expenses are usually a departmental support item.

If any directly associated costs are not explicitly budgeted and justified in the proposal, the project director must send a memo to the Research and Financial Services accountant specifically identifying these costs and their relationship to the project. The accountant is responsible for reviewing and approving the request. The requestor will be notified, with reason(s) why, if the request cannot be approved.

Acceptance from Awarding Agency

If the agency accepts the proposal, they can accept or reject any of the F.6.b. expenses. If the agency rejects any of the expenses, then we must treat the rejected expenses as indirect expenses and insure they are not charged to the project. If the project director is notified by the agency that some or all of the F.6.b. expenses are rejected, the project director must inform Research and Financial Services so that the grant or contract is administered properly.