Over the last couple of weeks the topic of indirect costs (IDC) has emerged in a number of conversations. The topic has emerged as a result of pending changes to the IDC rate charged on funds awarded to an academic from commodity groups. Of late there has been considerable confusion over what the rate is, what it will be in the future and what groups are included in this rate. So here's where the topic stands as of today. Funds awarded by CDFA now include an IDC rate of 10% (July 1, 2016 – June 30, 2017). Rates will increase 5 percentage points per year until the rate is 25% (July 1, 2019 – June 30, 2020). The IDC rate for CDFA funds July 1, 2020 and beyond remains under discussion.

The IDC rate for CDFA-established market orders and commodity board funds will remain at 0% at least through June 30, 2017. Beyond that date, the IDC rate is unknown at the present time. There is certainly interest in seeing the rate remain at 0% and there is an effort underway to quantify the contributions by market orders, commodity groups and growers to UC research as rationale for why the rate should remain 0%. Over the next few months a small task force will discuss and consider options of what and how to assess IDC for funds originating from growers. Once a decision is made, we will get that information to you.

Often times the conversation includes questions surrounding how IDC is used. Over my 20-year career writing grant proposals to commodity organizations, state agencies, and federal funding sources I have often questioned why I paid IDC and what that rate increased far quicker than funds available from funding sources. At a meeting 2 weeks ago with members of commodity groups, I shared a bit of what I have learned over the years. Attached is a file that may be of use to you if you, also, ask these questions.

While I can admit that I understand the purpose of IDC, it's a difficult thing to see almost as much of the awarded funds go towards something that I can't itemize and question how it directly benefits me or my funder. This is particularly difficult when I also watch salary, benefit, and tuition rates escalate. It seems like we have to constantly do more with less, making it seem so much easier to just do less with less. I was appalled when I first learned that USDA was allowing a 30% total funds awarded IDC rate. I couldn't imagine how they thought I could get work done with what would remain. On the other hand, I also realize that contract research organizations and private companies charge 65% to sometimes 100% IDC and some programs (SBIR, for example) allow a 100% IDC rate. Perhaps university rates aren't that high after all, which explains why many land grant institutions are discussing assessing IDC on programs that have historically been at 0%; a few have already applied IDC to grower funding.

Another challenge in the pursuit of funding is securing matching funds for programs that have a matching fund requirement. Campuses often have pools of funding available to use as match. Last week UC ANR announced that it, too, will have a pool of funds available for match when grants are prepared for programs that specifically require matching funds. While this doesn't solve the challenge of securing funding to maintain a research program or answer high priority questions, it hopefully helps alleviate the challenge of rounding up matching funds when time can be better spent writing a strong funding application.