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Percentage Recovery on Sponsor Funded Research (PROFR)
Percentage Recovery on Sponsor Funded Research (PROFR)
What is PROFR and its intended purpose?
What is PROFR and its intended purpose?
PROFR is a Direct Cost Recovery (DCR) policy in the ISE Department, which has been in place for almost 30 years. DCR policies are intended to recover the direct costs associated with faculty time spent on sponsored research grants/contracts throughout the academic year (i.e. supervising graduate students, directing the research activities, preparing reports, etc.), knowing that the time allocated during the summer is not typically reflective of the full time spent on the project. Having Academic Year (AY) time in the project budget more accurately reflects the total time spent by a PI on the project as well as the distribution of time throughout the year.
PROFR is a Direct Cost Recovery (DCR) policy in the ISE Department, which has been in place for almost 30 years. DCR policies are intended to recover the direct costs associated with faculty time spent on sponsored research grants/contracts throughout the academic year (i.e. supervising graduate students, directing the research activities, preparing reports, etc.), knowing that the time allocated during the summer is not typically reflective of the full time spent on the project. Having Academic Year (AY) time in the project budget more accurately reflects the total time spent by a PI on the project as well as the distribution of time throughout the year.
PROFR is required on every sponsored research proposal unless the sponsor, by policy, will not permit AY time. Known exceptions are listed below and will be updated as other occurrences arise that warrant the waiver of PROFR. The inclusion of PROFR consistently in proposal budgets is set to ensure a fair standard for all and to avoid case-by-case subjective determinations which would be harder to justify to auditors.
PROFR is required on every sponsored research proposal unless the sponsor, by policy, will not permit AY time. Known exceptions are listed below and will be updated as other occurrences arise that warrant the waiver of PROFR. The inclusion of PROFR consistently in proposal budgets is set to ensure a fair standard for all and to avoid case-by-case subjective determinations which would be harder to justify to auditors.
What is the requirement and value?
What is the requirement and value?
requirement is met by T&R faculty Academic Year effort only
a minimum of 7% of "Base for F&A Costs" within OSP Budget Template (also typically defined as Modified Total Direct Cost - MTDC)
AY time in budgets related to course buyouts does not count towards meeting PROFR
In proposals with TDC (Total Direct Cost) F&A calculations required by some sponsors, we will still use MTDC to ensure faculty are not penalized with 7% AY time being required based on budgeted tuition and the full value of subcontracts
is not applied when Research (RSCH), Administrative (ADM), or Instructional (INST) faculty are PI (even with T&R faculty in budget as Co-PI)
PROFR can only be waived when:
PROFR can only be waived when:
AY not allowed by sponsor (example: NSF organizational unit "Operational Engineering")
Any full and permanent waiver of PROFR is subject to department head approval
PROFR may be not included on a proposal budget that is primarily for student support. This would typically be a budget of $40,000 or less per year and is considered to be a temporary waiver of PROFR.
Faculty with proposal budgets that are submitted without AY time to meet PROFR will be required to be satisfy the temporarily waived PROFR from other active projects prior to the distribution of salary savings. This calculation of required PROFR to be eligible for salary savings will carry from one academic year to the next.
How is PROFR Calculated?
How is PROFR Calculated?
Expenditure Line Items Subject to PROFR
Faculty Summer Salary and Fringes
Faculty AY Salary and Fringe
Graduate Assistant fringes and wages
Travel
Contractual Services
Materials/Supplies
Lab Fees
Postdoctoral wage and fringe
Subcontracts (first $25,000 of each subcontract)
Note: The total of these is the base for the PROFR calculation. For projects that involve sub funds for other VT departments, only those amounts included in the ISE budget are used in the calculation. 7% of this amount is the PROFR minimum requirement. This is typically referred to on the budget as "Base for F&A Costs", For multi-year projects PROFR can be met based on the total of the project. For Optional periods, PROFR must be met within each period.
Expenditure Line Items NOT Subject to PROFR
Equipment
Tuition
Subcontracts (100% after first $25,000 of each subcontract)
Participant Support Costs
Rental costs
Returns to Faculty - Academic Year (AY) Salary Savings
Returns to Faculty - Academic Year (AY) Salary Savings
What is AY Salary Savings and its intended purpose?
What is AY Salary Savings and its intended purpose?
AY Salary Savings is how ISE determines the amount of discretionary resources to provide to faculty based on externally funded research activity in a given fiscal year. When a faculty member has a percentage of their effort charged to an external research grant, the equivalent dollar value does not get charged to the ISE departmental account. The resulting "Salary Savings" is able to be used for operations by the department.
AY Salary Savings is how ISE determines the amount of discretionary resources to provide to faculty based on externally funded research activity in a given fiscal year. When a faculty member has a percentage of their effort charged to an external research grant, the equivalent dollar value does not get charged to the ISE departmental account. The resulting "Salary Savings" is able to be used for operations by the department.
Due to continued budget tightening enforced by the college, departmental operating resources are constrained and the overwhelming majority of the budget provided by the college to ISE is used directly for the salaries of faculty and staff, as well as graduate student support for the MYO program. The AY Salary Savings generated from research activity is what, in part, allows the department to pay for the 10 restricted department staff to provide support to the ISE research enterprise and academic operations as there are insufficient resources provided in the ISE base budget to provide the level of service we strive towards.
Due to continued budget tightening enforced by the college, departmental operating resources are constrained and the overwhelming majority of the budget provided by the college to ISE is used directly for the salaries of faculty and staff, as well as graduate student support for the MYO program. The AY Salary Savings generated from research activity is what, in part, allows the department to pay for the 10 restricted department staff to provide support to the ISE research enterprise and academic operations as there are insufficient resources provided in the ISE base budget to provide the level of service we strive towards.
- A faculty or staff member that is "Restricted" is an employee whose salary is not provided by the college/university and ISE has to pay for them out of our own resources
How is AY Salary Savings calculated?
How is AY Salary Savings calculated?
Effective July 1, 2025 (FY26) and in place through June 30, 2027 (FY27) a percentage of PROFR charged to a sponsored project is returned to T&R faculty members each fiscal year using returned overhead dollars. The applicable percentage will align with the table below and these funds can be used at your discretion, i.e. student support, travel support, class buyouts, etc.
Starting July 1, 2027 (FY28) AY salary charged via the ISE department PROFR requirement will be retained by the department.
ISE aims for a higher level of administrative support to provide timely and substantive customer service. We also aim to reduce as much administrative burden on faculty as possible. Neither would be possible without savings from AY charged to research projects and the returned overhead.
Overhead is also a valuable resource used to provide salary funding for staff positions as noted above, to enhance new faculty start-up funding, as well as provide funding for department operating expenses and faculty discretionary funds.
How does AY salary savings get returned to faculty?
How does AY salary savings get returned to faculty?
AY salary savings have historically been returned to faculty via returned overhead resources generally known to faculty as "discretionary" with the fund number associated with the resources starting with a "2". The department will continue to prioritize funding salary savings via returned overhead because it is a resource that can be saved year over year to support larger purchases, student support, or a course buyout.
The federal landscape and potential change to the university indirect rate allowed to be charged, ~60% down to a possible 15%, may result in the department being unable to fund salary savings via returned overhead as the department would receive too small of a portion to do so. We would work to consider other methods to continue to encourage additional faculty time on research projects, more discussion will be had in this area as the future federal funding landscape and indirect policies become clear.
Returns to Faculty - Part-Time Research Faculty (Emeritus, Research Scientists, etc.)
Returns to Faculty - Part-Time Research Faculty (Emeritus, Research Scientists, etc.)
What is the return to faculty for part-time research faculty?
What is the return to faculty for part-time research faculty?
Part-time Research Faculty are to receive 20% of the College Share (OH140) returned overhead earnings per project awarded. The College Share equals 40.29%, meaning the estimated return to faculty is 8.058% of the total Indirect in the project budget. The final amount returned is dependent on the project indirect rate and distribution of expenditures that are subject to indirect (ex. tuition temission and equipment are not subject to indirect).
Part-time Research Faculty are to receive 20% of the College Share (OH140) returned overhead earnings per project awarded. The College Share equals 40.29%, meaning the estimated return to faculty is 8.058% of the total Indirect in the project budget. The final amount returned is dependent on the project indirect rate and distribution of expenditures that are subject to indirect (ex. tuition temission and equipment are not subject to indirect).
How does returned indirect get returned to part-time research faculty?
How does returned indirect get returned to part-time research faculty?
At the proposal stage a Form C is submitted in Summit that splits the college share (OH140 - 40.29%) between the following:
College of Engineering share - 25%
Part-time Research Faculty - 20% (PI to provide breakdown of 1 or more discretionary (2#) funds for this 20% return)
ISE Department - 55%
As project activity occurs and expenditures are recorded to the part-time faculty fund, monthly increments will be made to provide the allocable percentage of returned overhead earnings to the discretionary (2#) fund documented by the part-time research faculty in the Form C.
Any part-time research faculty collaborating with a full-time ISE faculty member would be required to have their own separate subfund for expected expenditures for their portion of the research project. That subfund would have a Form C as outlined above with 20% to a designated discretionary (2#) fund. The full-time faculty members research funding in the main grant fund would be subject to normal AY salary savings guidelines.
Are full-time restricted research faculty included?
Are full-time restricted research faculty included?
No, restricted research faculty that are full-time receive 5% of their salary from departmental resources in liue of any returned overhead or salary savings.
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