Approaching the Campus Budget - Part II

Campus Support

The purpose of this report, then, is to review the UMass Amherst research enterprise so we can clearly understand our current research investment and consider how to improve our effectiveness. As the campus seeks to increase the quality and productivity of research, it must also increase the funds available to support that research. The academic leadership of the campus drives the increase in quality and productivity and the campus budget reflects the investment in support of research. Because the resource base for research is so important and because the funds to support it are so limited and precious, every university reviews its research system frequently to ensure that it meets the needs of the campus and enhances successful national competition. We are ready to engage that review and this report provides a full statement about the funds available. The following tables summarize the projected FY04 research support from both external and campus sources; the first identifies the research components in the full FY04 budget and the second provides additional detail on the research costs.

Direct and Indirect Costs

A brief review of the various categories of revenue and expenses associated with sustaining research competitiveness will help highlight the issues before us. As mentioned above, in addition to the $23 million in faculty salaries allocated to research, the campus also provides a minimum of $39 million in other support and receives about $95 million from external agencies. The competition for external dollars brings in money for two types of expenses: direct and indirect. The direct expenses pay for costs clearly traceable to a particular research project. The indirect expenses pay for costs that support specific research projects but do not apply individually to the project (such as utilities and general administration). In almost every case, the total of direct and indirect costs provided by an external agency for a project does not pay for the full cost of the project. Instead, the university must pay for various expenses required for the research. All of the $39 million in other research support mentioned above, and a substantial portion of the $23 million in faculty salaries reflect campus support of external research projects.

In managing research funding, every major research university attempts to charge its external sponsors for all the costs incurred by the project, and the agencies often attempt to encourage the universities to share as many of these costs as possible. The larger the share of any research project’s costs the university recovers from outside agencies, the greater the research volume the university can support with its internal dollars. As a result, many universities provide a variety of incentives to encourage researchers to charge the sponsoring agencies for as much of the allowable costs as possible.

If most observers easily understand the general principle of direct costs, those expenses that buy specific equipment, staff, and other services needed for a particular project, the calculation and recovery of indirect cost appears much less straightforward. The federal government has a complex system that universities must follow when they calculate the indirect costs appropriate for research projects. This system, described in the linked document entitled Sponsored Research: Direct and Indirect, is relatively clear in general principle, if complicated in calculation.

1 | 2 | 3 | 4 | 5 | 6 | next

Approaching the Campus Budget

I. Approaching the Campus Budget

II. Approaching the Campus Budget: Research

Appendix: Sponsored Research: Direct and Indirect Costs

Projected FY04 Campus Budget (PDF)




FY07 Budget Update Amherst 250 Plan: Step One, An Interim Report Amherst 250 Plan Financial Master Plan Budget Document Archive Home	Approaching the Campus Budget - Part II Campus Support The purpose of this report, then, is to review the UMass Amherst research enterprise so we can clearly understand our current research investment and consider how to improve our effectiveness. As the campus seeks to increase the quality and productivity of research, it must also increase the funds available to support that research. The academic leadership of the campus drives the increase in quality and productivity and the campus budget reflects the investment in support of research. Because the resource base for research is so important and because the funds to support it are so limited and precious, every university reviews its research system frequently to ensure that it meets the needs of the campus and enhances successful national competition. We are ready to engage that review and this report provides a full statement about the funds available. The following tables summarize the projected FY04 research support from both external and campus sources; the first identifies the research components in the full FY04 budget and the second provides additional detail on the research costs. Direct and Indirect Costs A brief review of the various categories of revenue and expenses associated with sustaining research competitiveness will help highlight the issues before us. As mentioned above, in addition to the $23 million in faculty salaries allocated to research, the campus also provides a minimum of $39 million in other support and receives about $95 million from external agencies. The competition for external dollars brings in money for two types of expenses: direct and indirect. The direct expenses pay for costs clearly traceable to a particular research project. The indirect expenses pay for costs that support specific research projects but do not apply individually to the project (such as utilities and general administration). In almost every case, the total of direct and indirect costs provided by an external agency for a project does not pay for the full cost of the project. Instead, the university must pay for various expenses required for the research. All of the $39 million in other research support mentioned above, and a substantial portion of the $23 million in faculty salaries reflect campus support of external research projects. In managing research funding, every major research university attempts to charge its external sponsors for all the costs incurred by the project, and the agencies often attempt to encourage the universities to share as many of these costs as possible. The larger the share of any research project’s costs the university recovers from outside agencies, the greater the research volume the university can support with its internal dollars. As a result, many universities provide a variety of incentives to encourage researchers to charge the sponsoring agencies for as much of the allowable costs as possible. If most observers easily understand the general principle of direct costs, those expenses that buy specific equipment, staff, and other services needed for a particular project, the calculation and recovery of indirect cost appears much less straightforward. The federal government has a complex system that universities must follow when they calculate the indirect costs appropriate for research projects. This system, described in the linked document entitled Sponsored Research: Direct and Indirect, is relatively clear in general principle, if complicated in calculation. 1 \| 2 \| 3 \| 4 \| 5 \| 6 \| next	Approaching the Campus Budget I. Approaching the Campus Budget II. Approaching the Campus Budget: Research Appendix: Sponsored Research: Direct and Indirect Costs Projected FY04 Campus Budget (PDF)


© 2006 University of Massachusetts Amherst. Site Policies. This page is maintained by University Advancement Communications.