United States Department of the Interior

OFFICE OF THE SECRETARY

Washington, DC 20240

Nonprofit Organization

Indirect Cost Negotiation Agreement

EIN: 53-0206027 Date: 07/10/2023

Organization: Report Number: 2023-0488

Smithsonian Institution

1000 Jefferson Dr SW Filing Ref.:

Washington, DC 20560 Last Negotiation Agreement

 dated: 08/31/2022

The indirect cost rates contained herein are for use on grants, contracts, and other agreements with the Federal 

Government to which Public Law 93-638 and/or 2 CFR Part 200 apply subject to the limitations contained in Section 

II.A. of this agreement. The rates were negotiated by the U.S. Department of the Interior, Interior Business Center, 

and the subject organization in accordance with the authority contained in applicable regulations.

Section I: Rate

Start Date End Date Rate Type

10/01/2023 09/30/2024 Fixed 

Carryforward

Name Rate Base Location Applicable To

G&A 7.86 % (A) SI Onsite All Programs

G&A 11.23 % (B) SAO 

Onsite All Programs

Grants & 

Contracts OH 4.09 % (C) SI Onsite All Programs

SERC Core 

Support 4.80 % (D) SI Onsite All Programs

Direct 

Operating OH 27.83 % (E) SAO Onsite All Programs

Central 

Engineering 36.37 % (F) SAO Onsite All Programs

Material 

Burden 5.92 % (G) SAO Onsite All Programs

Non-Productive 

(Leave) 19.05 % (H)

SAO 

Onsite All Programs

Benefits: Full & 

Part Time 30.48 % (I)

SI/SAO 

Onsite All Programs

Benefits: 

Intermittent 

Employees

8.33 % (J)

SI/SAO 

Onsite All Programs

(SI) Smithsonian Institution

(SAO) Smithsonian Astrophysical Observatory

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Section I: Rate (continued)

(A) Base: Total cost input consisting of the total cost of direct operating activities including grants and contracts, 

materials, subawards, equipment, and applicable overhead, but excluding capital expenditures such as 

construction, equipment, the cost of collection items, equipment depreciation charges, and SAO home office

allocation charges.

(B) Base: Total costs of direct operating activities (including grants and contracts) net use of costs associated 

with materials, subcontracts, and equipment. In addition, the base includes Central Engineering Costs and the 

applicable share of overhead costs.

(C) Base: Grant and Contract direct operating costs including salaries and benefits, materials, serv ices, 

subawards, but excluding capital expenditures.

(D) Base: Total direct SERC costs, excluding capital expenditures.

(E) Base: Total direct salaries and wages, including fringe benefits costs.

(F) Base: Central Engineering direct costs including salaries, benefits, materials, and services.

(G) Base: Cost of direct materials, equipment, and subcontracts.

(H) Base: Total SAO full-time salaries and wages, excluding fringe benefits.

(I) Base: Total salaries less, intermittent and less than 90-day appointments.

(J) Base: Total intermittent and less than 90-day appointment salaries.

Treatment of fringe benefits: Fringe benefits applicable to direct salaries and wages are treated as direct costs; fringe 

benefits applicable to indirect salaries and wages are treated as indirect costs. 

Treatment of paid absences: Vacation, holiday, sick leave, and other paid absences are included in salaries and 

wages and are claimed on grants, contracts, and other agreements as part of the normal cost for the salaries and wages. 

Separate claims for the costs of these paid absences are not made.

Section II: General 

A. Limitations: Use of the rate(s) contained in this agreement is subject to any applicable statutory limitations. 

Acceptance of the rate(s) agreed to herein is predicated upon these conditions: (1) no costs other than those 

incurred by the subject organization were included in its indirect cost rate proposal, (2) all such costs are the legal 

obligations of the grantee/contractor, (3) similar types of costs have been accorded consistent treatment, and (4) 

the same costs that have been treated as indirect costs have not been claimed as direct costs (for example, supplies 

can be charged directly to a program or activity as long as these costs are not part of the supply costs included in 

the indirect cost pool for central administration).

B. Audit: All costs (direct and indirect, federal and non-federal) are subject to audit. Adjustments to amounts 

resulting from audit of the cost allocation plan or indirect cost rate proposal upon which the negotiation of this 

agreement was based will be compensated for in a subsequent negotiation.

C. Changes: The rate(s) contained in this agreement are based on the accounting system in effect at the time the 

proposal was submitted. Changes in the method of accounting for costs which affect the amount of reimbursement 

resulting from use of the rate(s) in this agreement may require the prior approval of the cognizant agency. Failure 

to obtain such approval may result in subsequent audit disallowance.

D. Rate Type: 

1. Fixed Carryforward Rate: The fixed carryforward rate is based on an estimate of the costs that will be

incurred during the period for which the rate applies. When the actual costs for such period have been 

determined, an adjustment will be made to the rate for a future period, if necessary, to compensate for the 

difference between the costs used to establish the fixed rate and the actual costs

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Section II: General (continued)

2. Provisional/Final Rate: Within six (6) months after year end, a final indirect cost rate proposal must be 

submitted based on actual costs. Billings and charges to contracts and grants must be adjusted if the final 

rate varies from the provisional rate. If the final rate is greater than the provisional rate and there are no funds 

available to cover the additional indirect costs, the organization may not recover all indirect costs. 

Conversely, if the final rate is less than the provisional rate, the organization will be required to pay back the 

difference to the funding agency.

3. Predetermined Rate: A predetermined rate is an indirect cost rate applicable to a specified current or future 

period, usually the organization's fiscal year. The rate is based on an estimate of the costs to be incurred 

during the period. A predetermined rate is not subject to adjustment.

E. Rate Extension: Only final and predetermined rates may be eligible for consideration of rate extensions. 

Requests for rate extensions of a current rate will be reviewed on a case-by-case basis. If an extension is granted, 

the non-Federal entity may not request a rate review until the extension period ends. In the last year of a rate 

extension period, the non-Federal entity must submit a new rate proposal for the next fiscal period.

F. Agency Notification: Copies of this document may be provided to other federal offices as a means of notifying 

them of the agreement contained herein.

G. Record Keeping: Organizations must maintain accounting records that demonstrate that each type of cost has 

been treated consistently either as a direct cost or an indirect cost. Records pertaining to the costs of program 

administration, such as salaries, travel, and related costs, should be kept on an annual basis.

H. Reimbursement Ceilings: Grantee/contractor program agreements providing for ceilings on indirect cost rates 

or reimbursement amounts are subject to the ceilings stipulated in the contract or grant agreements. If the ceiling 

rate is higher than the negotiated rate in Section I of this agreement, the negotiated rate will be used to determine 

the maximum allowable indirect cost.

I. Use of Other Rates: If any federal programs are reimbursing indirect costs to this grantee/contractor by a 

measure other than the approved rate(s) in this agreement, the grantee/contractor should credit such costs to the 

affected programs, and the approved rate(s) should be used to identify the maximum amount of indirect cost 

allocable to these programs.

J. Other:

1. The purpose of an indirect cost rate is to facilitate the allocation and billing of indirect costs. Approval of 

the indirect cost rate does not mean that an organization can recover more than the actual costs of a particular 

program or activity.

2. Programs received or initiated by the organization subsequent to the negotiation of this agreement are subject 

to the approved indirect cost rate(s) if the programs receive administrative support from the indirect cost 

pool. It should be noted that this could result in an adjustment to a future rate.

3. This Negotiation Agreement is entered into under the terms of an Interagency Agreement between the U.S. 

Department of the Interior and the cognizant agency. No presumption of federal cognizance over audits or 

indirect cost negotiations arises as a result of this Agreement.

4. Organizations that have previously established indirect cost rates—exclusive of the 10% de minimis rate—

must submit a new indirect cost proposal to the cognizant agency for indirect costs within six (6) months 

after the close of each fiscal year.

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Section III: Acceptance

Listed below are the signatures of acceptance for this agreement:

By the Nonprofit Organization By the Cognizant Federal Government Agency

Smithsonian Institution National Aeronautics and Space Administration

signature2 signature1

Signature Signature

Ron Cortez Craig Wills

Name: Name:

Division Chief

Under Secretary for Administration

Indirect Cost & Contract Audit Division

Interior Business Center

Title: Title:

signatureDate2 signatureDate1

Date Date

Negotiated by: Muberra Guvenc

Telephone: (916) 930-3816

Next Proposal Due Date: 03/31/2024

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7/19/2023 7/13/2023
Smithsonian Institution (SI On-Site) Supplement

FY 2022 Carryforward and FY 2024 Rate Computations Page 1 of 3 

1/ G&A Rate FY 2022 actual carryforward amount scheduled for liquidation in the FY 2024 rate is modified for

50% liquidation in the FY 2024 rate with remaining 50% ($608,295) postponed for liquidation in the FY 2025 rate. 

2/ SERC Support Rate FY 2021 actual carryforward amount scheduled for liquidation in the FY 2023 rate was 

modified for 50% liquidation in the FY 2023 rate with remaining balance of ($86,904) for liquidation in the 

FY 2024 rate. 

TITLE/DESCRIPTION G&A 1/

FY 2022 Direct Costs (incurred) 284,115,049 39,568,806 3,471,161

FY 2022 Rates (negotiated) 6.71% 11.95% 12.02%

Recoverable Indirect & OH Costs 19,064,120 4,728,472 417,234

FY 2022 Indirect & OH Costs (incurred) 18,945,532 3,052,438 236,196

FY 2020 Carryforward Balances Liquidated in FY 2022 Rate (1,098,001) 530,299 8,139

FY 2022 Indirect & OH Cost Pools 17,847,531 3,582,737 244,335

FY 2022 Carryfoward (Over)/Under Recoveries (actual) (1,216,589) (1,145,735) (172,899)

FY 2024 Proposed Indirect & OH Costs (estimates) 23,862,335 3,085,494 433,665

FY 2023 Carryforward Balance Deferred to FY 2024 (86,903)

FY 2024 Carryfoward Balance (for final liquidation) (608,295) (1,145,735) (172,899)

FY 2024 Indirect & OH Cost Pools 23,254,040 1,939,758 173,863

FY 2024 Direct Cost Bases (estimates) 295,718,808 47,482,567 3,620,074

FY 2024 Rates (SI On-Site) 7.86% 4.09% 4.80%

Grants & 

Contracts 

SERC 

Support 2/

DocuSign Envelope ID: 24D0C643-1BC7-4AE1-8880-48FFAAEE1884
Smithsonian Astrophysical Observatory (SAO On-Site) Supplement

FY 2022 Carryforward and FY 2024 Rate Computations Page 2 of 3

1/ Direct Operating OH Rate FY 2019 carryforward balance of ($426,594) was postponed for final liquidation in 

FY 2021 actual costs for the FY 2023 rate computation. Scheduled liquidation was postponed to FY 2022 actual 

costs for the FY 2024 rate calculation. Carryforward balance liquidation is complete. 

TITLE/DESCRIPTION G&A

FY 2022 Direct Costs (incurred) 67,179,257 41,297,855 7,815,208 32,729,734 39,221,737

FY 2022 Rates (negotiated) 14.23% 27.10% 37.23% 5.99% 17.86%

Recoverable Indirect & OH Costs 9,559,608 11,191,719 2,909,602 1,960,511 7,005,002

FY 2022 Indirect & OH Costs (incurred) 8,283,446 11,217,386 2,660,132 1,848,378 7,464,674

FY 2019 Carryfoward Balance Deferred to FY 2022 (426,594)

FY 2020 Carryforward Balance Liquidated in FY 2022 Rate 36,894 90,281 54,924 181,520 (450,689)

FY 2022 Indirect & OH Cost Pools 8,320,340 10,881,073 2,715,056 2,029,898 7,013,985

FY 2022 Carryfoward (Over)/Under Recoveries (actual) (1,239,268) (310,646) (194,546) 69,387 8,983

FY 2024 Proposed Indirect & OH Costs 8,804,418 11,857,335 3,036,638 1,867,887 7,464,673

FY 2024 Carryfoward Balance (for final liquidation) (1,239,268) (310,646) (194,546) 69,387 8,983

FY 2024 Indirect & OH Cost Pools 7,565,150 11,546,690 2,842,092 1,937,274 7,473,656

FY 2024 Direct Cost Bases (estimates) 67,368,522 41,487,120 7,815,208 32,729,734 39,221,737

FY 2024 Rates (SAO On-Site) 11.23% 27.83% 36.37% 5.92% 19.05%

Direct 

Operating 

OH 1/

Central 

Engineering

Material 

Burden

NonProductive 

(Leave)

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Smithsonian Institution & Supplement

 Smithsonian Astrophysical Observatory 

 (SI/SAO On-Site)

FY 2022 Carryforward and FY 2024 Rate Computations Page 3 of 3

1/ Both, Full Time/Part Time and Intermittent Employees Benefits, Rates FY 2022 actual carryforward amount 

scheduled for liquidation in the FY 2024 rates are postponed for liquidation in the FY 2025 rates. 

TITLE/DESCRIPTION

FY 2022 Direct Salaries & Wages Costs (incurred) 197,739,613 2,992,962

FY 2022 Benefits Rates (negotiated) 30.99% 8.36%

Recoverable Benefits Costs 61,279,506 250,212

FY 2022 Benefits Costs (incurred) 59,952,506 249,613

FY 2020 Carryfoward Balances Liquidated in FY 2022 Rate 2,665,503 (594)

FY 2022 Benefits Cost Pool 62,618,009 249,019

FY 2022 Carryfoward (Over)/Under Recoveries (actual) 1,338,503 (1,193)

FY 2024 Benefits Costs (estimates) 60,262,506 249,213

FY 2024 Carryfoward Balance (for final liquidation) - -

FY 2024 Benefits Cost Pools 60,262,506 249,213

FY 2024 Direct Salaries & Wages Bases (estimates) 197,739,613 2,992,962

FY 2024 Benefits Rates (SI/SAO On-Site) 30.48% 8.33%

Benefits-Full 

Time/Part 

Time 1/

BenefitsIntermittent 

1/

DocuSign Envelope ID: 24D0C643-1BC7-4AE1-8880-48FFAAEE1884