Financial Affairs
Administrative Fees
Effective date:
April 2, 2014
Revised date:
Review date:
April 2, 2015

Responsible Party:
VP for Administration and Finance

100.00 Introduction and Purpose

The University's General Operations budget incurs expenses related to activities that derive income from outside sales, F&A cost recoveries, and other self-supporting activities. For example, central costs for payroll processing, accounts payable services, information technology, liability insurance, etc., are incurred which support such activities. To recover a portion of the costs deemed to benefit these outside activities, an administrative fee is charged to all designated funds. The fee is calculated based on a percentage of the designated funds' expenditures. Certain indexes have been granted exemptions, and certain account codes have also been exempted, from this fee.

200.00 Policy

The administrative fee percentage is reviewed, set, and communicated annually by the Vice President for Administration and Finance. Unless specifically exempted in writing by the Vice President for Administration and Finance in accordance with this policy, each expenditure in MSU-Bozeman's Designated fund group shall be charged the administrative fee.

A list of currently exempted indexes, funds and account codes is attached as Exhibit A.

300.00 Procedure

310.00 Method of Payment

Designated fund index expenditures are automatically assessed a charge equal to the annually determined percentage.

320.00 Exemptions

Requests for an exemption to this policy must be submitted to the Vice President for Administration and Finance. Such request must be in writing and signed by the Department Head requesting the exemption. Such requests must address the following:

  • Source of funds in the affected account,
  • Use of funds in the affected account,
  • Whether the exemption is of a one-time nature (a specific purchase), at an account code level, or at a fund or index level
  • Explanation as to why the fee is not deemed appropriate

Requests will be either approved or denied by the Vice President for Administration and Finance based on criteria including, but not limited to:

  • The manner in which the exemption enhances the University's mission
  • Financial impact on the University
  • Consistency with past practices and decisions and current policy
  • Sources and uses of funds in the relevant designated account

Retroactive exemptions are not permitted. Administrative fee charges will be discontinued from the date of the exemption on a prospective basis.

400.00 Internal Control Considerations

A periodic review of exempt accounts will be performed. If non-exempt expenditures have been mis-recorded, the current (%) administrative fee will be applied on a retroactive basis.

500.00 Effective date and Review

The policy is effective April 2, 2014, and shall be reviewed annually by the Vice President for Administration and Finance.

600.00 Exhibit A

Administrative Fee Exempt Accounts
Administrative Fee Exempt Indexes