Demystifying Facilities and Administrative “Indirect” Costs

Cheryl Dykstra-Aiello: Okay. It’s 11:00. We had, quite a few RSVPs so there may be some more people trickling in, but I think there’s enough of us that we can get started. Thanks for joining us. My name is Cheryl Dykstra-Aiello. I’m a proposal development specialist here in Advancement and strategy in the Office of Research, and I’m here with my co-presenter, Becky.

Cheryl Dykstra-Aiello: And I’ll let her intro introduce herself.

Becky James: Hi, everyone. Welcome. Again my name is Becky James. I am the assistant director for research development in the College of Arts and Sciences. Although I would say that, in terms of working with faculty and doing proposals, Cheryl and I, we have different titles, but we pretty much do the same thing. Cheryl works for the whole university.

Becky James: I work specifically with, CAS faculty.

Cheryl Dykstra-Aiello: All right. So today we’re hopefully going to demystify F&A or indirect costs for you. I will let you know that this, presentation is being recorded and the recordings and slides will be available on the ORAP website, later for you to, view again or, tell your colleagues to watch. I also I want to let you know that we will allow time at the end of today’s presentation for Q&A.

Cheryl Dykstra-Aiello: So please hold your questions until that time. I won’t be monitoring the chat until that time. But we’ll get to your questions.

Becky James: We don’t have, you know, one of those slides as to what our goals are, but, as F&A and actually I should say, all of these terms are interchangeable facilities and administrative F&A is the short version, but they’re also called, indirect costs or overhead cost. We use those, terms interchangeably.

Becky James: So, there’s really no difference between that when we, whenever we’re talking about it. But the as F&A has come in to public discussion in recent months because of, the efforts to kind of reduce those and, you know, for, universities and colleges, we have discovered that a lot of people really don’t know what they are, why they exist.

Becky James: And that is true for people even within the university, within the institution, that they just they you know, they see this term and it’s just kind of write off. And nobody knows what it’s for or why it’s there. So hopefully at the end of this, you’ll have, clear understanding not only of what they are, but why they’re important.

Becky James: Because they really are for the university. I would also add that they are paid in advance. So when we’re when we say overhead often we say it’s overhead recovery because it’s the stuff that we’ve already paid for, but to put it in sort of the larger context of life and, you know, the pursuit of happiness, throughout the country.

Becky James: Everybody has overhead cost, right. Whether you go to your doctor or your dentist, you know, they’ve got very specialized equipment that they have to pay for. They have receptionist and, administrative staff, people who are doing, you know, insurance billing and that sort of thing. If you go to the grocery store, grocery stores have transportation and storage costs.

Becky James: They have to pay people to stock the goods. They have, cleaning, costs that, are invoked with, with their work, restaurants in particular, health code compliance. They’ve got a whole team of people behind the scenes who are making sure that the food is prepared correctly. Hopefully that the dishes are clean when they’re served to you.

Becky James: That’s all overhead costs. Not only that, they all have you know bookkeeping. They all have HVAC cost. It’s just a part of the cost of doing business. And they are absolutely vital to the maintaining that entity and keeping it going. You may not see, you know, any line on your bill or your receipt that says F&A or overhead.

Becky James: They don’t do that. But you can be sure that when you are paying for whatever it is that you are actually that those costs are actually worked into the bill. right, I don’t think anyone can argue with that. Universities are no different in that we have those costs. Next slide please Cheryl, so but some of those costs are.

Becky James: a little Different and they’re fairly unique to the university or to, you know, educational institutions. First of all, I would point out that the libraries. Library, is it’s central to the university, but it costs a of money for them to subscribe to all those journals. They have the database or the data repositories. All the things that the library does and that paid for by F&A recovery that is added to, to grant proposals or grant awards.

Becky James: That’s one thing that and that’s actually, I probably the small part of the F&A recovery. We also have like any other business, we have utilities, right. We have Hvac, plumbing, electricity, all that. But the thing is, with the university, we often have very specialized needs for something like Hvac. There are labs that, because of what they’re doing in the lab, the air cannot be recirculated back into the building.

Becky James: It can only go to the outside. Obviously, that’s a higher cost than your standard Hvac system. And there are other, you know, other labs. Well, we have a cadaver lab. Certainly there are regulations governing the environment within the cadaver lab. There are people who are working with Biohazards and, nuclear materials, other animal labs.

Becky James: All of those have special, needs, special regulations, that need to be paid for and cost more money than standard utilities. F&A also pays for the computing facilities at a university. And by that I mean IT. I mean all the data processing that happens here, the cybersecurity, which is growing, in, both scope and expense, pretty continually

Becky James: There are also lots of, research compliance and assurance issues. That the university is required by law to address. So we have you know, if there are export and import controls, again, the human and animal research or, you know, research participants, those are all regulated, hazardous materials, especially if they’re being shipped anywhere outside of the university.

Becky James: All that requires oversight and reporting. So there’s a whole staff involved with that. And then there are other support personnel, just people, you know, just the accounting people, to keep those, grants, you know, to keep the expenses and stuff, to keep the invoices and receipts going and so forth and so on.

Becky James: So there are quite a few expenses, that this F&A has paid for. The alternative to that, the other way to Bill for all of these things is to do what’s called a fully burdened budget. And that simply means, that you account for every cost associated with the research. So but you would have to figure out what is the cost for, the heating in this office.

Becky James: How much of the library am I using? As you know, like, it would actually have to be very granular in terms of doing that. So, yeah. So this whole F&A system and I’ll talk about how that came into being, but the whole F&A system was actually meant to be an easier and more efficient way of, accounting for these actual costs, that are not direct research.

Becky James: Right. You know, direct, direct costs being the salaries, the travel, the supplies and so forth. But this accounts for all of those things. Go to the next slide, please. Cheryl; Yeah. As I said, the the F&A is only received by the university when the direct expenses are incurred. So in other words, if you’re, you know, when you order, say, $100 worth of supplies, and then we invoice the sponsor for that $100.

Becky James: That is when we get the F&A associated, with that cost only back when that is reimbursed to us. And I just want to point out too, that, when we’re talking about F&A we really are almost, almost exclusively talking about federal funding. So funding from National Institutes of Health, National Science Foundation, Department of Agriculture, NASA, and so on.

Becky James: If you, and part of the discussion about why F&A rates are so high has been because there are nonfederal funders, private foundations and such that do not charge, you know, the 53, in some cases at 60% that other universities, do not charge as much F&A and as frequently fairly low, maybe 10 to 15%.

Becky James: The reason for that is because, first of all, there is a historically established relationship between research institutions and the federal government. And when the when the federal government, when we get federl grants, it is in response to a program th a request something that the federal government wants to have done. And I’ll talk about this again in, in a second to so whether it’s the the request for proposals or solicitation, broad agency announcement, whatever it is, it is the federal government asking for that work to be done.

Becky James: Foundations, typically do not have that kind of the scope of priorities. They do not use, the, the infrastructure, like the research that the federal government is asking of us, it’s just more narrowly focused. But essentially it’s the scope. And also they tend to be, they tend not, not to have the, the priorities that the for government does.

Becky James: Next slide Cheryl. And it’s somewhat similar with non- sorry, not nonfederal industry. That is industry also has its own interests. They are usually, very focused on the bottom line. They really want to, have things done in a shorter period of time. And, you know, again, the costs for these can be negotiated, with the business and the researcher.

Becky James: But sometimes because of what they want, they’re willing to actually pay the full of made cost, for the university to do this work here. And then there are other things that the, that, industry might provide. It might be, you know, access to facilities. It might be a person who’s coming to the university. So, either foundation’s industry just generally tends to be different, and they tend to be very much, according to that particular body that’s, that’s funding the program.

Becky James: And actually, I want to say something else here at this point, too. I have heard over the years many people, PIs have come to me and they said, well, I wanted to apply for this program, but they don’t have F&A so I can’t apply for it. The university won’t let me go, like, no, no, no, no, that is not true.

Becky James: That is not true at all. You know. Yes. Do we want F&A? Yes, we do, because it pays for all of those things that I talked about. But more than that, we want you to be successful. We want you to be able to do the research that you want to do. And so, if the agency does not allow F&A WSU will abide by that.

Becky James: It has to be whatever their policy is, it has to be in writing, like publicly, like on their website or, something, something equivalent to that. And it has to be universally, universally applied to all applicants. So you can’t just say, oh, you know, you can’t just go to a program officer and say, oh, I don’t want to pay F&A on this.

Becky James: So, write me a letter or something that doesn’t work. It has to be for everyone. So, and I can give you an example. The Spencer foundation, which is a it’s educational foundation. They have a policy. It’s been around. They have standardized. If the if the project is cost less than $75,000, they will not pay F&A pay no overhead on that.

Becky James: But if it’s over $75,000, then they do. And they have that on their website. It’s all explained. It’s it’s there for everyone to see. So whatever the recovery is from the, agency that you’re applying to the institution or the foundation, just make sure it’s documented and you’re good to go on it. Okay. Next shot slide. So, I talked about that historic relationship between the university and the federal government in terms of doing research and I think it’s worth mentioning how that came into being.

Becky James: You know, how did we get here, at this point and you really actually have to go all the way back to World War Two and the Manhattan Project. That was the first big science, right? That was the model for, pretty much what how things came, evolved over time. That is to say, the federal government, actually Franklin Roosevelt, it was pretty much an independent decision on his his part, agreed to fund the research for this major, this huge project to develop a nuclear weapon.

Becky James: Right. Because that that the Germans were doing that and, it’s actually started before U.S. involvement in World War two, but, things were looking pretty dire and wanted to make sure that we could actually beat them at that game. And so they, they threw millions into this. And, you know, this was again and then, starting in the late 1930s, a lot of money back that, so they put you know, Oppenheimer and, Feynman and all these other, you know, scores of scientists went to New Mexico, moved there with their families talk about overhead costs.

Becky James: The federal government actually paid for the buildings and the infrastructure in the town so that the scientists would be willing to live there for a long term. And of course, it was successful. I hope you know that, and, we did succeed in developing the bomb and, you know, the rest, as I say, is is history.

Becky James: But again, that was the model for big science of the federal government pays this money to tell scientists and engineers what they and what they want. It will get accomplished. And then, of course, after World War Two, and as the Cold War is taking place or taking shape, I should say and we had things like Sputnik, which just scared the bejesus out of everyone in the country.

Becky James: Thinking that the Soviets getting so far ahead of us technologically, so that by 1957, when that happened in 1957, and then right immediately as a result of that, we get the Advanced Research Project Agency, is formed, NASA and the National Defense Education Act, put lots of money to pay students and to help students study science and engineering so that they could keep it so that the US could keep up with this.

Becky James: And that’s really how it started. It was just the government, in short, realized the potential of partnering with universities, in order to achieve scientific advances. Right. And the alternative, what they could have done on their own is to build their own research facilities for their own scientists and engineers, and have all of the overhead costs directly paid by them.

Becky James: And quite frankly, it was just easier it was more cost effective, and it was more efficient for universities to do that. And again, they realized that there were overhead costs related to that research that needed to be paid. And to look at this, this, timeline here on the slide, it, you know, kind of shows you the, you know, was it developed over time and then, you know, there were increasing, caps or regulations for it.

Becky James: I would point out, first of all, just to highlight a couple things in 2014, uniform guidance was issued that’s relatively recently. But that really standardized all the administrative requirements, the cost principles, meaning something has to be, reasonable, allowable and allocable on a federal grant, and whatever audit requirements they have. So there are more regulations.

Becky James: So we know exactly what needs to be done, in order to, legally take advantage of, grant funding and, actually any, any federal acquisition. And then note, in 1966, I’m going backwards here, 1966, where it says Health and Human Services established its capacity to review and negotiate F&A rates. And that’s important because HHS is WSU’s cognizant federal agency for F&A.

Becky James: I’ll explain that in in a minute here. But emphasis on the negotiate because F&A rates are negotiated. Okay. Next slide please. Cheryl.

Becky James: And this is how it’s done. And anybody who has been involved with the process of negotiating F&A rates this takes months if not years, a couple of years to do what we first have to do with the university has to do first is calculate the cost of all those. Remember, everyone is talking about fully burdened budget and you have to go through and figure out the heating.

Becky James: And that’s kind of what they’re doing here. Except on a much bigger scale. They’re using historical cost. They’re doing more, you know, cost analysis studies, for, you know, the well, first of all, you mean the library and the and the utilities and so forth and so on. Everything is documented. And that’s an important point.

Becky James: This is not these aren’t just, you know, guesstimates it’s not random figures that they’re figures that they’re putting out. Everything is documented. It’s based on real cost. Okay. And, that you know, could be, where they’re literally calculating the square footage of each and every lab on campus. And how that plays into the rates here.

Becky James: So gotta have those documented. And then at that point HHS contact HHS and say, okay, we’re ready to negotiate. The other agency that does, negotiations is the Office of Naval Research. But again, ours is HHS. So that’s who we call. Okay. And they look at all those figures, they come to campus, they literally will look at the the facilities and the buildings and everything, and see what’s going on.

Becky James: And then that there is, as I said, a negotiation. They say, okay, well this is allowable. But you know, maybe that’s not quite as much. And so forth. But once that agreement is made and then we begin, you know, we have a rate schedule and we can charge the rate that is allowed by HHS.

Becky James: And the other important thing about that is, is it as a cognizant agency HHS, negotiates, they approve the rates on behalf of federal agencies for WSU. So whether it’s, you know, national Institutes of Health, Department of Agriculture, any agency abides by the rates negotiated by HHS here. So they have entire offices that, take care of those negotiations.

Becky James: And then, I would, you know, sometimes, you know, you hear about, like, Harvard, I think their F&A rate was it was 60 some percentage. Ours is currently 53. And those differences are just based on, you know, the facilities at any given institution, the conditions that are in any renovation and or construction, that is required for particular research, regional cost will also come into play, of course.

Becky James: So you know what we have here at WSU may not cost the same as, you know, like, I don’t know, UCLA or Harvard or, University of Nebraska, Lincoln, they were all going to have different rates based on, all those different factors. Okay. Next one. So this is our current F&A federally negotiated indirect cost rate schedule.

Becky James: That’s a mouthful. And it is, available on the WSU website. You can go to this, but what you see on there, is that this agreement was began, July 1st, 2019 and was scheduled to go through, June 30th, 2023. So in that regard, it’s expired. But, these do continue to take place until amended.

Becky James: And everything is exactly the same until HHS and WSU have had a chance to sit down and negotiate and figure out what the what a new rate might be, could go up, could go down, could be the same. We don’t know yet, but WSU is in process of doing this. Note also that, 53% is the on campus rate.

Becky James: That’s kind of the standard rate for, laboratory research, organized research. But there are different rates. If you’re doing a project that is fully instructional. And then there’s another category for other sponsored activities. So it’s not, you know, 53% across the board. And what Cheryl is going to talk about is that, like, we don’t charge F&A on every budget category either.

Becky James: But the point is, all of this, of this is based on real documented numbers and, cost of the past. So. Okay. Thank you. Cheryl.

Cheryl Dykstra-Aiello: My turn. So, this, slide is, just to show you, we looked at, Becky’s, NICRA slide that showed the different rates. And you can see that, we have an effective F&A recovery rate of 27%, of the, grant money that that we receive, everything that we receive is in compliance with federal and institutional policies and regulations.

Cheryl Dykstra-Aiello: So, the uniform guidance or the two CFR, that Becky previously mentioned and WSU’s Business Policies and Procedures manual with the BPPM and, I, I do want to say that, F&A reimbursements are classified by the government as unrestricted funding. So just like if you, are traveling for business and you get reimbursed for, you know, meal costs or if you pay for your own plane ticket, you can get that reimbursed.

Cheryl Dykstra-Aiello: You can spend that money that you get, back in your pocket. You can spend it however you want. That is also true of F&A reimbursements that are received by the university, however, we have, policies and procedures in place at WSU that dictate how the F&A distributed across the, across the campuses and university wide.

Cheryl Dykstra-Aiello: So the executive policy EP02, policy for allocating facilities and administrative cost recovery funds, this decision tree has been lifted, from that, manual. And you can see that there are a series of yes and no decisions. And, and depending on the answer, the rates differ, accordingly. So basically that it’s just to show you that, the allocations vary across, across colleges and across campuses.

Cheryl Dykstra-Aiello: And it is, based on, leadership, deciding these things, on a regular basis, they get, they get, statements of priorities that, that guide these allocations. And they do, look at these annually. So. With that, I kind of want to go into some myth busting, some things that maybe you, have been thinking about, F&A or or I’ve heard other people say about F&A and to, kind of dispel those myths and I and hopefully Becky is kind of already done that for you by, answering, the questions that are posed with these, these myths and statements.

Cheryl Dykstra-Aiello: But, so one of the one of the myths that comes up is that, F&A isn’t, a real cost of research. And I think that, Becky has kind of shown that that actually is, a cost to research that without these overhead costs, without the the cost paid for the facilities, we wouldn’t be able to have a research environment on, on campus, they, they may not be easily linked to a specific project, but that doesn’t make them less important.

Cheryl Dykstra-Aiello: To recover. And, Becky just went over the the fact that the, rates are not arbitrarily determined that they are negotiated rates, and they are, beneficial to, to the research environment on campus without them, we wouldn’t have lights on. We wouldn’t Have, the safety procedures in place.

Cheryl Dykstra-Aiello: For, you know, hazardous materials or looking after our human and animal subjects. That, F&A is a tax on research that allows universities to profit is, pretty popular. And I think that’s been kind of, supported by what’s coming out of the,

Cheryl Dykstra-Aiello: you know, coming out in the news. And that, is also untrue. First of all, universities do not have a, a profit line. They’re not profiting from, the research moneys that they are receiving from government grants. In fact, F&A funds critical infrastructure. It funds the research labs. It allows you to have, a place to do your research, and covers the costs, as, as Becky mentioned, of things like, utilities and libraries, high high speed computing, and, kind of going off of that.

Cheryl Dykstra-Aiello: I want to talk about, kind of a sample budget just to show you that, F&A costs are kind of another myth about F&A is that it is determined on the total budget and that that isn’t true. I think that pie chart sort of, alluded to that. But as a sample and this is not meant to be reflective of the rates that, have been, negotiated for WSU.

Cheryl Dykstra-Aiello: It’s just kind of a sample budget. It’s been adapted from, the Council on Foreign Relations (COGR) in a presentation that they have done, in the past but this is a budget based on $1 million, total award. And we’ve got some total direct costs here totaling $765,000. And you can see in the right, numerical column that F&A cost is determined based on those full total direct costs, but there’s a modified, cost that needs to be considered.

Cheryl Dykstra-Aiello: So, for instance, we can’t include things like, equipment. If it’s, if you’re buying equipment for your, for your research project and it’s more than $5,000 then it is not included in the determination of F&A recovery, tuition is not, if you’ve got a sub award, there’s, an amount that needs to be, removed from the total amount in order to calculate your, your F&A cost.

Cheryl Dykstra-Aiello: So in this case, then, we end up with, F&A recovery of $235,000 based on the modified total direct cost. And that ends up to be less than 25%, less than a quarter of the total budget. So, F&A is not, going towards any profit, for WSU, it’s not even, the ultimate F&A that is recovered is not even the total, at the rate that that is a agreed upon, and negotiated with the government.

Cheryl Dykstra-Aiello: So, based on that and based on, everything that we’ve shown you so far, it’s kind of been how things have have how we’ve been doing business, up to this point. And, you saw on the timeline that Becky presented that, caps have been proposed, over the years. And, we know from the news that, it’s been proposed again this year.

Cheryl Dykstra-Aiello: So federal funding agencies, DoD, NSF, NIH, Department of Energy have all tried to impose a 15% F&A cap this year. Those all were challenged in court and, have so far not been implemented. So there’s been some stays, some of them have been blocked. Some of them have been stripped down completely and some of them have been, granted injunctions, for further review.

Cheryl Dykstra-Aiello: And in the budgets that have proposed these F&A caps, the House Appropriations Committee specifically for the Department of Defense have come back with the comment that the Department works closely with the research community to develop an optimized F&A cost reimbursement solution that that, allows the nation to remain a world leader in innovation and is fair for everyone involved.

Cheryl Dykstra-Aiello: So with that, a group was formed of, community stakeholders and government leaders. And I can’t tell you who those government leaders are. But they formed this group called the Joint Association Group, or JAG, to come up with a new, a new model, a new way of, talking about, indirect costs and, F&A a new way of determining how these costs would be recovered.

Cheryl Dykstra-Aiello: And they called it a, a financial accountability in research or a FAIR model. And they had some several, several iterations of it, but they, and they and they received feedback from various universities who kind of plugged and played with these models that they came up with. And based on the feedback, they came up with, one model, with two options in it.

Cheryl Dykstra-Aiello: And what they wanted to do was they wanted to, create new trackable costing categories. So, going back to what, Becky called the fully burdened budget, it’s it’s very similar to that. They’re eliminating the F&A terminology completely. So as you’ll see in the next couple of slides, not talking anymore about direct costs and not talking about indirect costs.

Cheryl Dykstra-Aiello: They wanted to think about how the models could be implemented by across all institutions, and that would be fair for, all of the government agencies. And basically the the ultimate goal is to increase accountability and transparency of how how F&A is, accounted for and, and how it is reimbursed so that we can, you know, minimize these, misunderstandings that, are out there and, and, and not have so many myths about about what F&A is.

Cheryl Dykstra-Aiello: So the, the models that they’ve come up with kind of align more closely with how foundations do them in that they allow, foundations, allows, some line items that we would normally think of now as indirect costs. But they would be more assigned more closely to particular projects. So the models that I’m going to show you need to keep in mind that, they need congressional approval.

Cheryl Dykstra-Aiello: So they’re not they’re not going to be implemented next week or next month. It’s going to take, a few years to get them implemented. Changes to the uniform guidance are also going to be required. And, there’s going to be a transition period for the university. So it’s going to take some administrative, it’s, it’s going to have some administrative burden.

Cheryl Dykstra-Aiello: They’re going to have to go through, and be able to assign costs, to particular projects, come up with a way to do that, for costs that they’ve normally lumped in as an indirect cost. So this transition period I think has been proposed right now is a 2 to 2 year period. But that’s really going to, it will likely change.

Cheryl Dykstra-Aiello: So that’s, that’s not written in stone. We want to have they want to make sure that there’s minimal disruption to the administration in adopting these models that they’re fair and as long as they’re fair and the administrative burden is not great, then there’s going to be an increased likelihood of adoption long term. So, the FAIR model I’m showing you here the expanded option.

Cheryl Dykstra-Aiello: And you can see on this figure that there’s no, listing of direct costs per se or indirect costs. What we form or what we currently call direct costs are now being proposed to be called research performing costs or RPCs and those would be your normal, your normal costs that are specific to the project. You can specifically assign those to the project so your personnel costs, supplies, that kind of thing.

Cheryl Dykstra-Aiello: Publication costs. And then we move down to what we currently call indirect costs or facilities and administrative costs F&A and these are costs that need to be determined and and be allocable to the specific research projects. So things like regulatory compliance and those would be like IACUC and IRB biosafety, you know, and that kind of thing.

Cheryl Dykstra-Aiello: And then there would be award monitoring oversight and reporting costs or AMOR those would be like your, administrators, the people that look after your, your grants, after they’ve been awarded. There would be a percent rate assigned to essential research performance facilities or ERPF, and that would be, you know, your utilities, your maintenance costs.

Cheryl Dykstra-Aiello: things that that, you know, keep the lights on and make the labs available to you and then, research information services. So library subscriptions, that kind of thing would have a dollar, amount assigned to it. And so those would be the four subcategories that would be included in the expanded option under the essential research performance support costs, and then a flat rate fee for general research operations or GRO

Cheryl Dykstra-Aiello: and and those are the other items that, that are currently indirect costs, but that can’t really be assigned to a specific, research project. So, you know, things like, onboarding costs or, procurement or general services. That’s the those costs would fall under this GRO portion, and would be a flat percent budget. So costs that are not easily assigned to a given.

Becky James: Project.

Cheryl Dykstra-Aiello: That’s the expanded option. And then there’s a base option. And so I should say as well that universities could, decide to adopt either of these options, depending on, you know, their, their needs. You know, a larger university might want to, take the expanded option, while a smaller university with fewer, grant dollars may opt for the base option as a more simpler version to to do so, you can see that some of the things disappeared under the essential research performance costs on this base option.

Cheryl Dykstra-Aiello: Now there’s just the regulatory costs and the award monitoring and oversight and reporting costs, that are specific to the research project and, outlined on this base option. The other two, subcategories, would be put under a, flat rate, and JAG proposes a 10% rate, and it would be based on the total budget, for those two, final, subcategories the research information services and the essential research performance, facilities.

Cheryl Dykstra-Aiello: And then the general research operations would remain the same at 15%. So, again, F&A is important. Unfortunately, there’s some, misinformation on how, the federal government, reimburses F&A and how, how F&A is distributed on campuses, which definitely needs to be more transparent. And these models are, are a, a step forward towards that goal.

Cheryl Dykstra-Aiello: But it’s going to be a while before they can be implemented. So they’re out there. It’s a new way of thinking, we need to be aware that changes are going to be coming. But there is a it’s going to take a while. So in the meantime, our NICRA is still in effect. We still are doing, our F&A recovery the way we’ve always done it.

Cheryl Dykstra-Aiello: But we need to be aware that that that will be changing. And so that brings us to the end of the presentation. If you’re interested in learning more about, these models that I showed, and JAG, the JAG effort or just, F&A in general, these are some resources for you. Again, the slides will be uploaded to the, the ORAP website and you can, find them there.

Cheryl Dykstra-Aiello: And with that, we can, take questions.