Allowable Cost

Advertising Only for the recruitment of personnel required for the project.
Air conditioning Allowable as Indirect
Alcoholic beverages Unallowable
Alterations, non-construction Must be budgeted or approved.
Animals Generally allowable.
Bad debts Unallowable
Bonding Generally allowable.
Bonus payments Allowable if part of compensation
Books Generally allowable.
Business meals and meeting costs Only when specifically permitted by the Sponsored Agreement
Civil defense Allowable as indirect cost
Commencement and convocation Unallowable
Communication costs Generally allowable.
Computer costs Allowable if essential to the performance of the work and will be used solely for such project.
Conferences Only when specifically permitted by the Sponsored Agreement
Construction Unallowable unless authorized by awarding agency.
Consultant services Allowable, some agencies require approval. All Texas State employees must be approved in advance or listed in the approved budget.
Contingent reserves Unallowable except self
Contributions Unallowable
Custom and import duty Generally allowable.
Depreciation Indirect costs only.
Donors Generally allowable.
Drugs Generally allowable.
Dues Generally allowable.
Entertainment Unallowable unless specifically approved.
Equipment: general purpose (desks, file cabinets, fax machines) Usually must be budgeted or approved in advance.
Equipment: Scientific Allowable when necessary and will be used primarily, or exclusively for the project(s) to which the costs will be charged.
Equipment maintenance and repair Generally allowable as noted above.
Equipment rental Generally allowable as noted above.
Fines and penalties Unallowable
Fringe benefits Generally allowable.
Fund raising costs Unallowable
Goods or services for personal use Unallowable
Human subjects Generally allowable.
Insurance Only allowed to the extent required or approved.
Interest Usually allowable. Can be allowed if total cost of purchase including interest does not exceed the cost of rental.
Investment management costs Unallowable
Labor relations Should be charged as indirect costs
Legal costs Generally allowable.
Library costsIndirect costs
Licenses & permits Losses Unallowable
Maintenance Generally allowable.
Materials Generally allowable.
Meals Allowable for subjects and participants or employees on trips.
Memberships Business, technical and professional organizations only if specifically approved.
Moving costs Generally allowable.
News releases Allowable with approval.
Overtime Allowable, with institutional approval
Patient costs Generally allowable.
Plant security costs Indirect Cost
Periodicals Unallowable unless approved by the funding agency or essential to the daily conduct of the project and not readily available from other sources (such as the library).
Postage: Routine postage Unallowable except where a project requires specifically identifiable large mailings or the like.
Postage: Special mailing or delivery costs Allowable when necessary for the success or completion of project.
Pre-award Costs Unallowable, except for grants under Federal Demonstration Project grants and cooperative agreements from certain federal agencies with institutional approval.
Promotional items and memorabilia, including models, gifts and souvenirs Unallowable unless specifically requested and approved in proposal.
Proposal costs Unallowable as a direct expense
Publication costs Unallowable unless approved by the funding agency or essential to the daily conduct of the project and not readily available from other sources (such as the library).
Registration fees Generally allowable.
Rearrangement costs, refreshments Not allowable unless specifically approved by contracting officer.
Recruiting costs Generally allowable.
Relocation costs Generally allowable.
Rental/lease of facilities or Equipment Generally allowable.
Renovation costs Allowable if approved by agency
Repairs Generally allowable.
Royalty costs Generally allowable.
Salaries and wages: Faculty/Technical Costs of personnel are allowable on research agreements to the extent supported by actual effort performed on the project and approved in the award budget. An individual's base salary must be used to compute the cost charged to a sponsored agreement.
Salaries and wages: Administrative and ClericalGenerally recovered through indirect costs; therefore, they are usually unallowable as direct costs on federal agreements. Exceptions include: projects that involve extensive data accumulation, require making travel and meeting arrangements for large numbers of participants, projects where the principle focus is the preparation and production of manuals, books, etc, projects that are geographically inaccessible to normal department administrative services, such as field offices; projects requiring significant amounts of project-specific database management.
Scholarships and student aid Allowable costs for training grants only.
Service charges Generally allowable.
Specialized service center costs Generally allowable.
Student activity costs Unallowable
Subject costs Generally allowable.
Supplies: Project Supplies Allowable if identified as being exclusively for the support of a sponsored agreement. Chemicals, laboratory supplies, pens, pencils, folders, notebooks and the like.
Supplies: Office Supplies Unallowable if items commonly found in any office such as wall clocks, calendars, waste cans, letterhead, staples, etc. that would likely be used for other purposes except in specific circumstances.
Taxes Generally allowable.
Telephone: Local Generally unallowable as direct cost.
Telephone: Long Distance Allowable when specifically identified with an individual project.
Transportation costs Generally allowable.
Travel costs Allowable within the approved budget limits and university policy. Foreign travel requires program approval.
Examples of unallowable Costs Coffee Mugs for Administrative Staff; Bus Chartered for Administrative Staff; Reunion for Former Participants; Selling and Marketing; T shirts; Engraved key chains; Texas State banners (unless specifically requested and approved in proposal)

Unallowable Costs:

Unallowable costs are costs that cannot be paid by a sponsored program.  Such costs may be expressly prohibited by Uniform Guidance 2CFR 200.  Charging an unallowable expense to a sponsored award is prohibited, i.e., at no time should unallowable costs be charged to the sponsored project.

However, if an error does occur and unallowable cost is identified, the following process should be followed:

  • Division of Research will notify the PI/Department of the unallowable cost that should be moved to a department specific account.  Normally these unallowable costs are moved to the PI’s/Dept/College Designated Returned Indirect Cost Account.
  • If PI/Department is non-responsive to the request, the Division of Research has the authority to move unallowable costs to the PI/Department/College Designated Returned Indirect Cost Account.