What is Modified Total Direct Cost (MTDC)?
NJIT and other research institutions are allowed, by most Federal sponsors, to recover F&A (indirect) costs for grants and sponsored projects in the same proportion as such costs are incurred throughout the campus. F&A costs are assumed by the government to be in proportion to the general direct-cost level at the institution. At NJIT the F&A rate, {F&A costs}/{Direct costs}, is 50% as of July 1, 2003. The F&A rate will increase to 51% for new awards after July 1, 2004 and to 52% after July 1,2006. In order to promote uniformity of practice within and among institutions, the Federal Office of Management and Budget has defined how to represent Direct Costs in the denominator of the rate. The denominator is named Modified Total Direct Cost (MTDC). It includes salaries and wages, fringe benefits, materials, supplies, non-capital equipment, services, travel, and the first $25,000 of each subcontract. Excluded from MTDC are capital equipment, capital expenditure, tuition remission, scholarsh
