Policies and Procedures

Research Incentive Fund

Research Incentive Fund Implementation Plan (June 2013)

Effective immediately (FY 2013)


The Research Incentive Fund was established to provide a monetary research incentive to Purdue’s colleges, schools, departments and faculty. The Research Incentive Fund distribution is determined by the support received from externally sponsored programs garnered by faculty investigators and scholars. Since the program was implemented in 1990, these funds have been distributed to colleges and other similar units through a system linked to F&A rates and the total expenses of sponsored programs attributed to each unit.


The Research Incentive Funds are returned to the colleges, schools, departments and faculty to incentivize sponsored research program activity. Recipients are to use the funds, at their discretion, to enhance Purdue’s research enterprise. To this end, funds should be expended in a timely manner.

Basis of the Determination of the Research Incentive Fund Allocation

Accounts included in the distribution of the Fund are those where the account's expenditures were incurred in support of sponsored programs for West Lafayette-campus programs. All such accounts are incorporated including those that generate a reduced F&A rate.

Allocation Elements of the Research Incentive Fund Return

The proportion of the research incentive allocation provided to each unit is based upon the investigators’ contribution from sponsored programs during the prior fiscal year. The unit's allocation is the sum of the allocations from all the investigators in the unit.

The allocation is based on the following formula:

where “modified expenditures” include total expenditures minus the unrecovered F&A expenses. Total expenditures equals the sum of direct cost and indirect cost expenditures.

Research incentives occur at all levels. A fraction returned to the investigator provides positive incentive to individual investigators adding practical value to the advancement of an investigator’s research or scholarship. The funds pooled at the college or department level can support strategic initiatives or collective needs such as shared equipment or research support staff. Therefore,

  • Allocations will be made to the college-level unit.
  • Of the college-level unit allocations, a minimum of 25 percent of the allocation for each account will be assigned to the investigator.
  • If an investigator's allocation from all included accounts is less than $100, the funds should roll up to the college-level unit.
  • College-level units have flexibility and responsibility for distribution of the remainder of the funds with the understanding that they will be directed towards research incentives.
  • Unless explicitly indicated for inclusion in the allocation, centers and institutes are not eligible to receive allocations.

Additional Background Information

Purdue Policies and Processes

The previous plan at Purdue dispersed a fixed amount in proportion to recovered F&A to the college-level units through the Research Incentive Fund, which is managed by the Office of the Vice President for Research. The dollar value of the Fund was fixed at $3.2 million from FY 2005 through FY 2012. During this same period, the total F&A recovered increased significantly, such that the percentage of total recovered F&A costs returned to the colleges declined from 8.2 percent in FY 2005 to 5.1 percent in FY 2010. During FY 2013, the fixed value of the fund was increased to nearly $4.2 million, approximately 6 percent of total recovered F&A costs.

Brief History of the Research Incentive Return Program

The University began the Research Incentive Return Program in FY 1989-90. From FY 2001-02 through FY 2004-05, the projected annual incremental growth above the previous year’s budget amount was allocated to the university operating budget and to the Provost. The Provost’s share was split equally between the Research Incentive Fund and the Research Investment Fund. The Research Incentive Funds are returned to the schools and colleges to use at their discretion. The Research Investment Fund is used by the Provost to support research-related initiatives and activities.