Current GAIR and fringe benefit rates can be found on the Budget Development page under planning parameters.
For an inside look into campus benefits, rate calculation and rate charging, explore the expandables below.
The Boulder campus has used a pooled benefit rate, charged on salary, since 2004. Prior to that, actual benefit expenses were charged directly to departments. Pooled rates spread "risk", ensure coverage to all eligble employees who enroll, and minimize incentives to hire based on an employee's potential benefit needs.
For more detailed information on benefit coverage, visit the Employee Services webpage.
Employees elect benefit plans and are then charged for their portion of benefits on their monthly pay advice. This money then goes to the Office of Employee Services. This rate is applied automatically to salary expenses as part of the month-end close process. Monies flow through the campus benefit pools in fund 28 to the Office of Employee Services. Employee services pay insurance providers with these contributions and in return, employees recieve insurance ID cards, retirement statements, etc.
For a better understanding, view our visual representation of how fringe benefits flow in the CU system. (PDF)
The fringe benefit rate calculation uses the most recent fiscal year actual amounts to calculate future fiscal year benefit rates. These figures form the basis for projecting current year salary and benefits activity, which are used in turn to project the fringe benefit and salary expenses for the following year. Calculations of the estimated fringe benefit expenses determine the rate necessary to adequately fund projected fringe benefits expenses based on estimated changes to employer contributions.
For your convenience, we've created a chart that graphically displays the two year lag in actual expenses and the inclusion of calculated carryforwards (PDF). The campus is required by federal rules to include the prior year’s surplus or deficit (carry forward) in the following year’s rates.
Fringe benefit rates are submitted to the U.S. Department of Health and Human Services, Division of Cost Allocation by the end of December annually.
The General Administrative and Infrastructure Recharge (GAIR) is a combination of the General Administrative Recharge (GAR) and the General Infrastructure Recharge (GIR). GAR & GIR are overhead charges that the university levies on self-supporting operations, primarily Auxiliary fund groups, which benefit from central campus services and support. The two rates are distinct and are calculated separately, but are commonly referred to in combination as GAIR. Charging self-supporting operations for central support and services is common practice in Higher Education since this overhead charge supports the notion that an auxiliary is to be self-supporting.
The GAR portion is calculated using the federally defined general and administrative (G&A) cost pool divided by total campus operating expenditures per the annual audited campus financial statements.G&A expenditures are commonly found in the General Fund. Examples include accounting, human resources, budget office, a portion of OIT, and CU-system services (e.g. purchasing, payroll, IT functions). GAIR proceeds come into the general fund and are used to cover these general administrative costs.
The GIR portion is calculated by determining the auxiliary share of common infrastructure costs and then dividing that amount by total auxiliary operating expenses excluding GAIR expenses. Examples of common infrastructure costs include sidewalks, roads, garbage cans and bike racks.
GAIR is a cost recovery model.The GAIR rate is calculated annually using data from two years in arrears. For example, the FY2015 GAIR rate is calculated during FY2014 using FY2012 actuals. In general, if the G&A cost pool grows more slowly than the total operating expenditure base, the rate will go down; if the reverse is true, the rate will go up.
GAR is charged on a monthly basis to auxiliary and self-funded operations (20, 26, 28, 29) and their renewal and replacement plant fund (78) and to agency funds (80). GAIR is only applied against expenses, not cash transfers or revenue.
GIR is charged on a monthly basis to auxiliary and self-funded operations (20, 26, 28, 29) and their renewal and replacement plant fund (78).