OHSU

Overhead Cost Allocation (OCA)

iStock_000011406938XSmallOverhead Cost Allocation (OCA) is the methodology used to allocate direct and indirect expenses necessary for OHSU's missions to function. OCA expenditures are paid centrally and allocated to individual units that benefit from the services. OCA costs are grouped into six categories in which one of three methodologies are applied to allocate the costs to departments.

OCA costs are defined as costs common to all departments that are not directly assigned to a specific project, or costs that are not allocated to projects because the cost outweighs the benefit of tracking them to each project. OCA costs common to all departments include: insurance, interest expense on debt, and Administrative services (i.e. Human Resources; Information Technology; Legal; Facilities & Logistics; Risk Management; and Finance.)

 

OCA Contacts 

Maulin Patel Financial Analysis Manager (503)494-2237
Josh Anderson Financial Analyst 3 (503)494-5064

 

FY14 Rates 

Space Rates

 

Cost/Employee

 
Univ. Lab $53.96 Personnel Services $2,044.43
Univ. Non-Lab $45.04 Information Technology $3,901.03
Open Structure $1.19

Percentage of Expense

 
Primate $1.96 Other Expense University 7.07%
Central Lease $28.98 Other Expense Hospital 3.78%
Direct Lease $0.58 Other Expense Research 5.90%
Hospital $6.30 Restricted Expense 8.77%

 

Methodologies

The method applied to allocate each cost category is based on a department's expenses related to their employee full-time equivalent, expense base, or square footage expenses. One of the three methodologies is applied to a given cost category:

1. Full time equivalent (FTE)

2. Expense base

3. Square footage

 

Allocation of Cost Categories

1. Personnel Services

2. Information Technology

3. Other Expense

4. Research Expense

5. Space Allocation

6. Department Funded Building Credit

 

Personnel Services

The Personnel Services cost category includes costs related to administrative services (i.e., Payroll; Human Resources; Corporate Integrity; Affirmative Action); library services; workers' compensation insurance and accrued vacation.

These costs are allocated based on the adjusted FTE of employees paid by the department; overtime is excluded. The allocation fluctuates monthly as employee counts change.

 

Information Technology

The Information Technology cost category includes costs related to network maintenance (i.e., software maintenance; desktop support; ITG and Telecom space costs; email; and other IT infrastructure related items.)

The costs are allocated based on the adjusted FTE of employees paid by the department; overtime is excluded. The basis of allocation fluctuates monthly as employee counts change.

 

Other Expense

The Other Expense cost category includes costs related to all areas not already noted. This includes Administrative Services (i.e., Legal; Public Affairs & Marketing; Insurance excluding property and workers' compensation); Logistics; Financial Services; President's Office; Chief Administrative Officer's Office; Risk Management); the University's contingency and commitment pools and the Board of Directors. Included are costs related to the Schnitzer campus; South Waterfront campus; Space Committee; Public Safety; and Environmental Health and Radiation Safety.  

Other Expense costs are allocated based on a department's total non-capital expenses of the Department. The data is collected on a monthly basis and includes non-capital expenses for all OHSU funds and object codes with the following exceptions:  

  • Funds (0800-0899 Oregon Opportunity and 1400-1499 Central Service)
  • Object Codes

 

Research Expense

The Research Expense cost category includes costs related Research services (i.e., Departments of Grants and Contracts; Sponsored Project Administration, Research Integrity; Technology and Research Collaborations; Comparative Medicine; the Clinical Research Program; Tech Transfer and Business Development); and purchased services related to research support and other related expenses.  

Research Expense costs are allocated based on a department's direct sponsored project expenses; recovery for indirect costs is excluded in the basis of the allocation. The basis of allocation fluctuates monthly as related sponsored project expenditures change. The data is collected from the University's financial systems on a monthly basis. Non-Capital expenses include all total non-capital expenses with a fund greater than 5599 with the following exception:

 

Space Allocation

The space allocation category includes costs associated with OHSU occupied buildings (i.e., interest expense; depreciation; property insurance; utility expense; custodial services; Facilities and Real Estate; central leases; Campus Planning and Development; and credit from direct leased space.)

Space allocation costs are allocated based on the square footage occupied by a department. The costs are grouped into three types of space (i.e., wet lab; general office space; and parking lot areas) and applied over four locations (i.e., university; primate center; central paid lease; and direct paid lease.) The cost to a department is dependent on where the department resides.

Departments manage their space information in Space Planning's ISIS system. The data is collected and recorded on a monthly basis.

 

Department Funded Building Credit

The Department Funded Building Credit consists of departmental funding toward building costs in prior years and includes funding from gifts or other departmental revenue.

The data is based on an annual review of capital assets analysis. The credit is prorated evenly and is not expected to fluctuate throughout the year.

BLOG

View OCA related posts on the Finance Matter$ blog.

RESOURCES

Do you have more questions about OCA? Please visit our OCA How Do I…? page.