The Berkeley campus must request exceptions to negotiated indirect cost rates from the UC Office of the President. The campus will not request waivers or reductions of indirect cost recovery unless the project strictly meets the UCOP criteria for a vital program.

In the past, campus administration often used waivers as part of the campus contribution toward cost sharing in grant programs. However, the policies for returning overhead to the campus from UCOP, in effect since 2000, make the cost to the campus of waivers or reductions in indirect cost recovery comparable to direct cash contributions. Furthermore, overhead waivers are being strictly regulated by UCOP and are granted only for vital programs matching the following criteria.

• Small seed grants which may attract future larger awards;
• Cases of hardship for a new investigator;
• Awards which include contributions of equipment or building renovation funds;
• Awards for a community relations interest vital to the campus;
• Supplements for a student services activity which the campus must provide;
• Supplements for library holdings or public exhibits.

The campus also automatically grants waivers or reductions of indirect costs for most individual agencies that have formal policies dictating an indirect cost rate different from the federally negotiated campus rates. These waivers are handled automatically by SPO.