Indirect Cost Rate Request for 2026-27

Indirect Cost Rate Request for 2026-27

February 13, 2026 | Grants Management

Today’s tip is for everyone! Action is required for all, and yes that means you gentle reader! It is time to complete the annual request to receive an indirect cost rate for the upcoming year. A response is required whether you say yes or no, but CSS highly recommends you say yes! The process is quick and easy, and come July 1, you will be drawing down with your new rates. The survey is short. You can do it today, but you definitely want to take action by the March 27, 2026 deadline!

Indirect costs are the costs grantees can add to their grant drawdowns to recover their organization-wide administrative costs of managing federal grants, budgeting, purchasing, auditing, and payroll processing. TEA allows grantees to use “restricted” indirect cost rates to recover the organization-wide administrative costs of managing federal grants. It’s like paying yourself back for grant work not paid for by the grant. Restricted indirect cost rates are usually fairly low; for example, if you spend $1,000 on purchased goods or services, and have an indirect cost rate of 4%, then you can draw down and get reimbursed $1,040. On some grants, the “unrestricted rate” is allowed, and is higher than the restricted rate. One short survey gets you both rates, and it is well worth it!

How do I obtain an indirect cost rate?

Each year, charter school systems must request an indirect cost rate from TEA. TEA will access certified Public Education Information Management System (PEIMS) data related to each charter school’s resident public-school district and their respective calculated indirect cost rates to determine rates for charters schools that have requested rates. To view the TEA memo about the process, click here.

All open charter schools are required to submit an online survey known as the Request for Indirect Cost Rate Survey for Charter Schools for 2026-27 by March 27, 2026. The purpose is to let TEA know if you want an indirect cost rate issued for the 2026-27 school year or not.

We at Charter School Success strongly recommend that you request an Indirect Cost Rate, even if you are not certain you will claim indirect costs during the 2026-27 school year. Say yes!

All open-enrollment charter schools are required to respond, regardless of whether or not they wish to have an indirect cost rate issued, by replying “yes” or “no” on the form. Your response will let TEA know that, as an open-enrollment charter school, you are aware of the process. Just because you request a rate, you are NOT required to use it. On the flip side, if you don’t ask for one, you are out of luck.

To access the survey, click on the link above. It only takes a minute to complete.

Once the March 27, 2026 deadline has passed, TEA will post the Indirect Cost Rate in the GFFC Reports and Data Collections located in TEAL. This is expected to happen on or about July 1, 2026, the same day the new rates take effect.

Helpful tips about Indirect Costs

  • You do not have to put indirect costs in the grant in schedule (BS6001 for ESSA; BS6006 in IDEA) in order to claim indirect costs. You do have to ensure that funds are available before including indirect costs in your draw down requests. However, if you know for sure you want to claim indirect costs, you can include them in your budget schedules in the grant up front to earmark the funds. If you decide to do it at the end of the year and did not have it in your grant budget page, it is still allowed and wouldn’t require an amendment.
  • You can wait until the end of the year to see if funds are remaining to draw down indirect costs, or you may choose to draw them down throughout the year.
  • Indirect costs percentage is calculated on amounts expended, not the total grant award.
  • Indirect costs are not included in local budget when calculating maintenance of effort (MOE). They are considered an expenditure as part of the federal grant.
  • Want to spend 100% of your grant funds on direct services to students? That’s OK too! Claiming indirect costs is totally optional.
  • Applying will also get you an “unrestricted” indirect cost rate which is a higher rate allowed to be used on grants that allow supplanting (such as ESSER did). One application will get you both restricted (to use with ESSA, IDEA, Perkins) and unrestricted rates to use with grants that allow it. The grant NOGA will tell you which rate to use, and the IDCR is posted on the draw down screen in Expenditure Reporting (the draw down system in TEAL).
  • For more information regarding Indirect Cost rates, check out TEA’s Indirect Cost Rates page. Prior year list of rates are also posted there. Please note that the process for requesting rates is TOTALLY DIFFERENT from ISDs to charter schools, so be careful to distinguish between the two when navigating that page.

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