Basic Budget Building Research Executive Area. Please Note Rates used in this Tutorial are for...

Basic Budget BuildingBasic Budget Building

Research Executive AreaResearch Executive Area

Please NotePlease Note

Rates used in this Tutorial are for example purposes only and may not be up to date.

For current rates, please see our

Proposal Fact Sheet

Basic Budget BuildingBasic Budget Building

This presentation is available on the www under “Basic Budget Building Tutorial” at http://www.umass.edu/research/ogca/proceds.htm

All underlined entries herein are hyperlinks to other resources. You are invited to use and share this presentation and to follow the links for additional important information

First StepsFirst Steps• Contact OGCA by sending an email to the

pre-award research administrator responsible for reviewing your proposal. Let them know the deadline and provide the URL for program guidelines.

• Review Sponsor guidelines for any costing rules that could include:• Ceilings on requested amount• Indirect cost limits• Cost-share requirements• Direct cost restrictions (no equipment for example)

• Consult OGCA Fact Sheet for current rates• Identify sponsor forms• Build your budget using this basic budget building tutorial as a

starting point. Contact OGCA with any questions.

Two Major Budget Two Major Budget ComponentsComponents

• Direct Costs:Direct Costs:• The costs that are directly attributed to the project.

Examples include salary, supplies, equipment, etc.

• Facilities and Administrative Costs (F&A).Facilities and Administrative Costs (F&A).(Indirect Costs or Overhead):(Indirect Costs or Overhead):• Pooled costs UMass incurs in support of Sponsored

Activities not directly attributable to any one sponsored project. F&A is assessed as a percentage of direct costs.

Two Types of Direct CostsTwo Types of Direct Costs

• PersonnelPersonnel (Salaries and Fringe Benefits)

• Non-PersonnelNon-Personnel

PersonnelPersonnel

• Faculty Salaries• AcademicAcademic• Summer• Calendar

Academic Year (AY) SalaryAcademic Year (AY) Salary• Consult with your department head to determine how

much time you are allowed to dedicate to research projects. Personnel effort on all ACTIVE awards plus teaching load cannot exceed 100% . In other words, 100% summer salary (14 weeks) + committed academic year research effort (up to the maximum percentage allotted for research by your department during the academic year) + Teaching load + other obligations = 100%

• Academic Year (AY) salary is based on a 9 month appointment

• AY salary charged to the sponsor is assessed the full fringe benefits package. The exception to this is the non-tenure track research professor -- this can be non-benefited

Academic Year Salary Academic Year Salary (Cont’d)(Cont’d)

• Some sponsors (e.g. NSF) do not allow payment of academic year salary without strong justification (strictly research appointments, etc.)

Academic Year Salary Academic Year Salary Sample CalculationSample Calculation

• To charge 11% (1 month) of an academic salary of $65,000:

11% X $65,000 = $7,150

Show basis of effort according to sponsor preference, usually represented as either % of effort or monthly. NSF and NIH require that effort be reported in months.

Personnel Budget Detail Personnel Budget Detail Academic SalaryAcademic Salary

Cost Type Cost Fringe

Personnel

Principal Investigator (1 month or 11% academic year)

$7,150

Total $7,150

Fringe on Academic Year Fringe on Academic Year SalarySalary

• Group Insurance & Retirement:

29.37%

• Worker’s Comp., Unemp., & Univ. Health: 1.67%

• FICA (Medicare): 1.45% (applicable only if hired after 4/86)

• Health & Welfare: $13 per week

Academic Year SalaryAcademic Year SalarySample Fringe CalculationSample Fringe Calculation

• Group Insurance 29.37% X $7,150 = $2,100

• Worker’s Comp, etc. 1.67% X $7,150 = $119• FICA (Medicare) 1.45% X $7,150 = $104• 38 weeks (AY) X $13/wk X 11% = $54

• Total Fringe = $2,377

Fringe Budget DetailFringe Budget DetailAcademic Year FringeAcademic Year Fringe


Personnel

Principal Investigator

11% academic year

$7,150 $2,377

Total $7,150 $2,377

PersonnelPersonnel

• Faculty Salaries• Academic• SummerSummer• Calendar

Faculty Summer SalaryFaculty Summer Salary• Federal:

• Those faculty with Academic Year (AY) appointments can receive an additional 33% of their base Salary as summer salary. For example if AY Base Salary is $100,000, then an additional $33,000 can be charged as summer salary.

• The summer monthly pay rate is based on the 9 month academic year salary (AY Base/9).

• NSF permits only 2/9’s, the equivalent of 2 month’s salary.

• Industrial and Foundation:• Pay rate unrestricted – negotiated with sponsor

• Personnel effort on all ACTIVE awards plus teaching load cannot exceed 100% . In other words, 100% summer salary (14 weeks) + committed academic year research effort (up to the maximum percentage allotted for research by your department during the academic year) + Teaching load + other obligations = 100%

Faculty Summer SalaryFaculty Summer SalarySample CalculationSample Calculation

Annual salary = $54,000

Monthly salary= $54,000/9 = $6,000/mo

2 months of summer salary = $12,000 charged to the project

• Show basis of effort according to sponsor preference, usually represented as either % of effort or monthly. NSF requires by month, NIH by person-months

Personnel Budget DetailPersonnel Budget DetailSummer SalarySummer Salary


Personnel

Principal Investigator – Academic Year

1 month (11% AY effort)

$7,150 $2,377

Principal Investigator - Summer

2 months (67% Summer effort)

$12,000

Total $19,150 $2,377

Faculty Summer Salary Faculty Summer Salary Sample Fringe CalculationSample Fringe Calculation

• If PI hired before April 1, 1986• Worker’s Comp. = 1.67%(Summer Salary)

• If PI hired after April 1, 1986• FICA = 1.45%• Worker’s Comp. = 1.67%

3.12%

For the sample budget, assume the latter:3.12% X $12,000 = $374

Personnel Budget DetailPersonnel Budget DetailSummer Salary FringeSummer Salary Fringe


Personnel



$7,150 $2,377



$12,000 $374

Total $19,150 $2,751

PersonnelPersonnel

• Faculty Salaries• Academic• Summer• CalendarCalendar

Faculty Calendar Year Faculty Calendar Year AppointmentAppointment

• Some faculty have calendar year appointments – 12 months

• Full fringe is assessed; same as academic appointments

• Additional compensation can only be charged to Non-Federal sources and with Dean and Provost written approval - only FICA & Worker’s Comp. are charged for fringe

PersonnelPersonnel

• Faculty Salaries• Summer• Academic• Calendar

• Other Professional (Programmer, Technician, etc.)Other Professional (Programmer, Technician, etc.)

Other Professional Other Professional Sample CalculationSample Calculation

• Calendar year employees:

Sample annual salary = $30,000• Calculating effort on a % basis:

• 30% X $30,000 = $9,000• Calculating effort on a monthly basis:

• $30,000/12 months = $2,500/month; • $9,000/$2,500 = 3.6 months

• Additional compensation: professional and classified staff can be budgeted up to an additional 12% salary from Non-Federal sources on top of their base annual with Dept. Head and Dean approval. Must be clearly noted in the budget as “Add comp” – consult with Human Resources for allowability.

Personnel Budget DetailPersonnel Budget DetailOther Professional SalaryOther Professional Salary


Personnel



$7,150 $2,377



$12,000 $374

Other Professional – Calendar Year

3.6 mos (30% CY effort)

$9,000

Total $28,150 $2,751

Other Professional Other Professional Sample Fringe CalculationSample Fringe Calculation

• Assessed at full fringe rates• Fringe (29.37%) + Worker’s Comp (1.67%): 31.04%

$9,000 x .3104 = $2,794

• Health & Welfare $13/week or $676 annually30% effort x $676 = $203

• FICA (if hired after 4/1/86) 1.45%$9,000 x .0145 = $131

• Sick leave Bank (new) .18%$9,000 x .0018 = $16

• Total Fringe = $2,794 + $203 + $131 + $16= $3,144 for this example

Personnel Budget DetailPersonnel Budget DetailOther Professional FringeOther Professional Fringe


Personnel



$7,150 $2,377



$12,000 $374


3.6 mos (30% CY effort)

$9,000 $3,144

Total $28,150 $5,895

PersonnelPersonnel


• Other Professional (Programmer, Technician, etc.)• Graduate StudentGraduate Student

Graduate Student StipendGraduate Student Stipend

• Stipend - Minimum Graduate Stipends are set by academic areas, per student contracts. For a memo regarding specific minimum student stipends click here:

Minimum Graduate Student Employee Stipends

• Example: for a graduate student hired in 2007 for 20 hrs per week both academic and summer:

20 hours per week X 52 weeks = 1040 hours

1040 X $18.25 = $18,980

Personnel Budget DetailPersonnel Budget DetailGraduate Student StipendGraduate Student Stipend


Personnel



$7,150 $2,377



$12,000 $374


3.6 months (30% CY effort)

$9,000 $3,144

Graduate Student – Calendar Year

20 hrs/wk (100% CY effort)

$18,980

Total $47,130 $5,895

Graduate Student Graduate Student Sample Fringe CalculationSample Fringe Calculation

• GEO Health Fee: assessed at $3.92 per hour

The following examples reflect typical appointments:

• $2,979: 20 hours/wk X 38 weeks academic = 760 hrs X $3.92/hr

• $4,077: 20 hours/wk X 52 weeks = 1,040 hrs x $3.92/hr

• $5,174: 20 hours/wk X 38 weeks academic + 40 hours/wk X 14 weeks = 1,320 hours x $3.92/hr

Graduate Student Fringe Graduate Student Fringe Sample Fringe CalculationSample Fringe Calculation (cont’d)(cont’d)

• Health & Welfare$12/wk per student

• $624 for 52 week year • $456 for 38 week academic year• $168 for 14 week summer

$624 this example

Graduate Student Graduate Student Sample Fringe CalculationSample Fringe Calculation (cont’d)(cont’d)

• Summer Student Payroll FICAIf not enrolled in classes: 1.45% summer payroll

(14 weeks)

$18,980/52 wks = $365/wk

$365 X 14 wks = $5,110/summer

1.45% X $5,110 = $74

$74 for this example

Graduate Student Graduate Student Sample Fringe TotalSample Fringe Total

• GEO Health Fee $4,077• Health & Welfare $ 624• Summer Student FICA $ 74• Total $4,775

• NOTE: Curriculum fee is assessed on all academic year grad student appointments but not budgeted as fringe -- see “Other” for more info

Graduate Student Graduate Student Fringe CalculationFringe Calculation

• It is important to understand how the fringe calculation is done, however we have constructed a Graduate Student Fringe Calculator to make it easier. It also calculates the Curriculum fee.

Personnel Budget DetailPersonnel Budget DetailGraduate Student FringeGraduate Student Fringe


Personnel



$7,150 $2,377



$12,000 $374



$9,000 $3,144



$18,980 $4,775

Total $47,130 $10,670

PersonnelPersonnel


• Other Professional (Programmer, Technician, etc.)• Graduate Student• Postdoctoral FellowPostdoctoral Fellow

Postdoctoral FellowPostdoctoral Fellow

• Salary is determined by what the market will bear in a particular field and is usually figured on an annual basis. Check with your Department Head for prevailing rates

• $35,000 per year this example

Personnel Budget DetailPersonnel Budget DetailPostdoctoral Fellow SalaryPostdoctoral Fellow Salary


Personnel



$7,150 $2,377



$12,000 $374



$9,000 $3,144



$18,980 $4,775

Postdoc – Calendar Year

12 months (100% CY effort)

$35,000

Total $82,040 $10,670

Postdoctoral FringePostdoctoral Fringe

• UMass requires the budgeting of health insurance for postdocs by either providing:

• 1) The full benefits package – includes group insurance and retirement

• 2) Budgeting for the postdoc health plan – no retirement

Post Doc Fringe Post Doc Fringe (cont’d)(cont’d)

• 1) Full benefits: • Group Insurance & Retirement: 29.37%• Worker’s Comp., Unemployment, & Univ. Health: 1.67• FICA (Medicare): 1.45% (applicable if hired after 4/86)• Health & Welfare: $13 per week• Sick Leave Bank (new): .18%

29.37% X $35,000 = $10,2801.67% X $35,000 = $5841.45% X $35,000 = $50852 weeks X $13/wk = $6760.18% X $35,000 = $63Total Fringe = $11,759

Postdoctoral Postdoctoral Sample Fringe Calculation Sample Fringe Calculation (cont’d)(cont’d)

• 2) Postdoc Health Insurance plan:

Fellow only $182/mo

Fellow and child(ren) $509/mo

Fellow and spouse $636/mo

Fellow, spouse & child(ren) $963/mo

12 months X $182/mo = $2,184

• Worker’s Comp and FICA are assessed as well:

1.67% X $35,000 = $584

1.45% X $35,000 = $508

Postdoctoral Postdoctoral Sample Fringe TotalSample Fringe Total

Postdoc with health (no-retirement):• Worker’s Comp $584• FICA $508• Health Insurance $2,184• Total $3,276

Personnel Budget DetailPersonnel Budget Detail Postdoctoral Fellow FringePostdoctoral Fellow Fringe


Personnel



$7,150 $2,377



$12,000 $374



$9000 $3,144



$18,890 $4,775



$35,000 $3276

Total $82,040 $13,946

PersonnelPersonnel


• Other Professional (Programmer, Technician, etc.)• Graduate Student• Postdoctoral Fellow• SecretarialSecretarial

SecretarialSecretarial

The direct charging of secretarial services on federally supported projects is allowed only under a limited number of scenarios. Secretarial salary can be charged to non-federal projects with less stringent restrictions. See the policy statement and consult with OGCA proposal staff for guidance.

PersonnelPersonnel


• Other Professional (Programmer, Technician, etc.)• Graduate Student• Post Doctoral Fellow• Secretarial• Undergraduate StudentUndergraduate Student

Undergraduate StudentUndergraduate Student

• Undergraduate Students are hired for varying numbers of hours per week

• The pay scale for undergraduates is determined by the job description and Human Resources guidelines

10 hrs/wk X 38 wks X $10/hr = $3,800

Personnel Budget DetailPersonnel Budget Detail Undergraduate Student Pay Undergraduate Student Pay


PersonnelPrincipal Investigator – Academic Year


$7,150 $2,377



$12,000 $374



$9000 $3,144



$18,890 $ 4,775



$35,000 $3,276

Undergraduate – Academic Year

10 hrs/wk (50% AY effort)

$3,800

Total $85,840 $13,946

Undergraduate FringeUndergraduate Fringe

Undergraduate salary is not charged fringe. However, FICA is charged during summer employment if the student is not enrolled in summer classes.

Fringe = $0 for this example since the student is working during the academic year.

Personnel Budget DetailPersonnel Budget Detail Undergraduate Student Fringe Undergraduate Student Fringe


PersonnelPrincipal Investigator – Academic Year


$7,150 $2,377



$12,000 $374



$9000 $3,144



$18,890 $ 4,775



$35,000 $3,276

Undergraduate – Academic Year

10 hrs/wk (50% AY effort)

$3,800

Total $85,840 $13,946

Non-personnelNon-personnel

• ConsultantsConsultants

Non-personnel CostsNon-personnel CostsConsultantsConsultants

• A consultant lends their expertise and advice in their given field without actually “working” on the project

• UMass personnel cannot be paid as consultants on UMass grants & contracts

• As of 1/1/07 NSF limits consultant daily rate to max of $577 per day. This rate can be used for guidance on other federal projects but is not a requirement. Basis for costing on non-federal grants is market driven

• Reasonableness of consultant rate of pay –NSF maximum rate –as of March 15, 2006 has been eliminated BUT ONLY on new awards or new increments –if you have a standard grant funded with an earlier appropriation the maximum rate still applies

• Provide daily rate of pay in the budget – obtain from consultant – do not guesstimate, get exact rate

Non-personnel Budget DetailNon-personnel Budget DetailConsultantsConsultants

Cost Type Cost

Consultant – ABC Advice, Inc. ($577/day, 10 days) $5,770


• Consultant• EquipmentEquipment

EquipmentEquipment

• Definition:• $1,000 unit cost or more• Non-expendable tangible property• Useful life of 2 years or more

• Budgeting:• List pieces of equipment separately showing unit cost• Basis for costing: costing can easily be done on-line for

items from laptops to centrifuges, or with familiar vendors. Avoid guesstimates

Non-personnel Budget DetailNon-personnel Budget DetailEquipmentEquipment

Cost Type Cost


Equipment – 17” MacBook Pro $2,799


• Consultant• Equipment• AdministrativeAdministrative



• Administrative and Office SuppliesAdministrative and Office Supplies

Administrative Administrative Office & Administrative SuppliesOffice & Administrative Supplies

• Definition:• Pens, pencils, file folders, paper products, including

photocopy paper, film, tape, etc., and small office machines under $100

• Budgeting:• Federal: strict limitations placed on ability to budget. NOT

ALLOWABLE – consult with OGCA. Not included in sample budget for this reason

• Non-federal: no limits - budget as needed

• Basis of costing: experience

• Range: $25 - $100, depending on size of project



• Administrative and Office SuppliesAdministrative and Office Supplies• Postage and TelephonePostage and Telephone

Administrative Administrative Postage & TelephonePostage & Telephone

• Definition: • Overnight courier services, regular postage, telephone

• Budgeting:• Must detail project related need and state ability to

separately track these expenses from routine non-project expenses for auditing purposes

• Federal: telephone only for long-distance or for phone line entirely dedicated to the project with justification

Administrative Administrative Postage & Telephone Postage & Telephone (cont’d)(cont’d)

• Limitations on costing are not typically placed by non-federal sponsors

• Basis for costing: experience in related projects with costing scaled up or down depending on relative size of project. Check your records and/or bookkeeper’s for prior accounting on project of a similar size and type

• Typical range: $50 to $500; amounts vary depending on nature of the project

Administrative Administrative Postage & TelephonePostage & Telephone

SampleSample calculation/justificationcalculation/justification

• Postage for mailing brochures: • 200 X .41 = $82

• Justification • Mailing of brochures to candidates for participation

in the study. Brochures explain guidelines and criteria. They are required to properly educate possible participants prior to screening. These costs are auditable and accounted for separately from non-project costs

Administrative CostsAdministrative CostsPostage & TelephonePostage & Telephone

Calculation/Justification Calculation/Justification (cont’d)(cont’d)

• Telephone (long-distance): • $200

• Justification:• Long distance phone calls required for follow-up

with accepted participants to run initial interviews and to schedule and confirm appointments for participation. These costs are auditable and accounted for separately from non-project costs

Non-personnel Budget DetailNon-personnel Budget DetailAdministrative Administrative (cont’d)(cont’d)

Direct Cost Type Cost



Administrative –

Postage for mailing brochures

Telephone (long-distance)

$82

$200



• Administrative and Office SuppliesAdministrative and Office Supplies• Postage and TelephonePostage and Telephone• Subscriptions, Membership Dues Subscriptions, Membership Dues

Administrative Administrative Subscriptions, Membership DuesSubscriptions, Membership Dues

• Definition: • Self-explanatory; costs must be allocable to a specific

project and allowed by the sponsor

• Budgeting:• Federal: strict limitations placed on ability to budget.

NOT ALLOWABLE – consult with OGCA. Not included in sample budget for this reason

• Non-federal: no limits - budget as needed. Should be explained/justified

• Basis of costing: current vendor rates• Range: variable



• Administrative and Office SuppliesAdministrative and Office Supplies• Postage and TelephonePostage and Telephone• Subscriptions, Membership DuesSubscriptions, Membership Dues • PhotocopyingPhotocopying

AdministrativeAdministrativePhotocopyingPhotocopying

• Definition: • Both on and off-campus project-related photocopying

services

• Budgeting:• Federal: Allowable on federal projects but only with

thorough explanation and justification. Must detail project related need and state ability to separately track these expenses from routine non-project expenses for auditing purposes

• Non-Federal: no limits - budget as needed

AdministrativeAdministrativePhotocopying Photocopying (cont’d)(cont’d)

• Budgeting (cont’d)

• Basis of costing: experience in related projects with costing scaled up or down depending on relative size of project. Check your records and/or bookkeeper’s for prior accounting on project of a similar size and type

• Range: variable

AdministrativeAdministrativePhotocopying justificationPhotocopying justification

Sample explanation/justification:

• Funds are budgeted for project-related copying expenses incurred in the dissemination of paper submissions, documents/reports, and meetings/presentations required by the sponsor. These costs are auditable and separately tracked from routine non-project expenses

Non-personnel CostsNon-personnel Costs

• Consultant• Equipment• Administrative Administrative • SuppliesSupplies

Non-personnel CostsNon-personnel CostsSuppliesSupplies

• Consultant• Equipment• Administrative• SuppliesSupplies

• Laboratory supplies, chemicalsLaboratory supplies, chemicals

SuppliesSuppliesLaboratory supplies, chemicalsLaboratory supplies, chemicals

• Definition:• Laboratory supplies and chemicals allocable to

proposed project

• Budgeting:• List types and give subtotals for major items in the

budget explanation as applicable

• Basis for costing: check with vendors or accounting records for prior costing on similar projects. If new to budget building, confer with more experienced colleagues. Avoid over-inflating costs

• Range: variable, $100 - $25,000 based on project size/type

SuppliesSuppliesLab supplies/chemicalsLab supplies/chemicals

CalculationCalculation

Lab supplies/chemicals:• Chemicals: $5,000• Reagents: $1,000• Antibodies: $2,000• Enzymes: $500• Disposable lab supplies

(pipettes, media agents,

syringes, etc.): $300• Total: $8,800

Non-personnel Budget DetailNon-personnel Budget DetailSuppliesSupplies




Administrative –


Telephone (long distance)

$82

$200

Supplies –

Lab/chemical supplies $8,800

Non-personnel CostsNon-personnel CostsSuppliesSupplies (cont’d) (cont’d)

• Consultant• Equipment• Administrative• SuppliesSupplies

• Laboratory supplies, chemicals• Computer suppliesComputer supplies

Supplies -- Supplies -- Computer suppliesComputer supplies• Definition:

• Computer paper, diskettes, zip disks, toner, etc

• Budgeting:• Federal:

Allowable with proper explanation and justification Must detail project related need and state that these

expenses are separately auditable from non-project costs

• Non-federal: no restrictions

• Basis for costing: Check with vendors, accounting records, or colleagues for

prior costing on similar projects Avoid over-inflating costs

• Range: variable, $50 - $250 based on project size/type

SuppliesSuppliesComputer suppliesComputer supplies

Calculation/JustificationCalculation/Justification

• Computer supplies:• Cost: $200

• Justification:• Computer supplies are required for project

related sponsor mandated reports. These costs are separately auditable from non-project costs

Non-personnel Budget DetailNon-personnel Budget DetailSuppliesSupplies



Equipment – 17” Mac Book Pro $2,799

Administrative –


Telephone (long-distance)

$82

$200

Supplies –

Lab/chemical supplies

Computer supplies

$8,800

$200

Non-personnel CostsNon-personnel CostsSuppliesSupplies

The list of items in this sample budget under “Supplies” are not exhaustive but provided for illustrative purposes. Other costs that might arise are listed below for convenience. Click item for more information if hyperlinked

• Software, Software Upgrades, & Software Licenses


• Consultant• Equipment• AdministrativeAdministrative• SuppliesSupplies• TravelTravel

Non-personnel CostsNon-personnel CostsTravelTravel

• Definition: • Airfare (domestic & foreign), per diem, hotel,

conference registration, ground transportation (taxi/limo), car rental, mileage & tolls

• Budgeting:• Federal:

Cannot charge business class or first class air travel Must utilize U.S. flag carriers at the lowest available

rates

• Non-federal: No airfare limitations

Non-personnel CostsNon-personnel CostsTravelTravel (cont’d)(cont’d)

• Budgeting cont’d.• Basis for costing:

Airfare: check with travel agent or on-line service.Domestic per diem and hotel: UMass limits per diem

(food) charge on domestic travel at $40.00 per day ($50 for MA, NYC, DC). See federal per diem site for suggested domestic hotel costs or call your travel agent.

Foreign: Use foreign per diem and hotel rates, actual expenses based on prior travel or check with travel agent and/or bookkeeper.

Mileage: set at the IRS rate, currently (1/1/07) set at 0.485 per mile.

Non-personnel CostsNon-personnel CostsTravel Travel (cont’d)(cont’d)

• Range: $1,200 to $1,600 per domestic conference $1,500 to $3,000 per foreign conference depending

on location/duration Non-conference travel costs vary significantly Do not guesstimate Build budget with information suggested under

“Basis for costing” and provide explanation

TravelTravelCalculationCalculation

Domestic:• Conferences in DC (two each for PI & RA)

Airfare: $550 X 2 (PI & RA) X 2 trips = $2,200 Hotel: $110 X 3 days X 2 X 2 = $1,320 Per diem: 3 days X $40/day X 2 X 2 = $480 Registration: $400 X 2 X 2 = $1,600 Mileage (to/from Bradley): 0.485 X 70 miles X 2 = $68 Ground transportation (to/from Dulles): $35 X 4 = $140

• Total: = $5,808

TravelTravelCalculation Calculation (cont’d)(cont’d)

Foreign:• Conference in Moscow (PI)

Airfare: $950 Hotel: 5 days X $191 $955 Per diem: 5 X $103 $515 Registration: $400 Mileage: (to/from Bradley): $68 Ground transportation: $150

• Total: $3,038

Non-personnel Budget DetailNon-personnel Budget DetailTravelTravel



Equipment – 17” Mac Book $2,799

Administrative –


Telephone (long-distance) $282

Supplies –

Lab/chemical supplies

Computer supplies $10,050

Travel –

Domestic: $5,808

Foreign: $3,038 $8,846


• Consultant• Equipment• AdministrativeAdministrative• SuppliesSupplies• TravelTravel• SubcontractsSubcontracts

Non-personnel CostsNon-personnel CostsSubcontractsSubcontracts

Definition:

• Generally, a subcontractor is defined as an organization, often another university, who helps carry out the activities of the proposed project by performing a portion of the research using their own facilities. They receive a proportional share of funding from the sponsor via UMass and will often charge their own indirect costs

Non-personnel CostsNon-personnel CostsSubcontracts Subcontracts (cont’d)(cont’d)

Procedures• The following items must be provided to OGCA:

A letter signed by the subcontractor’s authorized signatory (OGCA equivalent)

Statement of work (subcontractor specific – does not include UMass effort)

Subcontractor budget and justification

Subcontractor Indirect Cost Rate and Fringe Rate Agreements (if subcontractor is budgeting them in their own budget)

Sole source justification

Non-personnel CostsNon-personnel CostsSubcontracts Subcontracts (cont’d)(cont’d)

Procedures (cont’d)

• The first four items should be handled by the subcontractor and forwarded to OGCA

• The sole source justification is completed by the UMass Principal Investigator. It explains why the subcontractor is uniquely qualified to carry out the work. Sole source justifications can be forwarded to OGCA via email

• Subcontractors should use all sponsor forms and include any required certifications/assurances

Non-personnel CostsNon-personnel CostsSubcontracts (cont’d)Subcontracts (cont’d)

Budgeting:• The subcontractor typically budgets for both Direct

Costs (DC) and Indirect Costs (IC). Take the total of the DC and IC provided in the subcontractor budget and roll that total into your budget creating a line item called “Subcontracts” – see next slide for sample subcontractor budget. The subcontractor’s total costs are then rolled into the UMass budget under the “Subcontract” line item

Subcontractor BudgetSubcontractor BudgetSampleSample

Wassamatta U. subcontract Cost

1. Salaries $10,500

2. Fringe $2,625

3. Equipment $2,500

4. Administrative $100

5. Supplies $500

6. Travel $2,500

Total Direct Cost $18,725

Total Indirect Cost (67% MTDC) $12,546

Total Cost $31,271

Non-personnel Budget DetailNon-personnel Budget DetailSubcontractsSubcontracts




Administrative – Postage for mailing brochures; Telephone (long-distance) $282

Supplies – Lab/chemical supplies; Computer supplies $10,050

Travel – domestic & foreign $8,846

Subcontract – Wassamata U. $31,271

Non-personnel CostsNon-personnel Costs• ConsultantConsultant• EquipmentEquipment• AdministrativeAdministrative• SuppliesSupplies• TravelTravel• SubcontractsSubcontracts• Other DirectOther Direct

Non-personnel CostsNon-personnel CostsOther DirectOther Direct

• Definition: the following items are often budgeted under “Other” but for the sample budget, only curriculum fee appears.

• Curriculum fee

• Equipment rentals, maintenance & repair

• Research animals and animal care charges

• Human subject payment

• Publication costs

• Participant support costs

• Do not use “Miscellaneous” as a line item

Above items not intended to be exhaustive but are illustrative of common items budgeted in the “Other” category.

Other Direct Other Direct CalculationCalculation

Curriculum Fee • The rate is $7.76/hr. (FY’08) per Graduate Student (GS)

1 GS X 20 hrs/wk X 38 wks X $7.76 = $5,897

• Note: No more than 760 hrs or $ 5,897 per GS will be charged in an

academic year

Summer effort is not charged CF

Curriculum Fee is exempt from F&A

Non-personnel Budget DetailNon-personnel Budget DetailOther DirectOther Direct




Administrative – Postage for mailing brochures; Telephone (long-distance) $282

Supplies – Lab/chemical supplies; Computer supplies

$10,050

Travel – domestic & foreign $8,846

Subcontracts – Wassamata U. $31,271

Other Direct – Curriculum fee on graduate student $5,897

Total Direct CostTotal Direct CostCost type Cost

Salaries $85,840

Fringe $13,946

Consultant $5,770

Equipment $2,799

Administrative $282

Supplies $10,050

Travel $8,846

Subcontracts $31,271

Other $5,897


Two Major Budget Two Major Budget ComponentsComponents

• Direct CostsDirect Costs

• Facilities and Administrative CostsFacilities and Administrative Costs

Facilities and Administrative Facilities and Administrative Costs Costs (F&A, overhead, indirect costs)(F&A, overhead, indirect costs)

• Definition:• F&A is calculated as a percentage of Direct Costs• Rates vary depending on type of project, sponsor type,

and project location (on-campus, off-campus); see fact sheet for specific rates. Consult with OGCA before budgeting either the “Off-campus” or “Other Sponsored Activities” or “Instruction” rates

• If the sponsor’s F&A rate differs from the University’s, defer to sponsor mandated rates but provide OGCA with a copy of the sponsor’s guidelines supporting this restriction

Facilities and Administrative Facilities and Administrative Costs Costs (cont’d)(cont’d)

• Definition (cont’d)• F&A is assessed either on a Modified Total Direct Cost basis

(MTDC) or a Total Direct Cost (TDC) basis. MTDC simply means -- do not assess F&A (subtract them from the total before calculating F&A) on the following costs:

• Equipment ($1,000 or more unit cost)• Tuition (for cost-sharing purposes)• Curriculum fee• Rental costs of off-site facilities• Fellowships• Subcontractor costs in excess of $25,000

Facilities and Administrative Facilities and Administrative Costs Costs (cont’d)(cont’d)

• Definition (cont’d)• Total Direct Cost (TDC) means that the applicable

F&A rate is assessed on the direct cost total. Every rule has an exception of course: never assess F&A on the curriculum fee

• Budgeting:• Review sponsor guidelines and assess F&A costs as

instructed. Confer with OGCA if unclear

Facilities and AdministrativeFacilities and AdministrativeCalculationCalculation

Assume an on-campus research project for our sample budget with a 57% MTDC F&A rate. 57% is therefore assessed on the total direct direct costs less equipment, curriculum fee, and subcontractor costs in excess of $25K. Thus the MTDC base:

$164,701 - $2,799 - ($31,271- $25K)* - $5,897 = $149,734; multiply this by 57%:

$149,734 X 57% = $85,348

*some people find it easier to subtract the full subcontract amount and add $25k back in: -$31,371 + $25,000

Cost type Cost

Salaries $85,840

Fringe $13,946

Consultant $5,770

Equipment $2,799

Administrative $282

Supplies $10,050

Travel $8,846


Other $5,897


F&A Budget DetailF&A Budget DetailCost type Cost

Salaries $85,840

Fringe $13,946

Consultant $5,770

Equipment $2,799

Administrative $282

Supplies $10,050

Travel $8,846


Other $5,897


Total Indirect Costs $85,348

Total Cost $250,049

Cost-sharingCost-sharingDefinitionDefinition

• Definition:

Cost-share is that part of the project’s costs borne by the University rather than the sponsor. Some sponsors require cost-sharing, often specific matching (such as 1:1 or 1:2) is required and other times agencies simply indicate that cost- sharing is recommended and will be a factor in the review and scoring of a proposal

Cost-sharingCost-sharingWhen allowableWhen allowable

• When to cost-share:• To include cost-share in your proposal, sponsor’s

written guidelines must either require it, or strongly suggest its inclusion.

• UMass policy does not allow for “voluntary” cost-sharing. If the sponsor doesn’t require it, cost-share must not appear in your budget.

• Do not provide shared costs from third party sources (Non-UMass, non-subcontractor). Confer with OGCA if third party share is required by sponsor.

Cost-sharingCost-sharingAllowable costsAllowable costs

• What to cost-share:• If established that the sponsor requires or recommends cost

share, only the following costs may be shared regardless of whether sponsoring agency is federal or non-federal:

• Salaries• Fringe• Equipment• Subcontractor• Tuition waivers• Indirect costs

• NOTE: Cost share must be from UMass accounts, not from other grants or contracts, federal or non-federal

Cost-sharingCost-sharingProcessProcess

• All cost-shared amounts and their associated state ledger account numbers must be listed on the second page of the Internal Processing Form (IPF). This cost-share must also be authorized with a signature in the far right column, by the individual authorized to commit the shared funds, usually the Department Head

Cost-shareCost-shareBudgetingBudgeting

• Salaries

Cost-shareCost-shareBudgetingBudgeting

• Salaries:• Shared salary must derive from UMass funds, not

matched from other federal or non-federal grants

• Shared salary can be budgeted for UMass personnel with paid appointments. Exceptions to this rule:

• Faculty summer salary & emeritus faculty salary

• Salary is shared only for time specifically dedicated to the project during the proposed project period

Cost-shareCost-shareSalaries Salaries (cont’d)(cont’d)

• Cost-shared salary is typically shown as a percentage of the employee’s base appointment but can also be budgeted in weeks or months following the same rules of effort reporting as required for reporting time charged to the sponsor

• Keep in mind that personnel effort on all ACTIVE awards plus teaching load cannot exceed 100% . In other words, 100% summer salary (14 weeks) + committed (charged and cost-shared) academic year research effort (up to the maximum percentage allotted for research by your department during the academic year) + Teaching load + other obligations = 100%

Cost-share, salariesCost-share, salariesSample calculationSample calculation

• Prof. Grant wants to cost-share 1 month (11% AY) of his academic salary. Prof. Grant makes $65,000 per academic year

• 11% X $65,000 = $7,150

• Show basis of effort according to sponsor preference, usually represented as either % of effort or monthly. Both NSF and NIH require effort shown in months.

Cost Type UM cost-share

PI (11% AY) $7,150


Cost-share, salariesCost-share, salariesSample Calculation Sample Calculation (cont’d)(cont’d)

• Regardless of whether funding is federal or non-federal, secretarial salary can be cost-shared at a minimum effort of 25% CY

• Secretary’s salary is $30,000/calendar year and will devote 25% to the project

• $30,000 X 25% = $7,500


PI (11% AY) $7,150

Secretary (25% CY) $7,500


Cost-shareCost-shareFringeFringe

• Salaries• Fringe

Cost-share, FringeCost-share, FringeSampleSample Calculation on PI AcademicCalculation on PI Academic

• Same rules apply for budgeting shared fringe as for charging to the sponsor:

• Group Insurance • 29.37% X $7,150 = $2,100

• Worker’s Comp, etc.• 1.67% X $7,150 = $119

• FICA (Medicare) • 1.45% X $7,150 = $104

• Health & Welfare • 38 weeks (AY) X $13/wk X

11% = $54

Total Fringe: $2,377


PI (11% AY) $7,150

Secretary (10%) $3,000

Fringe PI $2,377


Cost-share, FringeCost-share, FringeSampleSample Calculation on SecretarialCalculation on Secretarial

• Same rules apply for budgeting shared fringe as for charging to the sponsor. If secretary benefited:

• Group Insurance 29.37% X $3,000 = $881

• Worker’s Comp, etc.1.67 X $3,000 = $50

• FICA (Medicare) 1.45% X $3,000 = $44

• Health &Welfare: $12 week X 52 weeks X 10% = $62

• Sick Leave Bank (new):.18% X $3000 = $5

Total Fringe: $1,042


PI (11% AY) $7,150


Fringe: PI $2,377

Fringe: Secretary $1,042


Cost-shareCost-shareEquipmentEquipment

• Salaries• Fringe• EquipmentEquipment

Cost-share - EquipmentCost-share - Equipment SampleSample CalculationCalculation

• Criteria:• Must be purchased

exclusively for use on the project from UMass funds

• Must be purchased during the project’s anticipated period of performance

• Sample budget:• Eye Tracker: $7,995


PI (11% AY) $7,150


Fringe: PI $2,377


Equipment $7,995


Cost-shareCost-shareSubcontractSubcontract

• Salaries• Fringe• Equipment• Subcontract

Cost-share, SubcontractCost-share, SubcontractSample CalculationSample Calculation

• Subcontractor cost-share must be signed off by the sub’s OGCA. Shared items must be auditable.

• When applying UMass F&A on UMass shared direct costs, the subcontractor’s total shared cost, like equipment, is exempt. See slide on sharing F&A costs for further explanation.

• Sample budget: Sub contributes salary, fringe, and associated F&A costs: $4,175


PI (11% AY) $7,150


Fringe: PI $2,377


Equipment $7,995

Subcontract $4,175


Cost-shareCost-shareTuition waiverTuition waiver

• Salaries• Fringe• Equipment• Subcontract• Tuition waiversTuition waivers

Cost-share, Tuition WaiversCost-share, Tuition Waivers SampleSample CalculationCalculation

• Tuition waivers are budgeted for graduate students whose salary is being charged or cost-shared to the grant

• Student stipends must be budgeted at a minimum of $2,682 per semester to receive a waiver

• Tuition waivers: $2,705.50 per semester

• Calculation for sample budget:

1 student X 2 semesters X $2,705.50 = $5,411


PI (11% AY) $7,150


Fringe: PI $2,377


Equipment $7,995

Subcontract $4,175

Tuition waiver $5,411


Cost-shareCost-share Facilities and Administrative Costs Facilities and Administrative Costs

(F&A, overhead, indirect costs)(F&A, overhead, indirect costs)

• Salaries• Fringe• Equipment• Subcontract• Tuition waivers• Facilities and Administrative CostsFacilities and Administrative Costs

• Assess F&A on shared direct costs using same rate charged to sponsor. However, always use MTDC basis for sharing of F&A: equipment and tuition waivers are exempt from F&A assessment. In addition, do not assess F&A on subcontractor’s total shared costs.

• Sample calculation: $31,150 – ($7,995 + $4,175 + $5,411) = $13,569 X 57% = $7,734

Cost-share, F&ACost-share, F&ASample calculationSample calculation


PI (11% AY) $7,150


Fringe: PI $2,377


Equipment $7,995

Subcontract $4,175

Tuition waiver $5,411


Total Indirect Cost $7,734

Total Cost Share $38,884

Total BudgetTotal BudgetSponsor & UMass cost-shareSponsor & UMass cost-share

Cost type Sponsor UMass Total

Salaries $85,840 $10,150 $95,990

Fringe $13,946 $3,419 $17,365

Consultant $5,770 $5,770

Equipment $2,799 $7,995 $10,794

Administrative $282 $282

Supplies $10,050 $10,050

Travel $8,846 $8,846

Subcontracts $31,271 $4,175 $35,446

Other $5,897 $5,411 $11,308

Total Direct Cost $164,701 $31,150 $195,851

Total Indirect Costs $85,348 $7,734 $93,082

Total Cost $250,049 $38,884 $288,933

Budget Explanation and Budget Explanation and JustificationJustification

• A well-developed budget is accompanied by a budget explanation.

• A complete and realistic budget justification demonstrates that your project is well conceived. It also tends to minimize the chances that sponsors will arbitrarily reduce or eliminate budget categories. Sponsors have a good idea of what a project should cost, and generally know when you are over or under budgeting. Follow sponsor guidelines on minimum items required.

• Explanation and justification are synonymous terms except with federal grants where “Explanation” merely details what the cost item is while “Justification” conveys why a cost item – particularly “Administrative costs” – are allocable and necessary for the successful completion of the project.

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