Budgeting

Budgeting Guidelines

Budgeting Guidelines

TC's budget template. (Excel) is a useful tool for most types of grants.  It is NOT a required form, but rather a tool that:

• facilitates submissions to multiple sponsors
• provides all information needed to complete all administrative sections of major grant proposals in addition to the budget
• provides direct links to sponsor forms
• prompts users with reminders of sponsor budget requirements to avoid going over budget limits and other errors that can jeopardize funding
• Completely self-contained with instructions and color coded for ease of use.

The budget template was designed to accommodate all types of grant budgets. It assumes no prior knowledge of grant budgeting, or of TC salary formulas, indirect cost and fringe benefit rates, or even Excel formulas. All OSP's expertise in these areas is "built in" to the template, which we hope will make filling out application forms a task most administrators and office assistants can perform. To that end, OSP has phased in the template. We can demonstrate the template at departmental and other meetings upon request.

The new budget template standardizes faculty salary calculations as a percentage of annualized base salary (base x 153%), which about half our outgoing applications have been using for quite some time. This facilitates budgeting salary as a percentage of annual effort (which most sponsors now require) as well as annual time and effort reporting. It also maximizes potential salary from grants for all faculty. Other formulas can be used with prior OSP approval for purposes of meeting a budget ceiling or cost sharing. Below is some guidance for estimating costs of other frequently requested budget items:

Each item below corresponds to a common line item in most grant budgets

1. Faculty Salaries

In order to calculate faculty salaries for a grant budget, it is important to know that faculty at TC work on 9 month contracts corresponding to the Academic Year. Faculty compensation for this nine month period is known as an Institutional Base Salary (IBS). Federal Cost Accounting standards require that we charge grants for faculty salary according to formulas based on IBS, so you will need the current IBS of each faculty member named on a grant in order to calculate the budget. OSP has a complete list for all faculty and can provide you with that information if you do not have it.

The 9 month contract leaves the three summer months available for faculty to devote 100% of their effort on grant related work. Therefore, faculty will most frequently request Summer Salary from a grant. The three months of the summer are equal to 1/3 of the academic year, so summer salary is capped at 33% of IBS. Each month of summer salary is equal to 11% of IBS.

Faculty may also do grant related work during the year. A faculty member may elect to "buy out" of teaching (more formally known as "course release") to work on a sponsored project, at a rate equal to 20% of IBS for each course released. If a faculty member performs work on a sponsored project in addition to his or her normal duties at the college during the academic year, he or she may draw overage compensation. TC policy caps overage at 20% of IBS.

The maximum annual compensation a faculty member may draw from TC and external sources combined is thus 153% of IBS. Most sponsors request that effort on a project be requested as a percentage of each individual’s annual (12 month) effort. By taking the Institutional Base Salary and multiplying it by 153% we arrive at a figure known as the Annualized Base Salary (ABS). Most grants budget faculty effort as a percentage of ABS.

Here's an example to illustrate:

Prof. X has an institutional base salary of $100,000 per year, or an annualized base salary of $153,000. Prof. X will devote 20% of her total effort to a project each year. During year one of the project, the budget request $30,600 rather than $20,000 because we base the request on the annualized salary.

NOTE: The National Institutes of Health (NIH) sets an annual salary cap. Effective January 1, 2008, total compensation for individuals receiving funds from NIH and institutional sources may not exceed $191,300. If a faculty member's annualized base salary exceeds this amount, the lower amount must be used.

Grant budgets for the National Science Foundation (NSF) require that salary requests be expressed as months. No more than 2 months salary may be requested for any one individual on one grant.

2. Other Professional Salaries

Other professional staff at TC work on 12 month contracts and are not (in general) entitled to overage payments, so their salaries are far simpler to calculate. For professional staff currently on the TC Payroll, request salary for such individuals as a flat percentage of their current Institutional Base salary.

It's frequently the case that staff positions named in a grant proposal budget will only be created if the grant is funded, in which case we have to estimate what each position's Institutional Base Salary will be. Below is a list of position categories frequently included in grant budgets with a salary range for each.

Senior Research Scientist/PostDoc: $40,000-60,000

Project Director/Business Manager: $35,000-55,000

Project Coordinator/Data Collection Coordinator/Statistical coordinator (doctoral level): $30,000-50,000

Project Tech Support, Network Engineer, Web/Multimedia Designer: $35,000-60,000

Secretary/Clerical Staff : $25,000-30,000

3. Graduate Research Assistants

As of 1/1/08, the college has codified specific types of support for graduate students:

• Doctoral Research Fellowships: Includes a stipend of between $20-24K per year, with 12 credits tuition charged to the grant, matched by the college
• Graduate Assistant: Works no more than 20 hours a week and earns no less than $4000 per semester up to $19,999 per academic year.. Eligible for 6 points tuition waiver.

Part time hourly and part time professional lines may also be used to support graduate students.

4. Fringe Benefits

All full time faculty and professional staff positions are charged fringe benefits at 34% of their total compensation. Part time graduate student employees are charged 8.3%.

OTPS Expenses

5. Subcontracts

Subcontracts are budgeted when a project requires collaboration with another institution to fulfill its objectives. Usually, one institution takes the lead on the project, and issues one or more subcontracts to collaborating institutions. Each collaborating institution prepares a budget according to its own salary formulas, fringe benefit and indirect cost rates and submits it to the lead institution with a letter from an institutional official committing to do the work on the project should the grant be funded. Different sponsors have different requirements as to how much detail of each subcontract budget they need, so consult the program guidelines.

TC investigators who plan on submitting a proposal as a subcontractor to another institution must still submit their proposal budget for internal routing.

6. Consultants

Consultants are individuals outside of TC with skills or expertise necessary to the conduct of a project, but whose involvement is more limited in time or scope than a subcontractor. Consultants are often engaged on a project to perform statistical analysis, to evaluate research design or program outcomes, or to serve in an advisory capacity to a project. Most of the time, we don't know exactly who will be engaged as a consultant on a project. The maximum federal daily rate for consulting services is $500.

 7. Travel

 Most research grants budget funds for travel, for the Principal Investigator and other project staff to present and attend conferences. Travel requests of this type should be kept relatively low, no more than $1000-$2000 per year.

 Sometimes extensive travel is an integral part of the project, for example, when data collection takes place outside the NYC area or when collaborators work at a distance from one another. To budget in such cases, take the number of individuals who will be travelling, estimate the total number of trips per year each will have to make, and use the Web to get a sense of current airfares and room rates at the locations in question. Local travel should be budgeted on the travel line as well.

 8. Supplies and Equipment

 Federal guidelines define equipment as costing more than $5000. This means that most computing, software, low end a/v equipment, etc., should go on the supply line with items like toner cartridges, office supplies, etc, rather than on the equipment line. At TC, where we aren't doing research in the physical and health sciences that require major specialized equipment, servers and high end video equipment are the items most frequently found on the equipment line.

 We generally budget computers at $2000 per unit (unless we know for certain a higher-end model will be needed). Generally, we request at least one desktop computer for the graduate assistants working on the project to share, as well as one unit for each full time professional (exclusive of faculty) who work on the project. Requesting a laptop for a project can strike a sponsor as frivolous (unless it's clearly justified), but there is nothing to prohibit you from purchasing a laptop once funds are awarded.

Once again, the Web can help you obtain reasonable estimates for supplies and equipment.

 9. Participant Support Costs

Items on this line include payments to students in a training program for their time, room and board, travel or study fees. They also include compensation for time and travel of research subjects. The actual dollar amounts of these expenses will vary widely depending on the nature and duration of participants' involvement. Keep in mind, however, that according to federal guidelines on human subjects research, fees paid to subjects may not be set so high that the fees become an enticement to participate.

10. Tuition

Most grant applications do not include a specific line for tuition for your graduate assistants; we usually place it on a line marked "other." Tuition for the 2009-09 academic year is at $1085 per credit; budget for 6% annual tuition increases.

 11. Telephone/Office Supplies/Postage/Overnight Express Service

 Most grant budgets routinely request $300-$500 per year for each of these items. If you can anticipate the need for software upgrades or other routine maintenance expenses, they should go here as well. Your telephone budget should increase if you anticipate needing more lines than you currently have available, if you will be conducting telephone surveys or will be making significant long distance calls. Postage should be increased if you are conducting a mail survey or plan on doing mass mailings as part of the project.

Indirect Costs

12. IDC

Teachers College has a federally negotiated indirect cost rate of 69.1% on salaries only.

Not all federal programs will accept our negotiated rate. If a program sets a different rate, please print the guidelines for the reference of the Grants and Contracts Accounting Office. You may budget according to the rate set by the sponsor. Federal Training programs cap indirect costs at 8% of total direct costs, as do most programs from NYSED. Our rates for projects from NYC vary, but 18% of total costs is typical..

We request that proposals to private sponsors calculate indirect costs at 15% of total costs; ask for a higher rate if the sponsor allows it. Again, you will be allowed to apply for funds from sponsors who do not award indirect costs or who award them at a rate lower than 15%, but please print out the published program guidelines that state this for our reference.

Other Budgeting Issues

Most sponsors set limits on the amount of funds you may request in a given proposal. These budget ceilings must be met by adjusting the direct costs of the proposal budget. Indirect costs may never be waived simply to meet a budget ceiling. There may be certain, limited circumstances when indirect costs may be waived. Formal requests for a Waiver of indirect costs should be submitted to the Associate Dean no later than two weeks prior to the deadline date.

 A related issue is cost sharing. Applicants should be aware that, according to federal regulations, cost sharing may only be a consideration in the evaluation of a grant application if the program guidelines require it. Including cost sharing in a grant proposal that doesn't expressly request cost sharing will not help your proposal.

 The current budget climate at the College means that we will be looking at proposals that do require cost sharing with particular scrutiny. All applicants are responsible for obtaining commitments to meet the cost share prior to submission of the application.

 Budgeting needs to be a collaborative activity between the PI/project staff and OSP. Project staff should decide what its needs are for a given proposal; OSP can perform released time/overage, summer salary, fringe benefits and indirect cost calculations if you make your request at least one week prior to the sponsor deadline.

 An issue that arises frequently during the budgeting process concerns the appropriateness of particular budget items. The National Science Foundation usually funds up to two month's salary per faculty investigator on each award, which faculty may take as released time, overage or summer salary. This is a reasonable rule of thumb for applications to other agencies as well, though the scope of a particular project can often make a request for more time entirely appropriate, especially from NIH, which routinely makes multiyear awards in the millions of dollars. Beyond that, there really are not many hard and fast rules about budget requests. Agency program officers can provide important guidance in this area. Keep in mind that program officers are extremely reluctant to discuss budget issues independently of programmatic issues and therefore will always want to discuss the budget with you as the investigator rather than the Director or some other administrator. Most often, what you need is guidance in demonstrating that an unusual budget request is warranted by the objectives of the project. Program officers are happy to provide this guidance and will usually be fairly direct in letting you know if a particular budget request is a deal breaker or not.

 How the budget affects the chances of a proposal's ultimate success or failure is the source of much anxiety on the part of applicants. Reviewers are typically asked to evaluate if the applicant has identified sufficient resources to conduct the project as described, and at this point, coming in too low can hurt your chances just as much as coming in too high. Our indirect cost and fringe benefit rates, etc., will not factor in at this stage of the process. These issues do begin to matter when the peer review process has concluded and program officers have to choose among proposals given equal priority ratings by the review panel. Even so, it is not automatically true that funds will go to the proposal that comes in at the lowest cost. Many other factors come into play at this point, including granting funds to investigators whom the sponsor has supported before, supporting minority investigators and/or institutions (if that is stated as a priority in the RFP) and spreading benefits out over a wide geographical area. Remember that Federal agencies and private foundations are not profit-driven enterprises. If they have a budget of $15 m to give out during a particular funding cycle, they will give out $15 m, or otherwise lose it. No sponsoring agency operates under the assumption that the way to get the most "bang for the buck" is to distribute some funding to as many investigators as possible. If your budget is reasonable in relation to your objectives and contains no obvious padding or unnecessary expenditures, your chances of rejection for budgetary reasons are probably minimal. However, if your proposal received a high priority rating but was rejected for budgetary reasons, the program officer will tell you so if you inquire. In such instances, you will almost always be given advice about where to cut spending and be encouraged to apply during the next cycle.