1	Basic Budget Building Research Executive Area
2	Please 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
3	Basic 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
4	First 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.
5	Two Major Budget Components Direct Costs: The costs that are directly attributed to the project. Examples include salary, supplies, equipment, etc. Facilities and Administrative Costs (F&A). (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.
6	Two Types of Direct Costs Personnel (Salaries and Fringe Benefits) Non-Personnel
7	Personnel Faculty Salaries Academic Summer Calendar
8	Academic 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
9	Academic Year Salary (Cont’d) Some sponsors (e.g. NSF) do not allow payment of academic year salary without strong justification (strictly research appointments, etc.)
10	Academic Year Salary Sample 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 requires by month, NIH by %
11	Personnel Budget Detail Academic Salary
12	Fringe on Academic Year Salary Group Insurance & Retirement: 27.00% Worker’s Comp., Unemp., & Univ. Health: .91% FICA (Medicare): 1.45% (applicable only if hired after 4/86) Health & Welfare: $11 per week
13	Academic Year Salary Sample Fringe Calculation Group Insurance 27.00% X $7,150 = $1,931 Worker’s Comp, etc. .91% X $7,150 = $65 FICA (Medicare) 1.45% X $7,150 = $104 38 weeks (AY) X $11/wk X 11% = $46 Total Fringe = $2,146
14	Fringe Budget Detail Academic Year Fringe
15	Personnel Faculty Salaries Academic Summer Calendar
16	Faculty Summer Salary Federal: Those faculty with Academic Year (AY) appointments can receive an additional 33% as summer salary. For example if AY pay is $100,000, then an addition $33,000 can be charged as summer salary. The summer pay rate is based on the 9 month academic year salary. 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%
17	Faculty Summer Salary Sample 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 %
18	Personnel Budget Detail Summer Salary
19	Faculty Summer Salary Sample Fringe Calculation If PI hired before April 1, 1986 Worker’s Comp. = .91%(Summer Salary) If PI hired after April 1, 1986 FICA = 1.45% Worker’s Comp. = .91% 2.36% For the sample budget, assume the latter: 2.36% X $12,000 = $283
20	Personnel Budget Detail Summer Salary Fringe
21	Personnel Faculty Salaries Academic Summer Calendar
22	Faculty Calendar Year Appointment 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
23	Personnel Faculty Salaries Summer Academic Calendar Other Professional (Programmer, Technician, etc.)
24	Other Professional Sample 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.
25	Personnel Budget Detail Other Professional Salary
26	Other Professional Sample Fringe Calculation Assessed at full fringe rates Fringe (27%) + Worker’s Comp (.91%): 27.91% $9,000 x .2791 = $2,512 Health & Welfare $11/week or $572 annually 30% effort x $572 = $172 FICA (if hired after 4/1/86) 1.45% $9,000 x .0145 = $131 Total Fringe = $2,512 + $172 + $131 = $2,815 for this example
27	Personnel Budget Detail Other Professional Fringe
28	Personnel Faculty Salaries Summer Academic Calendar Other Professional (Programmer, Technician, etc.) Graduate Student
29	Graduate Student Stipend Stipend - Minimum Graduate Stipends are set by academic areas, per student contracts. For a memo regarding specific minimum student stipends click here: New Recalculated Minimum Graduate Student Employee Stipends Example: for a graduate student hired in 2003 for 20 hrs per week both academic and summer: 20 hours per week X 52 weeks = 1040 hours 1040 X $14.12 = $14,685
30	Personnel Budget Detail Graduate Student Stipend
31	Graduate Student Sample Fringe Calculation GEO Health Fee: assessed at $2.57 per hour The following examples reflect typical appointments: $1,950: 20 hours/wk X 38 weeks academic = 760 hrs X $2.57/hr $2,673: 20 hours/wk X 52 weeks = 1,040 hrs x $2.57/hr $3, 392: 20 hours/wk X 38 weeks academic + 40 hours/wk X 14 weeks = 1,320 hours x $2.57/hr
32	Graduate Student Fringe Sample Fringe Calculation (cont’d) Health & Welfare $11/wk per student $572 for 52 week year $418 for 38 week academic year $154 for 14 week summer $572 this example
33	Graduate Student Sample Fringe Calculation (cont’d) Summer Student Payroll FICA If not enrolled in classes: 1.45% summer payroll (14 weeks) $14,685/52 wks = $282/wk $282 X 14 wks = $3,954/summer 1.45% X $3,954 = $57 $57 for this example
34	Graduate Student Sample Fringe Total GEO Health Fee $2,673 Health & Welfare $ 572 Summer Student FICA $ 57 Total $3,302 NOTE: Curriculum fee is assessed on all academic year grad student appointments but not budgeted as fringe -- see “Other” for more info
35	Graduate Student Fringe 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.
36	Personnel Budget Detail Graduate Student Fringe
37	Personnel Faculty Salaries Summer Academic Calendar Other Professional (Programmer, Technician, etc.) Graduate Student Postdoctoral Fellow
38	Postdoctoral Fellow Salary is determined by what the market will bear in a particular field and is usually figured on an annual basis. Check with Department Head for prevailing rates $35,000 per year this example
39	Personnel Budget Detail Postdoctoral Fellow Salary
40	Postdoctoral 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
41	Post Doc Fringe (cont’d) 1) Full benefits: Group Insurance & Retirement: 27% Worker’s Comp., Unemployment, & Univ. Health: .91 FICA (Medicare): 1.45% (applicable if hired after 4/86) Health & Welfare: $11 per week 27% X $35,000 = $9,450 .91% X $35,000 = $319 1.45% X $35,000 = $508 52 weeks X $11/wk = $572 Total Fringe = $10,849
42	Postdoctoral Sample Fringe Calculation (cont’d) 2) Postdoc Health Insurance plan: Fellow only $232/mo Fellow and child(ren) $615/mo Fellow and spouse $728/mo Fellow, spouse & child(ren) $1,111/mo 12 months X $232/mo = $2,784 Worker’s Comp and FICA are assessed as well: .91% X $35,000 = $319 1.45% X $35,000 = $508
43	Postdoctoral Sample Fringe Total Postdoc with health (no-retirement): Worker’s Comp $319 FICA $508 Health Insurance $2,784 Total $3,611
44	Personnel Budget Detail Postdoctoral Fellow Fringe
45	Personnel Faculty Salaries Summer Academic Calendar Other Professional (Programmer, Technician, etc.) Graduate Student Postdoctoral Fellow Secretarial
46	Secretarial Secretarial salary can be charged to non-federal projects without any restrictions. The direct charging of secretarial services on federally supported projects is allowed only under a limited number of scenarios. See the policy statement and consult with OGCA proposal staff for guidance.
47	Personnel Faculty Salaries Summer Academic Calendar Other Professional (Programmer, Technician, etc.) Graduate Student Post Doctoral Fellow Secretarial Undergraduate Student
48	Undergraduate 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
49	Personnel Budget Detail Undergraduate Student Pay
50	Undergraduate 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.
51	Personnel Budget Detail Undergraduate Student Fringe
52	Non-personnel Consultants
53	Non-personnel Costs Consultants 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 NSF limits consultant daily rate to max of $498 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 Provide daily rate of pay in the budget – obtain from consultant – do not guesstimate, get exact rate
54	Non-personnel Budget Detail Consultants
55	Non-personnel Consultant Equipment
56	Equipment 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
57	Non-personnel Budget Detail Equipment
58	Non-personnel Consultant Equipment Administrative
59	Non-personnel Consultant Equipment Administrative Administrative and Office Supplies
60	Administrative Office & 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
61	Non-personnel Consultant Equipment Administrative Administrative and Office Supplies Postage and Telephone
62	Administrative Postage & Telephone Definition: Overnight courier services, regular postage, telephone Budgeting: 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 Federal: telephone only for long-distance or for phone line entirely dedicated to the project
63	Administrative Postage & Telephone (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
64	Administrative Postage & Telephone Sample calculation/justification Postage for mailing brochures: 200 X .25 = $50 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
65	Administrative Costs Postage & Telephone Calculation/Justification (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
66	Non-personnel Budget Detail Administrative (cont’d)
67	Non-personnel Consultant Equipment Administrative Administrative and Office Supplies Postage and Telephone Subscriptions, Membership Dues
68	Administrative Subscriptions, 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
69	Non-personnel Consultant Equipment Administrative Administrative and Office Supplies Postage and Telephone Subscriptions, Membership Dues Photocopying
70	Administrative Photocopying 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
71	Administrative Photocopying (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
72	Administrative Photocopying 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
73	Non-personnel Costs Consultant Equipment Administrative Supplies
74	Non-personnel Costs Supplies Consultant Equipment Administrative Supplies Laboratory supplies, chemicals
75	Supplies Laboratory 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
76	Supplies Lab supplies/chemicals Calculation 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
77	Non-personnel Budget Detail Supplies
78	Non-personnel Costs Supplies (cont’d) Consultant Equipment Administrative Supplies Laboratory supplies, chemicals Computer supplies
79	Supplies -- Computer 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
80	Supplies Computer supplies Calculation/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
81	Non-personnel Budget Detail Supplies
82	Non-personnel Costs Supplies 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 Research animals Software, Software Upgrades, & Software Licenses
83	Non-personnel Costs Consultant Equipment Administrative Supplies Travel
84	Non-personnel Costs Travel 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
85	Non-personnel Costs Travel (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 $30.00 per day ($35 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 (FY ’03) set at .375 per mile.
86	Non-personnel Costs Travel (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
87	Travel Calculation 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 $35/day X 2 X 2 = $420 Registration: $400 X 2 X 2 = $1,600 Mileage (to/from Bradley): .375 X 70 miles X 2 = $53 Ground transportation (to/from Dulles): $35 X 4 = $140 Total: = $5,733
88	Travel Calculation (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): $53 Ground transportation: $150 Total: $3,023
89	Non-personnel Budget Detail Travel
90	Non-personnel Costs Consultant Equipment Administrative Supplies Travel Subcontracts
91	Non-personnel Costs Subcontracts 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
92	Non-personnel Costs Subcontracts (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 Indirect Cost Rate Agreement (if subcontractor is budgeting indirects in their own budget) Sole source justification
93	Non-personnel Costs Subcontracts (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, including any required certifications/assurances
94	Non-personnel Costs 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
95	Subcontractor Budget Sample
96	Non-personnel Budget Detail Subcontracts
97	Non-personnel Costs Consultant Equipment Administrative Supplies Travel Subcontracts Other Direct
98	Non-personnel Costs Other 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 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.
99	Other Direct Calculation Curriculum Fee The rate is $6.31/hr. per Graduate Student (GS) 1 GS X 20 hrs/wk X 38 wks X $6.31 = $4,796 Note: No more than 760 hrs or $4,796 per GS will be charged in an academic year Summer effort is not charged CF Curriculum Fee is exempt from F&A
100	Non-personnel Budget Detail Other Direct
101	Total Direct Cost
102	Two Major Budget Components Direct Costs Facilities and Administrative Costs
103	Facilities and Administrative 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
104	Facilities and Administrative Costs (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 (back them out of 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
105	Facilities and Administrative Costs (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
106	Facilities and Administrative Calculation Assume an on-campus research project for our sample budget with a 55% MTDC F&A rate. 55% is therefore assessed on the total direct direct costs less equipment, curriculum fee, and subcontractor costs in excess of $25K. Thus the MTDC base: $157,194 - $3,299 - ($31,271- $25K) - $4,796 = $142,828; multiply this by 55%: $142,828 X 55% = $78,555
107	F&A Budget Detail
108	Cost-sharing Definition Definition: Cost-share is that part of the project’s costs borne by the University rather than the sponsor. Many 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
109	Cost-sharing When 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.
110	Cost-sharing Allowable 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
111	Cost-sharing Process 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
112	Cost-share Budgeting Salaries
113	Cost-share Budgeting 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
114	Cost-share Salaries (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%
115	Cost-share, salaries Sample 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. NSF requires by month, NIH by %
116	Cost-share, salaries Sample Calculation (cont’d) Regardless of whether funding is federal or non-federal, secretarial salary can be cost-shared Secretary’s salary is $30,000/calendar year and will devote 10% to the project $30,000 X 10% = $3,000
117	Cost-share Fringe Salaries Fringe
118	Cost-share, Fringe Sample Calculation on PI Academic Same rules apply for budgeting shared fringe as for charging to the sponsor: Group Insurance 27% X $7,150 = $1,931 Worker’s Comp, etc. .91% X $7,150 = $65 FICA (Medicare) 1.45% X $7,150 = $104 Health & Welfare 38 weeks (AY) X $11/wk X 11% = $46 Total Fringe: $2,146
119	Cost-share, Fringe Sample Calculation on Secretarial Same rules apply for budgeting shared fringe as for charging to the sponsor. If secretary benefited: Group Insurance 27% X $3,000 = $810 Worker’s Comp, etc. .91 X $3,000 = $27 FICA (Medicare) 1.45% X $3,000 = $44 Health &Welfare: $11 week X 52 weeks X 10% = $57 Total Fringe: $938
120	Cost-share Equipment Salaries Fringe Equipment
121	Cost-share - Equipment Sample Calculation 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
122	Cost-share Subcontract Salaries Fringe Equipment Subcontract
123	Cost-share, Subcontract Sample 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
124	Cost-share Tuition waiver Salaries Fringe Equipment Subcontract Tuition waivers
125	Cost-share, Tuition Waivers Sample Calculation 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
126	Cost-share Facilities and Administrative Costs (F&A, overhead, indirect costs) Salaries Fringe Equipment Subcontract Tuition waivers Facilities and Administrative Costs
127	Cost-share, F&A Sample calculation 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: $30,815 – ($7,995 + $4,175 + $5,411) = $13,234 X 55% = $7,279
128	Total Budget Sponsor & UMass cost-share
129	Budget Explanation and Justification 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.