DevelopProposal_H

Budget Guidelines

Guidelines for Internal Budget Development

Detailed Budget

Any or all of the following components may be found in a typical budget. This narrative is meant to be a guide, but the PI is urged to consult the specific program guidelines or the Office of Sponsored Programs (OSP) Pre-award Analyst if any question remains unanswered. You may download a budget template to facilitate this process. The proposal budget should be clearly presented, and should reflect UTMB accounting categories. For example, major budget categories such as personnel, benefits, travel, supplies, equipment, and facility and administrative cost(s) should be clearly identified. Conformance with UTMB accounting categories will ensure that the project, if funded, will be entered easily and accurately into UTMB's accounting system. In some cases, for presentation purposes to a potential funding source, a program budget may also be appropriate.

The following budget categories are typical. They are meant to serve as a guide rather than a template, and sponsors will vary the order of presentation somewhat.

Personnel

Salaries for personnel are calculated based on the effort a person will devote to the project. For comparison purposes, 50% effort is approximately two and one-half days (2.5) per week, 20 hours per week or 6 person months (since UTMB operates on a 12-month calendar). Because effort may vary over the life of a project, for budgeting purposes, effort should be determined based on an anticipated average over each project year. Personnel estimates of effort should describe accurately the amount of time expected to be spent by those involved with the project, along with total associated costs, including current salaries and fringe benefits (e.g., Project Director or Principal Investigator, 6 person months [pm] for one year at an annual salary of $30,000 = $15,000). Federal granting agencies now require percent effort to be expressed as “person months." A calculator to convert percent effort to person months is available on the Research Services website. Note that NIH has a current salary cap of $187,000.

Definition - Institutional Base Salary: The annual compensation that UTMB pays for an employee's appointment, whether that individual's time is spent on research, teaching, patient care, or other activities. Base salary excludes any income that an individual may be permitted to earn outside of duties to the applicant organization. Base salary may not be increased as a result of replacing institutional salary funds with grant funds.

Cost Sharing, Matching, In-Kind

The terms "cost sharing," "matching," and "in-kind" refer to that portion of the total project costs not borne by the sponsor. Cost sharing should be reflected only if mandated by the sponsor or needed to accurately reflect the effort required to conduct the project. All cost sharing and matching/in-kind commitments must be verifiable through documentation and must conform to University and federal/agency policies regarding allowability, allocability, and reasonableness. Any cost sharing or matching must be approved by the department head (or designee) and appropriate officials; link to the Cost Sharing Approval Form
If any individual contributes more effort to the project than the person-months being requested, this is considered cost-sharing. For example: The PI lists 3 person-months’ effort on the proposal, but requests only 1.8 months’ salary. The difference (cost share) should be described in the budget justification and a supporting account (from which the 1.2 person months will be paid) must be listed in the Proposal Routing Form. Faculty members who earn more than the salary cap will be paid the difference from departmental funds, but this does not need to be included in the cost-sharing description.

Fringe Benefits

Fringe benefit rates should be calculated using the rate applicable to the actual total annual salary earned by an individual. For example, a PI earning $250,000 should use the 14.47% rate for this salary range, even though his/her salary may be capped at a lower amount ($187,000 x 1.2 pm [10%] effort x 14.47% fringe benefit rate = $2,706).


Effective 09/01/17 for FY 2018
REGULAR EMPLOYEES
SALARY FY2018 FRINGE RATES
$ 1 - 68,600 35.47%
$ 68,601 - 85,20027.90%
$ 85,201 - 127,20025.38%
$ 127,201 - 142,500 22.95%
$ 142,501 - 190,000 21.29%
$ 190,001 - 270,00018.97%
$ 270,001 - + 14.38%
 
STUDENTS/PART-TIME EMPLOYEES <20 hours/week
$ 1 - 34,000

34.42%

Be sure to always check the web site for the most current fringe benefit rates.

Consultant Costs

If outside consultants are required, a description of their role in the project should be included in the research plan and in the budget justification. For each consultant, include a biographical sketch and a letter of participation. All external consultants should be listed, even if they are not charging fees or costs.
Consultants or lecturers, along with their fees and travel costs, may be included in the budget. The consultant's services to the proposed project must be professional, short-term or intermittent, and must be solely advisory to the project. For a federal employee, consult the agency guidelines applicable to the individual in order to determine allowability.
Consultants are often confused with consortium/contractual relationships.

Definition - Consultant: A person employed on a short-term basis who provides expert advice without responsibility for a portion of the work scope; an individual hired to give professional advice or services for a fee, normally not as an employee of the hiring party. In unusual situations, a person may be both a consultant and an employee of the same party, receiving compensation for some services as a consultant and for other work as a salaried employee. In order to prevent apparent or actual conflicts of interest, grantees and consultants must establish written guidelines indicating the conditions for payment of consulting fees. Consultants may also include firms that provide paid professional advice or services.

Subcontract and consortium costs

Subcontract and consortium costs comprise part of the project that may be conducted by an organization outside of the University. List the subcontractor or contractor name(s) and total cost. If the subcontractor is a college or university, it might charge F&A (indirect) costs to UTMB’s budget, as well as direct expenses. Include these F&A costs as a direct cost, if applicable.

Definition - Consortium: An agreement whereby a research project is carried out by the grantee and one or more other organizations that are separate legal entities. In this arrangement, the grantee contracts for the performance of a substantial and/or a significant portion of the activities to be conducted under the grant. These agreements typically involve a specific percent of effort from the consortium organization's principal investigator, who must provide a categorical breakdown of costs, such as personnel, supplies, and other allowable expenses, including Facilities and Administrative costs.

Your Pre-award or Contracts Analyst in OSP will assist in coordinating consortium or contractual arrangements. If investigators from other institutions will participate in the project, the PI at the collaborating institution must submit the following information to UTMB:

  • A letter of collaboration or statement of intent, co-signed by an institutional authority. NIH requires specific language, which can be obtained from the Office of Sponsored Programs. A template for a standard collaboration letter from UTMB may be found here. For a statement of intent to establish a consortium with money from UTMB, link here; for a consortium with money to UTMB, link to this template.
  • Signed Face Page (optional)
  • A Scope of Work
  • Detailed Budget for Initial Budget Period
  • Budget for Entire Proposed Period of Support
  • Biographical Sketches of Key Personnel (use biosketch sample or template)
  • Checklist

*Note: When using the federally negotiated rate, UTMB indirect costs can be charged on only the FIRST $25,000 of each subcontract.

Equipment

Equipment is defined as items that are: 1) $5,000 or more per unit; 2) have a life expectancy of more than one year; AND 3) can be tagged by UTMB. Provide justification for the purchase and how it is essential to accomplish the objectives of the project. A vendor quotation is always helpful. Exceptions to these definitions of equipment are: 1) items that have a per unit cost of less than $5,000 but will be used to fabricate a piece of equipment that is valued at more than $5,000 and can be tagged, and 2) items that are included on the UT System Controlled Items List . Exclude Equipment from F&A calculation.

Supplies

List laboratory/clinical supplies, chemicals and/or gases, animals, and similar consumable items that are required for the research. Estimates for supplies and expenses should be supported by a complete description of the supplies to be used, with the basis for computing estimates included (e.g., 100 assay kits x $25.00/kit = $2,500.00). Supply and expense estimates offered as "based on experience" are not sufficient. Estimated costs for purchases may be shown as follows:

Animal Purchases
 30 dogs x $120 ea.  = $3,600
 30 rats x $3.50 ea.  = $105
Supply purchases
 100 assay kits x $25 ea.  = $2,500
Travel

Provide explanation for purpose of trips, e.g. to a professional meeting to present results of the research project. If possible, name the prospective seminars. Transportation costs and per diem rates must comply with the UTMB Travel Policy. The budget or the budget narrative should include the number of persons traveling, the number of trips to be taken, and the length of stay. The estimated costs of travel, lodging, and other subsistence should be listed separately. When combined, the subtotals for these categories should equal the estimate given for travel or per diem.

Patient Care Costs

The costs of routine and ancillary services provided by hospitals to individuals participating in research programs, including patients and volunteers, are allowable provided that the procedures are not considered standard of care and billable to an insurance provider, such as x-ray, laboratory, pharmacy, blood bank, pathology, etc. Only the hospital technical charge can be budgeted and the rate is calculated using UTMB's Patient Care Rate Agreement. Exclude Patient Care Costs from F&A calculation.

The following otherwise allowable costs are not classified as research patient care costs: items for patient expense reimbursement, such as patient travel and parking; professional physician fees; and supplies, such as syringes, specimen collection kits, etc. Such costs should be included in the “Supplies” or “Other Expenses” category of the grant budget.

For those using the ITS Clinical Research Center, some costs associated with the clinical study (e.g., nursing, laboratory, and room) may be absorbed by the center's grant. Call ext 21950 for assistance.

Alterations/Renovations

Refer to program guidelines to determine whether this is allowed. Requests of this nature may represent commitments made by the President's Office or the Office of the Dean, and may be accompanied by an institutional cost-share or match. Exclude Alterations/ Renovations from F&A calculation.

Other Expenses

These are expenses that do not fit into the categories above. Examples include: Publication cost - $400; Service contract on Electron Microscope - $600; Subject reimbursement - $10/subject X 20 subjects = $200. Also, break down all costs for animal housing. Show the nature and extent of any printing to be done. Some specific allowable expenses follow.

  • Animal care: Standard rates apply for charging animal care costs. Contact the Animal Resource Center (ARC) at (409) 772-1275 for more information or the ARC Website.
  • Computer services: Academic Resources supports the University's academic and research missions by providing a wide range of computer services with facilities for hosting online tests and computer labs. Various computer consulting services and programming are also available. Contact Academic Resources to schedule an appointment (409) 772-4164.
  • Equipment maintenance costs and service contracts: Costs for repair and maintenance of project equipment that is necessary to keep it operating efficiently, yet does not appreciably add to its "permanent value or prolong its intended life," are allowable and should be budgeted (2 CFR, Part 220 ).

    Costs associated with the general maintenance and upkeep of a building used for research are generally considered as F&A (indirect) costs and therefore cannot be charged as direct costs. Costs of this nature include repair of light fixtures, custodial costs, unclogging drains, and other maintenance costs that cannot be directly related to a particular grant or contract.
  • Insurance: Costs of insurance required or approved pursuant to sponsored projects are allowable and may be charged to the federally sponsored projects.
  • Telephone service: Costs incurred for local telephone services, telephone equipment, cellular telephones, pagers, and fax lines are indirect costs and may not be charged to federally sponsored projects. These costs must be included in the Departmental Administration indirect cost rate component. Long distance toll charges may be charged to federally sponsored projects when a charge can be specifically identified with a project.
  • Photocopy Costs: Photocopy costs can be charged to federally sponsored projects only when the photocopies directly and specifically benefit the contract or grant to which the charge is made. Photocopy costs for routine administrative activities are indirect costs and may not be charged to federally sponsored projects.
  • Postage or Delivery/Courier Costs: Ordinary and routine postage costs may not be charged to federally sponsored projects. These costs must be included in the Departmental Administration indirect cost rate component. Federally sponsored projects with an extraordinary high demand for postage may be charged with these costs only if the postage is related to the specific work of the federally sponsored projects and only if the cost is included in the budget narrative and approved by the awarding agency. Delivery/courier costs can be charged to projects if approved in the project budget and justification.
  • Printing and Publications: Printing and publication costs are allowable and may be charged to federally sponsored programs.
  • Participant travel and any other direct payments to participants: Direct payments to participants, including patients, donors, subjects, and volunteers, should be listed in this category.
Tuition

Beginning in Fall 2007, students who enter the Basic Biomedical Sciences Curriculum (BBSC), the Biophysical, Structural & Computational Biology curriculum (BSCB), and any curriculum of the Preventive Medicine & Community Health program in the Graduate School of Biomedical Sciences (GSBS), may be reimbursed for tuition and standard required fees, if they are working under grants and/or contracts. The amount must be identified on the proposal budget.

Faculty sponsorship of tuition and fees for qualifying students is handled as a form of compensation, in accordance with the sponsor’s guidelines and with Uniform Guidance (2CFR Part 200). Some sponsors do not allow tuition reimbursement.

Tuition for Training Projects: The cost of tuition under training grants may be budgeted unless otherwise specified in the program guidelines. Note: If tuition is allowable under the program guidelines and indirect costs are based on Modified Total Direct Costs, tuition and fees must be excluded from the indirect cost base calculations. Contact your PreAward Analyst if you have questions concerning this information.

Facility & Administrative Costs

The Facility and Administrative Cost rate (F&A), also called indirect cost rate, should be included in all proposed budgets. UTMB accepts published sponsor restrictions regarding the reimbursement of F&A, i.e., a sponsor may not pay F&A, or may pay at a reduced rate. NOTE: Modified Total Direct Costs (MTDC) consist of all salaries and wages, fringe benefits, materials, supplies, services, travel and subcontracts up to the first $25,000 of each subgrant or subcontract, regardless of the period covered by the subgrant or subcontract. However, MTDC excludes equipment costing more than $5,000, capital expenditures, charges for patient care, tuition remission, rental costs of off-site facilities, scholarships, and fellowships, as well as the portion of each subgrant and subcontract in excess of $25,000. Some funding agencies allow F&A on all of these categories, without exclusions, which are considered Total Direct Costs (TDC).

Example: Budget calculation including subcontract

 Year 01Year 02Year 03Total Project
Direct Costs$177,500$184,600$191,984$554,084
Less Equipment-5,00000-5,000
Less Patient Care-5,0000 0 -5,000
Less Subcontract-37,000-38,480 -40,019 -115,499
Subtotal $130,500 $146,120 $151,965 >$428,585
Plus Subcontract Base 25,000 0 0 25,000
Total Indirect Cost Base (modified total direct costs -- MTDC) $155,500 $146,120 $151,965 $453,585
Indirect Rate 55% 55% 55% 55%
Indirect Total $85,525 $80,366 $83,581 $249,472
TOTAL COSTS $263,025

UTMB F&A Rates:

Federal and Non-Federal Grants 55% MTDC (effective 9/1/14-8/31/16)
Federal and Non-Federal Contracts 55% MTDC (effective 9/1/14-8/31/16)
Clinical Trials 30% TDC
Off-Campus Rate 26% MTDC (effective 9.1.12)
Training Grant Rate 47% MTDC (effective 9.1.12)

UTMB Indirect Cost (F&A) Rate Agreement

Incrementing Budgetary Requests in Multi-Year Budgets: NIH policy is to grant up to 3% annual increases for inflation. Experience shows that most federal agencies are receptive to this increase.

Budget Justification

Most federal sponsors require a budget justification and it's advisable to include one with all proposals, whether required or not. The justification gives the PI an opportunity to provide an explanation of budgetary requests that may not be immediately obvious to a reviewer.

For example: A $30,000 request that is described simply as "Laboratory Equipment" should be amplified to explain: “The $30,000 will be used to purchase a critically needed cryomicroscope that will serve as a dedicated tool for infectious disease research for on- and off-campus collaborators.” A clear and focused explanation helps the reviewer understand the need and benefit. See a sample budget justification.

Modular Budget

The budget justification requires only a description of the personnel who will be participating in the research, but their salaries should not be included. In fact, no budget breakdown (i.e., dollar amounts) is necessary at all. The detailed budget template that must be completed for the project is for internal review purposes only. It must not be included with the grant application.

If a difference exists in the requested amounts between one year and another, the justification must explain why. For example, $250,000 direct costs are sought for budget period 1, and $200,000 for budget periods 2-5, an explanation for this purpose is necessary (major equipment, for instance) and should be uploaded in the SF424 modular budget component “additional narrative justification” field.

Miscellaneous

Once the budget has been prepared, you should make a final comparison of the amounts listed in the budget narrative with the amounts in the budget form. In the rush to complete all parts of the application on time, you may make many last-minute changes. When discrepancies exist between the budget narrative and the budget form, or the total amount of the request listed elsewhere on the proposal, the amount of the request also may be in doubt. A final check of all the numbers will preclude such confusion. Budgets included in requests for external funding must be reviewed and approved by OSP. Budgets may be emailed or faxed to our office ahead of time.