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Creating a Successful Cost Proposal

Creating a Successful Cost Proposal. Post Doc Workshop October 26, 2016. Agenda. Introduction Understanding the Environment Government Agency Specific Funding Opportunity Building a Cost Proposal Detailed Budget and Justification Other items to Consider Review. Introduction.

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Creating a Successful Cost Proposal

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  1. Creating a Successful Cost Proposal Post Doc Workshop October 26, 2016

  2. Agenda • Introduction • Understanding the Environment • Government • Agency • Specific Funding Opportunity • Building a Cost Proposal • Detailed Budget and Justification • Other items to Consider • Review

  3. Introduction • Why is this important? • 48% of Carnegie funding comes from external sources (either private or federal) • Endowments everywhere are facing additional pressures • External funding can go to enhance or completely fund projects • Focus on federal funding, but will provide the building blocks for all cost proposals • Expect interactive training, not just a presentation

  4. Understanding the Environment Government Agency Funding Opportunity

  5. Guidelines: Government • Allowable • Reasonable • Allocable

  6. Allowable Is this cost within the limits of what the government regulations allow? Qualifications • Necessary and reasonable • Conform to limitations in Cost Principles • Consistent with grantees policies • Consistent treatment of other expenses • Be determined according to GAAP • Not cost share for other awards • Be adequately documented Examples • Personnel: Timesheets/effort reporting • Travel: Description of purpose • Equipment: Justification, quotes • All: Specific coding in the accounting system • All: Detailed policies and procedures

  7. Reasonable Qualifications • Necessary • Fall within restrictions (sound business, regulations, etc) • Market Price • Prudent • Within established policies Examples • Personnel: Salary Caps • Travel: Limits on non-economy and per diems • Equipment: Quotes/Bids • Contractors/Subawards: Experience and detailed justification Would the cost be incurred by a prudent person under the prevailing circumstances?

  8. Allocable Are the costs assignable with relative benefit received? Qualifications • Incurred for award • Proportionately distributed • Necessary for overall operation and is assignable • Indirectly • Not to fund overages • Allocated based on reasonable manner Examples • Personnel: Timesheets/effort reporting • Travel: Description of purpose • Equipment: Justification • All: Specific coding in the accounting system

  9. Review What are the 3 categories to determine if a cost should be charged/budget to an award? Reasonable Allowable Allocable

  10. Front Page Test

  11. Guidelines: Agency/Donor Proposal • Score Weighting • Templates • Categorization • Submission Website Post-Award • Allowability • Reporting • Line Item Flexibility

  12. Guidelines: Funding Opportunity READ and LOVE your funding opportunity announcement • Eligibility • Purpose • Agency • Due Date • Duration of award • Budget Ceiling • Cost Share/Matching requirement • Specific Terms and Conditions √ √ √ √ √ √ √ √

  13. ActivityReview a Funding opportunity • Agency • Due Date • Duration • Budget • Cost Share • Eligibility

  14. Building a Cost Proposal

  15. Understand the Submission Process

  16. Preparing the Cost Proposals • Detailed Budget • Provides detailed lists of all proposed costs • Budget Narrative • Provides categorical justification for the budget request. • SF-424 • Summarizes detailed budget and allows for input into the system • Other Supporting Documentation • Subaward Information • Resumes of key staff • Policies and procedures • Others are required by FOA/Agency

  17. Preparing the Detailed Budget

  18. Personnel Who is working on this award? • Category • Senior (Principal Investigator and Investigators) • Other (employees: post docs, other professionals, etc.) • Name/Position • Salary • % Effort • Total Funds Requested • Budget Justification • Name • Position • Description & Purpose

  19. Fringe Benefits What benefits do the staff get? • Health care • Employer taxes • Workers compensation • Unemployment insurance • Life insurance • Retirement contributions • Different rates for different categories • Rates for Carnegie: • Employee - 32% • Post-Docs – 16% • Budget Justification • Benefit Components • Rates used

  20. Equipment What equipment do we need to complete this project? • Non-expendable, tangible property with useful life > 1 year • Acquisition cost of $5,000 or more per item • Includes shipping and setup costs • An item consists of all components that are needed to make it operational • Component A costs $3,000 and Component B costs $2,500 • Need A & B for functionality? Capital Equipment • A or B can be used alone? Supplies • Include in-house if cost >$5,000 • Budget Justification • Description • Importance to research • Cost estimate & basis • Pricing/quote copies

  21. Travel Do we need to travel for this award? • Domestic vs Foreign • Per Diem (consistent with policy and GSA rates) • Estimate lodging using per diem rates • Charged to award based on the lower of actual or per diem • Lowest coach fare and Fly America Act • Upgrade for extra legroom in coach is not allowed • Other items: Auto rental, mileage reimbursement, tolls, parking, taxi • Budget Justification • Purpose • Names/headcount • When/Where • Air fare, per diem, list of all costs

  22. Participant Support Non-employee support costs (non-employees) • Fellows and participants • Support for Fellow-initiated research • Participation in training or events • Stipends/Subsistence • Non-wage payments • Travel • Provide same level of detail as for employee travel • Other • Include allocated fringe benefits (fellows) • Tuition • Materials and supplies • Budget Justification • Names, type, university, etc. • Travel plans • Subsistence requirements • Justify any other expense

  23. Subawards Funds provided to partner needed to carry-out programmatic objectives • Responsible for monitoring Subawards • Ensure proper classification (Subaward vs Vendor) • Budget Justification • Basis/Criteria for selection • Separate budget and budget justification • Institutional Letter of Support • Risk assessment/Monitoring plan • A-133 and Fringe rate documentation

  24. Other Direct Costs What else do we need in order to complete this project? • Materials and supplies • Cost <$5,000 per item and used for project specific purposes • Excludes office supplies • Itemize as much as possible. • Publication costs • Graphic design, photography • Journal page charges • Special use computing equipment • Consultant services • Individual who belong to particular profession or provide specialized services • Not employees and are not supervised by project personnel • Consider consulting rate, travel costs, materials, etc. • Fees must be normal or customary • Budget Justification • Detailed list of items • Cost per item • Type of unit (monthly, item) • Number of items/Time period • Justification for selection (services)

  25. Indirect Costs: Definition How do we include support from our administration function? Allocation of administrative costs that are not charged directly to the award but that are required for implementation of award Indirect Costs Include: • Administrative Support Staff • Utilities • Supplies • Building Costs

  26. Indirect Costs: Calculation Modified Total Direct Costs Total Direct Costs less: • Fellowship and Participant costs • Capital equipment of $5,000 or more • Portion of each subaward in excess of $25,000 • Other costs excluded per grant terms Total Indirect Costs Total Direct Cost Base (MTDC) Indirect Cost Rate 61.04%

  27. Indirect Costs: Process

  28. Indirect Costs: Other • Donor Differences • Calculation may differ • Allowable rate may differ • P Street approval required • Timing differences • IDC rate may change from reported to final amount (refund)

  29. Other Items to Consider • Proper classification • Implementation flexibility may be limited • Appropriate • Prior approval requirements • Travel, equipment, subawards, etc. • Cost share • Ensure tracking appropriately • No double-dipping • Multi-year budgets • Inclusion of inflation & merit increases • More complex and time consuming • Be aware of limitations set by sponsoring agency

  30. Review

  31. True/False Quiz • Government funding all has the same guidance • “Reasonability” has a vague definition based on a prudent person • Fringe Benefits should never be included in a budget • Subawards and Vendors should be treated the same • Carnegie has an institutional IDC rate, not one for each department • Proper classification is not important in the budgeting phase False True False False True False

  32. Secret to a GREAT cost proposal?

  33. Questions?

  34. Helpful Links • Uniform Guidance: http://www.ecfr.gov/cgi-bin/text-idx?tpl=/ecfrbrowse/Title02/2cfr200_main_02.tpl • NSF Guidance: https://www.nsf.gov/publications/pub_summ.jsp?ods_key=gpg • NASA Guidance: https://prod.nais.nasa.gov/pub/pub_library/grcover.htm • DOE Guidance: http://science.energy.gov/grants/policy-and-guidance/

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