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Building Realistic Budgets

Building Realistic Budgets. Judy Harris, Proposal Processing Division of Sponsored Research. An estimate of costs required to perform a statement of work with a specific start and end date. What is a Budget?. Proposal Budgets.

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Building Realistic Budgets

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  1. Building Realistic Budgets Judy Harris, Proposal Processing Division of Sponsored Research

  2. An estimate of costs required to perform a statement of work with a specific start and end date. What is a Budget?

  3. Proposal Budgets • Made up of costs that can be explained or verified and are reality-based • No “Educated Guesses” or “Off The Wall” estimates • May require several drafts before it is finalized • May vary in structure and complexity

  4. Why Is a Budget Important? • It is the second most scrutinized part of the proposal • A clear concise budget supported by a strong budget justification can increase the chances of a proposal being funded • The proposal budget can become the actual award budget

  5. Basic Proposal Budget Components • Direct Costs • Facilities and Administrative Costs, or F&A (a.k.a. Indirect Costs)

  6. Direct Costs • Expenses identified specifically with a particular sponsored project, instructional activity, or other institutional activity • Must be allowable, allocable, reasonable & necessary for the program, given consistent treatment and conform to sponsor limitations

  7. Facilities & Administrative Costs • Costs incurred for common or joint objectives which cannot be identified to a specific direct cost activity • Facilities and Utilities • Administrative and Clerical Salaries • DSR/Purchasing/HR/Controller • Postage • Local Telephone • Office Supplies • Data Processing/Computer Supplies • General Purpose Software • Memberships • Subscriptions

  8. Personnel Costs Fringe Benefits Travel Research Supplies and Materials Participant Support Patient Care Consultants Tuition Equipment Subcontracts Facilities and Administrative Costs (F&A) Other Direct Costs Major Budget Categories

  9. Personnel Costs • Personnel Categories: • Academic Personnel (includes Faculty & Post Docs) • TEAMS/USPS • OPS (includes Graduate Research Assistants, Student Assistants & Other Temporary Employees)

  10. Domestic Travel • Airfare • Lodging • Car Rental • Per Diem • Mileage • Parking Fees • Registration Fees • Local Transportation (Taxi, Metro, Shuttle) • Includes travel to Canada

  11. Foreign Travel (Generally subject to prior approval from sponsor). • Airfare • Apartment Rental • Car Rental • Local Transportation • Lodging • Per Diem (Federal travel subject to GSA Schedule) • Registration Fees • Includes travel to Mexico

  12. Budgeting Travel • Should include detailed information in budget narrative:

  13. Equipment • Costs more than $1,000 (State of FL, not Federal definition) • Has a useful life of one year or more • Some sponsors may require supporting documentation/quote at proposal submission

  14. Tuition • All new proposals, including resubmissions, competing renewals and supplements, that include salary/stipend for graduate assistants and where tuition is an allowable cost, must budget appropriate amounts for tuition.

  15. Consultants • Non-UF Employees • Not a subcontractor – no substantial programmatic involvement • Normal daily rate • Supported by letter/quote from Consultant

  16. Subcontractors • Can be: • Other Institutions • Commercial Companies • Subcontractor has substantive programmatic involvement and may be co-author on resulting publications

  17. Subcontractors • Before submitting the proposal obtain: • Letter of Commitment from institutional authorized official. • Written Quotes/Budgets • Statement of work

  18. Participant Support • Payments to individuals required on the project with no obligation to provide work or services (Generally workshops) • Typical costs • Stipends • Travel-related costs

  19. Other Direct Costs • Tuition, fees, stipends

  20. Other Direct Costs • Facilities • Rental Space • Renovation

  21. Facilities & Administrative Costs (Indirect Costs) • Applied to ALL sponsored projects unless sponsor policy/program limits indirect recovery • Following sponsor types have specified F&A rates: State of Florida: 10%TDC/25%TDC Water Management Districts 25% TDC Other Florida Governmental Entities 25% TDC Clinical Trials 25% TDC

  22. Facilities & Administrative Costs (Indirect Costs) University rates are based on the following factors: • Function/Purpose • Research • Instruction • Other • Location of Project • On-Campus • Off-Campus

  23. Facilities & Administrative Costs (Indirect Costs) Department of Defense (contracts) 48.5% 28.0%

  24. Calculating F&A • Identify Exclusions • Equipment • Capital Expenditures (includes renovations) • Patient care charges • Tuition remission • Rental costs of off-site facilities • Scholarships • Fellowships • Subcontract amounts in excess of first $25,000 • Modified Total Direct Cost Base (MTDC) = • Total Direct Costs minus items not charged with F&A. • Total Direct Cost Base (TDC) =Total Direct Costs x F&A rate without any exclusions.

  25. Total Budget Total Direct Costs + F&A Costs = Total Budget

  26. Cost Sharing in Budgets • Identifies necessary project costs not requested from sponsor • Should be a sponsor requirement • Should be referenced in budget as directed by sponsor • Shows UF’s/Third Party commitment to Project • Should follow UF Cost Sharing Policy

  27. Charging Costs Directly or Indirectly to Sponsored Projects • In order to comply with (OMB) Circular A-21 and the Cost Accounting Standards Board’s cost accounting standards, UF’s policy for charging costs to federallysponsored projects is: • Clerical and administrative salaries will be charged indirectly unless direct charging can be justified in accordance with OMB Circular A-21. • Postage will generally be charged indirectly. • Basic telephone charges will generally be charged indirectly, including cell phones. • Lab supplies will generally be charged directly. • Office supplies will generally be charged indirectly. • General purpose software will generally be charged indirectly. • Technical software will generally be charged directly. • Subscriptions will generally be charged indirectly. • Institutional and individual memberships will generally be charged indirectly. • Repair and maintenance charges for equipment purchased on the award will generally be charged directly. • Other related costs (photocopies, travel, technical and scientific equipment, animal care and other services provided by specialized service facilities) will generally be charged directly.

  28. Arithmetic – Double Check Budget! • Fringe Benefit Rates • GRA Tuition • F&A Rate • MTDC Exclusions • On & Off Campus • Budget Total

  29. Review and Finalize Budget • Review draft • ceiling price exceeded? • Revise • How much to cut? add? • Cut logical places • Should the technical proposal be revised due to budget changes? • Are Cost Share funds required? • Have cost-share commitments been secured? • Proposed effort documented? • Equipment match documented?

  30. Final Budget Presentation • Prepare Sponsor budget forms • Accurate • Neat • Legible

  31. Finalizing Budget • Prepare justification/budget narrative (Follow agency guidelines) • Should be arranged in order of Sponsor’s budget form • Clear & Concise • Explanation of request

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