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Building A Budget

Learn to create project budgets effectively, differentiate direct and indirect costs, calculate salaries and fringe benefits, and justify expenditures. Explore budget exercises and practical demonstrations. Suitable for researchers, PIs, postdocs, and graduate students.

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Building A Budget

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  1. Building A Budget Jenn Garye, Office of the VP for Research Laura Schaecher, Sponsored Research Administration

  2. Objectives • Understand the concept of building a budget • Identify types of costs – direct & indirect • Calculating salaries & fringe benefit rates • Calculating indirect costs • Budget Exercises • Demo Budget Workbook

  3. The Concept of Building a Budget • WHO? • PI • Co-PIs • Post Docs • Graduate Students • Subawards • WHAT? • Supplies • Auxiliary services • Publication Costs • Equipment

  4. The Concept of Building a Budget • WHERE? • Travel to conferences to present research • Travel to field location to complete research • Work performed on-campus or off-campus • WHEN? • How long does the project period need to be? • WHY? • Justification for the costs

  5. Direct Costs vs. Indirect Costs • Direct Costs • Items that can be specifically identified for a particular project • Reasonable, allowable & allocable • Examples: Salaries, Supplies, Travel, Publication Costs • Indirect Costs • Also known as “Overhead,” “Research Operating Costs,” or “F&A” • Can’t be identified with a particular project, but they are necessary to conduct research • Examples: Administrative Support, Office Supplies, Utilities

  6. Salaries & Fringe Benefits • Generally based on FTE, percent effort, person months • To calculate percent effort – Months on Project / Appointment Months = % Effort • 2 months on project / 12 month appointment = 16.7% effort (Calendar Year) • 2 months on project / 9 month appointment = 22.2% effort (Academic Year) • 1 month on project / 3 month summer term = 33.3% effort (Summer Months) • Do not use hourly rates; FSU does not maintain timesheets for salaried employees • 3% yearly cost of living increase is allowed • 9 mo. vs. 12 mo. Appointment and health insurance • Refer to the Facts Sheet for current fringe rates

  7. Graduate Students • Considered salaried employees • Allowed up to .50 FTE or 20 hours/week per the GAU • Minimum stipend for GA on 0.50 FTE for academic year is $15,000 or if less than 0.50 FTE $19.23/hour • Fringe Benefits • OPS Students Rate • Health Insurance Subsidy • Tuition • FSU requirement for 9/hours per semester • Proportionate to appointment • 1% escalation per year

  8. Other Direct Costs • Equipment • >$5,000 per unit with a useful life of ≥ 1 year • Travel • Must be in accordance with FSU travel policies • Differentiate between Domestic & Foreign Travel • Needs detailed justification • Participant Support Costs vs. Participant Incentives • Support costs are stipends, allowances or fees paid to or on behalf of a participant or trainee, not an employee, who is attending a conference or training • Incentives are items (gift cards, etc.) or cash paid to an individual to participate in a study, such as completing a survey, etc.

  9. Other Direct Costs • Tuition • Materials & Supplies – includes computers or equipment <$5,000 • Publications • Consultants • Subawards • Other items specifically needed for your project

  10. Indirect Costs • Federally negotiated rate • Based on the sponsor, project location, and project purpose • See the Facts Sheet for the current F&A rates • Two Bases • Modified Total Direct Costs (MTDC) • Federal & Federal Flow-through • Total Direct Costs (TDC) • State of Florida • Private

  11. Exclusions from IDC Base • MTDC base excludes: • Equipment • Tuition • Rent (off-site facilities) • Participant Support Costs (not Participant Incentives) • Amount of Subcontracts >$25,000 • Scholarships & Fellowships • TDC base excludes: • Tuition

  12. Cost Share & Funding Caps • Cost Share • FSU policy only allows for cost sharing to the extent required by the sponsor • Voluntary cost sharing is not a factor during the merit review process for Federal Awards (2 CFR 200.306) • Funding Caps • Some solicitations include caps on award amounts • Make sure you can realistically perform the work you are proposing • If Indirect Cost is included in the cap – • (Total Costs – Exclusions) / 1.54 = Direct Costs

  13. Budget Exercise #1 • “I want to submit a proposal for this solicitation.” • “I need some salary – probably about a month.” • Assumptions: 12mo faculty; $130,500 annual salary; ORP plan; Individual Health Ins. • “I need one grad student for a full year.” • Assumptions: $26,100 annual salary • “I need to go to a conference to present my findings and my GA is coming with me.” • “I need to purchase some supplies.” • “I need to publish my findings.” • Indirect Cost • Assumptions: On-Campus, federal research project

  14. Budget Exercise #2 • Budget Justification Handout

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