The Proposal Budget

1. The Proposal Budget What is the funding mechanism? Grant  Used when the sponsor and university have common goals – basic research, arts, public good. May require cost sharing. Budget revisions between existing budget categories typically allowed up to 10% of the overall project award. Contract  For the sponsor’s benefit. Has specific deliverables. Strict spending guidelines. Should never require cost sharing (including a reduced F&A rate). Cooperative Agreement  Basically a grant with a high level of sponsor involvement – scientific and programmatic. Budget revisions frequently don’t require sponsor approval except for specific items (subcontracts, participant support costs, etc.). 1

2. Review the RFP or other proposal guidelines for budget restrictions. Example: many federal agencies don’t fund food costs except in specific circumstances. USDA won’t pay for tuition even on graduate assistants. • Is the budget developed from statement of work or is the statement of work developed from the budget? • Do not include costs that do not directly benefit the completion of the statement of work. • Request funds allowed under various budget categories and in amounts required by the scope of work. • Try to include all reasonable budget categories --- even for minor amounts --- it will make budget reallocations easier. • Normally need a budget for each year and a cumulative budget • Make sure the budget narrative agrees with the budget itself!

3. Specific Budget Categories: • Salaries and wages • Cannot augment total salary or rate of salary (cannot receive more than base pay without specific sponsor approval). Meaning: no supplemental salary is allowed without specific sponsor approval. • NSF Grants – Salary typically limited to no more than two months of salary support from all NSF grants (includes summer salary). • Administrative support normally cannot be requested (See Exhibit C of OMB Circular A-21 for potential exceptions to this rule) • Use current or estimated salary for each project period • Estimate annual or merit raises • Academic year for nine-month faculty and calendar months for twelve-month personnel

4. Fringe benefits Visit Sponsored Program Administration’s website for current rates (http://www.spa.msstate.edu). Different rates for different personnel Graduate Assistant tuition is normally included here. However, on NSF budgets it is placed in “other direct costs.” Travel Specify reason for travel (how it is related to the statement of work?) Itemize by destination and cost May be requested for Field work Attendance at project related meetings Travel associated with proposed work 4

5. NSF Participant support • Transportation, per diem, stipends and other related costs • Must enter number of participants to be supported in budget • Indirect costs (F&A) not allowed on participant costs on NSF projects • Contractual Services • Consultants • Shipping costs • Research software • Registration fees for meetings

6. Long distance service phone charges • Printing charges • Commodities (Materials and supplies) • Lab supplies • Office supplies -- typically not allowed • Food -- sometimes allowed (non-travel status) • Group business meals while on travel status. • Expendable equipment (unit cost of <$5K). Careful! Laptops, etc. are not typically allowable since they are traditionally considered general purpose items…..i.e. not dedicated for use on this project.

7. Equipment • Determine if equipment purchases are allowed • MSU generally classifies items as non-expendable equipment if the individual unit has an acquisition cost of $5,000 or more. This is not to be confused with the inventory threshold! • Subawards • Not the same thing as a vendor purchase! • Subawards are used when responsibility for a portion of the statement of work is to be delegated to another entity. • Indirect costs • Also called overhead or Facilities and administrative costs (F&A) • On-Campus or Off-Campus?

8. Research, Instructional or “other”? Can charge F&A only on 1st $25K of each subaward. No F&A on tuition or equipment. If project is off campus in a rented facility and rent is being charged to the project, no F&A is allowed on the rental charges. Cost sharing Check agency or specific RFP requirements Cannot use other federal dollars as cost sharing Difference between negotiated F&A and sponsor allowed F&A may sometimes be allowed as cost sharing Is it a % of the total budget or a % of the sponsor budget? 8

9. Example of Proposal Budget

10. Example of Proposal Budget – Cont’d

11. EXAMPLE OF PROPOSAL BUDGET –CONT’D ¹Faculty salary was converted to 12 month rate. Review the sponsor budget form & instructions to determine how the sponsor wants it displayed. Raises can be included at 5%-7% effective July 1 for 12 month employees and effective August 16 for 9 month employees. However, typically raises will only be granted if IHL approves a university wide raise. ²If the salary budget has a significant portion of employees with >$45K salary, you may want to estimate the fringes using the details provided at http://www.spa.msstate.edu/budgeting/benefits.html. Note the new retiree rate. ³ The 0.76% fringe rate for students is valid only when enrolled. During periods of non-enrollment, the rate increases to ~ 8.41%. ⁴Estimated 5% tuition increase should be included each year effective August 16. College of Engineering uses a different rate. ⁵F&A is overhead. See the SPA website for off-campus rates as well as service and instruction rates. MTDC is the acronym for "Modified Total Direct Costs". MTDC is the total direct cost less equipment, tuition & subcontracts (except 1st $25K per sub).

12. Example of Proposal Budget – Cont’d 12

13. Questions? • Contact info: • Sandy Williamson • Direct #: 5-3573 • Email: sandy@research.msstate.edu • Lynn Wyman • Direct #: 5-6849 • Email: lynn@research.msstate.edu 13