Budget Development
Cost considerations are critical throughout the life cycle of a grant. It is imperative to the successful implementation of a project that proposal budgets are developed in compliance with sponsor and PSU requirements and with adequate calculations to ensure sufficient funding to carry out the project.
Practical Considerations: Helping the PI understand the costing requirements for certain types of expenses and how transactions are processed at PSU enables the PI to more quickly and efficiently incur expenses for their projects and minimizes frustration from unrealistic expectations regarding their ability to incur certain types of expenses.
Adherence to the Cost Accounting Standards (CAS) as required by 2 CFR 200 begins with the proposal budget which requires consistency in estimating, accumulating and reporting costs.
The fact that a cost requested in a budget is awarded, as requested, does not ensure a determination of allowability. The organization is responsible for presenting costs consistently and must not include costs associated with their F&A rate as direct costs.
- NIH Grants Policy Statement
Cost Categories
It is important that costs are listed in the agencies’ budget categories according to the agencies’ definition of the category – not PSU or PI’s definition of that category.
General Budget Categories
Practical Considerations
Adherence to CAS
Personnel (Salaries & Wages)
A basic understanding of PSU's employment policies and how
various types of work are classified
at PSU helps to:
Identify salary costs/ranges; and
Avoid over/under-budgeting for fringe benefits
Appropriate/consistent inflation factor
appropriateness of clerical salaries as a direct cost
Consistency in estimating costs for personnel effort charged to projects
Fringe Benefits
The fringe rate should correspond to the salary/wage classification
Fee Remission – shows in Banner as fringe but typically listed in agency budget as “other”
Fringe rates/calculations should be consistently applied to the appropriate salary/wage classification across grant
Consultants
Does the work qualify as employment, consulting, or subrecipient?
Guidelines for determining subrecipient or vendor relationship
Subcontracts
Is the work consulting (vendor relationship) or subcontract?
Guidelines for determining subrecipient or vendor relationship
Proposal should include cost proposal and validation of F&A rate for subcontractor
Federal awards use MTDC base (calculate F&A on first $25K of each subcontract)
Travel
Are the costs calculated using PSU rates for per diem, mileage, etc.?
Foreign Travel – many agencies have separate rules for foreign travel
Are the costs based on PSU travel requirements?
Equipment
ONLY items that have a unit cost of $5,000+ and useful life of one year can be listed in this category
“Minor Equipment” should be listed in the materials and supplies category of the budget
Is general purpose minor office equipment appropriate (printers, laptops, etc.) as a direct charge according to CAS and agency policy?
Materials & Supplies
Are general purpose office supplies appropriate according to CAS?
Participant Support
Is participant support clearly identified in the budget?
Participant support can be
in the form of stipends, scholarships, travel, reimbursement for supplies
Many agencies have restrictions on re-budgeting from this category
See agency (NSF, USDE, NIH) definitions of participant support
Participant support transactions must be accounted for as participant support using appropriate PSU account codes.
Click here for participant support form.
Other:
Research Subject Incentives
Needs to be specifically identified in the proposal budget
Hosting
Needs to be specifically described in the proposal budget
High Performance Research Computing
Is there a need for priority access for high performance research computing, like modeling, simulation, or other computationally intense research?
Submit a HPC Priority Access Form to request a quote from OIT or initiate services.
Telephone
Basic phone line charges are typically considered to be indirect costs and should require justification as a direct charge
F&A (Indirect)
Apply rates in PSU's Negotiated Rate Agreement in accordance with RGS guidance
Correctly categorize items in categories excluded from MTDC base (as defined in rate agreement:
>$25K of each subcontract
Equipment & other capital expenses, patient care, tuition remission, rental of off-site, facilities, scholarships & fellowships
Are we following our own policy for application of F&A rates to projects based on funding type?
Need to consistently apply F&A bases appropriately based on PSU policy