Sponsored Programs at NYU: Developing the Budget With Dollars and Sense Betty Farbman, Associate...

Sponsored Programs at NYU: Developing the Budget With Dollars and Sense

Betty Farbman, Associate Director, Office of Sponsored Programs

Nancy Daneau, Associate Director of Research Administration Training & Institutional Liaison

What we’ll cover…. Resources and budget categories What can (or can’t) be charged to a sponsored

project? Making the calculations How to treat and incorporate a budget from

collaborator(s) F&A: what is it and why do we care? Cost sharing Justifying the cost estimate Tools and references

Common Budget Categories Direct Costs

Salaries and Wages Fringe Benefits Equipment Materials and Supplies Travel Consultant Services Participant Support Costs Patient Care Costs Subcontracts Other Direct Costs

Tuition remission Stipends Rent Human Subject Payments

Facilities and Administrative (F&A)/Indirect Costs

Salaries and Wages Principal Investigator (PI) and Senior/Key

Personnel Technicians (programmers, scientists) Post docs Graduate Research Assistants Undergraduate Students Administrative support (direct charge only

when allowable and justifiable)

Salaries and Wages (cont’d)…

To charge salary, individuals must be NYU employees External collaborators are not employees; correctly identify as

consultants or subawards PI must commit effort to conduct research or oversee project

activities $’s requested for faculty and other key personnel must be in

proportion to the effort devoted to the project For key personnel, entering $0 dollars and no effort is unacceptable Total dollars, equivalent to 100% effort may not exceed annualized salary

Define effort in person months To convert percent of effort to person months:

Utilize person-months/percent effort calculator found at: grants.nih.gov/grants/policy/person_months_conversion_chart.xls

On internal budgets, note both person months and percent effort


Check for agency limitations Ex: For NSF, no academic year salary may be

charged Summer salary across all NSF-funded grants may not

exceed two-ninths of academic year salary (2 summer months)

NIH imposes a cap on salaries charged to awards; refer to http://grants.nih.gov/grants/policy/salcap_summary.htm for current rates


To calculate amount of salary to be requested: multiply person months x monthly base salary

9 month appointments Divide 9 month base salary by 9, then multiply by the #

of person months devoted to project 11 month appointments

Divide 11 month salary by 11, then multiply by the # of person months devoted to project

12 month appointments Divide 12 month salary by 12, then multiply by the # of

person months devoted to project Salaries that span fiscal years should be

“weighted” to incorporate increases

Calculating salary across fiscal years Project period 1/1/2008-12/31/2008

Base Salary in FY’08 = $50,000 Base Salary in FY’09 = $51,500 (3.5%

increase) (12 month employee)

Salary calculation Jan – Aug = $33,336

Calculation - 8 mos @ $4,167/mo Sept – Dec = $17,168

Calculation – 4 mos @ $4,292

Budget for project period = $50,504


To calculate salary on NIH proposals subject to the cap Salary for 9 month appt = $160,000 Annualize to 12 months

$160,000 / 9 = $17,777/month x 12 = $213,333 With salary for FY 07 capped at $186,600, monthly

rate is capped at $15,550 ($186,600 / 12) Salary request for 2 person months in summer totals

$31,100 ($15,550 x 2)


Post-docs Years of experience in field typically drives

rates for post-docs Check with Administrator or HR personnel for

salary rates specific to your school/dept For NIH NRSA institutional training grants and

individual fellowship applications NIH sets rates, based on years of experience, for

post-docs http://grants2.nih.gov/grants/guide/notice-files/NOT-OD-07-052.html


Graduate Research Assistants Check with Administrator or HR personnel for

salary rates specific to your school/dept NIH maximum: zero level postdoctoral stipend In addition to salary, GRA’s entitled to tuition

remission Goes in “Other Direct Costs” budget category Rates

FAS & CIMS: 37% of salary All Other Units: 51% of salary


Undergraduate Students Check with departmental administrator or HR

personnel Hourly rate must be at or above minimum

wage Number of hours per week limited to 15-20 for

enrolled students May work full-time (35 hours) during breaks

and summer Not entitled to fringe benefits


Administrative Support Salaries of admin and clerical staff

Generally part of the administrative portion of the F&A/indirect cost pool and therefore not direct-charged

Exceptions: Major projects or center grants (defined in Exhibit C of

OMB Circular A-21, Cost Principles for Educational Institutions) http://www.whitehouse.gov/omb/circulars/a021/a21_2004.html#exc

Projects requiring extensive data collection and analyses

Conference grants requiring administrative support for making extensive travel arrangements

Fringe Benefits Includes social security (FICA), retirement, unemployment,

worker’s compensation, health/life/disability insurance Fringe benefit rate applied to salary dollars requested for full-time,

eligible NYU personnel in proposed budget Portion of fringe benefits estimated in proposal budget tied to

person-months committed NYU’s federally negotiated fringe benefit rates

9/1/2007 to 8/31/2008: 27% 9/1/2008 to 8/31/2009: 27.5%

Increases by .5 points per year thereafter Fringe should be weighted across fiscal years

Ex: PI salary request = $25,000 Fringe Benefits request = $6,750

$25,000 x 27% = $6,750

Equipment Defined at NYU as:

Acquisition cost of $3,000 or more per unit with at least one year useful life

Include fabricated items (even if individual components cost under $3K)

Defined as sum of individual parts to procure and build workable equipment item

On proposals to *federal sponsors*, do not request funds for desktop computers, laptops unless justifiable due to nature of project

Deemed to be part of F&A/departmental research support Exclude from F&A/indirect cost assessment

Materials and Supplies

Laboratory supplies Animals

http://www.nyu.edu/uawc/doc/animalperdiemrate.pdf

Software Training/curricula/workbook materials Publication/reprint costs On proposals to *federal sponsors*, do not

request funds for general office supplies, local telephone charges, postage, etc. unless justifiable due to nature of project

Deemed to be part of F&A/departmental research support

Travel Airfare, lodging, car rental, mileage if using personal

automobile, per diem for meals Foreign travel: Fly America Act—use of U.S. air carriers

required except in exceptional circumstances Refer to Fly America Act:

http://acquisition.gov/far/current/html/Subpart%2047_4.html Provide detailed estimate

Number of trips, number of days per trip Number of individuals traveling Destination and purpose

NYU reimbursement rates Maximum Per Diem for Meals (unsubstantiated): $50 per day Maximum Expenses for Lodging & Meals (substantiated): $350

per day Business Mileage Rate: 48.5 cents per mile Refer to guidance on travel reimbursements:

http://www.nyu.edu/cdv/site20/policies/busexp.html#travperm

Consultant Services External collaborators Provide expertise, service and support, and/or skills not

found within NYU’s permanent staff Do NOT utilize NYU resources, space, facilities, etc. to

conduct work No employer/employee relationship exists Identify name, affiliation, hourly or daily rate

No maximum, but must be reasonable, based on market value Estimate number of hours or days necessary Budget for travel costs if applicable, i.e. airfare, mileage,

lodging, per diem for meals, etc. Use NYU reimbursement rates

Participant Support Costs (specific to NSF) Transportation, per diem, stipends and other

costs of trainees for: Conferences Meetings Symposia Workshops

Trainees may NOT be employees Exception for NSF proposal budgets

Local school districts where teachers are trainees In this case, stipends may be categorized as participant

support as long as school district has accounting mechanism in place to track and report stipends separate from salary

Exclude from F&A/indirect cost assessment

Patient Care Costs If inpatient and outpatient costs are

requested, separate and provide detail for both

Include Number of participants Estimated cost per day/per patient Expected number of visits/tests/trials Estimated cost per visit/test/treatment

Subawards and Subcontracts with Collaborators Transfer of a substantive portion of the

programmatic effort to another organization/institution Statement of Work drives the budget Determine $ amount required by subrecipient to conduct

assigned portion of the work Include direct and indirect costs at subrecipient

organization’s rates Collaborating institution’s total budget estimate (direct

and indirect costs) is shown as a direct cost on NYU’s proposed budget

Assess NYU’s F&A/indirect rate on only the first $25K of each subaward; remainder is excluded from indirect cost assessment

Other Direct Costs Tuition Remission

FAS & CIMS 9/1/97 to (until further notice): 37% of salary

All Other Units 9/1/90 to (until further notice): 51% of salary

Stipends NOT allowed on research grants Permitted on training grants and/or fellowships Different from salaries in that fellows are not NYU

employees; they are NYU trainees A set rate, no fringe benefits charged, no taxes withheld

(yet income reported via 1099) Used for living allowance

Other Direct Costs (cont’d)…

Rental expense (only if off-site facility is to serve as project site) Specify rate per square foot and size of space

needed Specify lease amount per month, annualize

Human Subject Payments Funds given to subjects for following protocol Set amount for each visit Can be lump sum based on completed

participation

Facilities and Administrative (F&A) Costs Costs that can’t readily be identified with one

specific project Called F&A, Indirect, Overhead

Cover a portion of institution’s operating costs including, but not limited to: maintenance and management of research laboratories,

libraries, and other facilities departmental administration and support central administrative support including payroll, OSP,

SPA, University Animal Welfare Committee (UAWC), and University Committee for Activities Involving Human Subjects (UCAIHS)

Facilities and Administrative (F&A) Costs (cont’d)…

Indirect cost rates are negotiated with NYU’s cognizant agency DHHS and based on costs for research operations incurred during the previous FY Rate applied to a modified total direct cost (MTDC) base MTDC = Total direct costs less:

Capital equipment Tuition remission Subawards beyond the first $25,000 Participant Support Costs

Apply stated rate to all proposal budgets unless F&A/indirect cost limited to a set amount or percentage in sponsor guidelines (sponsor policy must be in writing)

Facilities and Administrative (F&A) Costs (cont’d)…

On Campus 9/2005 - 8/2007 53.0% MTDC 9/2007 - 8/2008 53.5% MTDC 9/2008 - 8/2009 54.0% MTDC

Off Campus 9/2005 - 8/2007: 26% MTDC 9/2007 - 8/2008 26% MTDC 9/2008 - 8/2009 26% MTDC

Per federally negotiated rate agreement with NYU’s cognizant agency DHHS, dated July 2, 2007

Off-site rate used only when a preponderance of work is taking place off-site and no NYU space or resources being utilized

Refer to OSP website to obtain current rates http://www.nyu.edu/osp/policies/basicinfo.php

Two Cents About Cost Sharing Costs of conducting a project borne by NYU and not

charged to the sponsor Most often in form of time and effort (salaries, fringe benefits,

unrecovered indirect costs only when approved by sponsor) NYU policy

Cost sharing allowed only when mandated by sponsor in written guidelines

Quantified Specified as percentage or person months in proposal = Voluntary committed cost sharing Must be tracked in separate cost sharing account, reported to

sponsor and included in organized research base for F&A calculation

Unquantified Referenced in proposal or justification but not quantified =Voluntary uncommitted cost sharing

Two Cents About Cost Sharing (cont’d)…

Voluntary committed cost sharing Requires approval by Chair, Dean Has negative impact on NYU’s F&A rate

Costs included in the organized research base portion of F&A

Results in lower F&A rate recoverable

Voluntary uncommitted cost sharing Does not need to be quantified, tracked, or

reported upon No impact to the F&A base

Outside Support Third Party Contributions

Cash Document commitment of financial resources by

letter of support stipulating amount and any restrictions

In-kind Value of non-cash contributions

Ex: value of volunteer services

Budget Justification Narrative to accompany the cost estimate Breaks down each category of cost Provides detailed explanation of how costs

derived Quantify total costs of each line item and document cost

calculation Specify line items for each year and time frame during

which you expect they’ll be expended Elaborate on line items—use narrative form to justify

necessity; how costs will be used for successful project implementation

Hints and Tips Costs must be allowable, allocable, and reasonable

A-21, Cost Principles for Educational Institutions http://www.whitehouse.gov/omb/circulars/a021/a21_2004.html#j NYU and sponsor policies

Read the guidelines as they relate to budget development Comply with sponsor-imposed limits based on funds available

Specify the budget period start and end dates Budgeting in the out-years

Personnel (Salaries and Wages): Increase 3.5% each year Other than Personnel Services (OTPS): Increase 4% each year Tuition: Increase 5% each year

Hints and Tips (cont’d)…

Rules for federal sponsors differ from rules of foundations, corporations, others Provides flexibility; it may be possible to direct charge

items not normally allowable under a federal award Agency specific instructions take precedence

Put cost estimates into agency specific language or budget format and forms as necessary

Justification of costs should follow the order listed on budget sheet

Make it easy for reviewers to understand how cost estimate derived by walking through details

Reference for Unallowable Costs Per A-21, following are unallowable:

Alcoholic beverages Alumni activities Bad debts Commencement or convocation costs Charitable contributions, donations,

remembrances Development/fundraising costs

Unallowable Costs (cont’d)…

Entertainment costs: tickets to shows or sporting events, meals, lodging, rentals, transportation, and gratuities associated with entertainment

Fines and penalties Goods or services for personal use of

employees (including gifts) Housing and personal living expenses of

University officers Investment management costs Lobbying

Unallowable Costs (cont’d)…

Cost overruns on other sponsored agreements Pre-award costs (unless approved by the

sponsoring agency or permitted under expanded authorities)

Selling and marketing costs of any products or services of the institution

Student activity costs incurred for intramural activities, student publications, student clubs

Travel: First class tickets (unless extenuating circumstances)

Questions?

Contact your Projects Officer in OSP

or

Betty Farbman – [email protected] Daneau – [email protected]

Sponsored Programs at NYU: Developing the Budget With Dollars and Sense Betty Farbman, Associate...

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