BUDGETS $ $ $ $ $ $ $ $ $ $ $ $ Grant Writing in Psychology Alicia J. Knoedler, CRA, PhD PSY Spring, 2005

Overview Basic Budget Terminology Typical Project Needs All things personnel, including effort Other direct costs Indirect costs Agency specific budget issues Everything else Example Budget

Basic Budget Terminology Budget – accounting of project needs in US Dollars Budget justification – detailed explanation/ description of project needs in words Modular Budget – NIH ONLY – dollars are awarded in modules of $25,000; therefore, proposal budgets should be developed with modules and minimal justification Direct costs - Clearly identifiable costs related to a specific project; must be allowable, allocable, reasonable, and consistent – OMB A-21 Indirect costs (aka: overhead, Facilities and Administrative Costs or F&A Costs) - Costs related to expenses incurred in conducting or supporting research or other externally-funded activities but not directly attributable to a specific project Indirect Cost Rate (PSU = 45%) – a percentage of a portion of direct costs; this amount is used to support the research infrastructure of the university Modified Total Direct Cost – this is the amount used to calculate indirect costs – it consists of Direct Costs minus items that are exempt from indirect costs (equipment over $5K, tuition, rental, subcontracts over $25,000, and participant costs [not subject payments]) OMB Circular = OMB is the Office of Management and Budget within the Federal Government; circulars are instructions to Federal agencies (like granting agencies – NSF, NIH) on how to do business with federal dollars; agencies typically use these instructions to create guidelines that are used with universities and other institutions

Typical Project Needs (Look at your list) Personnel costs – salary (academic year and/or summer), research assistants, postdoctoral fellows, project directors/associates/assistants, technical staff, etc. Fringe benefits – a percentage of the personnel costs to cover items like health insurance, Social Security, retirement, etc. Travel – project related Materials and supplies – with a limited lifespan Equipment Tuition for Graduate Research Assistants Advertising Photocopying Communication costs Subject/Participant compensation Rental Costs Consultants Subcontracts

Personnel Costs Salary costs are typically associated with the amount of effort that any person on the project expends on the work of the project Additional slides for determining Percent Effort Some universities have very specific personnel costs, for example at PSU (COLA): –Course release = 20% of faculty academic year salary –Graduate research assistant stipend (1/2 time, Grade 13) = $14,805 ( Academic Year); $4863 (2004 Summer with tuition) –Postdoctoral Scholar = $32,352 ( ) –Fringe Benefit Rates Faculty, postdocs, professional staff = 26.4% Graduate student stipends = 5.2% Wages (by the hour) = 8%

Other Direct Costs Travel = Project-Related; travel to conferences ok if project related; travel to meet with collaborators or collect data Materials and Supplies = costs that have a limited lifespan, including equipment under $5,000; computer software, storage media, computer peripherals, etc.; possible = folders, paper, labels, envelopes, reminder postcards, etc. – have to be project related Equipment = technically, this only includes items that cost $5,000 each; this is exempt from indirect costs Graduate Research Assistant Tuition = if a grad student is receiving a stipend (academic year salary, not wages by the hour), tuition is also charged; this cost is exempt from indirect costs

Other Direct Costs, continued Advertising = project-related, primarily to recruit participants Photocopying = has to be project-related; photocopying session materials, response sheets, instruction sheets, consent forms, etc.; possible = photocopying journal articles/chapters/etc. that are necessary for training of project personnel and theoretical development Communication costs = project-related; contact among collaborators; contacting participants; usually long-distance or a phone line in rented space

Other Direct Costs, continued Subject/Participant Compensation = payment received for participating in an experiment/study/session, etc. –Not necessarily monetary, could be a gift certificate or course credit –Are NOT exempt from indirect costs –Must be compensation for participation; bonuses are not allowed unless they are available to all participants within the study –“Incentives” are not allowed in that they are associated with coercion and subjects may not be coerced to participate in a study –Subjects cannot be penalized in terms of compensation for dropping out of the study prior to completion There also may be a need for other participant costs, like transportation from home to a data collection site or costs to support siblings in a family study (refreshments, child care expenses, etc.)

Other Direct Costs, last slide Rental Costs = costs associated with renting space, equipment or other needs that are project-related –Lab space at another university or location –Computer, car, etc. –Rental costs are typically exempt from indirect costs –Off-campus rates for indirect costs may apply Consultants = a consultant is an individual hired to give expert/professional advice or services for a fee, normally never an employee of the hiring institution (not considered personnel) Subcontract = Funds received from a primary grant recipient to support the costs associated with carrying out a portion of a project at another location/university/ institution –Subcontracts are necessary if a portion of the project scope will be performed somewhere other than the primary institution –First $25,000 of the subcontract are subject to indirect costs; additional costs are exempt –Subcontract indirect costs are direct costs for the prime/lead institution –This is how we pay PIs/Co-PIs and their personnel from other universities on a grant

Indirect Costs This is money that goes to an institution (like PSU) that pays for things not typically placed as direct costs on a grant – electricity, heat and A/C, office and lab space, phone lines, computer support, administrative support, paper, copier and supplies, salary for grant assistance, etc.) PSU Research rate = 45% on campus, 27% off campus PSU Instruction-related rate = 44+% on campus, 19+% off campus Sometimes the agency will specify a rate (usually lower) that overrides PSU’s rate PSU will charge their rate unless the agency says that indirect costs or overhead cannot be charged to the award Usually, indirect costs are funds that are over and above what the PI has requested, so it does not decrease the amount of money available to the research project Sometimes institutions funnel indirect costs back to the PI to pay for project needs not included in the budget – Every college at PSU does this differently Indirect costs help institutions build and support programs and faculty and staff. Without them, it would be difficult to perform the research funded by the external agencies

Agency-Specific Budget Issues NIH –Modular Budgets – modules of $25,000 –R03 – 2 modules = $50,000 per year –R01 – 10 modules = $250,000 per year –Requests over $250,000 per year – detailed budget must be used instead of modular –Requests over $500,000 per year – permission for this must be obtained 6 weeks in advance of the deadline –Modular budget justifications require description of personnel, effort, and responsibilities but no details regarding other costs NSF –Detailed budget and justification required always –Modular budget might be in the future –2 months of summer salary is the only salary request possible Both NSF and NIH allow for expanded authority under FDP – this allows budgetary changes without agency permission

Everything Else – Proposed Budgets Annual Increases – 3% (NIH); 3.5% most other agencies PSU Tuition annual increase – 12% Agency cuts – 10-15% Don’t sweat the proposal budget to a certain extent PSU budget rates links: –Salary, fringe, and tuition: –Grad RA Stipends:

Everything Else – Awards The following allowable costs may appear to be direct costs, but if they are not SPECIFICALLY for the funded project, they are considered NOT ALLOCABLE and are therefore indirect costs: Books/Journals/Publications Professional Society Memberships Phone Postage Photocopying Furniture General use equipment General use materials and supplies Research support for students (graduate, undergraduate, potential) Proposal preparation costs Lab space alterations Project staff recruitment (as part of a well-managed recruitment program) The following costs are NOT ALLOWABLE as either direct or indirect costs: Alcoholic beverages Entertainment - including amusement, diversion, and social activities and any costs directly associated with such costs (such as tickets to shows or sports events, meals, lodging, rentals, transportation, and gratuities) Student activity costs - costs incurred for intramural activities, student publications, student clubs, and other student activities, are unallowable, unless specifically provided for in the sponsored agreements. Here are some common department expenditures that PIs have charged as direct costs on their grants. These are not acceptable use of grant funds: General (not grant related) photocopying Non-grant related long distance phone calls Costs of graduate student recruitment Lab parties, lunches, dinners, meals, etc. General use lab furnishings Travel and meal costs for departmental (not grant related) speakers

Questions….

Example - Research Needs General Info: –One year psychology proposal to NIH –$75,000 limit –Single PI and Grad RA –Start Date: July 1 Needs –PI course release (one) –PI summer salary 2 to 3 months –Grad RA stipend and tuition –Grad summer wages –Subject payments for 100 subjects participating for 1 hour each –Travel to 2 conferences for each (PI and Grad RA) –Statistical consultant –Photocopying –New desktop computer and printer –Statistical software licenses (2)