Preparation of the budget is, for many researchers, the most difficult section of the proposal. Granting agencies see hundreds of proposals yearly and are proficient at comparing level of funding requested to the research work proposed. Therefore, it is important that the budget section of the proposal reflect, as accurately as possible, the funding needed to carry out the proposed research. The investigator should neither overestimate the funds required nor underestimate budgetary needs. Either of these strategies may lead to proposal rejection. A budget, accurately detailing the funds necessary to carry out the technical statement of work, can strengthen the total proposal and increase the likelihood of funding. Furthermore, a carefully prepared budget can often identify weak areas in the proposal narrative and result in improvement of the technical proposal.
Personnel in the OSP are experienced in preparing budgets, and encourage investigators to contact them when they have a draft of the budget. The OSP staff can provide expertise in completing a budget request, applying fringe benefit and facilities and administrative cost rates, documenting subcontracts/subrecipient agreements, consultants, matching funds, and cost-sharing. In the case of more complicated proposal requirements, the OSP will complete sponsor assurances and certifications, and when requested, will assist the investigator in interpreting RFP guidelines.
- Direct Costs Salaries and Wages
To determine total salaries and wages, list the amount of time to be spent by each person, including secretaries and clerical assistants, who will be working on the project. Time should normally be shown in terms of person-months and a percent of full-time effort. Show breakdown between summer and regular academic year for faculty.
- No employee may be scheduled for activities in excess of 100% of effort in any given month.
- Sponsored activities may not result in any employees receiving compensation at a rate in excess of their authorized salary or academic rate. For multi-year projects, the budget should take into consideration any possible salary increases.
- The Uniform Guidance (2 CFR 200) relevant to secretarial and other clerical support: The Principal Investigator needs to justify the need for administrative support to perform the project, and it is the Investigator's judgment that this is the best way to spend the funds.
- Fringe Benefits
Fringe benefits are a direct cost to a sponsored project, charged as a percentage of the salaries and wages to be paid, and are shown as a separate entry in the budget. The University’s fringe rates are negotiated with its cognizant agency (DHHS) and are part of the University’s F&A Cost Rate Agreement. Rates beyond August 31, 2019 are estimates and are provided for planning purposes. The fringe rates for fiscal year 2019 (FY19) (i.e. 9/1/2018-8/31/2019) and later are as follows:
Approved Projections for Budgeting Purposes Benefits Eligibility FY19
Subsequent years Full-time
29.00% 29.8% 30.3% + 0.5% Part-time 39.60% 29.8% 30.3% + 0.5% Ineligible 5.80% 5.10% 5.10% 5.10%
Additional fringe benefit rate information can be found at UT Austin Payroll. The current F&A Cost Rate Agreement, which includes the fringe benefit rates for FY19, is available on the OSP website as is the UT procedure for budgeting fringe rates.
Normally, consultants are paid a consulting fee plus travel expenses. Many Sponsors do not permit payments to consultants and some restrict or limit such payments. If in doubt as to the allowability of consultants or rates paid to consultants, refer to the Sponsor's program literature or contact the OSP. Whenever possible, identify the proposed consultant by name, indicate the number of days of work, daily rate, and provide a curriculum vitae for the consultant in the proposal.
The participation of paid consultants in a sponsored project for periods longer than two weeks should be discussed with the OSP prior to submission of the proposal. UT Austin employees may be used as consultants on a project if the consultant is from a different department than the principal investigator. Institutional consulting policies are contained in 3.19 of the Handbook of Operating Procedures and Policy Memorandum 7.205.
Tuition is required on all grant and contract proposals that include graduate research assistants, unless the sponsor does not allow tuition remission.
- Capital Equipment
Equipment means an article of nonexpendable, tangible personal property having a useful life of more than one year and an acquisition cost of $5,000 or more per acquisition. Components, other than on-campus machine-shop labor, used to fabricate an item of capital equipment may be considered as capital equipment for budgeting purposes and should be identified for inventory purposes. The on-campus machine-shop labor component is subject to facilities and administrative costs. Additionally, service/maintenance agreements are not considered a capital equipment charge; therefore, such agreements are subject to facilities and administrative costs. A separate subaccount is required for each capital equipment item being fabricated.
- Expendable Equipment and Supplies
These are items costing less than $5000. Normally, a research project will consume expendable supplies such as laboratory items, teaching aids, computer software, and office supplies. A reasonable amount should be budgeted for these items.
Faculty who anticipate the use of a particularly large number of research animals or animals requiring special care should consult with the Animal Resources Center staff to see whether the funds estimated will be adequate and whether the Animal Resource Center has adequate facilities to accommodate the animals.
- Publication Costs
Budget the anticipated cost of publishing the results of the research, keeping in mind that page charges may vary from journal to journal. Consider both page charges and reprint costs.
If foreign travel is anticipated it must be specified. Travel costs expected to exceed institutional guidelines must be specified. For travel rates, refer to the current procedures noted in the Handbook of Business Procedures. Outside the state, the limits are set by the Federal government and vary by locality. These rates are available in the *DEFINE system on the administrative computer (GG1 command). Federal funds cannot be used to make trips to secure new or additional research support or funds.
- Computer Time
Computer time costs should be included as a budget item, if appropriate. If non-Sponsor funded computer time is needed, arrangements must be made in advance with your academic department or research unit. Overhead applies to all types of computer time, and to all computer supply budgets.
- Participant Support Costs
The Uniform Guidance (2 CFR 200.75) defines Participant Support Costs as follows:
“Participant support costsmeans “direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees (but not employees) in connection with conferences, or training projects.” According to the Uniform Guidance (2 CFR 200.456), “Participant support costs as defined in §200.75 Participant support costs are allowable with the prior approval of the Federal awarding agency.”
- Who is a participant?
A participant is a recipient who is not an employee of the University of Texas at Austin (UT-Austin), nor the provider of a service or training associated with a workshop, conference, seminar, symposium, or other short-term instructional or information sharing activity. Participants are not required to provide any deliverable to the university and they are not subject to UT-Austin Human Resource policies (e.g., they cannot be terminated for failure to perform). Participants may include students, scholars, and scientists from other institutions, representatives of private sector companies, teachers, and state or local government agency personnel. A person classified as an intern would be paid as an employee and not as a participant, because the intern, while receiving certain training, is also providing services to the university, to the grant sponsor, or to a third party (e.g., counseling students at a local public schools).
- What costs can be included in participant support costs?
Participant support costs include the direct costs for items such as the following:
- Stipend. A stipend is a set amount of money to be paid directly to the participant. Certain agencies of the federal government specifically restrict participant stipends. The professional staff in the Office of Sponsored Projects (OSP) will assist the Principal Investigator (PI) to determine if the sponsoring agency for a particular project restricts the stipend to be paid to a participant.
- Travel. Travel includes the costs of transportation and associated costs and must follow sponsor guidelines (e.g., U.S. flag carrier, coach class, most direct route) as well as travel rules for the State of Texas and UT-Austin policies and guidelines. The sole purpose of the trip must be to participate in the project activity. If a training activity involves field trips, the costs of transportation for participants may be allowable.
- Subsistence allowance. The cost of a participant’s housing and per diem expenses necessary for the individual to participate in the project are generally allowed, provided these costs are reasonable and limited to the days of attendance. Although they may participate in meals and snacks provided at the meeting or conference, participants who live in the local area are not entitled to subsistence payments.
- Fees. The fees paid by a participant in connection with meetings, conferences, symposia, or training projects are generally allowable costs. These fees may include laboratory fees, passport or visa fees for foreign participants, and registration fees. A sponsor may also allow the costs of any UT- Austin tuition and fee charges that are required to be paid for the individual to participate in the training project.
- Other. Certain other costs in support of the participant’s involvement may be allowable, including training materials, laboratory supplies, and insurance.
- What costs CANNOT be included as participant support costs?
Participant support costs do not include the following types of payments:
- Honoraria paid to a guest speaker or lecturer.
- Conference support costs such as facility rentals, media equipment rentals, or conference food.
- Subaward to a provider for multiple training events (i.e. an ongoing contract with specific terms and conditions).
- Agreements with employers (e.g., public school system) to reimburse the employer for the costs related to sending its employee to a conference or workshop. It is recommended that the PI inform participants prior to the initiation of the project about any costs associated with their participation in the project that are not covered.
Conditions associated with participant support funds
- All costs that are reimbursed to or paid on behalf of participants must be incurred within the project period and specifically allowed by the sponsoring agency.
- Participant support costs are budgeted in a separate line and must be accounted for separately.
- Funds provided for participant support costs that are not spent cannot be rebudgeted for use in other categories except with the prior written approval of the sponsor.
- In most cases, unspent participant support costs must be returned to the sponsor.
See complete Participant Support Costs Guidance.
- Subcontracts/Subrecipient Agreements
When a proposal contemplates a subcontract/subrecipient agreement to a named subcontractor, the following is required of the subcontractor and must be submitted with the Proposal Review Form: a statement of work, a detailed budget and budget justification, a negotiated rate agreement for Federal/Federal pass-through funding and a letter signed by the subcontractor's authorized institutional representative. Only rates from a negotiated indirect cost rate agreement will be allowed for proposals submitted to Federal sponsors. Should the subcontractor not have a negotiated rate for a Federal proposal, indirect costs will be calculated based upon 2 CFR 200 Uniform Guidance and no more than the 10% modified total direct costs (MTDC) de minimis rate will be allowed.
All subcontract Principal Investigator(s) and Covered Individuals must follow/be in compliance with pertinent Financial Conflict of Interest Policies. Some institutions are compliant by virtue of their participation in the Federal Demonstration Partnership’s FCOI Institutional Clearinghouse and do not have to submit additional training or disclosure. If, however, a subcontracting institution is not listed in the FDP Clearinghouse, then individuals must fulfill either Requirement A or B of UT’s Financial Conflict of Interest Policy and file the appropriate Financial Interest Disclosure, if necessary. Refer to the Conflict of Interest section of the Office of Research Support and Compliance’s website at https://research.utexas.edu/ors/conflict-of-interest/proposals-awards-and-contracts-guidance/ and https://research.utexas.edu/ors/conflict-of-interest/investigators-and-collaborators/#sponsored-research for more information.
In the event that the total amount to be subcontracted represents a substantial portion (> 50%) of the proposed direct costs, the Principal Investigator should contact the OSP for guidance.
- Other Direct Costs
Consider, as appropriate, costs for copying, long-distance telephone calls, postage, reference books and materials, tuition and required fees for participating graduate students, equipment maintenance, and contracted services. The Uniform Guidance (2 CFR 200) relevant to office supplies, postage, local telephone costs, and memberships: The Principal Investigator needs to justify the need for these items in relation to the project, and it is the Principal Investigator's judgment that this is the best way to spend the funds.
- Facilities and Administrative Costs
Facilities and Administrative (F&A)/indirect costs must be included using UT Austin's federally-negotiated rates unless the federal or not-for-profit sponsor has a statutory policy applicable to all potential proposers which deviates from these rates. All other deviations are subject to UT Austin administrative approval by the Associate Vice President of Research/Director, Office of Sponsored Projects. Sponsor guidelines limiting facilities and administrative costs must be provided with your proposal. Projects funded by the for-profit sector must accrue F&A at the appropriate negotiated rate.
The F&A rate for clinical trials is 38% of total costs.
To calculate the facilities and administrative costs for a project, do the following:
- Calculate the Total Direct Costs (TDC) which is simply the sum of all direct costs (salaries, benefits, supplies, equipment, etc.)
- Calculate the base against which the F&A rate will be multiplied by subtracting exempt items (capital equipment, graduate student tuition and required fees, stipends, and subcontract/subrecipient agreement costs in excess of the first $25,000 of each subcontract/subrecipient agreement over the life of the subcontract/subrecipient agreement) from TDC. This will give the Modified Total Direct Costs (MTDC).
- Apply the F&A rate against the MTDC base to calculate the facilities and administrative costs for the project.
- Add the TDC to the F&A to calculate the Total Project Costs.
TDC - exemptions = MTDC MTDC x F&A rate = F&A TDC + F&A = Total Project Costs
Note that since the federally-negotiated facilities and administrative cost rates are subject to change annually, Principal Investigators should be prepared to make adjustments in budgets for such changes. See facilities and administrative costs/fringe benefits rates or contact the Office of Sponsored Projects, (512) 471-6424, for more specific information. For other contact information, see OSP staff directory.
- Off-Campus Rate
The off-campus rate is 26.0% and should be calculated on modified total direct costs (MTDC) for projects conducted off-campus. The use of the off-campus rate must be approved in advance by the Office of Sponsored Projects. Requests for the off-campus rate must be received at least seven business days prior to the proposal deadline.
In order for the off-campus rate to be considered, the off-campus portion of the project must take place for at least 90 consecutive days. In addition, at least one of the following criteria must be met:
- The combined proposed effort of all involved UT personnel working off-campus must be greater than the combined proposed effort of all involved UT personnel working on-campus. This includes unpaid contributed effort.
- The budget must include leasing or renting an off-site facility as a direct cost, and the personnel paid from the grant and any equipment must be located at that facility.
- The total direct costs incurred off-campus must exceed the total direct costs incurred on-campus.
- Budget Guidance and Tools