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

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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

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What well cover.

• Resources and budget categories
• What can (or cant) be charged to a sponsored
  project?
• Making the calculations
• How to treat and incorporate a budget from
  collaborator(s)
• FA what is it and why do we care?
• Cost sharing
• Justifying the cost estimate
• Tools and references

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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 (FA)/Indirect Costs

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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)

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Salaries and Wages (contd)

• 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_mont
  hs_conversion_chart.xls
• On internal budgets, note both person months and
  percent effort

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Salaries and Wages (contd)

• 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/salca
  p_summary.htm for current rates

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Salaries and Wages (contd)

• 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

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Calculating salary across fiscal years

• Project period 1/1/2008-12/31/2008
• Base Salary in FY08 50,000
• Base Salary in FY09 51,500 (3.5 increase)
• (12 month employee)
• Salary calculation
• Jan Aug 33,336
• Calculation - 8 mos _at_ 4,167/mo
• Sept Dec 17,168
• Calculation 4 mos _at_ 4,292
• Budget for project period 50,504

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Salaries and Wages (contd)

• 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)

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Salaries and Wages (contd)

• 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/noti
  ce-files/NOT-OD-07-052.html

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Salaries and Wages (contd)

• 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, GRAs entitled to tuition
  remission
• Goes in Other Direct Costs budget category
• Rates
• FAS CIMS 37 of salary
• All Other Units 51 of salary

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Salaries and Wages (contd)

• 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

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Salaries and Wages (contd)

• Administrative Support
• Salaries of admin and clerical staff
• Generally part of the administrative portion of
  the FA/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.whitehous
  e.gov/omb/circulars/a021/a21_2004.htmlexc
• Projects requiring extensive data collection and
  analyses
• Conference grants requiring administrative
  support for making extensive travel arrangements

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Fringe Benefits

• Includes social security (FICA), retirement,
  unemployment, workers 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
• NYUs 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

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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 FA/departmental research
  support
• Exclude from FA/indirect cost assessment

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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 FA/departmental research
  support

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Travel

• Airfare, lodging, car rental, mileage if using
  personal automobile, per diem for meals
• Foreign travel Fly America Actuse of U.S. air
  carriers required except in exceptional
  circumstances
• Refer to Fly America Act http//acquisition.gov/
  far/current/html/Subpart2047_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

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Consultant Services

• External collaborators
• Provide expertise, service and support, and/or
  skills not found within NYUs 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

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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 FA/indirect cost assessment

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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

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Subawards and Subcontracts with Collaborators

• Transfer of a substantive portion of the
  programmatic effort to another organization/instit
  ution
• 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
  organizations rates
• Collaborating institutions total budget estimate
  (direct and indirect costs) is shown as a direct
  cost on NYUs proposed budget
• Assess NYUs FA/indirect rate on only the first
  25K of each subaward remainder is excluded from
  indirect cost assessment

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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

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Other Direct Costs (contd)

• 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

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Facilities and Administrative (FA) Costs

• Costs that cant readily be identified with one
  specific project
• Called FA, Indirect, Overhead
• Cover a portion of institutions 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)

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Facilities and Administrative (FA) Costs
(contd)

• Indirect cost rates are negotiated with NYUs
  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
  FA/indirect cost limited to a set amount or
  percentage in sponsor guidelines (sponsor policy
  must be in writing)

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Facilities and Administrative (FA) Costs
(contd)

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

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

Per federally negotiated rate agreement with
NYUs 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/pol
icies/basicinfo.php
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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 FA calculation
• Unquantified
• Referenced in proposal or justification but not
  quantified
• Voluntary uncommitted cost sharing

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Two Cents About Cost Sharing (contd)

• Voluntary committed cost sharing
• Requires approval by Chair, Dean
• Has negative impact on NYUs FA rate
• Costs included in the organized research base
  portion of FA
• Results in lower FA rate recoverable
• Voluntary uncommitted cost sharing
• Does not need to be quantified, tracked, or
  reported upon
• No impact to the FA base

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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

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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 theyll be expended
• Elaborate on line itemsuse narrative form to
  justify necessity how costs will be used for
  successful project implementation

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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_2
  004.htmlj
• 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

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Hints and Tips (contd)

• 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

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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

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Unallowable Costs (contd)

• 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

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Unallowable Costs (contd)

• 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)

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Questions?

• Contact your Projects Officer in OSP
• or
• Betty Farbman betty.farbman_at_nyu.edu
• Nancy Daneau nancy.daneau_at_nyu.edu