Building Realistic Budgets

1
Building Realistic Budgets

• Judy Harris, Proposal Processing
• Division of Sponsored Research

2
What is a Budget?

• An estimate of costs required to perform a
  statement of work with a specific start and end
  date.

3
Proposal Budgets

• Made up of costs that can be explained or
  verified and are reality-based
• No Educated Guesses or Off The Wall estimates
• May require several drafts before it is finalized
• May vary in structure and complexity

4
Why Is a Budget Important?

• It is the second most scrutinized part of the
  proposal
• A clear concise budget supported by a strong
  budget justification can increase the chances of
  a proposal being funded
• The proposal budget can become the actual award
  budget

5
Basic Proposal Budget Components

• Direct Costs
• Facilities and Administrative Costs, or FA
  (a.k.a. Indirect Costs)

6
Direct Costs

• Expenses identified specifically with a
  particular sponsored project, instructional
  activity, or other institutional activity
• Must be allowable, allocable, reasonable
  necessary for the program, given consistent
  treatment and conform to sponsor limitations

7
Facilities Administrative Costs

• Costs incurred for common or joint objectives
  which cannot be identified to a specific direct
  cost activity
• Facilities and Utilities
• Administrative and Clerical Salaries
• DSR/Purchasing/HR/Controller
• Postage
• Local Telephone
• Office Supplies
• Data Processing/Computer Supplies
• General Purpose Software
• Memberships
• Subscriptions

8
Major Budget Categories

• Personnel Costs
• Fringe Benefits
• Travel
• Research Supplies and Materials
• Participant Support
• Patient Care
• Consultants
• Tuition

• Equipment
• Subcontracts
• Facilities and Administrative Costs (FA)
• Other Direct Costs

9
Personnel Costs

• Personnel Categories
• Academic Personnel (includes Faculty Post Docs)
• TEAMS/USPS
• OPS (includes Graduate Research Assistants,
  Student Assistants Other Temporary Employees)

10
Domestic Travel

• Airfare
• Lodging
• Car Rental
• Per Diem
• Mileage
• Parking Fees
• Registration Fees
• Local Transportation (Taxi, Metro, Shuttle)
• Includes travel to Canada

11
Foreign Travel

• (Generally subject to prior approval from
  sponsor).
• Airfare
• Apartment Rental
• Car Rental
• Local Transportation
• Lodging
• Per Diem (Federal travel subject to GSA Schedule)
• Registration Fees
• Includes travel to Mexico

12
Budgeting Travel

• Should include detailed information in budget
  narrative

Number of Travelers Destination Travel Fares Length of Trip Per Diem Registration Fees/ Conference Costs
13
Equipment

• Costs more than 1,000 (State of FL, not Federal
  definition)
• Has a useful life of one year or more
• Some sponsors may require supporting
  documentation/quote at proposal submission

14
Tuition

• All new proposals, including resubmissions,
  competing renewals and supplements, that include
  salary/stipend for graduate assistants and where
  tuition is an allowable cost, must budget
  appropriate amounts for tuition.

15
Consultants

• Non-UF Employees
• Not a subcontractor no substantial programmatic
  involvement
• Normal daily rate
• Supported by letter/quote from Consultant

16
Subcontractors

• Can be
• Other Institutions
• Commercial Companies

• Subcontractor has substantive programmatic
  involvement and may be co-author on resulting
  publications

17
Subcontractors

• Before submitting the proposal obtain
• Letter of Commitment from institutional
  authorized official.
• Written Quotes/Budgets
• Statement of work

18
Participant Support

• Payments to individuals required on the project
  with no obligation to provide work or services
  (Generally workshops)
• Typical costs
• Stipends
• Travel-related costs

19
Other Direct Costs

• Tuition, fees, stipends

20
Other Direct Costs

• Facilities
• Rental Space
• Renovation

21
Facilities Administrative Costs (Indirect Costs)

• Applied to ALL sponsored projects unless sponsor
  policy/program limits indirect recovery
• Following sponsor types have specified FA rates
• State of Florida 10TDC/25TDC
• Water Management Districts 25 TDC
• Other Florida Governmental Entities 25 TDC
• Clinical Trials 25 TDC

22
Facilities Administrative Costs (Indirect Costs)

• University rates are based on the following
  factors

• Function/Purpose
• Research
• Instruction
• Other

• Location of Project
• On-Campus
• Off-Campus

23
Facilities Administrative Costs (Indirect Costs)

Function Location Location
On Campus Off Campus
Organized Research AREC Other Sponsored Acts 46.5 46.4 33.6 26.0 25.0 26.0
Instruction 50.0 26.0

Department of Defense (contracts) 48.5
28.0
24
Calculating FA

• Identify Exclusions
• Equipment
• Capital Expenditures (includes renovations)
• Patient care charges
• Tuition remission
• Rental costs of off-site facilities
• Scholarships
• Fellowships
• Subcontract amounts in excess of first 25,000

• Modified Total Direct Cost Base (MTDC)
• Total Direct Costs minus items not charged with
  FA.
• Total Direct Cost Base (TDC) Total Direct Costs
  x FA rate without any exclusions.

25
Total Budget

• Total Direct Costs
• FA Costs
• Total Budget

26
Cost Sharing in Budgets

• Identifies necessary project costs not requested
  from sponsor
• Should be a sponsor requirement
• Should be referenced in budget as directed by
  sponsor
• Shows UFs/Third Party commitment to Project
• Should follow UF Cost Sharing Policy

27
Charging Costs Directly or Indirectly to
Sponsored Projects

• In order to comply with (OMB) Circular A-21 and
  the Cost Accounting Standards Boards cost
  accounting standards, UFs policy for charging
  costs to federally sponsored projects is
• Clerical and administrative salaries will be
  charged indirectly unless direct charging can be
  justified in accordance with OMB Circular A-21.
• Postage will generally be charged indirectly.
• Basic telephone charges will generally be charged
  indirectly, including cell phones.
• Lab supplies will generally be charged directly.
• Office supplies will generally be charged
  indirectly.
• General purpose software will generally be
  charged indirectly.
• Technical software will generally be charged
  directly.
• Subscriptions will generally be charged
  indirectly.
• Institutional and individual memberships will
  generally be charged indirectly.
• Repair and maintenance charges for equipment
  purchased on the award will generally be charged
  directly.
• Other related costs (photocopies, travel,
  technical and scientific equipment, animal care
  and other services provided by specialized
  service facilities) will generally be charged
  directly.

28
Arithmetic Double Check Budget!

• Fringe Benefit Rates
• GRA Tuition
• FA Rate
• MTDC Exclusions
• On Off Campus
• Budget Total

29
Review and Finalize Budget

• Review draft
• ceiling price exceeded?
• Revise
• How much to cut? add?
• Cut logical places
• Should the technical proposal be revised due to
  budget changes?
• Are Cost Share funds required?
• Have cost-share commitments been secured?
• Proposed effort documented?
• Equipment match documented?

30
Final Budget Presentation

• Prepare Sponsor budget forms
• Accurate
• Neat
• Legible

31
Finalizing Budget

• Prepare justification/budget narrative (Follow
  agency guidelines)
• Should be arranged in order of Sponsors budget
  form
• Clear Concise
• Explanation of request