Budget Details

Direct Cost Categories

Personnel

Personnel effort on sponsored research projects is normally expressed as a percentage of an employee's annual base salary, commensurate with the estimated time the person will devote to the project, and charged to the sponsor as a line item in the personnel section of the budget. Where non-reimbursed time is committed, the University may be required to document it as cost sharing. The availability of sponsored funds has no bearing on the actual employee rate of pay.
 
Anticipated salary increases should be included when preparing a multi-year budget. Consult the Office of Sponsored Research or Financial Services for current cost of living projections. These projections do not commit the Principal Investigator, department, or school to grant specific increases to individual staff members; rather, they allow the University to present a consistent picture of its best estimate of for future costs.

• Faculty:
  Faculty members are generally appointed for the nine month academic year, and may seek reimbursement for academic year released time, when formally excused from teaching or other assignments by the department chair and dean, as well as for additional compensation for a maximum of two summer months, subject to limits set by funding agencies. The approximate percentage of time per month should be computed and multiplied by 1/9 of the academic year salary to determine the monthly salary for the summer.
  
  Faculty members may not receive "overload" compensation for additional research duties during the academic year or summer months. In other words, faculty members may not commit more than 100% of their effort, in accordance with Federal regulations.
  
• Staff:
  Staff members are compensated for such periods as they are actually employed. Their remuneration is calculated on the basis of a 12-month year. Specify in the proposal budget the compensation for the period of employment. Calculate the charge based on the salary multiplied by the percentage of time to be devoted to the project.
  
• Graduate Research/Teaching Assistants:
  Graduate Assistants are graduate students whose time is divided between formal study and research or teaching responsibilities. During the academic year, their stipend, and tuition and fees will be paid in accordance with University Policy. Summer Graduate Assistants are paid on an hourly basis and fringe benefits are calculated at the part-time rate.
  
• Undergraduate Students:
  Undergraduate students are called Student Assistants when employed on a research project. Wages are usually charged on an hourly basis.
  
• Administrative and Clerical Personnel:
  Revisions to the federal cost principles governing institutions of higher education have placed restrictions on the instances in which salaries for administrative and clerical personnel may be directly charged to grants. Eligible individuals must be identified specifically with a particular sponsored project and employed for non-routine tasks. Examples include projects involving:
     • assembling and managing teams of investigators;
     • accumulating and entering extensive data;
     • making travel and meeting arrangements for large numbers of participants;
     • principally preparing and producing manuals and large reports.
  In addition, levels of effort of less than 10% are less likely to be found acceptable than larger blocks of time. Consult the Office of Sponsored Research concerning whether the charges for these personnel are allowable.
  

Fringe Benefits:
Fringe benefits are charged as a percentage of salaries to cover such benefits as are provided by the University. The fringe benefit rate is determined by Financial Services; consult the Assistant Controller for current rate information.

Consultants:
Consultant fees are a separate category of direct costs and are not listed as part of the personnel budget. Consultant fees may be paid only to individuals not employed by the University who can provide special knowledge or advice necessary for the project. University employees who may be called on for special services should be listed in the salary section of the budget for an appropriate portion of their salary. Federal agencies specifically prohibit the payment of consultant fees from grants or contracts to persons employed by the federal government in any capacity. Consultant fees may include any charges associated with the consultant's services, such as travel and subsistence.

Travel:
Indicate briefly the purpose and frequency of expected travel and its applicability to the project. Per Diem rates, mileage, and air/rail travel are calculated using the University's rates. Consult Financial Services or the Office of Sponsored Research for the currently approved schedule of foreign per diem rates permitted by the federal agencies and any limitations or restrictions imposed by specific sponsors on travel outside the United States. Note that for most sponsors, except the National Science Foundation, Canada is considered a foreign country.

Capital Equipment:
Itemize capital equipment ($5,000 and above) to be purchased, providing a description, cost estimate, and justification of need. The cost of a single unit of equipment should include related charges, such as those for accessories needed to make it operable, installation fees, delivery costs, insurance, and taxes, if any.

Consumable Supplies and Expendable Equipment:
This category includes, but is not limited to, items such as the following: chemicals, glassware, small electronic components, and computer and printer supplies. The estimated costs should be given for each category.

The same revisions to the federal regulations which restrict administrative and clerical salaries also identify general purpose office equipment and supplies as unallowable direct costs. Proposals, however, may continue to request these items in those circumstances where administrative and clerical salaries are appropriate (see above). In addition, it is important to differentiate certain items such as computer software and supplies (when they are necessary to the conduct of the project) from general office supplies in the budget justification.

Participant Support Costs:
Costs of tuition and fees, travel, per diem, registration, books and manuals, and special supplies for program participants in conferences, symposia, and workshops may be allowable as a direct charge.

Publication and Printing Costs:
This category includes manuscript preparation expenses, illustration costs, and page and reprint charges in established journals. Costs for publication of a book, monograph, or pamphlet usually cannot be charged to a project unless prior approval has been received from the sponsor.

Communications:
This category includes the costs of bulk mailing, postage, commercial carrier, telex, fax, e-mail, long-distance telephone, telegrams or cables, and computer time.

Subagreements/Consortium Agreements:
A subagreement may be either a subcontract or a subgrant, each of which is an agreement between the University and a third party that transfers a portion of the grantee/contractor's duties under a sponsored project to the subrecipient. Documentation from each subrecipient's authorizing official including an itemized budget, with justification, a statement of work to be performed, and qualifications to do that work should be incorporated into the proposal. Many federal agencies require a completed cover sheet and certain certifications signed by the subrecipient's authorized official. Subagreements/Consortium Agreements may also require the prior written approval of the sponsor's grants officer. In accordance with OMB Circular A-110, subagreements of $25,000 or more are handled differently.  Please refer to the Office of Sponsored Research for details on handling such agreements.  In any event, researchers can engage in preliminary discussions with sponsors but they cannot speak for the University or enter into agreements on their own.

Indirect Costs (Facilities and Administrative Costs)

Indirect costs represent those expenses not readily allocable to any single research project, but which represent the University's costs for carrying out research activities. These costs include such items as building maintenance and operation, utilities, libraries and other facilities, and payroll, accounting, purchasing, research administration, departmental administration, and personnel services. The U.S. Office of Management and Budget (OMB) has issued, in conjunction with college and university representatives, Circular A-21 entitled, "Principles for Determining Costs Applicable to Grants, Contracts, and Other Agreements with Educational Institutions," which identifies allowable direct cost categories and also prescribes a standard distribution and allocation method for recovery of indirect costs.

Like all other universities with federally funded research grants and contracts, Chapman University prepares and submits a periodic determination of indirect costs in conformance with the A-21 standards. The submission is reviewed by federal auditors and is negotiated by the University with representatives of the University's cognizant federal agency, the Department of Health and Human Services (DHHS).

Indirect Cost Rates:
The current Indirect Cost Rate Agreement with DHHS outlines the rate that must be incorporated into all budgets. Indirect costs are charged as a percentage of salaries and wages.  Please consult with Financial Services or the Office of Sponsored Research for the current negotiated Indirect Cost Rate.

Indirect Cost Rates on Training and Other Projects:
Most training programs specify and indirect cost rate lower than the full negotiated rate. Some sponsors, however, pay full overhead costs. These rates are generally identified in the program announcements.

Cost Sharing:
Some agencies are precluded from reimbursing the University for the Full Costs of sponsored programs funded as grants. This means the University is required to share in the cost of each program. In accordance with University policy, cost sharing should not be offered in response to solicitations by federal agencies unless the regulations specifically mandate cost sharing. For those agencies with specific mandatory cost sharing requirements, two-column budgets (agency column and Chapman University contribution column) are generally prepared for submission. Cost sharing should generally be indicated on the basis of direct expenses, e.g., release time with associated fringe benefits and associated indirect costs etc.; cost sharing funds may be available and are subject to department and/or school/unit approval.