The following are common elements in a proposal:
Salaries and Wages
Include all salaries and wages of personnel who will be spending full or part time on the project. For key personnel, provide the name, title, amount of time on the project, rate of pay, and the total amount to be paid to each individual under the award. The names of supporting personnel are not usually necessary. Salaries of employees should be expressed in terms of a percentage of total effort, rather than as hourly or daily rates.
If the proposal will be submitted to a federal agency, salaries and benefits for administrative and clerical staff may not be requested unless the project requires more than the usual level of administrative or clerical support because of its size or complexity. Such projects may be center or program projects, projects that entail assembling and managing large teams of investigators, projects that involve extensive data accumulation and analysis, projects that require making travel and meeting arrangements for large numbers of participants, and projects that require extensive work involving project-specific regulatory protocols. If clerical or administrative salaries are requested, they should be carefully justified in the budget narrative. The practice of including a specified fraction of pooled salaries for clerical or administrative staff is not allowed under federal guidelines.
The university sets minimum compensation levels for graduate research assistants and postdoctoral scholars. These minimum salaries for graduate assistants and minimum salaries for postdoctoral scholars are updated annually each spring.
Fringe Benefits
The University, as part of its rate agreement with the Department of Health and Human Services, negotiates a fringe benefit rate for use on sponsored projects. Fringe Benefits are calculated on all salaries and wages excluding graduate research assistants and enrolled student workers. A copy of the rate agreement can be obtained from your Contracts and Grants administrator or you may view the rates online.
Materials and Supplies
These include consumable supplies such as office supplies, glassware, chemicals, computer supplies, etc. These may be listed under one general heading with an explanation of the types of items to be purchased. If the cost is substantial, the breakdown should be more detailed.
For proposals requesting federal funding, general office supplies are ordinarily considered part of indirect costs, and should not be included in the direct cost budget unless the nature of the project requires more than minimal expenditures and is easily justifiable.
Equipment
Equipment is defined by the federal government as an item of property that has an acquisition cost of $5000 or more and an expected service life of two or more years. Items of equipment should be listed individually by description and estimated cost, including tax, and should be adequately justified. If funds for “general purpose” equipment, such as fax machines or photocopiers, are requested, the justification should be particularly thorough. Because equipment is an expense that many sponsors are reluctant to fund, any pertinent agency guideline should be reviewed and observed.
Travel
This section should detail each trip, the destination, purpose, and expense, and should include transportation, lodging, per diem, and incidentals. In budgeting for foreign travel, keep in mind that for federally funded projects, the government requires the use of U.S. air carriers, regardless of cost or convenience.
Communications
This category usually includes telephone, courier, fax, postage, etc. costs associated with the project. Depending on the significance of communications costs and the preferences of the proposer and the sponsor, this category is sometimes included in the “other direct costs” category.
Proposals submitted for federal funding should not include requests for postage or local telephone costs unless the nature of the project is such that expenses for these items will be unusually great. If, for instance, the project includes mass mailings or telephone survey work, the costs are appropriate.
Publications
Included in this category are the costs of preparing and publishing the results of the activities conducted under the sponsored project, including costs of reports, reprints, page charges, illustrations, and other journal costs.
Contractual Costs
This category should contain any contractual agreements to be entered into by the University, under which non-University employees or entities will be paid for contributions to the project as either consultants or subcontractors.
Consultant services should be justified and information should be furnished on each consultant’s expertise, primary organizational affiliation, compensation rate, and number of days or percent of time contemplated. Some agencies limit the daily rate that may be paid to consultants. In any event, the daily rate should not exceed the rate that the consultant customarily receives for similar work.
When funding for subcontracts is requested, a subcontract proposal, including an appropriate budget signed by the authorized subcontractor official, should be included in the proposal.
Other Direct Costs
Miscellaneous items that do not fit into any other category are entered as other direct costs. Examples might be payments to subjects, animal maintenance costs, and repair and maintenance contracts. These costs should be itemized by unit and category.
Indirect Costs
Indirect costs are those costs incurred in the general support and management of the proposed activities which cannot be readily determined by direct measurement. They may include:
- general administration, including such functions as accounting, personnel, payroll and other administrative functions
- research administration
- department administration
- plant operation and maintenance, including utilities, janitorial services, routine maintenance and repairs
- depreciation and use allowance
- libraries
Indirect costs are usually expressed as a percentage of Modified Total Direct Costs (MTDC). MTDC are total direct costs excluding the costs of equipment, patient care, tuition and fees, and that portion of each subcontract exceeding $25,000. A copy of the rate agreement can be obtained from your Contracts and Grants administrator or you may view the rates online.
Indirect costs must be requested at the approved rate unless a sponsor has a published policy restricting the payment of indirect costs. Any exceptions must be specifically approved by the appropriate Dean/Director.
Cost Sharing
Cost sharing is the portion of project or program costs not borne by the sponsor. Cost sharing occurs whenever any portion of project costs is provided at USC’s expense rather than at the expense of the sponsor. For example a sponsor may award $400,000 for research and the school may pledge to contribute $50,000 to buy a piece of equipment needed for the research or a school may agree to charge less than the federally allowed overhead.
Mandatory Cost Sharing is required by the sponsor as a condition of the award and is quantified in the proposal.
Committed Cost Sharing is not required by the sponsor but is quantified in the proposal. For example, if an investigator proposes to devote 35% effort to a project but only requests 25% salary support, the additional 10% effort that will be supported by USC is Voluntary Committed Cost Sharing. This must have prior approval by the dean.
Voluntary Uncommitted Cost Sharing (VUCS) is not initially promised in the proposal or otherwise indicated. For example, if an investigator proposes and charges 25% effort, but the investigator actually devotes 35% effort, the additional 10% effort that was not originally promised is VUCS. VUCS must be supported by unrestricted or appropriate gift sources and may not be attributed to another sponsored project. The significance of the distinction between the two types of voluntary cost sharing is that Voluntary Uncommitted Cost Sharing is not included in the project budget and not included in the university’s organized research base for computing the indirect cost rate.
You may not offer a cost-share commitment on your own, even if you think it is desirable to free up funds for other project costs. You would in effect be charging the department or school budget for effort you are devoting to the sponsor’s work, as well as impacting USC’s rate for Recovery of Indirect Costs. Dean’s prior approval is required.
Mandatory or Voluntary Committed Cost Sharing must be identified and approved in writing by the Dean of the relevant school(s) or unit(s) or their authorized designee, prior to submission to the Department of Contracts and Grants. Both Mandatory and Voluntary Committed Cost Sharing must be charged to companion cost sharing accounts and any cost shared effort of these types must be certified. This is to demonstrate to sponsors that cost sharing commitments have been fulfilled.
The NIH salary cap is the maximum amount of salary that can be charged to an NIH award. The salary cap does not limit total USC compensation but only the portion of compensation that is charged to the award. It assumes a 12 month full time contract so if your appointment level or contract period is anything less it needs to be prorated.
The difference between the percentage of total salary and the allowable salary must be charged to an unrestricted institutional account. Since this overage cannot be charged to an NIH grant, it also cannot be used to meet any cost-sharing commitments.
As an example, if a faculty member is paid over the salary cap and is providing 10% of his or her effort on an NIH award, 10% of the capped amount for the corresponding time period can be charged.
Faculty Salary: $250,000
NIH Cap: $203,700
Effort on NIH grant: 10%
Maximum salary charge to NIH grant = Effort % x NIH Cap = 10% x $203,700 = $20,370
The difference between the salary charged to NIH and the actual salary must be paid from a university unrestricted account. It is not, however, considered cost-share, as it is not an NIH allowable expense.
Budget Justification
This section should explain and justify any budget items that may not be clear or that may raise questions.