In the following sections, direct and indirect costs are discussed in more detail and examples of standard direct costs are provided.
Using the budget worksheets, begin to determine the direct costs of your project. Use Worksheet A to develop a detailed budget for the first year of your project and, if applicable, use Worksheet B to prepare a summary budget for subsequent years. In some cases, you may need to provide a detailed budget for each year (check sponsor guidelines). Remember to include a 3% increase each year to account for inflation and cost of living salary increases, and explain this increase in your budget justification. See a Sample Budget and Sample Budget Justification.
Identify all Drake University personnel who will be involved in the project. If the proposed project is a multi-year project, begin with those personnel who will be involved in the initial budget period. List personnel by name and identify their role on the project. If you are uncertain of the specific personnel who will be involved, begin by identifying the project roles you will need to fill. List all participating personnel, even if you are not requesting that their salaries be paid by the grant or contract. Once you have identified the people you would like to include on your proposal, talk to each one and verify their interest and availability.
For each person who will be involved in the project, list the type of appointment (e.g., 9-month appointment, 12-month appointment), the percent of the appointment to be spent on the project (i.e., percent effort), and the University base salary. Indicate if any appointments are part time and provide details in the associated justification. Multiply the percent effort by the base salary for each person to determine the amount of salary that will be associated specifically with the project. Multiply this adjusted salary by the appropriate Fringe Benefit Rate to determine the total direct cost for each person. If the project is a multi-year project, remember to include appropriate salary increases for each year of your proposed budget. Faculty members with 9-month appointments may be eligible to receive external funding to cover their salary for work performed during the summer months (see Quick Info). If your proposal includes hiring someone for a particular role, identify the role and type of appointment and estimate the associated salary and percent effort. Inform personnel whose salaries will be fully supported by grant funds that their employment may be terminated if grant funds are exhausted and no replacement funds are obtained.
If you are unable to fulfill all of your project requirements with University personnel, you may need to hire outside consultants. You will need to provide the name of the consultant or consulting firm, an estimate of time required from the consultant and the expected rate of compensation. You will need to include justification for hiring the consultant. Note: See 20 Common Law Questions to Assist in Determining if the Worker is an Employee or an Independent Contractor.
This category includes capital equipment only. The Federal Government's definition of capital equipment is any single item that costs $5,000 or more. If a sponsor has a different definition of capital equipment, the sponsor's definition will take precedence, so check sponsor guidelines. Begin by listing all capital equipment you will need to acquire for the proposed project. Keep in mind that many sponsors are unlikely to fund equipment purchases that are disproportionate to the expense of the whole project. Sponsors want to see evidence that you have resources available to conduct the proposed project. If your equipment list is too extensive, sponsors may doubt that you have adequate University support. Provide justification for the purchase of any equipment, including where you will house the equipment and whether appropriate mechanical and electrical services will be available. If the University will need to allocate additional space to you or modify existing facilties for the appropriate installation of the equipment, you will need to obtain approval from your department chair, dean or other appropriate administration. Include costs of any necessary service or maintenance agreements under "other expenses," as allowable.
Supplies and materials are items used exclusively in support of the sponsored project and consumed completely within the proposed timeframe of the project. It is generally acceptable to provide a breakdown of supplies and materials by broad categories rather than a detailed listing of individual items. Include any non-capital equipment (any single item that costs less than $5,000 or does not meet the sponsor's definition of capital equipment). Provide a detailed justification for each category and/or item listed.
Identify any proposed travel expenses associated with the sponsored project, such as travel to disseminate findings at professional meetings or travel to study sites.
If proposing foreign travel, check sponsor guidelines to determine if foreign travel is allowable.
If applicable, itemize the costs of any essential alterations or renovations, including repairs, painting and removal or installation of partitions.
Identify and justify any other anticipated expenses such as printing and duplicating, animal purchase and related supplies, research participant costs, off-campus space rental, equipment maintenance or service agreements, hazardous waste disposal, long distance telephone and laboratory services or testing.
If your proposed project includes contracting with one or more outside organizations for a substantial or significant portion of the activities of the project, include the costs of each subcontracting organization in your budget proposal. Request a detailed budget from each organization including the specific percent of effort from the organization's principal investigator and a categorical breakdown of costs, such as personnel, supplies and other allowable expenses, including facilities and administrative costs.
Facilities and administrative (F & A) costs are usually a percentage of all Drake salaries. If the sponsor specifies modified total direct costs, the total direct costs excludes captial equipment (items costing $5,000 or more), tuition and fees and that portion of each subcontract exceeding $25,000. The type of sponsor you are soliciting for funds will determine the facilities and administrative cost rate you use. Current negotiated rates are provided on the Quick Info page. SPA will review your facilities and administrative cost calculations before your budget is submitted to the sponsor.
F & A costs must be requested at the current negotiated rate unless the sponsor has a published policy restricting the payment of F & A costs or will only pay F & A costs at a specific rate. The Provost and the Vice President, Business & Finance, must specifically approve all exceptions.