Budgets prepared to closely reflect the research plan are an important component of a strong proposal. Carefully prepared budgets demonstrate to sponsors the investigator's ability to manage a research program.
The Office of Sponsored Programs has a comprehensive guide to budgeting.
Salary and Fringe Benefits
Salary costs budgeted should be based on current actual salaries (with appropriate inflationary increases, if allowable by the sponsor) or salary ranges for unfilled positions.
When budgeting for physicians, be aware that their total compensation may or may not be found in the OSU HR system. The total compensation for many physicians is composed of an academic salary and a clinical salary. Before July 1, 2011, the clinical portion of the salary was not available in the HR system. From July 2011 through June 2012, the OSU physicians are in transition from their previous clinical salary model into the OSU Faculty Group Practice, which is a single OSU entity allowing total salary to be reflected in the OSU HR system. Contact the individual’s department or the Office of Sponsored Programs with any questions about whether an individual has transferred into the OSU Faculty Group Practice or not.
- Physicians who have been transferred to the OSU Faculty Group Practice will have at least two records in the HR system. The title associated with the clinical salary is “Physician”, and these records will have compensation associated with them.
- The total compensation for physicians who have not transferred must still be obtained from the individual's department and /or the Office of Sponsored Programs.
The College of Medicine expects that faculty with nine-month appointments who wish to budget salary support for themselves for the academic year and their quarter off duty will distribute their time equally across the entire year.
Fringe benefit rates for individuals who are appointed as a cost to the sponsor on a sponsored research project are pooled rates that are negotiated with the Department of Health and Human Services. The current rates are available from the Office of Sponsored Programs. Rate changes are effective July 1 of each year. Note that the practice plan portion of a clinician's total compensation (those who have not transferred into OSU Faculty Practice) may have a fringe benefit rate lower than the OSP rates. These rates are also available from the individual's department and the Office of Sponsored Programs.
Note that it is inappropriate not to budget time, whether as a cost to the sponsor or as
cost share, for the principle investigator. As the person in charge of the work, the principle investigator will spend time on a project, and that time must be documented for
effort reporting purposes.
Subawards and Subcontracts
Subawards or subcontracts to other institutions require separate budgets from those institutions. The investigator must notify the sponsored program officer early enough in proposal preparation to allow time for the other institution to prepare their budget, submit their pieces of the proposal itself and complete their internal administrative processes. Ideally, the sponsored program officer is informed of the need for subawards at least a month before the proposal deadline.
The subaward components from the other institution must be approved by that institution's business official. Submissions from the principle investigator only are not acceptable.
Subaward budgets include that institution's Facilities and Administrative (F&A) costs, to the extent allowable by the sponsor. The total cost of the subawards becomes Ohio State's direct cost, and F&A is charged on the total cost of the subaward, as allowable by the sponsor and general F&A guidelines.
Patient Care Costs
Patient care costs are for those services provided by and billed by the hospital. These costs are excluded from the calculation of F&A on projects with full F&A rates. Patient care services that are not provided by the hospital, such as blood draws made by research staff, are not considered patient care costs by the Office of Sponsored Programs for purposes of F&A calculation.
The costs of services are provided by The Ohio State University Medical Center's Research Billing Office (RBO). The hospital will not honor lower rates for services that were not approved by the RBO. Contact Jennifer Lanter in the RBO (614) 293-2115 with questions.
F&A (facilities and administrative costs)
Facilities and administrative costs (F&A) are those costs associated with the research infrastructure (such as maintenance, building use, and administrative support) which cannot be easily identified with a specific research project. Sponsor guidelines typically state very clearly what their policy is with regard to the F&A rate that they are willing to pay.
The Ohio State University's F&A rate agreement is negotiated between the university and the Department of Health and Human Services and is based upon actual expenditures incurred by the university in its research programs. NIH and NSF both pay the full F&A rate for most of their grant programs, with the notable exception of training or career development awards.
Ohio State's College of Medicine expects principal investigators to budget the full F&A rate that the sponsor is willing to support. Principal investigators must use the full, federally negotiated F&A rate when written sponsor guidelines do not specify a rate, with the exception of industry-sponsored clinical trials. The College of Medicine’s minimum expectation for industry-sponsored clinical research is 26% F&A.
F&A is calculated by multiplying the F&A rate by the “base,” which is all or a portion of the direct costs. There are two common bases:
- Total Direct Costs (TDC): The F&A is calculated on all direct costs. This is the base that is appropriate when the F&A rate is less than the full, federally negotiated rate, unless the sponsor specifically excludes items from the base in its written policy.
- The College of Medicine expects that this base be used whenever appropriate and allowable.
- This is the appropriate base for industry-sponsored clinical trials. All costs, even pharmacy and WIRB fees, are included in the base.
- Modified Total Direct Costs (MTDC): The F&A is calculated on all direct costs, less equipment, capital expenditures, charges for patient care and tuition, off-campus space rental costs, scholarships and fellowships, and the portion of each subaward exceeding $25,000. This is the appropriate base when the full, federally negotiated F&A rate is used. Most NIH awards, regardless of the F&A rate, require the use of the MTDC base.
In some cases, the sponsor will not support the full F&A rate. The difference between the full F&A rate and the sponsor supported rate is known as unrecovered F&A. If the sponsor also requires that the grantee institution share in the support of the costs of a sponsored project, then the amount of unrecovered F&A can often be counted as cost share. When calculating the unrecovered F&A for purposes of cost sharing, the total F&A costs are calculated using the MTDC base. The amount the sponsor is willing to pay is subtracted from that total, and the difference is the cost-shared F&A.
The base used for F&A calculations is noted in the PI Portal immediately after the F&A Rate in the table at the top of each project page.
Contact Melinda Akins, (614) 292-4876, at Ohio State's College of Medicine Office of Research for assistance with calculating F&A or determining the appropriate base or rate.
Cost Sharing
Any inclusion in a proposal of cost shared expenses (also known as items or effort "without cost," "in-kind" or "Ohio State contributed") must be approved by the departments and colleges providing the cost share and follow Ohio State and sponsor policies.
Download the Guide to Cost Sharing for Sponsored Programs
Contact Melinda Akins, (614) 292-4876, at Ohio State's College of Medicine Office of Research for assistance well in advance of submission of a proposal with requests for cost share from the College of Medicine.