HJF® Guide to Services: Grants, Cooperative Agreements & Contracts
Grants, Cooperative Agreements & Contracts
Lease and Renovation Services
Clinical Trials
Education & Endowments
Human Resources
Travel
Purchasing & Reimbursements
Financial Reports
Graphics & Communications
Information Technology
Technology Transfer
Courier Service
Forms

Guide to Services Home

print this page

Prepare a Budget

The Foundation can help you prepare the budgets required for applications or proposals for extramural funding. We provide templates for federally required proposal forms and assistance with tasks such as determining appropriate salary levels for new personnel. Additionally, your grants specialist or contract manager will provide you with approved rates for fringe benefits and Facilities & Administrative (F&A/indirect) costs and instructions on how to apply them. They will also inform you of federal restrictions on costs (e.g., salary caps, consultant per diems, etc.).

The budget should include all direct costs including personnel, equipment, supplies, travel and other costs for activities required for the project, as well as F&A costs.

Most costs may be adjusted for inflation in future project years. The NIH inflation factor is limited to 3% per year. In most instances, equipment purchases are made toward the beginning of the project. Your contract manager or grants specialist can answer any budget questions.

The budget checklist shows the possible costs allocable to a sponsored project. To develop an effective, comprehensive budget, begin with these basic categories.

Project Personnel

Personnel is usually the largest component of a research budget, so this section warrants the most attention. Once you have a specific idea of what you hope to accomplish, determine what types and levels of personnel you will need to accomplish your goals. If you need help determining appropriate salary ranges for your budget, contact the Office of Sponsored Programs (OSP) or the Contracting Department for assistance.

Fringe Benefit Rates

Fringe benefit rates must be used when preparing application/proposal budgets. Each fiscal year, HJF negotiates fringe benefit rates with the U.S. Department of the Army. Contact your grants specialist or contract manager to obtain the current fringe benefit rates to use in your proposal.

HJF has two rates for fringe benefits. The first rate (tier one) is for employees who work 21 or more hours per week. The second rate (tier two) is for graduate students, intermittent workers and temporary employees (less than 21 hours per week or four months per year). In both cases, the rate is applied to all salaries and wages except paid vacation time. Paid vacation time is not charged to projects, and fringe benefit rates are not charged against stipends.

Fringe benefit rates include:

* These benefits do not apply to employees working less than 21 hours per week

Some things to keep in mind when planning a budget:

Equipment

Equipment is defined as tangible assets with a unit or aggregate cost (if used as an operational unit) of $5,000 or more and a useful life of more than one year. Shipping and transportation costs associated with the equipment are treated as part of the total equipment cost. (Items costing less than $5,000 fall under the "tangible assets" category.)

If an item costs under $5,000, but functions as part of an operational unit or system costing over $5,000, it falls into this category. Equipment in this category is not subject to the F&A cost.

Examples: computer hardware and software; office furnishings; scientific or medical equipment; alarm/monitoring system hardware

Many funding agencies require prior written approval for the purchase of equipment items that were not specified in the original project budget. By including a detailed itemized budget of all anticipated equipment purchases when preparing your application, you will avoid having to obtain prior approval from the sponsor each time you wish to purchase equipment.

Materials and Supplies

Supplies should be subdivided into major categories such as radioisotopes, reagents, animals, etc. For animals, state the species, the number to be used, their unit purchase cost, their unit care cost and the number of care days anticipated.

Tangible Assets

This category applies to assets that have a unit or aggregate cost of less that $5,000 and a useful life of longer than one year. Shipping, transportation, installation and warranty costs associated with the equipment are associated with the equipment costs, but maintenance contracts are not included.

Examples: chairs, desks, computers, file cabinets, fax machines, printers, refrigerators, microscopes, incubators, water baths, projectors

Travel

If an individual on the project has to travel to present data or to attend a conference or class, that is counted under domestic travel. Domestic travel includes travel to Canada and Mexico, as well as local travel (which may include use of a privately-owned vehicle or public transportation). This category should include an estimate of the frequency and cost of travel.

Foreign travel usually requires prior written approval from the funding agency. By including a detailed itemized budget of all anticipated foreign travel when preparing your application, you will avoid having to obtain prior approval from the sponsor each time you want to travel outside the domestic travel zone.

For more information, see the Travel section of this guide.

Consultants

You may use consultants on contracts and grants as long as the individuals or organizations meet the Internal Revenue Service requirements for independent contractors.

You are required to provide the names and organizational affiliations of all consultants (other than those involved in consortium/contractual arrangements). Describe the services to be performed and include the number of days of anticipated consultation and the expected rate of compensation, as well as travel, per diem and other related costs.

Contracted Services Agreements (Contracts for Service)

Contingent upon the approval of the sponsor, contracts and agreements with vendors may be established for the provision of goods and services. For contracted agreements valued in your budget at more than $100,000, you should identify in your application the institution or individual with which you want to contract. Federal regulations require that you submit either three competitive quotes, a single source justification (if there is only one available source) or a sole-source justification (if you are choosing this sole source without providing competitive quotes).

If you do not know with which institutions or individuals you will want to contract, staff in either OSP or Contracting can assist you. They will help you identify institutions or individuals that can perform the work by developing a Request for Proposals (RFP).

Subawards/Consortium Arrangements

If you will be collaborating with another organization that will perform (relatively independently) a portion of the proposed project, you will need to establish a working agreement with that organization. Typically, you will include in your application a written statement supplied by the collaborating organization indicating their intent to cooperate. In addition, the funding agency may require a detailed proposed budget for the subaward or consortium participant. Consortium arrangements may involve personnel costs, supplies and other allowable costs, including F&A costs.

If you need assistance determining the appropriateness of using a vendor versus initiating a subaward, click here for guidelines.

Proposal Requirements for Subawards

The proposal format for the identified subrecipient should mirror the format HJF is required to submit to the sponsor. At a minimum, the proposal should include:

  1. A statement of work;
  2. A budget, which includes an itemization of categories such as salaries and wages, fringe benefits, supplies and materials, equipment, travel and other direct costs; F&A costs; and a budget justification;
  3. Documentation supporting cost sharing or matching commitments, if any;
  4. A copy of the subawardee institution's current negotiated rate agreement;
  5. Completed and signed certifications and representations, if required, in the same format as those to be submitted to the sponsor by HJF;
  6. Approval from an authorized institutional representative of the subrecipient institution (e.g., signature on their proposal cover page or a separate letter of intent from the authorizing official);
  7. If required by the sponsor, biographical sketches, current and pending support information, checklist, resources, and/or human subjects or animal subjects documentation; and
  8. Intellectual property agreements, if any.

Subaward costs (both direct and F&A) are included in the HJF proposal budget as a direct cost to the Foundation, with the exception of NIH applications. When calculating F&A costs, exclude that portion of each subaward that exceeds $25,000. HJF calculates F&A costs only on the first $25,000 of each separate subaward, regardless of the number of budget periods over the duration of the project.

For NIH applications, F&A costs are not included in direct costs, but instead are included with HJF's F&A cost. Contact your grants specialist or contract manager for details.

Facilities & Administrative Costs (F&A/Indirect Costs)

Each fiscal year, HJF submits proposed F&A cost rates to the U.S. Department of the Army for approval. These rates should be used when constructing your proposal budget. Your contract manager or grants specialist will verify that the appropriate F&A rates are used in your proposal.