Budget Development

Salaries and Benefits

An employee's requested salary on a sponsored program is based off the employee's annual compensation paid by UMMC (i.e., institutional base salary or "IBS"). These figures come directly from UMMC's Budget Office and cannot be changed without proper justification and approval.

List the names and roles of personnel committing effort to the project. Include an estimate of the number of months or percentage of time each will devote to the sponsored program, the salary rate, and the total amount of salary to be paid to each person.

If the individual to fill a particular position has not yet been identified, the position budget should be at the middle range for that title.

Current NIH salary cap: $183,300

Calculating person's months and salary

UMMC uses the 12-month calendar appointment for all sponsored programs. To calculate person months, multiply the percentage of your effort associated with the project times your FTE equivalent times the number of months of your appointment.

In some cases, it may be appropriate to budget at an hourly rate of pay. To determine hourly rate of pay, divide the base salary by 2080 for full-time employees or the FTE equivalent for part-time employees (e.g., 1040 for 0.50FTE).

Examples

  • Dr. F, a full-time faculty member, has an IBS of $100,000 and commits 50% effort on the proposal.
    12 x .5 = 6 person months
    ($100,000/12)*6 = $50,000 salary requested
  • Mary, a part-time (0.5FTE) staff member, has an IBS of $25,000 and commits 10% effort on the proposal.
    12 x .5 x .1 = 0.6
    ($25,000/12)*0.6 = $1,250

Provision for anticipated salary increases

Provision for anticipated salary increases should be made in sponsored programs budgets when allowed by the sponsor. These increases should be considered for any program extending for more than one year. The salary budget should be properly justified to explain the anticipated salary increase and the period to which the increase applies. There are three types of salary increases, which should be shown as follows:

  • Cost of living increases - These are not set in UMMC policy and some sponsors may not allow or may limit any COLA increases. OSP will approve reasonable COLA increases (1-3%) in budgets if allowable by the sponsor.
  • Mandatory step increases - Projected step increases should be provided in accordance with the guidelines for that particular staff title (i.e., postdoctoral fellows).
  • Promotions - If an employee is scheduled to receive a promotion before the project start date or during the program period, a letter from the department chair stating the promotion and increase in salary must be provided to the OSP for approval. Promotions and salary increases cannot be conditional on if the grant or contract is awarded.
  • Increases in FTE for part-time employees - If an employee is currently part-time, you may increase their proposed FTE with funds budgeted in the sponsored programs. A letter from the department chair stating this increase is approved must be provided to the OSP for approval.

Administrative and clerical salaries

The salaries of administrative and clerical staff are normally treated as F&A costs. Administrative and clerical costs may be charged as direct costs to a federally sponsored program only if all of the following conditions are met:

  • The costs are integral to a project or activity;
  • Individuals involved can be specifically identified with the project or activity;
  • Such costs are explicitly included in the budget or have the prior written approval of the Federal awarding agency; and
  • The costs are not also recovered as indirect costs.

Such costs must be explicitly included in the proposal budget or have prior sponsor approval prior to charging to the sponsored program budget.

Admin/clerical costs may be directly charged to non-federally sponsored programs if permitted by the sponsor's policies, award terms and conditions, or are otherwise approved by the sponsor. If the expense is questioned, the PI will need to justify the charges to the sponsor and any auditors, and will be responsible for paying back any unallowable expenses, if required.

Benefit rates

Employee benefits (i.e., fringe) are a direct cost charged as a percentage of salary. Benefit rates are negotiated and approved by the Department of Health and Human Services (DHHS), UMMC's cognizant federal agency, on an annual basis. The rates apply to all sponsored programs. Actual fringe benefit rates charged to a sponsored project will reflect the current approved rates for that fiscal year.