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Stephen F. Austin State University
Grants and Contracts Procedures Manual (GCPM)

Adopted by SFA policy 8.3 - Revised: August 29, 2017

PART 3 - Prepare a Grant Application

 

Standard Proposal Information (Contacts, EIN, DUNS, etc.)

Proposal Processing and Submission Procedures, & PI/PD eligibility guidelines

Contracts to SFA: Development, review, and approval

Tips for Project Planning and Proposal Writing

Special Proposal Requirements: Current/pending support, data management, mentoring, subawardee certifications

Develop a Budget

  1. Direct and Indirect Costs
    * Salaries and wages (including descriptions of common grant-funded positions)
    * Additional compensation
    * Fringe benefits
    * Subawards and vendor contracts
    * Equipment
    * Supplies and materials
    * Travel
    * Participant costs - scholarships and stipends
    * Other direct costs
    * Indirect costs
  2. Matching and Cost-sharing Commitments
  3. Budget Justifications

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Standard Proposal Information

The following information is needed for the submission of some grant applications. Contact ORSP if you need any information not provided below.

OFFICIAL ADDRESS*
REQUIRED for federal applications
Submitting Organization (Applicant)


(*for DUNS, CCR, and SAM)

Stephen F. Austin State University
1936 North Street
Nacogdoches, Texas 75965-3940

For applications REQUIRING 501(c)(3) status [Please contact the Office of Development or SFA Foundation staff.]

Stephen F. Austin State University Foundation, Inc.
P.O. Box 6092, SFA Station
Nacogdoches, Texas 75962-6092

Address for Official Correspondence

Stephen F. Austin State University
Office of Research and Sponsored Programs
PO Box 13024
Physical address: 1936 North Street OR 404 Aikman Drive
Liberal Arts North, Room 421
Nacogdoches, Texas 75962

Type of Organization

Public Institution of Higher Education

U.S. Senate
U.S. Congress
Texas Senatorial District
Texas House of Representatives District

Senator John Cornyn and Senator Ted Cruz
Congressional District 1 - Congressman Louie Gohmert (TX-001)
Senate District 3 - Senator Robert Nichols
House District 11 - Representative Travis Clardy

Authorized Organizational Representative (AOR) - signatory authority for all proposals, certifications, and contracts

Baker Pattillo, President
or his designated authority

Financial Contact


Mailing Address for Checks

Dora Fuselier, Controller
Phone: 936.468.2303

Office of the Controller
P.O. Box 13035, SFA Station
Nacogdoches, Texas 75962

Contact for Contractual Matters

Jennifer Hanlon, Interim Director
Office of Research and Sponsored Programs
P.O. Box 13024, SFA Station
Nacogdoches, Texas 75962
Phone: 936.468.6606

Principal Investigator or Project Director

Faculty Name (or investigator to serve as project contact if there are co-investigators)

SFA Employer ID Number (IRS EIN)
System for Award Management - SAM (CCR)
DUNS Number (parent location)
CAGE Code
FICE Code
TEA County-District Number (CDN)
SFA Charter School CDN
State Agency Number
Federal Non-Profit Status

75-6002514
Valid until May 3, 2018; POC - Kathy Williamson
073894727
3EXP9
362400
174-501
174-801
755
Governmental entity, Section 170, IRS Code, 1986

Fringe Benefit Rates (estimates FY18)
See fringe benefit rate table (below) for additional information and rates for part-time employees, retirees, and additional compensation

30% of salaries or wages (faculty and staff)
2% of salaries or wages (all students)

Indirect Cost (IDC) Rates
Negotiated Indirect Cost Rate Agreement (NICRA)

Use for all grants and contracts (unless a different rate is required by the sponsor)

NEW rate effective for all projects awarded 9/1/2017: 31.28% MTDC (on-campus) and 10% MTDC (off -campus)

Effective rate for projects awarded prior to 9/1/17:31% MTDC (on-campus); 10% MTDC (off-campus)

*MTDC excludes capital equipment items >/=$5,000, scholarships, fellowships, and the portion of each subgrant or subcontract in excess of $25,000.

Cognizant Agency: Department of Health and Human Services (DHHS)

Date of agreement: 06/20/2017

Effective dates of agreement: 09/01/2017 - 08/31/2021 or until amended

Type of Rate: Predetermined

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Proposal Processing and Submission Procedures

Administrative Review and Clearance Process - All external funding proposals must be approved in advance of submission by the appropriate department chair(s), college dean(s), vice president(s) and the president. Per SFA policy and procedure, no grants, contracts, or other agreements may be submitted to a sponsor without the prior approval of the president or delegated authority.

Deans and academic chairs/directors are responsible for reviewing grant proposals and contracts, for assuring that the proposed commitments of unit resources are feasible and realistic, and that the proposals support the mission of the university. This includes confirming that the following are appropriate, as applicable: (1) faculty and/or staff time commitments; (2) cost-share or matching commitments; (3) use of university facilities; (4) required facility modification or remodeling; and (5) overall cost of equipment to be purchased, including shipping, set-up, and maintenance.

If a proposal reaches ORSP with insufficient time for review, or is submitted without prior administrative approvals, ORSP will perform a post-submission review and make the sponsor aware of any needed revisions. Proposals with serious deficiencies may be withdrawn.

For a proposal to be cleared for submission, the Principal Investigator (PI) or Project Director (PD) should submit the following items to ORSP at least three (3) days prior to the date the proposal is due to the sponsor or at least four (4) weeks before the planned start of a contract term (note that for non-electronic submissions, more processing time is required):

Electronic Submissions - ORSP submits all applications on behalf of the University, including those submitted electronically (by e-mail or web-based systems). Common web-based systems include:

Tips for a successful electronic submission:

Some additional tips:

Copying and Mailing Paper Applications - In instances where a proposal must be mailed, the PI/PD is responsible for making copies and sending the proposal package to the agency. ORSP will provide assistance when requested, but it is the project director’s responsibility for all costs associated with copying and sending to the agency.

All online and paper submissions require prior approval of the Provost/VPAA and the President and require a Proposal Clearance Form. Some applications also may require that a signature page signed by the Authorized Organizational Representative (the SFA President or delegated authority) be submitted after completion of the online submission.

Provisions & Assurances and Terms & Conditions - Federal and federal pass-through applications and awards require that the University agree to specific provisions and assurances. Non-federal contracts and similar agreements include terms and conditions that also must be reviewed by the university's general counsel and agreed to by the University. Only the president (or designee) may sign provisions/assurances and contracts.

Required assurances, representations or certifications are usually detailed in the proposal instructions. Proposals are considered incomplete if required endorsement signatures are omitted, or if required certifications are not provided.

For example, federal funding agencies require certification that the University is in compliance with the Drug-Free Workplace Act; that the university has not used and does not intend to use federal funds for lobbying activities; and that the University is not debarred or proposed for debarment.

ORSP will obtain the required vice president/president signatures as the proposal is routed through ORSP.

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Contracts to SFA: Development, review, and approval

A PI/PD must contact ORSP before beginning contract term and budget discussions with a sponsor.

Before contracts, subcontracts, subawards, consulting agreements, interagency, interlocal, cooperative agreements, or other forms of contractual agreements from another entity to SFA can be fully executed, they must be:

If the contract represents the entire proposal, a Proposal Clearance Form (PCF) also must be submitted to ORSP. The completed form should be submitted to ORSP for routing with:

To ensure that there is sufficient time for the clearance process, including legal review, and to obtain the president's signature on the contract, please submit the contract and PCF, as required, to ORSP at least four (4) weeks before the start date of the contract.

Contracts with Commercial Sponsors - A PI/PD must contact ORSP before beginning contract term and budget discussions with a commercial (private, for-profit) sponsor. These contracts often require modifications and subsequent review by legal departments on both sides. Refer to SFA policy 1.3 (Contracting Authority) for more information.

Additionally, these contracts often include one or more of the following special terms or conditions:

Regardless of the source or purpose, no contracts or other binding agreements shall be executed without the signature of the President or delegated authority. Only the President has the authority to make commitments for the University.

Management Responsibilities of the PI/PD - The PI/PD is responsible for the effective management of all awards to SFA in the form of a contract (see section IX. Manage a Project).

Subawardee Certifications - Subawards and subcontracts from federal sources may require completion of one or more subawardee certifications in addition to those included in the body of the contract. ORSP will obtain any required signatures.

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Tips for Project Planning and Proposal Writing

Okay, you're ready to begin writing - where do you start?

1. Meet with ORSP - If you have not already done so, you should set up a meeting with ORSP to discuss your project. ORSP can offer insight and assistance in developing your proposal. By contacting ORSP at the beginning of the process, ORSP staff can help make sure you have all the necessary documents in the correct format. ORSP staff can also provide suggestions and basic information for your narrative and budget, or provide suggestions if you are submitting a letter of intent. We also encourage you to attend our workshops.

A copy of the entire proposal solicitation instruction package (application forms and instructions) should be forwarded to ORSP when it is received by the PI or PD, along with an indication of who intends to submit a proposal under the RFP, so that appropriate internal reviews and approvals may be accomplished before specified submission deadlines.

2. Plan your Project - Developing a project plan is an essential prerequisite to successfully finding funding for a project. The development of a project plan and proposal is an ongoing process and ORSP can help you every step of the way.

It's generally not a good idea to look for a funding agency and then create a project to fit the agency's needs. You may find yourself pursuing a project that is far from your original idea! Instead, develop a project outline first. A written plan can help you get your thoughts organized and can allow ORSP, project staff, potential partners, and management to provide feedback. A good plan includes the following elements, modified to reflect a research, service, instructional, or other purpose:

While developing the plan, you should consider the following:

3. Read the Project Guidelines - Your primary guide for proposal preparation should be the sponsor's written guidelines, information provided on a sponsor's web site, and any personal advice offered by the program officer or grant contact. The guidelines will tell you what documents you will need to include and how to format your proposal. If you don't understand something in the program guidelines/announcement, you can usually submit questions to the agency's contract or program officer (within specified time lines); however, you should be aware verbal information given to you by the sponsor is not binding, so it's always best to get everything in writing.

Typically a proposal will include a narrative, budget, and budget justification. Many agencies have prescribed formats for text, biographical data, budgets (including cost-sharing and matching), and forms. For agencies that do not have specific formats, we suggest that the project director contact ORSP for sample proposal outlines.

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Special Proposal Requirements

Some federal agencies require that the PI address specific areas in a proposal. For example, the National Science Foundation (NSF) requires the following: a Data Management Plan, Current and Pending Support descriptions, and a Post-doctoral Mentoring Plans.

1. Subrecipient Certification of SFA

Any time SFA serves as a subrecipient on a proposal, the lead institution may require SFA to complete a subrecipient certification form. Most institutions will have their own standard form (for reference, see SFA's form SUB). This document must be signed by the university's signature authority, the president or designee, and becomes part of the proposal package submitted to the lead institution. The certification form usually requests, but is not limited to, the following information:

2. NSF Data Management Plans (DMP)

According to the National Science Foundation's (NSF) website, effective January 2011, all proposals to the NSF must contain a Data Management Plan (DMP) which describes the plans for data management and sharing of research products. The DMP will be reviewed as part of the intellectual merit and/or broader impacts of the proposal. This supplement is limited to no more than two pages and should describe how the proposal will meet the NSF policy on the dissemination and sharing of research results and may include the following:

A valid DMP may include a statement that no detailed plan is needed but there must be a clear justification. Only one DMP is needed for simultaneously submitted collaborative proposals and proposals that include subawards (they are considered a single project). Data management requirements and plans specific to the Directorate, Office, Division, Program, or other NSF unit, relevant to a proposal are available at: http://www.nsf.gov/bfa/dias/policy/dmp.jsp. If guidance specific to the program is not available, then the general requirements apply.

For more information, refer to NSF's Award and Administration Guide.

3. Current and Pending Support Descriptions

Almost all government agencies require documentation of current and pending support/funding from all sponsor types (federal, state, local, and private). Most have their own form or required format and request the following information for projects that are currently funded or pending applications.

This information is required for PIs and co-PIs (and often senior personnel) even if they do not receive salary support from the funding agency.

4. NSF Post-doctoral Mentoring Plans

Any National Science Foundation (NSF) proposal including a postdoctoral researcher must include a one-page description of the mentoring activities that will be provided to that researcher, regardless of his/her institutional affiliation. This document is a supplement and not a part of the 15-page project description.

Examples of mentoring activities include, but are not limited to: career counseling; training in preparation of grant proposals, publications and presentations; guidance on ways to improve teaching and mentoring skills; guidance on how to effectively collaborate with researchers from diverse backgrounds and disciplinary areas; and training in responsible professional practices. The proposed mentoring activities will be evaluated as part of the merit review process under the Foundation's broader impacts merit review criterion.

For more information, refer to NSF's Award and Administration Guide.

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Fringe Benefit Calculations

For each dollar paid as salary or wages to an employee, the university incurs associated costs for non-optional fringe benefits. These benefits include F.I.C.A., worker's compensation, unemployment compensation, retirement matching, and health insurance. SFA Human Resources Benefits

Fringe benefits are treated as a direct cost to a sponsored project and are shown as a separate entry in the budget. The actual costs for fringe benefits are charged to a sponsored project fund at the time the costs are incurred. The amount charged is based on salary, the selected benefit package, and other variables applicable to the individual employee. Calculations for full-time employees include withholding taxes, retirement contributions, and health insurance.

When developing budgets, determine benefits using an estimated calculation based on the table, below.

The table below outlines rates for each benefit category.

Fringe Benefit Breakdown - FY 2018

Description of Benefit (paid by SFA)

Regular Employee

Graduate
Assistant**

Student
Assistant

Health Insurance (portion paid by SFA)

100%
$617.30/mo. employee only
$970.98/mo. employee + spouse
$854.10/mo. employee + children
$1,207.78/mo. employee + family

50%
$308.65/mo.

0

FICA/Medicare

7.65%

0

0

Retirement Matching

6.8%, TRS; 6.6% ORP; (8.5%)*

0

0

Unemployment Insurance

1%

1%

1%

Worker's Compensation

1%

1%

1%

* Non-TRS employees hired before 1996 receive 8.5%. All others receive 6.8% (TRS) or 6.6% (ORP) as of 9/1/13.
**Graduate assistants must pay half of their insurance premium if they elect to be covered by SFA.

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Facilities & Administration (F&A) [a.k.a. Indirect Cost (IDC)] Calculations

All proposals and contracts submitted on behalf of the University must include indirect costs at the maximum rate allowed by the sponsor.

In addition to costs directly related to a project, the University incurs costs that are indirectly related to all projects. These costs include:

In other words, indirect costs encompass all elements that support sponsored activities that cannot be directly associated and charged to a specific grant or contract. The recovery of these costs is essential because these costs don't go away, and if unrecovered, are paid for by tuition and other non-grant sources.

Indirect costs are allowable, necessary and expected. Sponsors that allow indirect costs DO NOT preferentially fund proposals that request less than the maximum allowed IDC rate and including indirect costs in a budget does not negatively affect the outcome.

Indirect cost rates are determined for each institution using a standardized, detailed cost accounting procedure. Representatives of the federal government (the cognizant agency) audit and approve IDC rate calculations.

SFA's current negotiated indirect cost rates and effective dates for all programs are:

To calculate IDC on MTDC (refer to the NICRA for additional exclusions):

IDC must be included using SFA's federally-negotiated rates unless the sponsor has a written policy that specifically limits IDC for all applicants. Sponsor guidelines or policies that document limitations on IDC must be included with the Proposal Clearance Form (PCF). Requests for voluntary IDC reduction must be approved by SFA administration before a proposal or contract budget is presented to a sponsor. These requests must be justified using a Indirect Cost Reduction Request (ICR) form and submitted with the PCF.

Only the President of SFA can waive or reduce indirect costs (SFA policy 8.5). Any under-recovery of indirect costs due to grantor restrictions must either be treated as cost-sharing on behalf of the university or supplied from other funds.

Program income is assessed the same indirect cost rate as the program that generated the income. For example, if a project is restricted to 8% MTDC by federal agency regulations, any income earned as a direct result of the project will also be assessed at the 8% MTDC rate.

IDC Recovery and Distribution: After IDC is charged to sponsored projects based on the approved rate, the resulting revenue is placed in a campus fund for distribution by campus administration based on SFA's IDC policy. Any questions about the collection and distribution of recovered IDC may be directed to ORSP.

Recovered F&A Distribution Formula - as of July 28, 2015

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Develop a Budget

Budget preparation is a critical component of grant applications and contracts. It is important that the budget section of the proposal reflect, as precisely as possible, the funding needed to carry out the project. The Principal Investigator (PI) or Project Director (PD) should neither overestimate the funds required nor underestimate budgetary needs as either of these strategies may lead to proposal rejection. A budget that accurately details the funds necessary to carry out the technical statement of work strengthens the overall proposal and increases the likelihood of funding. A carefully prepared budget can also identify weak areas in the proposal narrative and result in improvement of the technical proposal.

ORSP staff are experienced in preparing budgets and encourage investigators to contact them when they have a draft of the budget. ORSP can provide expertise in completing a budget request, calculating fringe benefit and indirect cost rates, documenting subcontracts/subrecipient agreements, consultants, indirect costs, and identifying matching funds and/or cost sharing resources. ORSP also completes sponsor assurances and certifications for the President's signature, when required by the sponsor.

Budget Set-up and Revision Form (BUD) - This form is designed to help you plan your budget, including indirect costs, and translate SFA internal accounting codes to sponsor budget categories.

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1. Direct and Indirect Costs

Direct costs are costs which can be directly identified with your project. The categories established for federal budgets are useful in the preparation of budgets for all types of proposals. For federal projects, direct costs are those that can be directly attributed to the project. To be eligible as a direct cost, a cost must be allocable to the project, allowable under the cost principles, reasonable, and charged consistently across the University.

On the other hand, indirect costs cannot be directly identified with your project. They include building space, utilities, departmental administrative and clerical services, the services of ORSP, general counsel, payroll, travel, purchasing, university security, and custodial support, and other related services. In other words, all those elements essential to supporting sponsored activity which cannot be broken down and directly charged to a specific grant or contract.

Definitions of what are allowable and unallowable direct costs for federal projects are outlined in OMB A-21, Cost Principles for Educational Institutions (OMB A-21) for projects funded prior to December 24, 2014, and for those funded after that date, 2 CFR 200, Subpart E.

Most federal and state agencies and private entities further define allowable costs specific to their grants within their respective grant guidelines. If you are uncertain or have any questions about what constitutes an allowable direct cost for an application or award, contact ORSP.

Quick Reference Guide: Allocable and Allowable Costs

Guidelines for expenditures from university funds (includes restricted grant funds).

Before finalizing a project budget, review the budget format, cost categories, and allowable costs for the specific funding opportunity. These will differ significantly from one sponsor/opportunity to another.

In general, categories of direct costs include:

Indirect Costs

Salaries and Wages

A project may employ current university employees or may hire new employees solely for the duration of the grant. Allowable costs for federal awards are detailed in 2 CFR 200.430 - 431.

Salaries and wages should be listed by the time to be spent by each person who will work on the project, including faculty, exempt and non-exempt staff, and students (graduate and undergraduate). For faculty, professional staff, and graduate assistants, time commitments are usually expressed in terms of months and a percent of full-time effort (i.e., 9 months at 25% time). Budgets should show a breakdown between summer commitments and the regular, 9-month academic year for faculty (or for 10- or 11-month appointments). Non-salaried students and casual employees are calculated based on the hourly rate times the anticipated number of hours to be committed to the project.

Sponsored activities may not result in any employees receiving compensation at a rate in excess of their authorized base salary or rate of pay. In other words, under no circumstances can anyone be paid from grants at a rate higher than their regular salary. In exceptional circumstances, exempt individuals may receive additional compensation above their base pay (see below.)

Grant Funded Positions

Human Resources (HR) has developed standard classifications for common grant-funded staff positions. You are required to use these classifications and related salary scales except as noted below.

Project Assistants (I, II, III) [Administrative Assistants on grants] – There are three levels of administrative assistant classification specifically for grants. Project Assistant I is a clerical position similar in scope to a senior secretary. Project Assistant II is an administrative support position similar in scope to an administrative assistant. Project Assistant III is a senior level administrative support position and assumes a higher level of project responsibilities. Most grants will need a Project Assistant II. Contact ORSP for assistance in selecting the proper classification for your project.

Project Coordinator – This is a generic classification used for a position responsible for coordinating the financial/operational activities of a project, without providing any technical or field-specific assistance. It is an exempt position in a salary grade 9. HR should review the general duties before this title is used in a proposal.

Associate Project Director – This is a specific classification created when a new position is created under an awarded grant. This classification is used for a position responsible for assisting in directing project activities, including providing technical or field-specific assistance. Officially, the classification will be ungraded to allow for competitiveness with the market. However, unless justified, the position will be in a salary grade 7. HR should review the general duties before this title is used in a proposal.

Project Director - This is a specific classification created when a new position is created under an awarded grant. This classification is used for a position responsible for overseeing the operations of a project. An incumbent in this position should be considered an expert in the field. The classification will be ungraded to allow for competitiveness with the market.

Principal Investigator

**Any other unique or specialist position created by a grant will have a specific classification created when the new position is awarded by a grant. HR should review the general duties before any unique title is used in a proposal.

Contact ORSP for more information.

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Additional Compensation

In exceptional and unusual circumstances, faculty and exempt staff may be eligible to receive additional compensation for work performed outside of normal work hours and that exceeds normal expectations as outlined in SFA policy, faculty contracts, and/or job descriptions. Non-exempt staff are generally not eligible to receive additional compensation; they must be paid overtime for work performed in excess of 40 hours a week.

Sponsors and SFA normally expect faculty to be paid a portion of their base salary with grant funds and to be granted proportional release time from teaching and other duties and/or receive pay for work on grants during the summer months.

If warranted and approved as outlined below, faculty who expend extra effort during the conduct of sponsored projects may be paid additional compensation up to an amount not to exceed 25% of their institutional base salary for work performed in addition to teaching and other university duties. Please note that an employee cannot be paid regular salary or cost-share salary on a grant and receive additional compensation pay from the same grant.

Institutional base salary is defined as the total annual compensation that an individual receives from the university to perform activities listed in a faculty contract or professional employee job description. It does not include stipends for temporary administrative assignments, course overloads, or additional compensation payments.

Please review the following two policies, Compensation from Grants, Contracts and Other Agreements (policy 12.1) and Salary Supplements, Stipends, and Additional Compensation (policy 12.16) , as well as the sponsor guidelines, before deciding to include additional compensation in your proposal.

In summary, employees may be eligible for additional compensation if the work falls into one of two areas:

Terms for the payment of additional compensation to faculty and staff must be specifically outlined in the grant application or contract and approved by the sponsoring agency. The proposal, budget, and/or budget justification must:

All grant or contract budgets must be reviewed by ORSP staff before they are submitted to a sponsor for consideration. This will help to ensure that they meet SFA and sponsor requirements.

ORSP's Additional Compensation Verification Form (ACV) must be submitted to ORSP along with HR's Authorization for Additional Compensation Services before the proposed work begins. After ORSP staff have confirmed the request meets both sponsor and university policies and guidelines, the ACV is signed by the director of ORSP and both forms are routed by ORSP to HR for processing.

Refer to the section on benefit calculations for instructions on how to calculate fringe benefits on additional compensation.

IMPORTANT: You must account for fringe benefits on additional compensation amounts. For example, if $2,000 total is budgeted for additional compensation, then 16.45% of the total must be subtracted from the amount requested for payment ($1,717 in additional compensation payment and $283 for fringe benefits). Failure to account for fringe benefits may result in a budget overage.

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Subawards and Vendor Contracts - See the Forms page for contract templates (updated 9/1/17)

Subawards (Subcontracts)

Subawards are made by the university to other organizations that will perform a part of the scope of work for a project awarded by the sponsor to the university. Subawards may be subgrants, sub-cooperative agreements, or subcontracts, and are generally of the same type as the award to the university. Allowable costs for federal awards are detailed in 2 CFR 200.459.

The PI/PD should incorporate prospective subrecipient's work statements, budgets, and administrative approvals, with the university's initial proposal to the potential sponsor, adhering to any required sponsor or SFA formats. Failure to identify a subrecipient in a proposal may require sponsor approval or competitive selection before the subaward can be executed.

In some cases, such as National Science Foundation (NSF) submissions, partnering institutions that constitute subawards will be required to enter and submit their own information in an online application.

If your project involves expenses associated with a cooperative organization or a tiered agreement, those expenses should be included as a subcontract in the proposed budget. The total subcontract cost should appear as a line item in your proposal budget, and a separate budget breakdown for subcontract costs should follow the proposal budget. In addition to a detailed subcontract budget, a letter signed by the individual authorized to contractually commit the subcontracting organization is typically required by a sponsor. Subcontract costs should include the subcontracting organization's fringe benefit expenses and indirect costs (see below).

$25,000 IDC limitation - Indirect costs (IDC) in a subcontract must be in compliance with the sponsoring agencies guidelines. Under federally sponsored research awards, as well as some additional sponsors, the university may only recover indirect costs on the first $25,000 of each subcontract over the life of the contract.

Subcontractors may recover indirect costs on the amount of the subcontract in excess of $25,000 at the organization's negotiated rate. If the subcontracting organization does not have a negotiated rate, no indirect for the organization should be included. This limitation generally does not apply to training grants or other programs that require alternate IDC rate calculations. Be sure to carefully read the program guidelines, and request assistance from ORSP, as needed.

Vendor Contracts (Consultants, Lecturers, Workshop Presenters, Mentors, etc.)

Agreements to obtain goods or routine services are purchases (vendor contracts) and not subawards and are subject to all relevant university procurement policies.

Consultants - Normally, consultants are paid a consulting fee plus travel expenses, if applicable. Some sponsors do not permit payments to consultants and some restrict or limit such payments and may require inclusion of travel costs in the contract fee. If in doubt as to the allowability of consultants or rates paid to consultants, refer to the sponsor's program guidelines and/or award documents, or contact ORSP for assistance.

Whenever possible, provide the following information in the proposal before it is submitted:

Lecturers, Presenters, and Mentors - Lecturers, workshop presenters, mentors and other service providers are not ordinarily considered consultants. Such services should be detailed by task and overall amount of funding.

Additional information on the distinction between subawards and procurement is found in OMB Circular A-133, Section 210 and in 2 CFR 200.330.

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Equipment

Most agencies make a distinction between capital equipment, which must be detailed in line items, and minor equipment, which is generally included in the supplies and materials (or operations and maintenance, O&M) budget category. Federal property standards are goverened by 2 CFR 200.310 - 200.316. Allowable equipment costs for federal awards are detailed in 2 CFR 200.439.

Most sponsors accept the applicant institution's definition of capital equipment, which for SFA is defined as an item with a cost of $5,000 or more, which is non-consumable, independently functional, not attached to a permanent structure, and with a useful life of more than one year.

Unless otherwise specified by a sponsor, capital equipment is the property of the university and must be inventoried. All capital equipment purchased with federal funds must be identified as such in the institution's property records.

Any shipping, maintenance, and warranty costs to be paid during the life of the award should be included in the budget per sponsor guidelines. If allowed, these costs may be listed under equipment, supplies, or other direct costs).

For more information: SFA's Department of Procurement and Property Services

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Supplies and Materials

Materials and supplies, which include expendable, non-capital equipment, are items costing less than $5,000 and include such items as expendable laboratory supplies, teaching aids, computer software, and office supplies. A reasonable amount should be budgeted for these items as allowed by the sponsor. Allowable costs for federal awards are detailed in 2 CFR 200.453.

Most federal grants generally do not allow the purchase of office furniture and other general purpose equipment unless they are necessary for conduct of the project and are specifically approved in the budget. In addition, some general office supplies, telephone, long distance, fax, and copy machine charges are frequently considered part of indirect costs and are not allowable without clear justification.

Note that although they cost less than $5,000, some items are controlled (e.g., cameras, computers, scanners, TVs, and all other digital equipment except cell phones and fax machines) and must be inventoried.

For more information: SFA's Department of Procurement and Property Services

Guidelines for the expenditure of university funds (includes restricted grant funds).

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Travel

Individuals who travel using grant funds must adhere to university travel policies. (See SFA policy 3.29, Travel.) Allowable costs for federal awards are detailed in 2 CFR 200.474.

ONLY SFA employee and student travel is included in the travel section of the budget. Travel funds for non-SFA personnel are included as part of subawards and/or vendor or participant contracts.

Travel on official university business, including travel on grants, requires prior approval of university administration and the sponsor. In addition, many sponsors require a detailed estimate of travel plans and expenses (e.g., destinations, hotel, per diem, and transportation) in the proposal. Travel on grants must directly support project goals, which may include dissemination of results. Federal grants generally prohibit travel outside of the 48 contiguous United States. If approved by a sponsor, travel to a foreign country may require additional administrative approvals.

Meal and lodging rates differ depending on whether the travel is in-state or out-of-state. Reimbursement for travel on grants is the same as for all other university business, except in instances where the approved grant application or contract specify different rates in the travel justification. Meals are reimbursed only if associated with overnight travel.

For complete information regarding university travel policies and procedures: SFA's Travel Office

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Participant Costs - scholarships and stipends

Participant scholarships and stipends are payments to provide financial assistance during a period of grant-supported education and training. Scholarships typically pay for tuition and fees, but also may provide for living expenses (paid as a "difference check"). Scholarship funds are classified in the Banner accounting system with account codes 775830 for undergraduate students and 775831 for graduate students. Research scholarships (both graduate and undergraduate) use account code 775835. Scholarships are managed by the Financial Aid Department. Allowable costs for federal awards are detailed in 2 CFR 200.456 and 200.466.

Participant stipends are non-scholarship, non-salary support classified in the Banner accounting system with account code 772991. Such stipends are monetary support for participation in the project as approved by the sponsor. They require a contract with the participant that outlines the terms for payment and typically include monetary support for participation in the sponsored project.

If these items are allowed by a sponsor, they must be clearly detailed in the project budget. Participant costs are typically excluded from indirect cost calculations.

Note that fellowships, scholarships/tuition, that are specifically designated for research purposes, have a separate Banner account code (775835) so they can be monitored and reported separately.

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Other Direct Costs

Other direct costs include items that cannot be captured in any of the above categories. As appropriate for the project and as allowed by the sponsor, costs for copying, long-distance telephone calls, postage, reference books and materials, publication costs, and equipment maintenance. As noted before, some general supplies, telephone, long distance, fax, and copy machine charges are frequently considered part of indirect costs and are not allowable without clear justification.

Use caution in this area as some of these costs are considered indirect costs, so the PI/PD must justify the need for these items in relation to the project's scope and desired outcomes.

Major Programs (see 2.CFR 200.518) For many of these charges to be allowable in federal projects, they must be part of what is considered a "major program." Examples of major projects include but are not limited to:

Quick Reference Guides: What about Food Purchases?

Allowable, Allocable and Reasonable Costs

Guidelines for the expenditure of university funds (includes restricted grant funds).

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2. Matching and Cost-sharing Commitments

Some sponsors require matching funds or cost-sharing of resources.

Although these two terms are often used interchangeably, matching funds are normally defined as cash (e.g. a percentage of the cost of a piece of equipment or cash donations from a collaborating partner). On the other hand, cost-sharing usually takes the form of contributed time and effort by the PI, PD, or other project staff (faculty release time, graduate student salaries, and student workers).

Some tips on cost-sharing and matching:

Refer to 2 CFR 200.306 (or OMB Circular A-110, Subpart C.23 for earlier awards), for federal cost-share requirements.

If cost-sharing and/or matching funds are committed to a project, the PI/PD includes a detailed budget showing these funds with the Proposal Clearance Form (PCF). This detail may be provided within the proposal budget detail and/or attached using the Cost-share Budget Detail Form (CSB). Cost-sharing and matching commitments must be approved by the department chair(s), the college dean(s), the provost/VPAA, and the president.

When an award is accepted that includes cost-sharing, the university commits to formally documenting that the cost-sharing was actually applied to the project during the term of the project. If the award level is significantly lower than the requested level, a corresponding reduction in cost-sharing should be negotiated.

Upon award, and annually thereafter for multi-year awards, the budgeted amount of cost-shared salaries and wages, travel costs, and supplies and materials, will be transferred from the designated departmental fund into a Banner cost-share fund (107600 or 150600) specifically tied to the grant by a unique Banner organization number (ORG) assigned to the project manager, thus providing a clear accounting record of these cost-shared expenditures. Electronic Personnel Action Forms (EPAFs) are required for all cost-shared salaries and wages to charge the cost-shared salary or wage to the corresponding cost-share fund-org.

Matching funds in the form of cash may be accounted for using this same companion cost-share fund or another, non-federal university fund that is appropriate for the stated purpose of the match. If cash is provided by an outside party to satisfy a matching commitment, it cannot be considered a gift.

Cost-sharing in the form of volunteer effort or contributions from third parties must be accounted for in terms of the "market value" of the effort or contribution. Written documentation must be kept for such cost-sharing and may need to be submitted to the sponsor.

Suggested cost-sharing or matching items and required documentation:

Faculty salaries and benefits, percent release time

Effort certification documents and 107600/150600 fund expenditure details

Graduate assistant salaries and benefits

Effort certification documents and 107600/150600 fund expenditure details

Graduate assistant out-of-state tuition waivers

Banner expenditure reports from the Controller's Office

Student wages (non-FWS)

Time records from the TimeClock Plus System and 107600 fund expenditure details

Unrecovered indirect costs (if allowed by sponsor)

Example: balance of 31% - 15% (charged) = 15%
Example: balance of 10% off-campus - 5% (charged) = 5%

If the full off-campus rate of 10% is used, there is no unrecovered IDC to cost-share
Banner expenditure reports

Indirect costs on cost-shared salaries, benefits, etc.

Example: 31% x total of cost-shared charges
Banner expenditure reports

Use of equipment or computer services (e.g., GIS lab)

Sign-in sheets documenting hours used and by whom; must use established rate schedule

University space

Use of facilities or land at the established rental or lease rate or rental estimates based on square footage and the prime commercial rate for the area (market value). ORSP can provide assistance with this information.
Rental rates from real estate agents, square footage from the THECB space utilization records

Travel

107600 fund expenditure details or copies of invoices and Banner expenditure reports provided to the Controller's Office

Materials and supplies

107600 fund expenditure details or copies of invoices and Banner expenditure reports provided to the Controller's Office

Cash matches from third-party collaborating partners

Banner expenditure reports for matching grant or non-grant funds

In-kind volunteer services or activities (non-SFA)

Sign in sheets documenting hours; rate of pay equivalent to the going rate for that activity (market value)

Quick Reference Guide: Documenting Cost-sharing and Matching

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3. Budget Justifications

The budget justification is a narrative explanation of the budget and is typically the first item that reviewers see. The budget for the project must be directly related to the scope of work discussed in the proposal.

Every item in the budget should be completely justified in the narrative as to why it is needed and how it is related to the activities proposed. If an item cannot be easily justified and supported in the body of the grant, then that item should be removed from the budget.

Some sponsors explain the detail they expect to see in the justifications. Some limit the number of pages; others do not. ORSP pre-award staff can provide you with sample budget justifications.

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