The purpose of this section is to introduce cost categories in the proposed budget, discuss the need for budget justification, and introduce a number of Dartmouth College policies and procedures affecting sponsored research budgets.
The proposal budget should delineate the entire cost of the project, lists the amount being requested from the sponsor, and identify project costs that will be met by other sources. The proposal's budget must accurately reflect necessary project costs that are allowable and reasonable. These costs must also be supported by budget documentation. Elements of most budgets include direct costs, indirect costs, cost sharing, and a budget justification. The budget should clearly state to the sponsor how much the entire project will cost and what the specific cost categories are.
If the project is well thought out, the budget will reflect the methodology described within the proposal narrative. Most reviewers will be able to determine if sufficient funds are being requested to successfully complete the project, and that those costs are reasonable given the scope of work.
Accuracy and detail are essential in this section. Again, researchers are encouraged to follow a sponsor's guidelines exactly. Be sure to show all costs related to the project. Keep in mind that sponsors will support costs that are reasonable and justified in a budget description.
Costs directly linked with carrying out the work of the project. Direct costs include the following:
Salaries and Wages
The time and effort of all Dartmouth personnel should be included in the budget. Proposed salaries must be in accordance with College approved salary scales and position grades. For information and advice on salaries ranges and position grade levels contact Office of Human Resources. In developing a multi-year project budget, remember to factor in salary increases. Note: allow for flexibility in hiring by requesting sufficient salary funding to attract the best qualified or most experienced applicant. Some sponsors impose salary limitations, also sometimes known as salary caps e.g.: National Institutes of Health (NIH) salary caps.
Fringe benefits include such items as health insurance, retirement benefits, and federal withholdings. Rates are contingent on the type of appointment each staff holds, i.e., API, APII, faculty, etc. The rate must be charged to the grant in relationship to the salaries and percentage of effort charged to the grant. View current fringe benefit rates.
Consultants provide technical expertise for a limited duration necessary for the conduct of the sponsored project. A consultant is not considered an employee of the College.
Equipment critical to carrying out the project should be listed with a catalogue price or accurate estimate of the cost of each item listed (capital equipment is defined as items costing more than $5,000).
Materials and Supplies
Expendable equipment (up to $5,000) and supplies should be listed in this section. Each item or group of items should be listed and carefully justified in terms of need.
Domestic and foreign travel costs include meals, lodging, airfare, and ground transportation. The type and extent of domestic travel and its relationship to the project should be specified. Travel allowances for air travel normally cover round trip cost of coach accommodations. Separate projected transportation costs from food and lodging costs.
Other Direct Costs
May include services such as those activities performed to support the project effort. Examples may include project specific postage, installation of equipment, maintenance on equipment, delivery costs, human subject fees, and project specific telephone service. Some services list exclusively as part of the project may also be considered subcontract expenses.
Subcontracts and subgrants are agreements by which some scientific or programmatic aspects of a grant or contract made originally to the Trustees of Dartmouth College are contracted out to another organization. A subcontract is appropriate when a portion of the research or grant activity will be performed at another institution or commercial vendor. The primary proposal to be submitted to a sponsor must include the subcontractor's statement of work and proposed budget. A Letter of Intent from the proposed contracting organizations should be included with the primary proposal information. Dartmouth College will charged overhead on the first $25,000 of a subcontract. Contact the Purchasing Office for guidance in obtaining outside bids, and contract negotiation with outside vendors.
Indirect costs are costs that are not readily identifiable with individual projects. They allow an institution to recover some of the costs associated with supporting the research project. In developing the indirect cost rate such expenses as utilities and library use are factored into the indirect cost rate. These costs must be included in all budgets as a percent of total direct costs, excluding services and subcontract costs.
Indirect costs are computed into the final cost of the project using a rate that has been established between Dartmouth College and the Federal Government. Indirect cost rates are fixed for a negotiated period of time and are consistent for all grant or contract applications unless the sponsor prohibits indirect costs or designates another rate. There are times when the OSP may negotiate a different indirect cost rate that is lower than Dartmouth College's negotiated rate. Exceptions must be requested in writing and sent to the appropriate Dean for your area.
Indirect Costs cannot be charged on equipment, alterations and renovations, patient care costs, rental and maintenance of off-site facilities, tuition remission, scholarships and fellowships, and subcontract amounts over $25,000.
Cost Sharing and Matching Funds
Some sponsors require that the College contribute a certain portion of funding to the overall cost of a project or the purchase of a piece of equipment. This contribution may come from in-kind (non-cash) or cash contributions and must be approved by the appropriate Dartmouth College official. For this reason, be sure to obtain written authorization for cost sharing before writing or submitting a proposal requiring this kind of commitment by the College.
Cost sharing is that portion of the total costs - direct and indirect - of a sponsored project or program that meets the following criteria:
- It is not provided by the sponsor, i.e., Dartmouth College has agreed to fund it; and
- It is included in the itemized costs of the project or program's budget that has been
approved by the sponsor.
Cost sharing as defined above may be included in either of the following categories:
- Mandatory Cost Sharing: Cost contribution required of the grantee by the sponsor as a condition of the award, such as the matching requirements of challenge grants.
- Voluntary Cost Sharing: Cost contribution voluntarily offered by the Principal Investigator and accepted by the sponsor in the program budget.
Federal Regulations Regarding Cost Share Dollars
Please note that the Uniform Guidance implemented in December of 2014 has made significant changes concerning cost sharing and federal grants. Cost Sharing is now only allowed under narrow circumstances. As stated in the Uniform Guidance "Under Federal research proposals, voluntary committed cost sharing is not expected. It cannot be used as a factor during the merit review of applications or proposals, but may be considered if it is both in accordance with Federal awarding agency regulations and specified in a notice of funding opportunity."
Federal agencies must clearly indicate the nature and rationale for cost sharing requirements in funding solicitations. Prime grantees are required to provide pass-through entities with indirect costs in relation to their negotiated indirect cost rate agreement or provide for a de minimus of 10%.
In order to be acceptable for cost sharing, costs must:
- Be allocable, i.e., necessary and reasonable for proper and efficient accomplishment of project or program objectives;
- Be allowable under the applicable cost principles; and be verifiable from the grantee's records;
- Not be included as contributions for any other federally-assisted project or program;
- Not be paid by the Federal Government under another award, except where authorized by Federal statute to be used for cost sharing or matching;
- Be provided for in the approved budget when required by the Federal awarding agency;
- Not be unrecovered indirect costs without prior approval of the Federal awarding agency; and
- Conform to all other applicable provisions of the OMB Uniform Guidance
Required Approvals for Cost Sharing
When cost sharing appears on a proposal budget, the source, type and amount of funds should be identified by and authorized by appropriate dean. If the proposal budget contains required matching funds, the Development Office should also review it to ascertain who is responsible for raising the funds externally.
The budget justification is the researcher's opportunity to describe in some detail any budget expenses that needs further clarification or explanation. A complete and sensible budget justification demonstrates that your project is well conceived. It can potentially reduce the chances that sponsors will arbitrarily decrease or eliminate budget categories.