ORA Budgeting and More

ORA Mission & Purpose  To provide the best service possible to the VCOM faculty and staff in their pursuit and administration of external funding.  ORA provides full service throughout the lifecycle of a project, from preliminary review to award closeout. 2

What is a Sponsored Program? External to VCOM Funds are awarded for a specific purpose Restrictions on the use of funds Specific timeline for completion of project Deliverable i.e. progress report, services The entity that is sponsoring the project will be billed for project costs incurred by VCOM 3

General Regulatory Framework Federal OMB Circulars Sponsor’s general guidelines VCOM’s institutional policies and procedures Sponsor’s RFP/RFA and award-specific requirements 4

Information Needed for Budget Always The RFP/solicitation/application guidelines Project Start and End dates (period of performance) VCOM personnel to be included on budget Provide guidance regarding costs to be included (by category, by year). 5

Information Needed for Budget If Applicable Target or ceiling value Supporting data for subcontractors and or consultants Sponsor documentation for reduced indirect (must have written policy) Cost Sharing % and breakdown between cash and in-kind contributions Sponsor’s Cost Exclusions 6

Budget – Cautions/Red Flags VCOM does not estimate costs, contract for, report progress, or submit invoices based on man-hour rates A subcontractor or group of subcontractors should not receive the largest share of funding on a VCOM project – if they do, they should be the prime applicant and VCOM should be the sub Subcontractors have to adhere to all RFP requirements including any indirect limitations, costs sharing requirements, and cost exclusions Cost sharing should not be “volunteered” above the minimum amount required by RFP 7

Budgeting Basics Always have ORA review your budget Including informal quotes to your sponsor and pre-proposal budgets Terms to know: Cost Share: VCOM’s portion of the project cost = REAL COST Only used if required by sponsor Indirect (aka: overhead, facilities & administration) Costs that are not project specific Examples: administrative salaries, office supplies, postage, lab utilities, memory sticks Extraordinary costs may be approved as direct costs Calculated from Federal Rate Agreement To use a lower rate, documentation of sponsor policy is necessary 8

Why get ORA approval on your budgets? Ensure that auditable pricing data is submitted to your sponsors Ensure compliance with regulations Prevent under funding or over funding issues ORA has to approve budgets for a sponsored research fund number to be established Budget variables change frequently 9

Major Categories of Costs 10 Personnel (salaries, wages, & fringe benefits) Percentage of effort or months Typically largest cost Based on actual payroll records Equipment $1,000 or greater and useful life of >1 year Equipment should be 100% allocable to the project they are charged Travel Differentiate between Domestic & International International travel requires advanced sponsor approval

Major Categories of Costs (cont.) 11 Materials/Supplies Items needed to conduct the research. Lab supplies, field supplies, etc. Office supplies & administrative items are not included, they are covered by indirect cost. If exceptions are necessary, please let us know Computers – There are some questions to answer before you request a computer be listed on your budget. 1.How is the computer necessary to fulfill the project’s scope of work? 2.How does the computer go beyond normal use in day-to-day operations of the laboratory? 3.How is the computer different from similar items provided by VCOM that are treated as F&A (indirect) costs? 4. How will computer time be systematically allocated between multiple projects or split between a sponsored fund and an unrestricted department fund?

Major Categories of Costs (cont.) 12 Consultants An individual or organization hired to provide services of an advisory nature Can be hired when the necessary expertise is not available within the VCOM community VCOM employees cannot be paid as consultants on sponsored projects Subcontractor An individual or organization hired by the University to complete a portion of the project because the necessary expertise is not available within the VCOM community Contribute to a deliverable and are vital to the proposed work Funding for a subcontractor is provided by and must be approved by the sponsor

Salary/Fringe/Overhead Rates Salary*3%on 7/1 Fringe Rates VCOM charges actual rates On-Campus F&A53.5% Off Campus F&A21% Note that no other costs are automatically escalated * Salary escalations are only estimates for budget purpose and do not guarantee a salary increase 13

Direct Vs. Indirect Costs 14 Direct Costs that can be specifically identified with a particular project or program. Indirect Real costs that are incurred… for common or joint objectives and which therefore cannot be identified with a particular project or program.

Direct Costs 15 Principles Reasonable and necessary Allocable and verifiable Allowable under regulations Examples PI salary and fringes Travel Equipment and materials/supplies Contractual services and subcontractors

Cost-Sharing 16 Quantified financial support contributed by College to the Sponsored Project-this is a real cost that must be reported to the sponsor Cost Sharing Form should always be completed if the proposal involves cost sharing/matching ORA approval required for all cost share not directly required by sponsor

Budget Narrative 17 Justify each item (or group of items) in each category Provide justification for initial year budget and escalation/exceptions for additional budget years (including fringe) Good idea to establish a budget narrative template It is recommended to address each cost category in the order they are listed in the proposal budget

Your Budget After the Award 1. Budget revision to match the actual funding Will it affect your proposed Effort? 2. Your Budget relative to your Research Plan 3. Your Budget Justification 4. “Burn Rate” 5. Re-budgeting 6. Incremental funding and carry-over 18

Award Negotiation OSP must review for: Type of Award (cost reimbursable or fixed price) Budget Limitations / Restrictions Invoice Requirements Technical Reporting Requirements Unacceptable Terms that must be negotiated: Laws of another state or country Indemnification Intellectual Property Rights Publication Rights 19

Types of Agreements Grant Financial assistance For public good – not to be restricted for commercial or internal use Federal Grants use standard federal assistance terms Contract Procurement of research services Specific obligations and detailed terms & conditions Federal Contracts use Federal Acquisition Regulations (FARs) Cooperative Agreement Sponsor and VCOM cooperate on a specific SOW with both parties assigned specific responsibilities Specific obligations and usually detailed terms 20

Post Award Responsibilities:  Review award set up  Sponsor Terms and Conditions  Process amendments on grants and contracts  Review no-cost time extensions  Monitor, review, and approve expenditures  Prepare internal budget revisions  Submit invoices and financial reports timely  Accounts Receivable management  Issue and monitor subawards 21

PI’s Responsibilities  Provide overall project management to ensure compliance  Manage the project budget  Request no-cost time extensions through ORA  Responsible for all expenditure transactions  Certify time & effort  Submit technical progress reports timely 22

Budget Pitfalls Forgetting that salary and fringe typically eat up 60 to 80% of total direct costs Underestimating support time and effort Vague and unjustified costs categories; padding categories Inappropriate F&A charges 23

Major Compliance Issues Charging administrative costs to federally funded projects Research involving human subjects requires approval from IRB Research involving animals requires IACUC approval 24

Office of Research Administration

Proposal Assistance Search for Funders Find Collaborators Proposal Formatting Proposal Guidance Administrative Forms Boiler plate Information 26

Statistical Assistance Research Design Sample Size Calculation Outcome and Predictor Variables Statistical Analysis Plan Review of Data Collection Forms and Data Entry Keys Survey Creation Statistical Analysis and Report Findings

Contact Us 28 Eryn Perry : Dawn Bennett : CK Vanover : Greg Reaves : Dalia Meisha : ORA main site :