Expense Categories

Institutional Base Salary

  • ALL compensation paid to faculty is part of the institutional base salary whether that is compensation for research, administrative, teaching, or clinical. The academic base is a commitment that they will be paid and shouldn’t be viewed as the only salary that should be used as the IBS on grant applications. Includes University and CPUP payments, but not bonuses or VA appointment salary.
  • NIH’s website describes IBS as: “An individual's institutional base salary is the annual compensation that the applicant organization pays for an individual's appointment, whether that individual's time is spent on research, teaching, patient care, or other activities. Base salary excludes any income that an individual may be permitted to earn outside of the duties to the applicant organization.” (e.g. The VA Hospital)”

Employee Benefits

Does salary requested = effort?

  • If not, include salary waiver letter, except
    • if individual has a K award, or if sponsor limits salary payments.
    • Important note for K award recipients:
      Be sure to include salary for any future years of the current proposal budget that fall outside the K award project period. Review NOT-OD-18-157 for information on concurrent federal salary support for K recipients.

Evaluate proposed effort

  • verify the calculation
  • Faculty: Institutional Base Salary = all Penn-related Professional activities.
  • Reasonable estimate based on tasks to be performed for this proposal.
  • Evaluate impact on other active and pending proposals. Will reductions of effort on active projects need to be adjusted to accommodate effort on the proposed project?
  • Does the investigator have a VA appointment? See sample budget justification to use in a proposal.  Effort is based on Penn effort only.

Salary Caps

  • NIH (and some other federal agencies) have a cap published annually in the NIH Guide (Salary Cap History).
  • Amount requested = Cap *  % effort.  NIH utilizes Calendar Months (% effort * 12 month appointment)
  • Institutional base salary should be cited in full.

Can Penn staff be consultants?

  • A Consultant is an individual who provides professional advice or services for a fee, but normally not as an employee of the engaging party.  In unusual situations, an individual may be both a consultant and an employee of the same party, receiving compensation for some services as a consultant and for other work as a salaried employee.  Consultants also include firms that provide professional advice or services.
  • Penn staff cannot be included in this category. Also, don’t include personnel who are part of a consortium agreement.

Key Personnel

  • Must have measurable effort
  • Must contribute substantively to scientific development or execution of project.
  • Typically have post-graduate degrees.
  • Consultants OK if they have measurable effort or some fees paid.
  • 0% effort or “as-needed” are specifically excluded.

Other Significant Contributors

  • Provide no measurable effort.
  • Only list Consultants if there is no measurable effort/fees paid.

Allowability of clerical and/or administrative staff expense

  • Generally part of F&A costs.
  • Administrative or clerical staff must be integral to a project in order to be direct charged to a federal award and must be budgeted and justified or have prior written sponsor approval. Under the Uniform Guidance, a project no longer needs to be identified as “major” to include administrative salary, but in general such expenses should be treated as indirect (F&A) costs unless the following conditions apply:

  • To be integral to the project, the administrative activity should be:

  • Essential or vital to the project, and described accordingly in the justification;
  • Budgeted at a percentage of a person-month that reflects that essential nature (a minimum of 10% FTE)
  • Performed by individuals specifically identified with the project or activity
  • Costs that are not also recovered as indirect costs

  • Applicable Uniform Guidance section: 200.413

    For non-federally sponsored projects, administrative or clerical staff may be direct charged provided they benefit the project and follow those sponsors’ requirements for the award.

"Equipment” often includes items such as:

  • Cost >= $5,000.
  • Estimated useful life > 2 years.
  • Includes computer software that meets this definition (capitalized computer software).
  • Excluded from Modified Total Direct (MTDC) Base and F&A.
  • Obtain quote for large-ticket items. (Required for equipment grants).

  • Itemize, except cost categories with costs < $1,000.
  • Typically includes lab supplies, animal purchases (Identify species for animals.), equipment < $5,000/each, etc.
  • Do not include purchased services (e.g., animal per diem, ancillary laboratory tests).
        (These go in the "Other Expenses" category of the budget.)
  • Generic Office Supplies
    • Generally not treated as direct costs.
    • Can be allowable if specifically related to the project. For example:
      • Specific aim of the project is to create a manual or other instructional media.
      • Extensive human subjects data accumulation, questionnaires, etc., is required.

  • Employee travel only in this category.
  • Subject/patient travel is part of the "Other Expenses" budget category.
  • Penn travel policy is the guideline, unless sponsor is more restrictive.
  • Observe Fly America Act.

  • Defined in DHHS rate agreement: "…hospitalization and other fees associated with patient care whether the services are obtained from an owned, related, or third-party hospital or other medical facility…" of UPHS (e.g., tests performed at a hospital outside of the University of Pennsylvania Health System are not coded as patient care in our accounting system.)
  • Excluded from Modified Total Direct Cost (MTDC) base and F&A calculations.
  • What’s not included in Patient Care?
    • Subject reimbursement and travel.
    • Costs of ancillary tests performed outside the hospital on a fee-for-service basis. This includes costs accumulated in service centers at Penn, such as those in Radiology.
    • Consulting physician fees.
    • All of the above are part of the "Other Expenses" budget category.

"Other Expenses” often includes items such as:

  • Publication costs.
  • Rent, when appropriate, but excluded from MTDC.
  • Animal per diem.
  • Subject compensation and travel.
  • Purchased services, for example:
    • Artwork for manuscripts.
    • Service center charges.

Consultants

  • A Consultant is an individual who provides professional advice or services for a fee, but normally not as an employee of the engaging party. In unusual situations, an individual may be both a consultant and an employee of the same party, receiving compensation for some services as a consultant and for other work as a salaried employee. Consultants also include firms that provide professional advice or services.

  • Penn staff cannot be included in this category.

  • Don’t include personnel who are part of a consortium agreement.

Consortia (Subcontracts)

  • A Consortium Agreement is a formalized agreement whereby a research project is carried out by the grantee and one or more other organizations that are separate legal entities. Under the agreement, the grantee must perform a substantive role in the conduct of the planned research and not merely serve as a conduit of funds to another party or parties.

  • F&A costs at the consortium site(s) become direct costs to the primary institution.

  • Generally should have all the same forms as required of the primary applicant, however, a letter of intent is no longer required. The signed face page is the preferred document for intent to participate.

  • Always include a detailed quote.

  • Are there any humans involved?
    • If so, did you remember to:
    • Include subject compensation and travel?
    • Include related patient care costs?
    • Equate costs proposed to research plan, especially with the consent forms?
  • Are there any animals involved?
    • If so, did you remember to:
    • Prepare detail cost estimate (including shipping and box charges)?
    • Include animal per diem rates?
    • Equate costs proposed to research plan?
  • Are there large pieces of equipment?
    • Installation and set-up included?
    • Maintenance contracts?
    • Space available or renovation costs included?
      • Provide a quote.
  • Are there pre- and or post-docs?
    • Is tuition included in the budget,and excluded from MTDC and F&A?
    • Are health insurance costs listed?