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The budget has two functions. First, it estimates, as realistically as possible, the cost of completing the objectives identified in the proposal. The sponsor will use the budget details to determine whether the proposal is economically feasible and realistic. Secondly, the budget provides a means to monitor the project's financial activities over the life of the project. Many sponsors (especially government agencies) provide either a form or a format for the budget. It is imperative to follow the agency's instructions explicitly.
The OSP will assist you to prepare budgets for federal contracts and grants, in accordance with the Office of Management and Budget (OMB), Form A-21, “Cost Principles for Educational Institutions”.
Guidance by Budget Category
Preliminary Budget Information---Brainstorming a budget requires you to think carefully about costs associated with every phase of the project from planning to implementation to evaluation.
Salaries and Wages
Personnel—Who will lead and/or run the project and how much time will it take (days per week or % of a full-time equivalent)? If this will be a new position at the university, try to ballpark an annual salary and percentage of that salary it will take to direct the project. What Armstrong staff are needed to run this project and what will their time commitment be (e.g., administrative support, faculty member, etc.)? If you know the names of current staff, list them and the position they will hold. All salaries must be calculated as a percentage of the current year contract. Nine-month faculty: course reduction = 1/10 of salary shown on contract; one summer month = 1/9 of salary shown on contract. Personnel not on nine-month salary = contact OSP.
Employee Fringe Benefits
The following fringe rates are used to accomplish this objective: Academic Year Fringe Benefits = 30% of salary; Summer Fringe Benefits = 18.87% of salary; Student Fringe Benefits = 10% of salary.
Consultants/ContractorsWill any outside group be used to accomplish specific tasks involved in the work plan (e.g., evaluation, design of website, etc.--specify group or person, if known, tasks/daily rate/number of days)?
TravelWill there be any conference travel and/or local travel costs? Please describe (e.g., two staff developers will make two round trips to ABC Elementary School each week for approximately 38 weeks). Mileage rates for Tier 1: Automobile - $0.51 per mile; Motorcycycle - $0.48 per mile; Aircraft - $1.29 per mile
OTPSMake a list of any costs other than personnel and travel costs: e.g., program supplies, meeting costs, stipends for people to do specific tasks, anything else you can think of.
Most proposal budgets will also require a Budget Justification, which, when submitted along with the budget will highlight, explain, and provide rationale for each budget category entry, and how the principal investigator arrived at certain cost estimates. For example, the salary or personnel category will explain each employee's role, what tasks they will perform, and the percentage of effort required to conduct the project or program.
The guidelines and/or instructions contained within the agency's funding announcement will contain information regarding whether a budget justification is required to be submitted along with the proposed budget.
If the potential funding agency requires a budget justification, and does not supply their own budget justification form or offer specific instructions, the budget justification should follow the format of the budget form used, with a justification for each budget category entry.