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GSR Office(760) 750-4066OGSR@csusm.eduCraven Hall 5102 Monday through Friday 8:30am - 4:30pm

Budget Development

Grants and Contracts Development works with PIs/PDs to develop budgets that meet sponsor requirements, account for the full costs of the project, satisfy internal policies and procedures related to expenditure of funds, and are compliant with sponsor guidance and Office of Management and Budget (OMB) Uniform Guidance (2 CFR §200).   

When projects are funded, budgets are overseen by PIs/PDs and expenses are approved by the Office of Sponsored Projects. The Office of Sponsored Projects provides the level of review pertaining to terms of conditions of the award as stated in the notice of award (NOA) as well as Uniform Guidance. University and CSUSM Corporation policies and procedures pertaining to travel, contracting, purchasing, and other activities must be followed.  

The following principles are intended to describe the calculations of direct and indirect costs in CSUSM proposal submissions. The budget is not a fixed document. University policies and procedures will be followed throughout the award period, which means cost estimates and cost categorization in a proposal may change during the award stage according to calculations and policies/procedures during the award stage.  While there may be some deviations from these procedures, such exceptions may require additional approvals.  

UNIFORM GUIDANCE 

2 CFR 200, known as Uniform Guidance, is the basis for budget development and oversight.   The following excerpts from Subpart E, Cost Principles, are fundamental principles for PIs to be aware throughout the award lifecycle.  

  • 200.404 ‐ Reasonable costs A cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. 
  • 200.405 ‐ Allocable costs A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received.
  • 200.403 ‐ Allowability of costs Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. necessary, reasonable and allocable; 2. be consistent with policies and procedures that apply uniformly to both federally-funded and other activities at the institution; 3. conform to any limitations or exclusions; 4. not be included as a cost or used to meet cost sharing of any other federal award 5. consistent treatment between direct and indirect costs; 6. be adequately documented.  

DIRECT COSTS  

A direct cost is defined as a cost that can be identified specifically with a particular sponsored project, instruction or any other institutional activity or that can be directly assigned to such activities relatively easily with a high degree of accuracy (CSU Sponsored Programs Policy Definitions).    

The following are direct cost categories for sponsored projects.  

  • PERSONNEL

    There are generally two categories of personnel – senior/key personnel and other personnel.  

    Senior/key personnel includes the PI/PD, Co-PI/Co-PD/Co-Investigator, and others referred to as Senior Personnel. Other personnel includes non-key individuals who are included in the budget as employees such as undergraduate and graduate students, administrative support personnel, project managers, to be hired, and post-doctoral personnel. 

    Proposed effort for the PI/PD Generally there is some level of grant-supported effort of PIs/PDs for the administration of sponsored projects. The level of personnel effort depends on a number of factors. PI/PDs should budget for the anticipated level of effort needed to meet the project’s objectives or deliverables. Keep in mind that PIs/PDs can expect to spend additional time on administrative and programmatic tasks related to the management of a sponsored project.   

    Proposed effort for other key/senior personnel and other personnel Effort for other senior/key and other personnel should reflect the anticipated level of effort needed for their role on the project, keeping in mind that to be considered an allocable cost, the effort must benefit the project.  

    Institutional Base Salary (IBS)  

    Personnel wage/salary calculations in proposal and sponsored project budgets are based on institutional base salary per OMB Uniform Guidance (§ 200.430).   

    Faculty Institutional Base Salary 

    For tenured and tenure-line faculty, institutional base salary is the 1.0 appointment.  For those who serve as department chairs, this appointment, coupled with the faculty appointment, comprises their institutional base salary (e.g., .7 Chair, .3 Instructional Faculty).  IBS does not include 2403 or special consultant appointments, additional employment, or teaching through during the intercession or summer.  

    Staff/Administrator Institutional Base Salary 

    Staff and administrators’ institutional base salary is one’s FTE appointment.  IBS does not include bonuses or temporary reclassifications. 

    Faculty 

    There are three types of compensated effort for University Faculty on sponsored projects. 

    1. Reimbursed Time

    Faculty reimbursed time, also known as course buyout, is calculated using the 30 weighted teaching unit (WTU) load as the denominator and the appropriate WTUs for the course buyout as the numerator (3 units/30 units = 1 course release = 10% of annual institutional base salary).  

    1. Non-Academic Year Time 

    Non-academic year time, often called Summer effort, is budgeted as comprising approximately 4 months.  To calculate a rate of pay for non-AY time, divide institutional base salary by 8 to arrive at 1 month 

     In the award stage, non-AY time is considered to amount to 4 available months during which faculty may devote 100% effort (plus 25% additional per below) to sponsored projects.  In the award stage, available non-AY days will be used for precise calculations following the CSUSM Corporation Additional Employment and Overload Guidelines and Procedures There are roughly 125 non-AY days available.    

    1. Additional Employment/Overload

    Additional employment includes any CSU or auxiliary employment that is in addition to the employee’s primary appointment. Additional employment is allowed up to a maximum of 125% time (not salary) for all campus activities, including work performed on grants and contracts.   

    Personnel lines generally should project for 3% GSI increases. University Faculty should also project for increases related to promotion to another rank. 

    University Staff and Administrators 

    There are two types of compensated effort for University Staff and Administrators (assumes a 12-month position). 

    1. Reimbursed time.Reimbursed time is appropriate when the sponsored project relates to the individuals University appointment and with permission of their supervisor. Reimbursed time is reflected as a percentage of effort within the 1.0 appointment.  
    1. Additional Employment/Overload.Additional Employment/Overload is permitted by supervisor. Overload is paid as 1.5x for hourly employees. Overload is paid as percentage of salary for exempt employees. 

    For CSUSM Faculty, Staff, and Administrators: Both non-academic year time (in the case of faculty) and additional employment/overload (faculty, staff, administrators) are paid through CSUSM Corporation, which means University employees will be hired through HR Corp for those periods. The exception is for those who are H1-B visa holders as they may not be paid through another entity. A different process will be followed for these individuals.   

    Current Corporation Employees  

    Employees of CSUSM Corporation follow the same guidelines as those of University Staff and Administrators in that reimbursed time is reflected as a percentage of effort within the 1.0 appointment. Their CSUSM Corporation appointment, when it is .75 FTE and higher, is considered the primary appointment for the purposes of defining the salary that determines theirinstitutional base salary.  This means that lecturer appointments and other appointments through the University are not considered part of their institutional base salary and the rate of those appointments is not based on their primary appointment with CSUSM Corporation.  

    Budgeting for accrued vacation 

    Proposal budgets should include a line for accrued vacation as a salary line for current or to-be-hired Corporation Employees who are considered .75FTE and greater on sponsored projects. This is to prevent issues later if someone leaves a project and has accrued vacation. Accrued vacation that is unused at the time of separation must be paid out and will be billed to a project. Proposal budgets should estimate 8 hrs/month based on the individual’s hourly rate. Where an individual’s time is split among projects to total a .75 FTE or greater, proposals budgets should account for a proportional amount of anticipated accrued vacation.  

    Students

    Students may work up to 20 hours per week during the academic year and up to 40 hours per week during intercession and the summer. For proposal budgets, assume 34 weeks for the academic year and 16 weeks for the summer/intercession Reference the CSUSM Corporation  Student Assistant Classification and Salary Guide. The CA minimum wage is $14/hour in 2021 with a projected increase to $15/hour in 2022.  

    To-be-hired 

    Positions that will be hired should be budgeted according to the CSUSM Corporation Position Matrix  based on skills, experience, and requirements of the position.   

    Administrative Support on Sponsored Projects  

    OMB Uniform Guidance 200.413 requires that administrative expenses typically be treated as Facilities and Administrative (F&A) costs.  However, including administrative salaries as direct costs may be appropriate when they can be closely identified with the project and the fulfillment of its objectives. In these scenarios, administrative costs can be allocated to the project based on the proportional benefits as long as they are treated consistently. 

    Selected agency-specific guidance 

    NIH: PI/PDs and other senior personnel may not have salaries/wages for NIH proposal budgets/projects that exceed the NIH salary cap.   

    NSF: The National Science Foundation limits personnel to a maximum of 2 months of NSF support across all projects. A deviation from this limit requires that budget justification justify the inclusion of more the 2 months of NSF support. Common justifications for exceeding the 2 month limit include referencing the heavier teaching load (9 WTUs per term) for CSUSM faculty in comparison to faculty at research institutions OR referencing a full-time, grant-funded position as a Research Scientist with CSUSM Corporation where the individual’s full-time appointment is devoted to research.  

  • FRINGE BENEFITS

    Fringe benefits costs are costs that CSUSM and CSUSM Corporation incur for employees’ full compensation package at the University. These costs include workers’ compensation insurance, unemployment insurance, the employer’s portion of Social Security taxes, retirement plan contributions, health/dental insurance, and life/disability insurance.  In the proposal development stage, Grants and Contracts Development uses estimate rates provided by the CSUSM Budget Office (for CSUSM employees) and CSUSM Corporation (for CSUSM Corporation employees). During the life of an award, for stateside reimbursement of benefits, the actual benefits rates are charged to sponsored projects. Therefore, please keep in mind the rates below are estimates and the actual charge for benefits will be different.  

    Fringe benefits costs always follow salary on proposal and award budgets. On rare occasions for fellowships awarded to individuals, sponsors are unwilling to reimburse fringe benefits costs. In these cases, the college must fund the fringe benefits associated with the PI/PD salary  

    Fringe Benefits rates for Proposals FY 21-22

    Appointment 

    Rate 

    Estimate or Pooled Rate 

    State/Auxiliary 

    Faculty academic year buyout/reimbursed time  

    50% 

    Estimate 

    State 

    Faculty non-academic year (summer/intercession) and additional employment (overload) 

    12%  

    Pooled (will be updated) 

    Auxiliary – part-time, temporary 

    Staff reimbursed time 

    61% 

    Estimate 

    State 

    Full time (30 hours+) CSUSM Corporation employees 

    40% 

    Pooled (will be updated) 

    Auxiliary 

    Part-time Corporation employees (up to 1,000 hours per year) 

    12% 

    Pooled (will be updated) 

    Auxiliary – part-time, temporary 

    Part-time Corporation benefits rate over 1,000 hours per year   

    20% 

    Pooled (will be updated) 

    Auxiliary – part-time, temporary 

    Students academic year 

    4% 

    Pooled (will be updated) 

    Auxiliary – part-time, temporary 

    Students summer/intercession 

    12% 

    Pooled (will be updated) 

    Auxiliary – part-time, temporary 

  • TRAVEL

    Travel costs are generally budgeted as a per-person cost for each trip.  During the life of the award,  PI/PDs should be aware that all travel reimbursement must follow CSU Travel and Business Expense Reimbursements Policy and CSUSM Travel Guidelines, in addition to sponsor guidance and federal regulations. 

     Among some of the rates to keep in mind for proposal budgeting: 

    State of CA Regulation 

    The State of CA passed AB 1887, restricting travel to states that have enacted laws that have the effect of repealing state or local protections against discrimination on the basis of sexual orientation, gender identity or gender expression. Where grants funded by federal or non-state of CA sources require travel to one of the banned states, such travel may be considered an exception to AB1887.  However, grant funding from the state of CA will not permit travel to banned states. For a current list of banned states visit the State of California Office of Attorney General site. 

    International travel 

    When international travel is expected and the location is known, the PI/PD should indicate the location in the Cayuse Proposal Form and a signature for the Associate Dean of EL Global Education will be requested 

    Federal regulations – Fly America Act (U.S.C. 40118) 

    The Fly America Act is a federal regulation that requires that any air travel that is on federally funded awards, must be booked on U.S. Flag Air Carriers or code-share carriers regardless of cost.   

  • EQUIPMENT

    Equipment is defined in the U.S Office of Management and Budget’s Uniform Guidance, 2 CFR 200.33, as: Tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds $5,000. 

    According to Uniform Guidance, two main categories of equipment are classified as General Purpose Equipment and Special Purpose Equipment, which are defined below. 

    General Purpose Equipment is defined in the U.S. Office of Management and Budget’s Uniform Guidance, 2 CFR 200.48, as: 

    Equipment which is not limited to research, medical, scientific, or other technical activities. Examples include office equipment and furnishings, modular offices, telephone networks, information technology equipment and systems, air conditioning equipment, reproduction and printing equipment, and motor vehicles. 

    Special Purpose Equipment is defined in the U.S. Office of Management and Budget’s Uniform Guidance, 2 CFR 200.89, as: 

    Equipment which is used only for research, medical, scientific or other technical activities. Examples of special purpose equipment include microscopes, x-ray machines, surgical instruments and spectrometers. 

    Section 2 CFR 200.439(1)(2) of the Uniform Guidance states that expenditures for general purpose equipment are unallowable as direct costs on Federal awards. However, expenditures for special purpose equipment are allowable, provided they have prior sponsor approval when required.  

    Special purpose equipment costs included in proposal budgets should be based on current quotes from vendors and should account for associated costs such as shipping and installation, warranty (when allowed), training (when required), and the CA use tax of 7.75%.   

    The ongoing maintenance and space implications of equipment should be discussed with the college dean well in advance of finalizing the proposal budget.  If the equipment requires space not yet assigned to the PI/PD, a request should be made of the Vice Provost for Planning and Academic Resources (signature also in the Cayuse Proposal Form) in advance as well. Warranty information should be understood and discussed with the college dean. A plan for maintenance and user fees should be discussed in the proposal stage and may be required by the sponsor 

    Equipment that is to be purchased through externally funded sponsored projects must follow the CSUSM Corporation Procurement Policy. Once purchased, equipment is property of the University and subject to the CSUSM Corporation Property Control Policy and Procedures 

  • PARTICIPANT COSTS (TRAINEES)

    Participant support costs are defined by Uniform Guidance as follows:  Participant support costs means direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees (but not employees) in connection with conferences, or training projects. 2 CFR § 200.75 

    When budgeting participant support costs, keep in mind that the cost is only allowed on federal awards when budgeted and approved at the proposal stage or with prior approval from the sponsor.  During the award stage, funds may not be moved from the participant support costs category to another expense category unless there is prior approval from the sponsor.  Participant support costs are excluded from the base in the calculation of indirect costs.  

    Participants may Include the following when their role is as a trainee: 

    • CSUSM students 
    • Students from other universities* 
    • Teachers at  K-12 institutions receiving professional development 

    *Please note the guidance through CSUSM Student Financial Services in the CSUSM Payments to Students Guidelines and Procedure.  Generally trainee costs for CSUSM students will be handled through Student Financial Services.  On the SFS site, you may respond to questions to determine payment type.  Notify your Grants and Contracts Specialist regarding questions. For students from other universities, payment will be made through Direct Pay. There is a 7% California withholding for out-of-state students.   

    Participants may not include the following: 

    • CSUSM employees 
    • Advisory board members 
    • Anyone who is responsible for a deliverable or is providing a service to the project  
  • SUBRECIPIENTS

    A subaward made to a subrecipient is an award of financial assistance made under an award.”  During the proposal development process, a PI may determine that he/she/they will collaborate with another institution to accomplish the proposed scope of work.  Grants and Contracts Development will support this process by requesting a budget and Subrecipient Commitment Form from the collaborator’s institution.  CSUSM PIs should work with Grants and Contracts Development regarding the estimated subaward amount and should work with the collaborator on the scope of work. Reference the table below regarding the differences between a subrecipient, vendor, and consultant.

    Subrecipient, Vendor, Consultant  

     

    Subrecipient 

    Vendor 

    Consultant 

    Is it considered a federal award 

    Yes 

    No-It is a payment for goods and services 

    No-It is a payment for goods and services 

    Performance measured against objectives of federal award 

    Yes 

    No 

    No 

    Responsible for Programmatic Decision-Making 

    Yes 

    No 

    No 

    Must adhere to applicable Federal program compliance requirements 

    Yes 

    No 

    No 

    Subject to audit under A-133 

    Yes 

    No 

    No 

     

    Mechanism 

    Subagreement 

    Purchase Order 

    Independent Contractor Agreement  

  • VENDOR/SERVICE PROVIDER
    Vendors/service providers are paid through a contract for the purpose of obtaining goods and services. Vendors/service providers provide similar goods and services to many different purchasers and operate in a competitive environment. They do not have a programmatic decision-making like a subrecipient.  For purchases between $10,000 and $149,999, the Supplier Selection and Cost Justification Form will be required (unless Sole Source/Brand Name Justification will be used). 
  • INDEPENDENT CONTRACTORS/CONSULTANTS
    Costs of professional and consultant services rendered by persons who are members of a particular profession or possess a special skill are allowable assuming certain conditions are met. State law governs the determination of whether someone is an employee or an independent contractor. The ABC test (summarized on the CSUSM Corporation HR site) is used for this determination. PIs are encouraged to complete the Contractor/Consultant Determination Request during the proposal stage.  PIs should be aware that  during the award stage, after the Independent Contractor determination is made an Independent Contractor Agreement and requisition are needed before the work commences. If the person does not meet the criteria for contractor/consultant, the person will need to be hired as a temporary employee (note this is only possible for those in the state of California).  Discuss with the Grants and Contracts Specialist whether a subrecipient relationship is appropriate.
  • MEALS
    Meals and hospitality expenses are generally unallowable unless they are part of participant support costs and are explicitly described in the budget/budget justification or are necessary for a conference/symposia/workshop when the primary purpose is the dissemination of technical information beyond the non-Federal entity [CSUSM] and necessary and reasonable for successful performance under the Federal award. 
  • IITS EQUIPMENT
    For costs associated with computers and annual support costs base cost estimates on those reflected in the IITS refresh charges pricing chart (sponsored programs are not-eligible columns)  

    For other expenses related to IT equipment, all hardware, software, and services, please allow for time to correspond with the Dean of IITS or Dean’s Office staff regarding cost projections.   

  • RESEARCH INCENTIVES
     When budgeting for incentives for participants engaged in the research, PIs/PDs may reference the CSUSM Corporation Gift Card Purchasing Procedure.   
  • PUBLICATION COSTS
    Costs associated with publication and dissemination may be considered essential and reasonable costs. Paying international publishing costs will require additional steps and planning.   

INDIRECT COSTS 

Indirect (F&A) costs: Indirect costs or Facilities and Administrative (F&A)  Costs are those costs incurred for a common or joint purpose benefitting more than one cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. In developing budgets, Grants and Contracts Development will ensure the appropriate indirect cost rate is applied and that the base for indirect cost calculations conforms to our federally negotiated rate agreement.   See CSUSM’s Facilities and Administrative/Indirect Costs Procedure. When the sponsor limits/caps indirect cost recovery and Indirect Cost Recovery Waiver Form will be required and uploaded as an attachment in the Cayuse Proposal Form. 

COST SHARING 

Cost sharing refers to the portion of the project or program cost that is not borne by the sponsoring agency. Cost sharing will only be included in proposal budgets when required by the sponsor.  Upon award, cost sharing commitments that are included in the proposal become mandatory and are binding.  Cost sharing commitments that are included in proposal budgets will conform to Uniform Guidance and Cost Sharing Procedure for Sponsored Projects. Cost sharing will be indicated on the Cayuse Proposal Form and a detailed cost sharing budget will be uploaded as an attachment.  Signatures will be requested from the units providing the cost share. 

GSR Office(760) 750-4066OGSR@csusm.eduCraven Hall 5102 Monday through Friday 8:30am - 4:30pm