Develop a Budget
Develop a Budget
Forms & Tools
Policies & Instructions
Developing a budget is an important part of the proposal process, and your budget must conform to established federal, UNH, and other sponsor requirements.
Grant and Contract Administrators (GCAs) provide one-on-one assistance with budget development. Contacting your GCA early and often will smooth the budget development process for you.
GCAs are assigned responsibility for specific departments/programs/campus offices.
Budgets generally include two different types of costs: (1) direct costs and (2) facilities and administrative (F&A) costs.
Direct costs are those costs that are specifically associated with a particular sponsored project and/or can be directly assigned to that project or with a high degree of accuracy.
The tests of allowability for direct costs budgeted and charged to sponsored programs are that:
(a) they must be reasonable;
(b) they must be allocable;
(c) they must be given consistent treatment (as either direct or indirect); and
(d) they must conform to any limitations or exclusions set forth in the sponsored agreement.
Common Direct Costs include:
Salaries and Wages
UNH has adopted the definition of equipment as an article of non-expendable, tangible personal property having a useful life of more than one year and an acquisition cost of $5000 or more.
UNH’s policy provides a comprehensive explanation.
- Purchases of major equipment are subject to agency/sponsor regulations and award terms and conditions
- Estimates should be based on written quotations or catalog prices
- Before budgeting equipment on a sponsored project, assure that the:
- Equipment is necessary for the performance of the project
- Equipment is allowable
- Cost of equipment is reasonable
- Equipment purchase is allocable to the project (i.e., equipment benefits this particular project)
- Timing of the purchase is consistent with the project's period of performance
- General-purpose equipment—such as photocopiers, laptop computers, and fax machines—generally is not allowable, unless the equipment will be used primarily or exclusively for the research project. Budget justification should include detailed information linking the general-purpose equipment acquisition to the technical work of the project
- Capital equipment is excluded from the F&A cost base
Many research projects include the design, development, and building of equipment that is not available commercially. Equipment that cannot be purchased “off the shelf,” and is built by the research team, is called “fabricated equipment.”
- If fabrication of equipment at UNH is anticipated, a cost estimate of the completed equipment should be developed based on required materials and components
- Characteristics of fabricated equipment:
- Unique, specialized equipment
- Not commercially available
- Useful life of more than one year
- Aggregate cost of materials and services is $5,000 or more May require sponsor approval.
- Fabricated equipment is considered equipment for F&A purposes. If the cost of the fabrication is more than $5,000, the fabricated equipment is excluded from Modified Total Direct Costs and thus excluded from the F&A calculation. If the cost of fabrication is less than $5,000, the fabricated equipment is included in the F&A calculation.
- Fabricated items delivered to sponsors or sponsor directed third parties will not be considered Equipment. Instead the items will be coded as Sponsor Deliverable Equipment and will incur F&A.
- Please refer to Fabricated Equipment guidance and Sponsor Deliverable Equipment guidance for further information.
Fabricated Equipment Guidance Statements
This guidance is to define criteria and procedures for the inclusion of Fabricated Equipment on research projects sponsroed by the federal government, so that such charges are in compliance with federal requlations and University policies.
This guidance is to provide direction on accounting for the purchase of equipment, assembly of components, and fabrication of complex equipment for delivery to the government or prime sponsor on Sponsored Program Accounts.
Supplies are defined as expendable property with an acquisition cost of less than $5000 per unit and/or a life expectancy of less than one year. General office supplies normally are considered as F&A costs; if the proposed project calls for supply items normally considered general office supplies, the budget justification must explain how the supplies are intended to advance programmatic objectives.
Consultants are individuals from outside of UNH whose expertise and skills will add value to a project; faculty or other UNH staff should not be budgeted or paid as consultants on a project.
Travel costs are the expenses for transportation, lodging, and subsistence to be incurred by employees who will travel on official project business. On occasion, travel for non-UNH personnel involved in the project may be budgeted.
Collaborating institutions budgeted to perform a significant portion of the project.
Other costs could include items such as animal care, long distance telephone charges, duplicating costs, leases/rentals, etc.
Facilities and Administrative (F&A) Costs
Sometimes called “indirect costs” or “overhead,” F&A costs are those that cannot be readily assigned to particular projects or activities and include the costs of administration, maintenance, utilities, and other expenses necessary for the operation of a research enterprise.
F&A costs are calculated for a project by using the formula Rate x Base = Cost where Rate varies depending on the type of activity (i.e., research vs. instruction and on-campus vs. off-campus) and Base varies according to Federal and/or sponsor regulations. UNH’s F&A rates are negotiated for a set number of years with its “cognizant” agency, currently the U.S. Department of Health and Human Services (DHHS).
For further information see University of New Hampshire Guide to Sponsored Programs F&A Cost.
Estimating the cost of a research project is an inherently unpredictable exercise; primarily because the manner in which a research endeavor progresses is itself unpredictable. Experience makes the exercise easier to carry off and liberal rebudgeting authority from sponsors (when it is offered) makes precise estimating less critical.
Federal agencies will generally provide either a form or a prescribed format for estimating and presenting cost; it is important to follow their instructions explicitly. Many agencies that haven’t developed their own forms use the SF 424 as their standard format.
Budgets have to be built obeying the rules of both Uniform Guidance and UNH’s disclosed cost accounting practices. The reference guide highlights selected items of the Uniform Guidance that impacts proposal submissions.
Value of Volunteer Time (This standard is used by the Federal government and provides state-by-state values.)