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Stage
Develop and Submit Proposal
Topic
Develop the budget and justification
Subtopic

Federally sponsored budgets

Need assistance with federally sponsored budgets?

When developing the budget and budget justification for a federally sponsored proposal, investigators and grant managers should work together on two key aspects. First, ensuring that all costs to conduct the research are included, and second, complying with any limitations or restrictions for the specific funding opportunity.

Budget and cost considerations

Direct costs

Direct costs are costs that can be identified as pertaining specifically to a particular sponsored project, or that can be directly assigned to such activity easily with a high degree of accuracy. These include, but are not limited to: salaries and fringe benefits, travel, supplies specific to project completion, equipment, consultants, patient care costs or participant support, and subrecipients. The "Related Resources" section on this page contains specific policies and guidance for incorporating direct costs into budgets.

Indirect costs

Indirect costs (also called facilities and administrative or F&A) are costs that are incurred for common or joint objectives, and therefore, cannot be identified readily and specifically with a particular sponsored project, an instructional activity, or another institutional activity. The "Related Resources" section on this page contains specific policies and guidance for incorporating indirect costs into budgets.

Other uncovered costs

Along with identifying what costs the grant will cover, it can be equally important to identify in advance the costs NOT covered by the grant, and to ensure that appropriate funding is lined up in advance to cover those should the grant be awarded. Examples of uncovered costs include but are not limited to:

  • Unallowable fringe
  • Unallowable tuition remission
  • Uncovered stipend and tuition
  • 100% effort requirements with insufficient funding 

Refer to the funding opportunity announcement for uncovered costs specific to that mechanism. 

More information here:

What is F&A and why is it in my budget?

Short Answer: F&A (also referred to as "indirect costs" or “overhead”) are the real costs associated with the facilities and administration necessary to support research but are not readily assignable to a particular project. 

The Details: When Duke conducts externally-sponsored research, the sponsor funds Duke for the expense of the research itself (direct costs) and for the expense of the facilities and administrative (F&A) services required to conduct the research.  F&A costs cover the portion of infrastructure and operational costs related to research. 

Examples include: 

  • Maintenance of facilities specifically-designed for cutting-edge research 

  • Utilities, telecommunications, hazardous waste disposal 

  • Infrastructure necessary to comply with various federal, state, and local rules and regulations 

All applications for sponsored research, education, and outreach (public service) projects will generally have associated F&A costs. These F&A charges are real expenses incurred in the conduct of sponsored activities and must be recovered from the sponsor using Duke’s current, standard F&A rate in all applications. If the sponsor limits the F&A that may be recovered, it is important that you work with your grant administrator early in the process to secure institutional approval to accept a capped rate.  

See Duke’s policy on Facilities and Administrative Costs on Sponsored Projects 

Types of budgets

Two types of budgets will generally be used when preparing an application budget for submission. Researchers should find out from the funding opportunity which type is required:

  • Detailed budget - (Also known as "Line Item budget") A detailed budget is the most common type of budget when submitting to federal, state, or private/non-profit organizations. This requires line-by-line budget information for salary / fringe, supplies, travel, publication costs, subaward/consultant costs, etc.
  • Modular budget - A modular budget is an NIH specific budget that is required for new, competing continuation (also known as renewal), resubmission (also known as amended), and competing supplements (also known as revisions) that request up to a total of $250,000 in direct costs (minus consortium F&A) for select funding mechanisms. Duke requires a high level detailed budget in SPS for modular submissions.

 

Budget justifications

The budget justification is a detailed explanation of the budget in narrative form. The justification needs to carefully explain all expenses to show that each item is necessary for the successful completion of the project. Investigators, grants and contracts administrators, and research team members that may implement the project should work together to develop the budget justification.

Important considerations:

  • Refer to the funding opportunity announcement for any budgetary restrictions or requirements
  • Ensure that cost descriptions are accurate and that the justification complies with all restrictions and requirements 
  • Relate each cost item back to the scope of work for the proposed project
  • Ensures that the budget justification matches the budget.

Access sample budget justifications. Budget justification templates for various federal funding agencies and mechanisms can be found within the toolkits on the following pages: