BUDGETS

Foundation personnel are available to provide assistance in completing a budget request, and verifying salary figures, fringe benefit rates, and indirect cost rates. Foundation personnel will also complete the certification forms, the Foundation qualification statements, and the cost forms required by the sponsor. The following is an explanation of costs included in most proposals.

Direct Costs

1. Salaries and Wages
   
   To determine total salaries and wages, list the amount of time to be spent by each person on the project. Time should normally be shown in terms of person-months as a percentage of full-time effort.
   
   Sponsored activities may not result in employees receiving compensation at a rate in excess of their authorized salary. Compensation levels and new job classifications must conform with Texas A&M University System procedures. Graduate student payments should be consistent with those customarily paid within the department or college.
   
2. Fringe Benefits
   
   The Texas A&M University System negotiates fringe benefit rates with its Federal audit agency, the Department of Health and Human Services. For proposal purposes, the rates are used to estimate the costs for social security, retirement, insurance, worker's compensation, and unemployment compensation. After award, the actual cost of each benefit is specifically identified for each employee, and itemized in the invoice to the sponsor.
   
3. Consultants
   
   A consultant is an individual who is hired to perform part of the proposed work, independently, for a stated sum of money. A consultant works without supervision and controls the method of accomplishing the end result to be achieved. By definition, consultants are not Texas A&M University System employees. When possible, identify the proposed consultant by name, indicate the number of days of work, and provide a resume for the consultant in the proposal.
   
   
4. Travel
   
   List trips separately, including destination, trip duration, number of persons, and purpose. The trips should be calculated as close to actual cost as possible considering airfare, car rental, and per diem or subsistence costs.
   
   Per diem (lodging plus meals and expenses method): The per diem rate includes the cost of lodging, meals and miscellaneous incidentals. Per diem may only be claimed on those trips requiring an overnight stay. A maximum per diem rate of $95 may be used and does not require receipts for lodging or meals.
   
   Subsistence (meals and expenses method): Travelers will be reimbursed under this method for the reasonable costs of lodging and meals, but the total cost per day generally should not exceed the maximum rate of $100 for lodging (exclusive of taxes) plus $38, $34, $30 or $26 (depending on the city) for meals. Receipts for lodging are required. Allowable lodging expenses will be based on the single room rate for the lodging used.
   
   Prairie View A&M University has rental vehicles available, and charges are based on a mileage rate and a rate per day. The cost of gasoline is additional.
   
   The Foundation's travel policy is included in Appendix A and is used for most awards. However, some sponsors place additional restrictions on travel.
   
5. Capital Equipment
   
   Capital equipment is defined as those non-expendable items having an acquisition cost of $500 or more, with a life expectancy of at least two years. If there is a requirement by a sponsor that an item costing less than $500, or having a life expectancy of less than two years be classified as equipment, the sponsor's requirements will be followed.
   
6. Expendable Supplies
   
   Normally, a research project will require expendable supplies such as laboratory items, software, reference materials, books, gases, and replacement parts. A reasonable amount should be budgeted for these items.
   
7. Publication Costs
   
   The cost of publishing the results of the research, page charges, and reprint costs are itemized in this category.
   
8. Computer Costs
   
   Computer costs are budgeted by listing the type of computer, the number of hours, and the rate to be utilized.
   
9. Subcontracts
   
   A proposal from the subcontractor which has been signed by an authorized official is required. The proposal should include a statement of work, an estimate of the time required to complete the work, and a proposed budget (including applicable indirect costs). A statement concerning the need for a subcontract and the method used to select the subcontractor should be written by the Principal Investigator.
   
10. Other Direct Costs
    
    Include itemized costs for photocopying, long-distance telephone calls, freight, postage, library search services, conference and registration fees, equipment maintenance, and special support services.
    

Indirect Costs

Indirect Costs are legitimately recoverable costs that are not readily identified with a specific sponsored project. They encompass such costs as general administrative expenses, library expenses, departmental administration, sponsored project administration, building and equipment use allowance, and physical plant operation and maintenance. These costs represent a real expense, and when not recovered, represent a loss of research resources. Indirect cost percentages are determined annually from actual cost records through a detailed cost accounting procedure and are audited and approved by the Federal government.

Although indirect cost rates may be reduced when the sponsor limits indirect cost recovery, rates are not subject to arbitrary adjustment. The Department Head, Dean, and appropriate Texas A&M University System Part must approve a reduction in the indirect cost prior to routing a proposal for University signatures.

Cost Sharing and Matching Funds

Cost sharing is that portion of the project cost which the sponsor requires to be contributed by the recipient. Cost sharing is usually in the form of faculty salaries included in the project at no cost to the sponsor. Cost sharing may also be in the form of equipment which will have a long term benefit to the research program. Because of the complex nature of cost sharing, the researcher should consult with The Texas A&M University System Part, or the Foundation for further clarification.

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