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Administration and Fiscal Management

Budgeting for Sponsored Projects
When developing a proposal budget, individuals must take into consideration the scope of the project which will be accomplished and realistically determine what funds will be required to complete the work. Additionally, you must determine if the sponsor will allow such charges to the project. You can generally determine sponsor allowed costs by reading through the sponsor request for proposal. Federal agencies also must abide by the appropriate Office of Management and Budget (OMB) circular. (OMB circulars are federal governing regulations that apply to all federal sponsors.)

Many sponsors will also request that your budget be prepared in a specific format. Again, reading the sponsor request will provide you the necessary details to determine if this is the case. In general, proposals will have the following components:

Budget Components
  • Personnel – salaries, wages and benefits
  • Student Support/Salaries—Graduate Assistantships, Hourly Student Employees
  • Consulting/Personal Service Contracts
  • Goods and Services
  • Travel
  • Equipment
  • Participant Support
  • Subcontracts
  • Facilities and Administrative Costs
  • Other – items identified in the sponsor request, including cost share
  • Budget Justification
While these categories are broad, it is important to realize that not all costs are allowable. A sponsor may specifically exclude items, items may be unallowable per the OMB circulars, or the item may not be specifically allocable to the project.
  • Sponsor exclusions can be located within the sponsor request.
  • OMB A-21 defines clearly what is allowable for a federal sponsor. Note: When working with a private sponsor, more flexibility is allowed as long as the sponsor approves the cost.
  • Costs must be specifically allocable to the project. For example, paper, office supplies, general microscopes, can all be used for a variety of different things including your project, these costs cannot be allocated to one specific project with ease and are therefore not allowed.
Preparing your proposal budget is a critical task in the proposal preparation process. Your institution generally has trained individuals, who understand the various guidelines, that are ready and willing to assist you in this process. Pay particular attention to the sponsor guidelines and read the sponsor request thoroughly. By doing so, you show the sponsor that you have thoroughly thought through the project and have a clear understanding of the costs associated with it.

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