Announcer: From the National Institutes of Health in Bethesda, Maryland this is All About Grants.
Megan Columbus: Welcome to another edition of All About Grants. This is Megan Columbus from NIH’s Office of Extramural Research, here today with Grace Olascoaga from the National Institute of General Medical Sciences where she’s a grants management officer, talking today about developing a budget for your grant application. When you think about your budget you need to think about what NIH will be doing with the budget, about what the reviewers will be looking at in your budget, and what you really need. Grace, today I wonder if you can talk to us a little bit about all of that, maybe starting with the reviewers and the NIH program officials?
Grace Olascoaga: So at NIH, reviewers and program officials use the budget by essentially evaluating it in the context of a research plan that’s been proposed by the investigator and assessing whether the cost items proposed and the total amount of the budget aligns with the scientific scope of the project that’s being proposed.
Megan: So I guess one of the important points is in the review process, reviewers are evaluating the scientific and technical merit of the application, scoring the application, and only after the application is scored, do they turn their attention to the budget.
Grace: That’s correct. Keep in mind they’re also judging the principal investigator’s competence in the area of putting together a proposal, not only the research scientific side of it, but also have they developed a budget that looks reasonable and appropriate for the type of work.
Megan: It may be that if the budget doesn’t reflect the scope of the application, that that would potentially put a shadow of a doubt on the competency or maybe the naiveté of that investigator.
Grace: Right. I think reviewers and program officials do take into account new investigators who may be not as experienced, perhaps allow some leniency on the budget that’s been prepared, but for the most part there’s an assessment of whether it seems a prudent use of resources. In addition, if the review group does recommend budget adjustments, it’s usually on the basis of one of a few things, that either there wasn’t sufficient justification in the budget justification for the type of science that’s proposed, or in the future year projected costs there isn’t adequate explanation of variations in the cost, or if they do recommend a reduction in the dollar amount or length of time it could be because they feel that the research can be completed at those lower levels.
Megan: So let’s get into the nitty gritty of the budget, starting with personnel. Personnel is frequently the biggest expense on our regular research grants, which is what we’re talking about today. Do you have any suggestions for determining personnel costs?
Grace: Well, for any type of costs, it’s always important to review carefully the specific funding opportunity announcement to which you’re applying, because there could be specific guidance in there about cost items, for instance the type of personnel that may or may not be appropriate to request, or even minimum or maximum levels of effort. And a principal investigator then should think about who is critical to the project, what personnel they’re actually going to need to conduct the research, and then give an estimate of the level of effort required by each person on the project. Once they’ve determined that, they can work closely with administrators at the applicant institution to calculate the amount of salary compensation that they’ll need to request from the grant, taking into account the individual’s annual base salary and again, the level of effort that’s proposed for the project.
Megan: What about materials and supplies? Is there a formula that people can use? How would you estimate materials and supplies?
Grace: Well again, all the costs should be ultimately based on anticipated actual need for the project. There’s no real formal guideline as far as rate or amount that’s appropriate to request, but a lot of people do tend to use something along the lines of $15,000 to $20,000 per person on a project. But again, that can vary and really should be calibrated against the nature of the work that’s being proposed.
Megan: And as we go through this I think an important point to make is that if an investigator hasn’t touched base with their office of sponsored research or their central administration that they can get a lot of guidance from there that would be very pertinent to this.
Grace: Yes, definitely. Certainly they’ve probably seen a whole range of the types of budgets that have been prepared by other individuals at the grantee institution and most likely they’ve also communicated often with funding agency personnel to get a good sense of what are appropriate costs.
Megan: Let’s look at equipment. What equipment can we request on a grant application?
Grace: Well, in general, equipment’s defined as items or property that are over $5,000 in cost and with an expected life of over a year. Again, institutions can vary that, so you always want to check with your own administrative officials. Items that are directly related to the conduct of the project are appropriate, and, as with any cost, really should be well justified in your budget narrative.
Megan: So what about if I need a new laptop?
Grace: Computer items are usually considered general purpose items, unless they are specifically required and directly related to the nature of the research being conducted.
Megan: What about travel funds? Can I incorporate travel into my research grant application?
Grace: Travel costs are a common item we see in budget requests. They’re usually proposed for either attending or presenting at a scientific meeting or traveling to work with collaborators. Again you also want to take a look at the funding opportunity announcement to see if there are specific instructions about expectations for travel or attendance at meetings, that kind of thing.
Megan: And the travel for attendance at meetings or giving presentations would be specific to that project?
Grace: Yes, definitely. Again, it needs to be directly related to the project, and you’ll want to keep in mind reasonableness as far as the number of travel events for each personnel.
Megan: What other types of direct costs could I request?
Grace: Other cost items that can be requested again should be directly related to conducting the project. Typically, what we might see are things like publication costs, or tuition remission, or consultant costs.
Megan: So I figured what I need in each category, and I add up all my costs, then how do I decide, there’s multiple budget forms, how do I decide which budget form I should use?
Grace: First of all, if you’re applying from a foreign institution, then it’s required that the “Research and Related” budget form be used, which involves a detailed, categorical breakdown of the budget. If you’re applying from a US domestic institution, then the type of budget form you use is basically driven by the total direct costs that you’ve requested in your budget, and that’s exclusive of sub-contract, facilities and administrative costs. So if your total direct costs add up to $250,000 or less, the modular format is appropriate. If your costs exceed that amount, then you’ll need to use the “Research and Related” budget form, which again, is a categorical breakdown.
Megan: And that $250,000 is on an annual basis?
Megan: Is there a cap on the amount of money I can request from NIH?
Grace: There’s not a cap unless, of course, the funding opportunity announcement to which you’re applying actually states a cap. And if there is a dollar amount stated as a cap, you’ll just want to be attentive to whether it’s stated in terms of direct costs or total costs or an annual amount versus costs for an entire project period. But if there is no cap cited specifically, then there really is no cap, but again, bear in mind that reviewers and other NIH staff are going to be looking at the budget request in terms of is it justified in relation to the work proposed and is it potentially a good value of investment for the NIH?
Megan: If I’m going to be proposing a particularly large project, do I need to contact NIH in advance of submitting that?
Grace: There is an NIH requirement that, in general, if one is requesting over $500,000 in direct costs in any year that they contact institute or center staff prior to submission of an application for approval to submit a budget of that scale.
Megan: And I guess that’s to protect the applicant, as much as the NIH, so NIH for planning purposes and for the applicant so that if this is something that NIH wouldn’t be able to fund they don’t go through all the time and effort of developing that application?
Grace: Right. It’s an attempt to sort of manage on both sides expectations and allocation of resources.
Megan: Once the application is reviewed you already mentioned that reviewers might recommend cuts to the budget. Are there other reasons my application might be cut after review?
Grace: Yes. After review, the institute and center program and grants management staff also scrutinize budgets very carefully and, in the context of their own allocations, may determine that further budget cuts are necessary. They’ll also be looking closely at any scientific or budgetary overlap that may be apparent and try to resolve those. It’s possible that budget cuts may be made to address those issues.
Megan: If I’m a PI and the institute is proposing severe budget cuts, and I don’t think I’m going to be able to accomplish all the specific aims that are proposed within that budget, what would I do? Do I just accept it and hope for the best, or…?
Grace: Well certainly you’re always welcome to discuss your budget concerns with a program official assigned to your project, and if the cut is actually greater than 25% reduction from what the study section had recommended, there’s an opportunity to revise the scope and the aims of your project given the budget that’s been awarded to you. But again, that’s a negotiation you want to engage in with the program official and work with grants management staff, as well, to realign your scientific aims with the budget that’s been awarded.
Megan: I think one of the recurring themes here in our podcasts is that talking to NIH as you submit your grant application is a smart thing to do. So here we’ve heard again that talking to your program official both before you submit your application and once your application is in the negotiation, the award stage is critical. Is there anything else you can think of adding?
Grace: Well, as far as other individuals that an investigator might talk to, again, I encourage them to get to know the administrators at their business offices who can certainly give them a lot of advice in the context of the allowable costs under the cost principles that they are subject to. As well as they might also confer with other colleagues or investigators, but bearing in mind that the funding situation they were awarded under could be slightly different.
Megan: Wonderful. Thank you so much for joining us today. For NIH and OER this is Megan Columbus.
Announcer: For more information on developing your budget, check out OER’s website at grants.nih.gov and search for “developing your budget.”