Budget Preparation Guide

We have created different budget templates in excel for specific agencies that require paper proposal applications. These templates can be found on our website, These templates match up to their specific formats. If you are submitting through grants.gov or Cayuse, you should use the Grants.gov template. We do have a generic template that can be used when there is no specific format required.

What makes up a Budget

The spreadsheet is usually broken up in several parts.

  • Key/Senior Personnel.
  • This is where PI’s, Co-PIs and other essential personnel would be listed.
  • Other Personnel
  • This would include, Post Docs, Grad Students (both RAs and PAs), Undergrads, other professionals, etc.
  • Fringe Benefits
  • Every salary that is charged to a project will also be charged Fringe benefits. This includes such things are Fed and State tax, SSI, health insurance, retirement, etc.
  • Each salary category has its own FB rates. These rates are calculate by the UW and approved by the DHHS.
  • Equipment.
  • Capital Equipment must be budgeted separately from Materials and Supplies because of the $5k policy
  • Travel
  • The UW does not require individual trips to be broken down, but a total amount of travel for both US and foreign is required. Some agencies do require travel breakdown. Please read the announcement carefully.
  • Other Direct Costs.
  • This is typically where you would put Materials & Supplies, Publications, Services, Subcontracts, Tuition Remission and any other direct cost that does not fit in another category.
  • Total Direct Costs
  • Indirect Costs (or overhead & F&A),
  • The University negotiates with the Federal Government (DHHS) an appropriate rate to use on all Sponsored Projects ( .
  • When calculating the Indirect Costs at the full rate some budget categories are excluded. This is what is called Modified Total Direct Costs. There are some exceptions to using the full indirect cost rates
  • Total Cost for the whole project.
  • Overhead Base
  • This is used when you have subcontracts on the project. The University’s policy is to exclude anything over $25K on each subcontract. So if you have a subcontract that is for $50k, only the first $25K would be have indirect costs charged on it.

Creating a Budget

Salaries

  • Since most COE Faculty are paid on an Academic year schedule, asking for summer salary on Research Projects is very common.
  • A PI can request Summer Salary. If a PI wants to request Academic Year Salary, they need approval from Chair before COE will approve the proposal.
  • When entering a base salary for a faculty member, an inflation of 3-4% should always be added.
  • This also covers an increase in the Fringe Benefit Rates.
  • If salaries for collaborators are needed, you can ask them directly, ask your payroll office or contact our office. Please do not use the Redbook. It does not have the most up to date information.
  • The GradSchool calculates the Grad Student Rates.
  • Currently the full time RA rate is $40,800 for 12 months.
  • A RA appointment can be no higher than 75%.
  • Typically COE’s range is between 33% to 62.5%. You should check with your departmental administrator to find out if they have a specific rate they use across the board.

Since we are using Excel, taking advantage of the formula functions is a great option. Here are the formulas that we use in our office.

Faculty and Academic Staff

=Base salary* 1.04/9* # of months

=Base salary *1.04/12* # of months

Graduate Students

=$40,398* % of RA appointment

Classified Staff

=Hourly Rate *2080/12* # of months

Since the University does not pay Faculty or Academic Staff on an hourly basis, we do not calculate budgets to reflect this. If a budget has to be done as hourly we always add a statement, The University of Wisconsin does not pay its faculty and staff on an hourly basis, but rather a fixed amount monthly rate. The numbers above are only estimates and there is not an audit system in place to verify.

The correct formula for converting the monthly rate would be as follows:

Faculty

Base Salary/1560 = Hourly Rate

**1,560 represents the number of hours in nine months. Since faculty are only paid 9 months of the year, you would not use 2080.

Academic Staff

Base Salary/2080 = Hourly Rate

Fringe Benefits

  • Fringe Benefits Rates are updated on a yearly basis in the spring.
  • Once the Rates are announced COE will update all the templates.
  • You should check on either COE’s or RSP’s website for the new rates and update your budget accordingly. We use the same rates for multi year projects.

Equipment

  • Capital Equipment is defined as a single piece of equipment having a cost of more than $5K.
  • The University's definition of capital equipment conforms to Federal Sponsoring Agencies and State of Wisconsin definitions.
  • You will need to list each individual piece of Equipment, plus the dollar amount.
  • According to our F&A Agreement, Capital Equipment is excluded from F&A.

Travel

  • Travel is broken down into domestic and foreign.
  • Unless required by the Sponsor, detailed breakdown is not required in the budget itself. This usually would go into the Budget Justification.
  • Travel needs to be entered every year.
  • It does not automatically carry over and add inflation since travel costs can vary each year.
  • The exception to this is in an NIH budget.

Other Direct Costs

  • Items that are budgeted in Other Direct Costs categories are things such as Materials & Supplies, Publications Subcontracts, Services and Tuition Remission.
  • The only fixed rate in the Other Direct Cost section is Tuition Remission.
  • The fixed rate for Tuition Remission is $8,000 per student per year.
  • As long as a RA’s appointment is at least 33%, $8K will be charged.
  • If RA appointment is under 33%, no tuition remission will be charged and the Grad Student is responsible for their tuition. If they have another appointment which would bring their appointment over 33%, the tuition remission would be prorated on both accounts.
  • If a Grad Student is only working one semester it would be $4K and there is no tuition remission charged during the summer.
  • If you have a subcontract, please remember that only the first $25K is charged indirects. There is a cell on each spreadsheet that this amount can be entered.

Total Direct Costs, Indirect Costs and Total Project Costs

The Total Direct Costs (TDC) is where all the direct costs are totaled. There should never be a reason that this column would need to be modified. If it is, you jeopardize getting all the funding that you need.

Indirect Costs (aka, overhead, F&A)

The University negotiates with the Federal Government (DHHS) an appropriate rate to use on all Sponsored Projects ( . When calculating the Indirect Costs some budget categories are excluded. This is what is called Modified Total Direct Costs.

Calculation for MTDC

Total Direct Costs – Equipment – Participation Costs – Tuition Remission + Indirects Costs on the first $25,000 of each subcontract.

Total Project Costs

The Total Direct Costs + the Overhead = Total Project Costs

If at any time you have questions on the budget, please feel free to contact the Dean’s Office.