Budgeting and Budget Preparation

It is Rutgers University policy that all proposals for externally funded sponsored projects recover the full cost of the project. This includes both direct costs, such as salaries and supplies, and Rutgers’ federally negotiated Facilities and Administrative (F&A) costs.

The current F&A rates are available on the Cost Analysis website: Facilities and Administrative Cost Rates | University Finance and Administration.

F&A costs, also known as indirect costs (IDC), are real expenses related to the infrastructure that supports the research enterprise but cannot be easily attributed to a single project. These costs include the operation and maintenance of buildings and equipment, library expenses, and administrative support, such as the administration of sponsored projects.

The specific F&A rate applied depends on the type of work (e.g., research, training) and where the work will primarily occur (on- or off-campus). When employees are approved to work remotely, their designated remote work location - such as a home office - is considered an extension of the campus for the purposes of university policies, expectations, and conduct standards.

For help determining the correct rate for your proposal, please use our budget templates and F&A rate matrix, or contact our office for assistance.

If the F&A Rates specified in the Facilities and Administrative Cost Rate Agreement will not be applied, and if the sponsor does not have, publish, or provide an indirect cost rate, the Request for Reduction or Waiver of Indirect Costs Associated with a Sponsored Program form must be completed and approved to establish the indirect cost rate for the project.

Additional information may be found in the Determination of On-Campus and Off-Campus F&A Rates procedure, the Facilities & Administrative (F&A) Rate Application Matrix guide, and the Understanding Facilities & Administrative (F&A) Costs guide.

Rutgers develops and submits the fringe benefit rates annually to DHHS Cost Allocation Services (DHHS-CAS), our federal cognizant audit agency, for approval. Prior-year provisional fringe benefit rates remain in effect until DHHS-CAS approves the current fiscal year's rates. Once approved, the final negotiated fringe benefit rates take effect on July 1 of the fiscal year specified in the rate agreement.

The current fringe benefit rates are available on the Cost Analysis website: Fringe Benefit Rates | University Finance and Administration.

Cost Share is the portion of sponsored program costs not paid by the sponsor. Resources dedicated to cost-share may draw from contributions, donations, or proportional matching from the University and/or external third-party (“In-Kind”) entities. There are three types of cost share associated with sponsored programs:

• Mandatory Committed
• Voluntary Committed
• Voluntary Uncommitted

Including a cost share in a funding proposal requires approval from the Department Chair/Director/Dean, as indicated in RAPSS. Moreover, only the mandatory cost-share is advised due to the University's resource restraints.

Additional information may be found in the Cost Share Procedure, the Cost Sharing Type Summary guide, and the Cost Sharing Distribution Signature Form.

When preparing a grant proposal, Principal Investigators (PIs) must build their budgets using the actual salaries of all personnel involved in the project.

When preparing a grant proposal budget, it is important to correctly account for personnel salaries. Principal Investigators (PIs) must use actual salaries for all project personnel and incorporate Rutgers' contractually mandated salary increases for future years for both union-aligned and non-aligned employees. This salary escalation should be clearly detailed in the budget justification.

Be aware that some sponsors, particularly federal agencies like the Department of Health and Human Services (DHHS), impose restrictions. These can include prohibiting salary escalations for cost-of-living adjustments or imposing a legislatively mandated cap on the amount of an individual's salary that can be charged to an award. Always check the specific funding announcement and sponsor guidelines to ensure your budget is compliant. For assistance, please consult your RSP Grant Specialist.

Additional information may be found in the Grant Budgeting for Salary Escalation and Salary Caps guide.

By default, administrative and clerical salary costs are recovered through the application of the Facilities & Administrative (F&A) rate as indirect costs. However, these costs may be charged as direct costs on a sponsored program if all the following criteria under Uniform Guidance §200.413 are met:

• Administrative or clerical work is integral to projects or activities.
• Per Rutgers policy, “integral” means the services are essential, vital, or fundamental to the project, and at least 25% FTE compensation is budgeted.
• The individuals performing the work can be specifically identified.
• The costs are explicitly included in the proposal budget or have prior written approval from the federal awarding agency.
• The costs are also not recovered as indirect costs.

Additional information may be found in the Charging of Administrative and Clerical Salaries procedure.

All proposals, including resubmissions, competing renewals, continuations, and supplements that request support for graduate research assistants (GAs) must also include a proportional amount of tuition, unless the sponsor explicitly prohibits tuition costs. Salary, fringe benefits, and tuition should each be charged to the grant in proportion to the GA's effort dedicated to the project.

Tuition and fee rates are approved annually by the Rutgers Board of Governors and vary by student’s school affiliation, campus, and academic program. For current rates, please refer to the Tuition & Fees Rates for the applicable academic year.

Additional information may be found in the Graduate Student Support on Sponsored Programs guide.

Computing Device Costs are typically recovered as indirect costs through the application of the Facilities & Administrative (F&A) rate. However, under Uniform Guidance §200.453, these costs may be charged as direct costs if the devices are essential and allocable to the performance of a federal award—even if they are not exclusively dedicated to the project.

To qualify as direct costs, computing devices must meet the following conditions:

• Devices costing less than $5,000 per unit are treated as supplies, regardless of their useful life.
• Devices costing equal to or more than $5,000 per unit are considered equipment and must be specifically approved by the sponsor to be charged directly to the project.
• Devices must be clearly itemized in the project’s budget and budget justification.
• Devices should be purchased at the beginning of the project to demonstrate their essential role in project completion, unless the sponsor approves a different timeline.
• At the end of the project, devices are considered University property.

These guidelines apply only if the project does not have reasonable access to other devices or equipment that can serve the same purpose. Note that convenience or personal preference is not a valid justification for direct charging.

Fabricated equipment is a complex, scientific device built from various individual components to create a single, functional unit. This option is typically pursued when the required equipment is not commercially available or when existing "off-the-shelf" equipment lacks the necessary functionality.

To qualify as fabricated equipment, the final assembled unit must:

• Have a combined total cost exceeding $5,000.
• Function as a single, free-standing unit with a useful life of more than one year.
• Consists of components that cannot be used independently of the main unit.

Costs for materials, supplies, and outside services used in the fabrication process are exempt from indirect costs (F&A) if the University retains title to the equipment. However, internal university labor costs, such as salaries for Principal Investigators (PIs) and graduate student researchers involved in the fabrication, are not included in the equipment's acquisition cost and are subject to indirect costs.

If you plan to include fabricated equipment in a grant proposal, you must complete and submit the Fabricated Equipment Questionnaire to your assigned Grants/Contracts Specialist.

Additional information may be found in the Fabricated Equipment procedure and the Fabricated Equipment on Sponsored Projects guide.

A stipend is a form of financial aid paid to students, typically at the start of a quarter, based on merit or need. It supports a trainee-mentor relationship and is not compensation for work; therefore, it does not include a scope of work, employee benefits, or Workers' Compensation coverage.

In contrast, a salary is compensation for work performed, creating an employer-employee relationship. It is paid based on hours or time worked and includes a scope of work, applicable employee benefits, tuition remission, and Workers' Compensation coverage.

Stipends from fellowships may be tax-free if used by a degree candidate for qualified educational expenses, such as tuition, fees, books, and required supplies.

Additional information may be found in the Stipend vs Salary Comparison guide.

Participant support costs are funds included in a grant to cover expenses for individuals who are trainees or participants in a sponsored conference or training project. These costs are direct expenses, including stipends, travel allowances, subsistence, and registration fees.

Who is a participant? A participant is a recipient of a service or training, not a provider. They cannot be university employees and do not perform any work or provide services for the project. Participants can include students, scholars, scientists, teachers, and representatives from the private sector.

These costs are typically included in grants with an education or outreach component, often from sponsors such as the National Science Foundation (NSF). Other federal agencies, such as the NIH, EPA, and USDA, may also permit them under specific circumstances. It is crucial to remember that facilities and administrative (F&A) costs cannot be applied to the participant support cost category.

Additional information may be found in the Participant Support on Sponsored Programs procedure and the Participant Support Costs and Eligibility guide.

University Policies

• 20.1.12 Surplus Property
• 40.1.1 Budget Planning & Implementation Procedures
• 40.2.3 Fiscal Responsibilities Associated with the Administration of University Accounts
• 40.3.1 Risk Management and Insurance Policies
• 40.4.1 Travel and Business Expense Policy
• 40.5.1 University Policy on Internal Control
• 90.1.1: Sponsored Programs Facilities and Administrative Costs Policy

Research Administration Handbook

• Fabricated Equipment
• Charging of Administrative and Clerical Salaries
• Charging Computing Devices
• Cost Share
• Determination of On-Campus and Off-Campus F&A Rates
• Participant Support on Sponsored Programs

Open | Research Administration Handbook

Resource Library

• Cost Sharing Distribution Signature Form
• Fabricated Equipment Questionnaire & Worksheet
• Facilities & Administrative (F&A) Rate Application Matrix
• Understanding Facilities and Administrative (F&A) Costs
• Cost Sharing Type Summary
• Grant Budgeting for Salary Escalation and Salary Caps
• Graduate Student Support on Sponsored Programs
• Fabricated Equipment on Sponsored Projects
• Stipend vs Salary Comparison
• Participant Support Costs and Eligibility
• Rutgers Budget Template
• Rutgers Budget Template (proposed FY27)
• Budget Template Instructions

Open | Resource Library