Proposal Budgets 

It justifies your request and shows how you calculated costs.

It provides financial guidance for your project if you are funded.

It shows that you and MSUN will manage the sponsor's funds, which are usually public money, responsibly.

A recipient institution is responsible for ensuring that costs charged to a sponsored research agreement are allowable, allocable, and reasonable. (2 Code of Federal Regulations 200.403 Subpart E)

• Allowable costs: Costs must not be expressly prohibited by the sponsored program regulations, the sponsored agreement, the University's own policies, or the Federal Cost. A cost must be reasonable, allocable, consistently treated, and conform to Uniform Guidance (Code of Federal Regulations) or to the Sponsored Agreement.
  • The cost is necessary and reasonable for the performance of the federal award and be allocable.
  • The cost conforms to any limitations or exclusions set forth by the funding agency or Uniform Guidance.
  • The cost must not be used to meet cost sharing or matching requirements of another federal award.
  • The cost should be determined in accordance with Generally Accepted Accounting Principles (GAAP).
• Allocable: Costs are incurred solely to support or advance the work of a specific sponsored research award (and only during the sponsor-approved project period).
  • The cost is incurred specifically for the federal award.
  • The cost can be distributed to all benefited funding sources using reasonable methods.
  • The cost is necessary to carry out the award.
• Reasonable: Costs must be able to withstand public scrutiny. A prudent person would have purchased this item and paid this price.
  • It is necessary for the performance of the sponsored project.
  • You have considered the prices for comparable goods and services to estimate cost.
  • A prudent person would think this cost is reasonable.
  • The cost is in accordance with the sponsored agreement terms and conditions.
  • The cost is consistent with established institutional policies and practices.
  • The cost treated consistently across grant funded programs at the institution. Costs must be treated consistently by applying the generally accepted accounting principles appropriate to the circumstances (such as the Federal Cost Principles).

Most sponsors require you to submit a budget justification (sometimes also called a budget narrative) in addition to an itemized budget.

This allows you to explain the need for each line item in the budget, as well as show the breakdown of calculations used to arrive at the amount in each line of the budget.

Check the instructions from your funding sponsor. They might have a template or they describe the online fields that you will fill in for the the proposal. But most budget templates are similar.

Download this example budget template.

A “person month” is the metric for expressing the effort (amount of time) principal investigators (PIs), faculty and other senior personnel devote to a specific project. The effort is based on the type of appointment of the individual with the organization; e.g., calendar year (CY), academic year (AY), and/or summer term (SM); and the organization’s definition of such. For instance, some institutions define the academic year as a 9-month appointment while others define it as a 10-month appointment.

Some federal sponsors, such as NIH, require person-months in budget proposals to estimate salary.

For full information, see the  NIH Frequently Asked Questions page on person-months.

Download this NIH calculator to estimate person-months.

Contact the Grants Coordinator for the most up to date benefit rates.

Rates depend on classification and retirement.

Contact the Grants Coordinator.

Student wages and benefit rates vary based on several factors including the type of work, academic v. summer calendar, experience of the student, comparable wages established by Human Resources, and potential for injury.

The Grants Coordinator can help collaborate with Human Resources to establish an appropriate wage and benefit rate.

The indirect cost rate for MSUN is 40.00% of direct salaries and wages including all fringe benefits

You may still apply for the funding.

Please document the lower/no indirect cost rate for our records.

• Let the Office of Sponsored Programs know when you fill out the Proposal Intent to Apply form.
• Save the written documentation as a PDF and include it when you submit the Proposal Authorization Form.

Indirect or F&A (Facilities & Administrative) costs are those costs incurred for common or joint objectives that cannot be specifically attributed to an individual project.

In contrast, direct costs are costs that can be identified specifically with a particular sponsored project relatively easily and with a high degree of accuracy.

• Indirect (F&A) costs are sometimes also referred to as overhead, or administrative expenses.
• Indirect costs promote research and scholarly activity at MSU-Northern. Unless the sponsor restricts the rate, all budget proposals generally will include the current MSUN negotiated rate. See Policy 1130 Grant and Contract Applications.
• The indirect rate is established by negotiation with a cognizant federal agency. For MSUN, it is the U.S. Department of Health and Human Services.

The items below are examples of indirect costs. Therefore, they should not be included in your proposal budget as direct costs:

• Services of University accounting staff and research administrators
• Utility costs for buildings housing research projects
• General office supplies, office computers, postage, local telephone service, and communications infrastructure
• Salaries of personnel engaged in providing departmental support activities (such as departmental administrative assistants)

Cost Share or Cost Match is when a sponsor requires you to match the funds they will give you.

They may require a 1:1 match (i.e., you must match the funds received dollar for dollar) or some other percentage.

Contact your chair and/or dean and the Office of Sponsored Programs as early as possible.

Funds or in-kind matching must be identified before you proceed with your grant proposal.

For more information, see the Cost Share/Match Guidelines. 

In-kind contribution: Cost share may also include the value of donated space or unpaid volunteer time (which is usually referred to as an in-kind contribution).

A subaward is when a portion of a sponsored project is passed from the sponsor through a pass through entity to a subrecipient. The subrecipient carries out part of a sponsored project received by the pass-through entity.

MSUN is commonly the subrecipient to the primary recipient of the grant award funds. 

MSUN can also be the primary recipient of grant award funds and act as the pass through entity to provide a subaward to a subrecipient.

Contact the Office of Sponsored Programs as soon as possible.

We will send a Subrecipient Commitment Form to your colleague at the subrecipient institution. 

Ask your colleague to create a subaward budget.

When you submit the Proposal Authorization Form for review and approval, attach the signed Subrecipient Commitment Form and the subaward budget. 

The Project Director (PD)/Principal Investigator (PI) is responsible for monitoring the programmatic and financial performance and progress of a subaward.

For detailed information about all responsibilities, see the MSUN PD/PI Subaward Responsibilities. 

Contact the Office of Sponsored Programs as soon as possible.

We will need additional information from the subrecipient institution to create a subaward agreement.