Use the correct salary figures.
A large number of grants provide faculty with the opportunity to buy out their time from the University or to arrange to receive additional hours - both during the year and especially in the spring and summer months. The State does not allow faculty to earn more than their regular hourly wage. Nor can faculty earn more than a particular percentage over their regular salary during the course of the year. Therefore, it is important that you get accurate figures to use in your budget section. Human Resources can supply you with the necessary information. The person to contact there is Beth Gould (661-1142).
When it comes to including the cost of your time in a proposal, you have to remember that your salary consists of both wages and fringe benefits. Those fringe benefits can cost up to an additional 35% (and as health costs continue to increase, that number may also increase). The University pays for a large percentage of our benefits. Remember, we still have to pay our own portion of retirement, social security, and taxes, and any other applicable deductions on top of that.
So why worry about salary and fringes when doing a grant budget? Consider the following examples:
a. The budget shows one flat rate for the faculty member, $1,000. In real terms, that means the check they receive from their work might show a total of anywhere from $650 to $825. (Everything is dependent upon your individual deductions as well as the employer fringes.) That’s what they can put in the bank. The institution had to deduct the benefits portion from the grant funds as the grant was picking up the faculty member’s time. It also had to deduct those items we are personally responsible for. Occasionally, a grant might be set up such that the grant picks up the wages for the faculty member and the institution picks up the fringe benefits. All of those things have to be negotiated prior to the grant being submitted.
b. In our second example, the grant budget is set up to cover both the salary at $1,000 and a calculated estimate of the fringe benefits on top of that. Apart from the individual deductions such as social security, retirement, and taxes, the amount on the check that goes in the bank will be much higher than in our first example (a).
c. Any money over your regular salary will not have health and dental deducted.
d. If your intention is to receive additional funds from another state agency or a grant during the time you are under contract with the University, it is imperative that you meet with Human Resources to be sure you are within the State regulated guidelines.
An important exception you should know about . . . .
In the beginning, I naively assumed that all PreK-12 schools and Universities were state agencies. PreK-12 schools are not considered state agencies. Therefore, in a situation where a school is the fiscal agent (they get the money directly from the funding agency and handle the bills) for the grant and they’ve retained your services, then the salary you receive from them is not counted towards your annual total, nor is it subject to the hourly wage limitations. In other words, it is as if it didn’t even happen! However, if they buy your services from the University and you receive your check from the University, then it does count towards the annual total limitations and the hourly wage limitations. Always, make sure that your time commitments do not interfere or conflict with your scheduled teaching and office hours. Clear any such arrangements with your department chair. Watch how you set it up and always double-check on regulations as they change!