Sponsored Projects

Preparing a Budget

A budget is the financial plan for a project or proposal. The budget will contain both the sponsor and non-sponsor share of the total project cost. Proposed projects costs are comprised of allowable direct costs and administrative (F&A) costs, and cost sharing. Allowable costs are those that are reasonable and allocable to the sponsored project and allowable under University and sponsor policy.

A budget justification (or budget narrative) should be prepared to explain how the budgeted costs relate to the project. The Justification should provide sufficient detail to allow the sponsor to understand how the funds will be used and to determine whether the proposed costs are reasonable and appropriate.

Budget Development Guidelines

The following are general guidelines to building a budget. Individual funding agencies may have unique instructions or restrictions that should be considered in combination of the guidance below. If you have questions while developing your budget, please reach out to OSP.

Date Ranges

  1. The Project Period represents the period of time in which the entire project will be executed.
  2. Budget Periods represent the periods of time – often in 12-month increments – that expenses are calculated in the budget and disbursement of the grant funds are expected.
  3. If you must determine your own project period, it is recommended that it begin with the Academic Year (Aug 1st), the Calendar Year (Jan 1st), or the University Fiscal Year (July 1st). It is recommended that you begin a project period with the Federal Fiscal Year (Oct. 1st) only when required by the funder.


  1. The personnel category should include all University employees, including student employees.
  2. Calculate faculty and other nine-month contract salaries by using the current academic year’s salary as a base and the number of months and percentage of time to be spent on the project by each individual.
  3. To allow for sufficient funds in the future, choose a percentage to represent the projected increase earned each year. Be consistent with the percentage used throughout each budget category. Typically adding a 2% projected increase for each year is sufficient. Remember to build in an increase even for Year 1 which often starts a year or two in the future.
  4. Graduate assistant stipends are determined each year by the Graduate Studies department. You will need to work with this office once funded to get the position set up. You’ll also want to request approval from your departmental chair and dean.
    • Graduate assistants, full time or 100% effort equals 15-20 hours per week during the AY. Make sure you are using the current stipend levels when building a budget, those can be found on the Graduate Studies website  
    • Undergraduates must be paid an hourly wage (current minimum wage).
  5. It is recommended that you use the title of Principal Investigator or Project Director for the lead person on the project, and use titles such as Project Manager or Project Coordinator for other staff. Be sure to read the guidelines in case there are any other specific instructions by the funding agency.

Fringe Benefits

  1. Fringe benefits must always be included when salary is included in the budget.
  2. Fringe benefits and salary should not be combined in one personnel calculation. Fringe benefits should always be calculated separately.
  3. Verify accurate fringe rates for each individual based on their classification.
  4. Be sure to note that faculty fringe rates for the academic year differ from fringe rates for the summer.
  5. Current fringe rates can be found in the OSP Commonly Needed Info tab on the OSP website.
  6. Occasionally, proposal guidelines require you to justify fringe benefit rates, OSP can provide some sample language for this instance.
  7. GAs and hourly student employees are not eligible for fringe benefits.


  1. “Equipment” means an article of nonexpendable, tangible personal property having a useful life of more than one year and an acquisition cost of $5,000 or more.
  2. Equipment costs include the cost of a piece of equipment, plus the cost of any modifications, attachments, accessories, or auxiliary apparatus necessary to make it usable for the purpose for which it is acquired. Also included are costs to put equipment in place, such as transport and installation charges.
  3. Before requesting funds for equipment, a reasonable effort must be made to check the University’s inventory of equipment.


  1. Travel expenses should include all costs associated with transportation, meals, and lodging necessary to complete the scope of work.
  2. Travel expenses should account for travel costs for all personnel. Include travel costs for consultants, if any, and participant (trainee) travel costs.
    • Check proposal guidelines for specific allocation of travel costs. (For example, NSF requires participant (trainee) travel costs be allocated to the Participant Support budget category.)
  3. Travel reimbursement rates are posted on the Business Services Travel Guide website  
  4. Be sure to check the proposal guidelines for any specific travel reimbursement requirements. WIU policy requires that you use WIU rates for budgeting purposes unless the funder’s rates are the lower of the two.

Participant Support

  1. Participants are individuals who participate in and benefit from the project, but are not the research subjects.
  2. Often referred to as trainees, or scholarships/fellowships, these costs represent direct costs for items such as stipends, subsistence allowances, travel allowances and registration fees paid to or on behalf of participants of trainees (but not employees) in connection with meetings, conferences, symposia or training projects.
  3. These costs are interpreted as incentives for the individuals to participate in the project. Incentives should only be used for participants, not to replace compensation or for providing services to supplies in place of wages.

Materials and Supplies

  1. Supplies are expendable, tangible personal property consumed during the course of the project.
  2. Items such as postage, software, and photocopies often go in Other Direct Costs budget category because essentially costs associated with these items pay for services or fees.

Other Direct Costs

  1. This category includes all other expenses that pay for services of fees such as postage, printing, and telecommunications. It also includes:
    • Rental costs such as booth rental at a conference
    • Room and board for participants at a workshop (check with sponsor if costs should be included in participant support)
    • Honoraria – These must be paid based on standard salary/wage rate. If a consistent amount will be paid to multiple individuals, the amount cannot exceed any one individual standard salary/wage rate for the same amount of effort.
    • Parking permits for on -campus visitors; keep in mind for workshop activities.


  1. The contracts category includes:
    • Sub-Awards to a third-party partner for substantive programmatic work
    • Consulting Agreements with individuals who will give advice or provide a service for a fee.
  2. If you intend to establish a partnership with a consultant or sub-awardee, OSP can provide a simple Professional Services Agreement or more detailed Sub-Award Agreement budget template.
  3. Keep in mind, whatever administrative guidelines we are required to follow in response to a funder must be also applied to our relationships with subcontractors.
  4. Compensation paid to consultants must be based on standard professional rates (hourly or daily) and include the estimated effort.
  5. Partnerships such as service agreements with vendors who are not providing substantive programmatic work would be listed under “Other Direct Costs.”
  6. We recommend that you develop a separate budget in Excel for sub-awards and enter only the total in the Contractual line item. Additionally, most funders will require you to submit the sub-award budget as an attachment.
  7. Occasionally, funders will have a required budget format to use that does not include a line for Contractual items. If so, list the contractual items in “Other Direct Costs.”

Facilities & Administrative Costs

  1. Often called Indirect Costs (IDC), Facilities & Administrative (F&A) costs are those that are incurred for common or join objectives and therefore cannot be identified readily and specifically with a particular sponsored project. For example: departmental secretaries, office supplies, classrooms, electricity, security, and other general administrative costs such as personnel, purchasing, and services of the controller’s office.
  2. WIU’s F&A cost rate is negotiated with the Federal government and is currently 36% of Modified Total Direct Costs (MTDC), (17% of MTDC for off-campus programs).
  3. MTDC = Total Direct Costs less equipment, the portion of sub-awards greater than $25,000, participant costs, tuition, and scholarships.
  4. To qualify as an off-campus program, more than 50% of the project activities must be performed in facilities not owned by the institution and where these facility costs are not included in the F&A pool, or where rent is directly allocated/charged to the project.
  5. Current F&A rates are effective July 1, 2021 – June 30, 2025.
  6. Often, proposal guidelines (especially for training grants) require a reduced F&A rate other than our federally negotiated rate. Use the F&A rate required by the funder in your calculations.
  7. Some agencies may not allow F&A costs. Please attach a copy of these guidelines when you submit the proposal to OSP for approval.