Direct Costs

Direct costs are costs which can be directly identified with your project. The federal government also provides definitions of what are allowable and unallowable direct costs in OMB Circular A-21, Cost Principles for Education Institutions, Direct costs include the categories discussed below.


List each person who will work on the project by name or job type and indicate the amount of time that person will devote to the project. A project may employ current college employees or may hire new employees with the understanding that their employment is for the duration of the grant.

The time college employees devote to the project while under contract to the college can be release time, overload, or a change in employment status. A proposal may also provide for summer employment for nine-month employee(s). When the agency assumes a faculty or staff member's time for work on a project, it is reimbursing the college for a portion of that person's academic year salary. You do not receive any increase in your salary, unless the work on the project is taken on in addition to regular duties as overload. According to federal policies and regulations, no employee can exceed 100% of his established salary on federal money. You can request that your effort on a federal project be carried out above and beyond or in addition to your regular duties - this must be specified in the budget narrative and approved by the program officer. You can also request release time or overload approval from the college for yourself to be used as cost-sharing on a project. All time commitments to a project by a current college employee must be cleared initially with the department chair or Dean.

Fringe Benefits

For each dollar paid as salary or wage to an employee, the college incurs associated costs or fringe benefits. These benefits include F.I.C.A., worker's compensation, unemployment compensation, retirement, and health insurance. If assistance if need for calculating Fringe Benefits contact the Office of Grants and Contracts Administration. An example of how to calculate fringe benefits is as follows:

GSC Individual's project salary $36,000 per year (25% time commitment)
$9,000 x fringe rate 30% = $2,700
Total fringe benefits for the individual = $2,700


List each piece of permanent equipment not already available that is needed to conduct the project. Most federal government agencies define "permanent equipment" as any unit costing $500 to $1,000 or more and having a useful life of two years or more; state agencies define it as property having an acquisition cost of $1,000 or more and a useful life of one year or more. Be as specific as possible in your description, including model numbers and types.

Supplies and Materials

Itemize the expendable supplies needed for your project. Basic office supplies are not allowable direct expenses under OMB Circular A-21, unless these expenses are for a "major project."


Travel costs include travel to collect data, consultant travel, and travel to present research results at professional meetings. Be specific. List costs for transportation and per diem separately and include the number of people. Mileage reimbursement in privately owned automobiles cannot exceed the amount of coach airfare to the same destination. If you are requesting support to attend a professional meeting, indicate the professional organization involved and the site if known.


Consultants should be budgeted only for tasks where on-campus expertise does not exist or is not readily available. Normally, consultants are paid a consulting fee plus travel expenses. Many sponsors do not permit payments to consultants, and some restrict or limit such payments. If in doubt contract the sponsor. Identify the proposed consultant by name, indicate the number of days of work, and provide a vita for the consultant in the proposal. Consultants are not employees. Internal Revenue Publication 15-A should be used to determine whether or not an independent contractor or employee relationship exists. Note: Consultants should not be listed under personnel, they cannot be college employees, and fringe benefits are not calculated for consultants. If you want to use a college employee in a "consulting role" contact the Office of Grants and Contracts Administration.


If your project involves expenses associated with a cooperative organization or a supplemental agreement, those expenses should be included as a subcontract in the proposed budget. The total subcontract cost should appear as a line item in your proposal budget, and a separate budget breakdown for subcontract costs should follow the proposal budget. In addition to a detailed subcontract budget, a letter signed by the individual authorized to contractually commit the subcontracting organization should be included in the proposal. Subcontract costs should include the subcontracting organization's fringe benefit expenses and indirect cost expenses at the organization's negotiated rate. Indirect costs in a subcontract must be in compliance with the sponsoring agencies guidelines. If the subcontracting organization does not have a negotiated rate, no indirect costs for the organization should be included. For further assistance contact the Office of Grants and Contracts Administration.


Other expenses are typically those which do not fit into the established budget categories, such as publication costs. At times consultants and subcontracts are recorded as other expenses.