Budget and Cost Resources

Find information related to graduate student research assistants (GSRA) compensation, tuition rates and stipend levels for use when creating budget and proposal information for sponsored research projects on the Graduate Student Research Assistants (GRSA) Cost Estimates and NRSA Stipend Levels page.

Cost information by type

Participant support costs

Participant support costs are a direct cost budget category intended for items such as stipends or subsistence allowances, travel allowances and registration fees paid to or on behalf of participants or trainees (but not employees) in connection with meetings, conferences or training projects. Amounts allocated to the participant support cost budget category of federal awards are excluded from the Modified Total Direct Cost (MTDC) base and may not be reallocated into or out of other budget categories without the written approval of the sponsor.

To track and manage participant support activity, a separate sub Project Grant (P/G), which is not coded to incur an indirect cost, must be established for awards containing a participant support cost budget allocation. Because the participant support cost budget category is restricted and may not be reallocated to other budget categories, any unexpended balance left in a participant support sub P/G at the end of the project period will become a de-obligated balance and cannot be used to offset expenses in the parent P/G or other sub P/Gs.

Specialized services

Charges for computing services should be budgeted whenever these costs are justified. It is essential, however, that the budget clearly differentiate between central computing services provided by Information Technology Services and other computing services.

Specialized service centers that have an approved user rate should be included in the proposed budget on a cost basis that reflects the recharge rates with the anticipated number of hours or other units of service clearly indicated. Once established, the schedule of rates must be applied to all users of the services/facilities, including internal-University users. Recharge rates are designed to recover, over the long term, not more than the aggregate cost of the services provided. The recharge/user rate should be included as part of the MTDC for the project and should carry the appropriate indirect cost rate.

Consultants and subcontracts

Federal agencies frequently establish a maximum daily rate of pay for consultants. The University must enter into a formal agreement with the consultant prior to the initiation of his or her effort. Consultant agreements as subject to the full recovery of indirect costs at the rate applicable to other direct cost items in the proposed budget.

The entire cost of a subcontract is normally shown as a single line item under “Other Direct Costs.” A formal proposal from the subcontractor — including a statement of work, a detailed budget, period of performance and key personnel — should be included to support this cost element. The principal investigator should provide an explanation of why and how the proposed subcontractor was selected, including the number of bids obtained.

Subcontracted effort requires a formal agreement between the University and the subcontractor, signed by a University official authorized to enter into contractual agreements on behalf of the Board of Regents. See Subawards, Hybrid Agreements and Purchase Orders for criteria and procedures. Indirect costs are recovered on the first $25,000 of each subcontract. For awards beginning on or after July 1, 2026, indirect costs are recovered on the first $50,000 of each subcontract.

Human subject fees

Human subjects often are paid a fee for their participation in research projects. Protocols for the use of human beings in research, teaching or testing are reviewed and approved, according to federal, state and university policies. Visit the Human Research Protection Program for more information.

Consumable supplies

Treat consumable supplies as direct costs if it can be demonstrated that such supplies are used only in the conduct of the project, are not used for other purposes, and are consumed completely in the course of the project. If used only for project purposes, items such as laboratory supplies and materials, lab notebooks, transparencies, printer paper for research data and reports, report binders, and so forth are justified as consumable supplies. However, when such items are purchased to support the multiple activities of project personnel, they are considered office supplies and cannot be charged directly to federal funds.

The estimated costs of consumable supplies and materials should be indicated in the proposed budget. It is generally acceptable to sponsors to provide a breakdown of supplies and materials by broad categories as opposed to the detailed listing of individual items. Contracts awarded by industries holding a prime contract with a federal agency, however, may require detailed itemization of supplies.

Office supplies

When supply items are purchased to support the multiple activities of project personnel, they are considered office supplies and cannot be charged directly to federal funds. This category includes, for example, computers (under $5,000), printers, monitors, fax machines, printer paper, toner cartridges, pens, pencils, legal pads, clips, rubber bands, sticky notes, books, individual subscriptions to journals, notebooks, binders and folders. The category does not include printing, photocopying and duplication, research publication costs, and page charges, (i.e., these are generally treated as allowable direct charges). The circumstances surrounding the expenses in this category play a major role in determining whether to treat as an exception and permit as a direct charge.

Computer and network costs

Hardware, software, personnel services, public access sites and other related costs required to enable University personnel to share software or data or to communicate electronically with other individuals, are generally considered to be part of the physical infrastructure of the University and should not be included as direct costs in the proposal budget, as these costs are indirect in nature and included as a component of the F&A rate. 

However, individual workstations and specialized hardware and software attached to the network, which are not available to all users, are not included as part of the network costs and therefore may be treated as direct costs and recovered from sponsored projects through the use of approved recharge rates. For example, purchasing computers to control and monitor scientific equipment represents a different circumstance or use of that equipment and would typically be allowed as a direct charge.

Equipment

Major items of equipment proposed for acquisition should be itemized by descriptive name and estimated cost, and an adequate justification should be provided in the proposal narrative. In federal sponsored projects, an item is considered equipment if it costs $5,000 or more per unit and has a life expectancy of one year or greater. Nonexpendable items valued at less than $5,000 or with less than a one-year life expectancy should be budgeted as supplies. For awards beginning on or after July 1, 2026, the equipment threshold will be $10,000. 

Shipping and/or installation charges associated with equipment acquisitions should be included in the cost estimates but generally are not itemized. For more information, visit Finance’s Equipment & Furniture page. 

Telephones and general office equipment

The costs of telephones and general purpose office equipment (e.g., furnishings, air conditioning equipment, reproduction and printing equipment, and motor vehicles) are an unallowable direct cost except with prior, written approval. These costs have been delegated to U-M schools, colleges, units, departments, institutes and centers, consistent with the University’s overall management incentives program. Project directors should contact their dean, director, or department administrator for information concerning procedures established for the handling of requests for such equipment.

Telephone costs can be made against federal funds only where the line can be shown to be completely dedicated to a project or set of closely interrelated projects. Telephones used for the conduct of surveys are allowable as this would represent an unlike circumstance to routine business purposes. Telephone line charges to interrelated projects must be pro-rated on some defensible basis. Telephone toll charges are allowable if they are directly related to the project activities and some mechanism is in place to ensure that such calls are documented and charged to the projects to which they are directly related. Specific advance approval of telephone toll charges as a direct cost generally is not required by the sponsoring agency.

Cell phones and prepaid long distance calling cards should not be direct-charged to federal sponsored projects because there is no easy or accurate way to monitor usage to ensure project relatedness.

Travel

Funds may be requested from the sponsor to cover travel costs associated with the proposed project. Sponsors often require a breakdown of such travel costs by trip, reflecting the purpose, point of travel, number of persons, number of days, air fare, lodging and meal costs (per diem). If foreign travel is contemplated, the proposal should include relevant information (including names of countries to be visited) and justification. Some sponsors have special regulations (e.g., use of domestic air carriers) governing foreign travel.

Publishing reports

Costs of preparing and publishing reports of project results should be included in proposed budgets. Since page charges often are billed well after the completion of the research, it may be necessary to secure time extensions to pay these charges prior to the time that the project is closed out.

Data management and sharing

Certain funding agencies, such as NIH, are increasingly allowing data management and sharing (DMS) costs to be included as direct costs in proposal budgets. Absent any prohibition from the funding agency, and in accordance with the applicable terms and conditions of the underlying grant, costs associated with data curation, data formatting, data de-identification, preparation of metadata, and repository data deposition fees may be planned for and included in the proposal as direct costs. Specialized IT infrastructure uniquely needed for data management and preservation prior to deposit into a repository may also be included in the proposal budget as a direct cost.

NIH DMS costs should be shared in the appropriate cost category, e.g., personnel, equipment, supplies and other expenses, following the instructions and providing details as instructed within the applicable form (e.g., R&R Budget Form or PHS 398 Modular Budget Form). In most cases, the DMS Plan oversight at U-M will be provided by the PI and other study personnel. If help is needed, consider these resources:

• Budgeting for Data Management & Sharing
• U-M Resources for NIH Data Management & Sharing Policy
• Research Data Management (Health Sciences) – Research Guide

Travel visas

The guiding principle for the allowability of charges is whether they directly benefit the sponsored project. The UG specifies “Short-term, travel visa costs (as opposed to longer-term, immigration visas) are generally allowable expenses that may be proposed as a direct cost. Since short-term visas are issued for a specific period and purpose, they can be clearly identified as directly connected to work performed on a Federal award.”

Allowable on sponsored projects

• H-1B petition expenses: H1B visas are allowable expenses on NIH projects only if the visa is for a new recruit. H-1B visas for existing employees are not allowable. If the individual is being recruited to work on the sponsored project, the fees are chargeable to that sponsored project because that project will receive a direct benefit from the University appointment. If the resulting appointment will be to multiple university sources, the charge to the individual sponsored project should be prorated accordingly.
• O-1 visas: Expenses associated with requests for O-1 Visas (temporary work visas for aliens of “extraordinary ability or achievement in the sciences, arts, and education”) may be charged to sponsored projects using the same criteria set forth above for H-1B visas. Specifically, there must be a clear and direct benefit derived by the sponsored project to justify direct charging the petition expenses.
• J-1 visas (Form DS-2019) when the visiting scholar exchange is sponsored project specific: When the purpose of the visiting scholar or professor exchange is to work on one or more sponsored projects, the project(s) can reimburse for the Student and Exchange Visitor Information System (SEVIS) and other fees.

It is important to establish and document the direct involvement of the individual to the project being charged. This documentation should be forwarded both to ORSP and Finance-Sponsored Programs.

Additional considerations:

• There is no requirement that these expenses be charged to sponsored projects. It is the responsibility of the hosting faculty member to identify the appropriate funding sources.
• If the resulting appointment will be to multiple University sources, the charge to the individual sponsored project should be prorated accordingly.
• Expenses associated with the potential employee’s dependents cannot be charged to sponsored projects (but could be charged to general/discretionary funds should the unit so desire). 
• If the visa request is denied by the DHS, the charges cannot be covered by the sponsored project. It is expected that the hosting faculty member or unit will cover the charges from an alternative source and the expense be removed from the sponsored project. 
• If the visa expenses are covered by a sponsored project and the employee leaves the University within 12 months of the start of service to that project as an H-1B holder, the fee expenses must be transferred from the sponsored project account to a discretionary account identified by the PI of the sponsored project. 
• Because these expenses are difficult to foresee, it is not recommended to include them in prospective budgets. While sponsors will not likely grant requests for additional funding for these expenses, the expenses may be able to be re-budgeted from the awarded grant or contract.

Not generally allowable as charges to sponsored projects:

• Student (F-1) visas: This policy specifically excludes all student (F-1) visas. For an F-1 visa holder, the primary purpose for joining the University community is to be a student. Subsequent participation on sponsored projects is incidental to their roles as students even though projects may derive benefit from their involvement.
• J-1 visas (Form DS-2019): This policy generally excludes exchange visas for visiting scholars or professors to come to the US to participate in a program of teaching, scholarship or research, unless the purpose is specifically to participate in a sponsored project.
• Permanent Residency requests: This policy specifically excludes Permanent Residency requests as the primary beneficiary is the individual and direct benefits to individual research projects cannot readily be shown.

Postage and shipping

The postage costs associated with the normal administration of a project are generally not allowable as direct charges. Examples include interactions with vendors and routine correspondence with the sponsor, colleagues and potential publishers. Postage, including the cost of courier services, should be budgeted to federal projects only where there is an extraordinary need (i.e., an unlike circumstance) for postage, such as mailed surveys, which can be justified explicitly in the budget explanation submitted to the sponsoring agency. In general however, the costs of overnight shipping and handling are allowable assuming they are directly associated with the conduct of the project. The principal reason for this distinction is that the latter can be directly assigned to a particular project relatively easily and with a high degree of accuracy. Stamps are generally purchased in bulk and consumption cannot, in a cost effective manner, be assigned to a specific activity. 

Memberships

The dues to maintain individual memberships in professional and scientific organizations are not allowable direct costs to federal sponsored projects. They are considered professional development expenses and should be covered with discretionary or personal funds.

Hosting

There are very few cases where hosting is allowable on federally sponsored projects. These circumstances are stated during the proposal budgeting process and are only allowable when the sponsor gives express consent. ORSP will not utilize the re-budgeting authority to give authorization for hosting expenses. Written authority will need to be obtained directly from the sponsor by the department.

Other anticipated direct costs

Other anticipated direct costs such as equipment rental, maintenance agreements or off-campus space rental should be itemized. “Miscellaneous” or “contingency” categories should not be included. Items normally considered indirect costs should not be included in the proposed budget unless they are extraordinary and for unlike circumstances (e.g., utility costs required to operate a high-energy particle accelerator).