Budgets - Direct Costs

Recommendations

• A proposed UC San Diego salary should match the current salary schedules for each particular job classification.
• The UC Office of the President (UCOP) has issued guidance on forecasting wage escalation for multi-year sponsored projects. Please review this guidance memo (under the "Guidance" section). This guidance may be helpful as you calculate wage escalations in your proposals for extramural funding.  Keep in mind that agency policies and practices may not allow for these wage escalations; however, UCOP’s guidance provides a reasonable justification to a sponsor should they inquire about the basis for wage escalations.
• Salaries should include any projected merit or cost-of-living increases.

Preparing the Budget

When preparing the salary for each UC San Diego employee listed in the salaries category of the budget, include:

• Name and Payroll Title of the employee. If you know a position will be required but the individual has not yet been identified at the time the proposal is being submitted, indicate To Be Named or TBN in place of the name.
• Monthly or annual salary. This should be escalated for all applicable cost-of-living and merit increases. Keep in mind that these increases must coincide with the future beginning date of the project or program.
• Budget Justification should include:
  • Personnel work duties.
  • Statement about UCSD salaries.
    • Example: "Salaries for all UC San Diego personnel are based upon current University of California salary scales."

Resources

• Academic Salary Scales at UC San Diego
• Salary and Fringe Benefits for Scripps Institution of Oceanography (SIO) Faculty 
• School of Medicine Salary Scales at UC San Diego
  • Note: This content has moved to Pulse (pulse.ucsd.edu) and UC San Diego Active Directory login is required.
• Joint UCSD/VA Faculty Appointments
• Postdoctoral Scholars: Campus Appointment & Guidelines (postdoc.ucsd.edu)
• Graduate Student Pay Rates at UC San Diego

Policy Limits Salary from Federal Awards

Effective July 1, 2012, Principal Investigators may receive no more than 97% of their salary from federal awards, including federal flow-through funding. This Policy applies to all Principal Investigators whose salary is derived entirely from federal awards. Read the full policy (PDF).

Review the detailed table on CBR rates. Go to Composite Benefit Rates (CBRs) for how to apply CBR - Planning Rates.

• July 2019: CBR - Planning Rates are required for all sponsored agreement proposal budgets. CBR - Planning Rates were developed to reduce the impact of federally approved Composite Benefit Rates (CBRs) that will go into effect in 2020. 
• June 2020: implementation of federally approved Composite Benefit Rates (CBR) will begin when UCPath goes live

Campus Notice: New Benefit Rates in Sponsored Research Proposals - June 4, 2019

Budget Justification

The budget justification for fringe benefits should include a general statement such as: "Fringe benefits are calculated using the current planning Composite Benefit Rates (CBR) in effect for the UC San Diego. CBRs are reviewed and approved by UC San Diego’s cognizant Federal agency, the Department of Health and Human Services."

After July 1, 2019, please use Composite Benefit Rates (CBR) - Planning Rates. See CBR section above.

Budget Preparation Rates Quick Reference (PDF) includes fringe benefit rates, tuition remission rates, and indirect cost rates.

When to use Composite Rates

Under certain circumstances, the use of composite benefit rates may understate actual costs for employee benefits (e.g., when the majority belong to family dental and health plans). In those situations, or when a more precise measurement of fringe benefit costs is desirable, budgeting the actual fringe benefit costs, expressed as a percentage of salary, would be warranted in proposal budgets rather than the use of composite rates. Should this approach be used, it should be applied consistently to all named employees ("to be named" employees will still require the use of composite rates).

Note: The largest increases from the rates previously published are due to the UC Retirement Plan and Core Health

Composite Rates are a weighted average percentage which consist of the following components:

• UCRS Retirement Contribution
• Health Plan Contribution
• Social Security (FICA)
• Dental Plan
• Vision Contribution
• Workers' Compensation Insurance
• Employee Support Program
• Unemployment Insurance
• Non-Industrial Disability Insurance
• Employer-Paid Life Insurance
• Annuitant Health/Dental Program

For more information on benefit rates and components see the Employee Benefits Rates Blink page. 

Budget Justification

The budget justification for fringe benefits should include a general statement such as: "Fringe benefits are calculated at rates currently in effect for the University of California."

About

Tuition Remission allows Graduate Student Researchers (GSR) who are employed at 25% time or more during any one academic quarter to be compensated for their tuition and other UCSD student-related fees.

Graduate Student Researcher Tuition and Fee Remission is assessed for each academic month, up to nine months, October through June, that the GSR is proposed to work on the project or program. No assessment is made for the three summer months (July, August, and September.)

Tuition Remission rates are to be applied according to the graduate department of the GSR which, in some cases, may not be the same department as the principal investigator.

There are 4 separate groups or pools of tuition remission rates that are used depending on the GSR appointment location in either:

• Engineering
• Physics
• Scripps Institution of Oceanography
• General, which is for all other UCSD appointment locations not included in the 3 areas above.

Engineering is further separated into 4 subgroups:

• Computer Science and Engineering (CSE)
• Electrical and Computer Engineering (ECE)
• Mechanical and Aerospace Engineering (MAE)
• Structural Engineering (SE)

Calculating Tuition Remission for Budgets

Calculating tuition remission begins with selecting the appropriate rate from one of the 4 groups or pools, depending on the GSR's department. If the period of performance continues for more than a year, escalate that rate on October 1st of every year thereafter until the ending date of the project or program.

• Projects during an academic year: Due to some projects or programs beginning in the month of July, tuition remission will be a straight-forward calculation with all 9 months in the same academic year; October through June.
• Projects starting before/after academic year:  tuition remission rates are escalated every October, and due to some projects or programs beginning in months after the academic year begins (e.g. November or January), the tuition remission calculation amounts will need to be broken up onto 2 separate lines on the UCSD Proposal Budget Form:
  1. one line for the amount reflecting the remaining months within the current academic year, for example January through June
  2. another line for the escalated amount reflecting the months remaining in the new academic year, for example October through December.
• Budget Justification: language for tuition remission should include the following general statement: "Tuition Remission is calculated at rates currently in effect at the UCSD." 

Graduate Division

The Graduate Division is responsible for the development of policy, rates, and implementation of tuition remission for UCSD.

For updated rates go to Graduate Division: Student Academic Title Pay Rates 

Consultants provide expert advisory or other services for brief or limited periods of time during the period of performance.

Documentation from a consultant should be in the form of a letter that includes his or her name, the daily rate of pay (and justification for the rate of pay), number of days, travel costs, and a statement indicating his or her willingness to participate in the project or program.

No compensation may be requested for UCSD employees who serve as consultants on a UCSD project or program.

Equipment is identified as an item of non-expendable, tangible personal property, meaning it can be appraised for value, has an acquisition cost of $5,000 or more, is free-standing or can stand alone, and has a normal useful life expectancy of one year or more.

Items that cost less than $5,000 are not considered equipment and belong in the Supplies and Materials category of the budget.

Each equipment item should be listed individually on the budget form, and their estimated cost should also include sales tax, shipping, and assembly, if necessary.

Please note:

• Repair/replacement components for equipment, regardless of cost, are not considered to be equipment and should be budgeted in the Supplies and Materials category.
• Accessories or component parts are considered to be equipment when the acquisition cost is $5,000 or more, and either:
  • The accessory or component permanently increases the value of the existing equipment, or
  • The accessory or component permanently increases the useful life of the existing equipment.
• Computer software, regardless of cost, is not considered to be equipment and should be budgeted in the Supplies and Materials category.

Fabrications:

• If a piece of equipment is to be fabricated rather than purchased, the cost of its components plus all materials, supplies, and services from outside vendors or authorized internal recharge activities used in the fabrication process are considered equipment costs if the title is retained by the University and the item has a useful life expectancy of more than one year.
• Department labor, travel, or other operating expenses associated with the fabrication (such as salaries of Principal Investigators, graduate student researchers, or other comparable personnel who participate in the fabrication process) are not included in the acquisition cost of the item.

Leasing:

• If it is being leased with an option to buy, it is considered equipment.
• If it is being leased/rented with no intention to buy, it is not considered equipment. 

The budget justification for equipment should describe each item and its need for the completion of the project. Include the estimated cost of the equipment, based on a catalog, website, or other vendor quotation.

Supplies and materials should be listed separately and include sufficient justification.

Each trip should be specified in the budget justification with:

• The specific destination and purpose of the trip, if known
• The number of people traveling
• The mode and cost of transportation
• Airfare costs
• Hotel costs
• Ground Transportation
• The number of days of per diem and the per diem rate

Travel intended to cover costs of bringing participating outside consultants to UC San Diego is to be budgeted in the Consultants category of the budget.

Both the direct and indirect costs for the subaward site appear on UCSD's budget page and are considered to be direct costs to UCSD.

In addition, the entire grant proposal that was prepared by the subaward site and approved by their contract and grant office would also be required as confirmation of their participation in the proposed project or program.

Follow the funding agency's written guidelines. Specific agencies may require a detailed subaward budget and justification from each proposed subawardee. The subaward site's information should generally be addressed by the UCSD PI as to why the subaward site is necessary and what part of the work they will be performing on the UCSD budget justification page.

The budget justification includes the name of the subaward site, their total costs, and a general statement about what aspect of the research they will be performing and how their participation will benefit the project or program.

Please Note: Work that is contracted on a fee-for-service/vendor-contract basis is not considered to be research and should be budgeted in either the Consultant's category or Other Expenses category. 

Each miscellaneous cost should be listed separately and include sufficient detail in the budget justification

Miscellaneous costs may include:

• Publication expenses
• UC Open Access Fact Sheet for Researchers Applying for Grants
• Human subject payments and travel
• Service contracts for equipment maintenance
• Other campus recharge services
• Annual software licenses, as opposed to software purchases
• Rent or lease costs for off-campus non-UCSD-owned space
• General Liability Program costs - when allowed on non-federal proposals
• Cloud Computing Costs through UCSD Contracts, via ITS or via SDSC: 
  • Includes: Amazon Web Services, Microsoft Azure, SDSC Cloud, Triton Shared Computing Cluster (TSCC), SDSC Project Storage, and Sherlock Cloud.
  • Such costs will be exempt from IDC.
  • New account codes assigned to these costs will ensure these charges are exempt from IDC. 
  • Note: Cloud computing costs acquired directly, or through purchase of equipment/ licenses, will be subject to the assessment of IDC.
  • See Cloud Computing Services: Exemption from Indirect Costs for more information.

A flat monthly charge, referred to as the Next Generation Network (NGN), supports enhanced data and voice network services provided under NGN3. This charge is levied automatically for each campus employee who qualifies as a Communication User as determined by the employee's payroll title code.  Costs associated with the NGN fee are not included in the calculation of UCSD’s negotiated indirect cost rate.  For more information and NGN Communication User Rates see the Next Generation Network (NGN) Blink page. 

NGN provides enhanced communication services and technology, including:

• Faster data connections and increased Internet bandwidth
• Sustainable state-of-the-art technology
• Expanded help desk services
• Better network security
• Increased network services
• Resources for network repairs and upgrades
• Wireless equipment and services
• E-mail, active directory, and other network services

Following are guidelines regarding the application of the NGN charge to contracts and grants: 

• Charges are assessed at the current on-campus or off-campus rate per projected full-time employee (FTE) or fractional proportion based on FTE effort. Current rates can be found on the Next Generation Network (NGN) Blink page.
• This charge is for services to provide state-of-the-art technology infrastructure and services to the campus community.  
• Applies to contracts and grants for the research FTE that support sponsored research programs.  
• Applies to contract and grant budgets for all sponsors 

A line item for the NGN charge should be included in proposal budgets and a detailed explanation should be included in the budget justification. For example: 

BUDGET LINE ITEM: NGN Charge $$$$ (Next Generation Network)

BUDGET JUSTIFICATION:

UC San Diego Information and Technology Services (ITS) charges a flat per-month fee for services to provide state-of-the-art technology infrastructure and services to the campus community. These charges are directly attributable and proportionally applied to the individual(s) included in the proposed budget for the project. These costs are not included in the campus' Facilities & Administration (F&A) rate as an indirect cost. UC San Diego auditors have determined that it is both equitable and consistent with the OMB Circular 2 CFR 200 provisions on cost allocability that the costs be assigned to FTE on grant and contract funds. Accordingly, an allocable portion of these NGN costs are included in this budget as direct project costs.

The application of the HS Technology Service Charge (HS-TSC) to contracts and grants is strategically aimed at ensuring an elevated level of security protection for Health Sciences personnel actively engaged in research discovery within an environment rich with HIPAA data. Clear guidelines emphasize the importance of supporting the security and technological needs of faculty and staff, fostering an environment conducive to groundbreaking research exploration.

Following are guidelines regarding the application of the HS Technology Service Charge to contracts and grants: 

• $130.89 per month per projected full-time employee (FTE) or fractional proportion based on FTE effort
• Please note that on March 29, 2022, our Executive Body came to the conclusion that certain IT investments had to be made to protect our Organization from malicious attackers. As such, it has been decided that an increase of 7% for the next 5 years is necessary. Therefore, please make note of the following HS-TSC fees and plan accordingly:
  • Fiscal 2023 --> $122.33
  • Fiscal 2024 --> $130.89
  • Fiscal 2025 --> $140.06
  • Fiscal 2026 --> $149.86
  • Fiscal 2027 --> $160.35
• Applies to contracts and grants for researchers operating within the Health Sciences domain and receiving full-service support from UC San Diego Health Information Services.     
• Applies to contract and grant budgets for all sponsors 
• Include on proposal budgets effective July 1, 2021
• Applies to contract and grant awards effective July 1, 2021
• Will not apply to awards from sponsors that do not allow these types of costs as direct charge without advance notification and approval. If a sponsor does not approve, it will be necessary to allocate this charge to other discretionary funds as approved by the Department Chair.
• Awards where funding is not adequate to cover these charges will be given consideration of a waiver from the Department Chair for these fees, on an award-by-award basis. 
• Does not apply to General Campus or Scripps Institution of Oceanography (SIO) researchers. For General Campus or SIO researchers collaborating with Health Sciences researchers on projects, the fee will only be assessed for Health Sciences affiliated personnel and will not be assessed on the salaries of non-Health Sciences personnel.

A line item for this charge should be included in proposal budgets and a detailed explanation should be included in the budget justification. For example: 

BUDGET LINE ITEM: HS-TSC (Health Sciences Technology Services Charge) $$$$

BUDGET JUSTIFICATION:

UC San Diego Health Information Services costs have been included to reflect costs associated with the increased level of security required for all personnel within UC San Diego Health, which includes UC San Diego School of Medicine, Skaggs School of Pharmacy and Pharmaceutical Sciences, and the hospitals and clinics. These charges are directly attributable and proportionally applied for the individual(s) included in the proposed budget on the project.   

TO BE USED IN THE DETAILED BUDGET JUSTIFICATION:

UC San Diego Health Information Services (IS) provides mandatory Information Technology Services to all of Health Sciences faculty and investigators, including costs associated with the increased level of security required for all personnel within UC San Diego Health, which includes UC San Diego School of Medicine, Skaggs School of Pharmacy and Pharmaceutical Sciences, School of Public Health and the hospitals and clinics. To mitigate the specific risk profile of this highly connected environment, UC San Diego Health Information Services ensures that all PIs whom IS provides services to, whether they directly access patient information or not, operate in a highly secure desktop, application and server environment with dedicated and highly trained support. Charges are based on percent of FTE working on a grant and are charged on a monthly basis.

These costs are not included in the campus' Facilities & Administration (F&A) rate as an indirect cost. UC San Diego auditors have determined that it is both equitable and consistent with the OMB Circular 2 CFR 200 provisions on cost allocability that the costs be assigned to FTE on grant and contract funds. Accordingly, an allocable portion of these Technology Services costs is included in this proposal as direct project costs.

For questions about the Health Sciences Technology Services Charge, visit the About ITSS webpage or contact Miguel Villalobos.

Research Patient Care Costs are the costs of routine and ancillary services provided by hospitals to individuals participating in research programs. The costs of these services normally are assigned to specific research projects through the development and application of research patient care rates or amounts.

• Routine Services are regular room services, minor medical and surgical supplies, and the use of equipment and facilities, for which a separate charge is not customarily made.
• Ancillary Services are those special services for which charges are customarily made in addition to routine services, e.g., x-ray, operating room, laboratory, pharmacy, blood bank, and pathology.

Research patient care costs do not include: (1) the otherwise allowable items of personal expense reimbursement, such as patient travel or subsistence, consulting physician fees, or any other direct payments related to all classes of individuals, including inpatients, outpatients, subjects, volunteers, and donors, (2) costs of ancillary tests performed in facilities outside the hospital on a fee-for-service basis (e.g., in an independent, privately owned laboratory) or laboratory tests performed at a medical school/university not associated with a hospital routine or ancillary service, (3) recruitment or retention fees, or (4) the data management or statistical analysis of clinical research results.

The budget justification for patient care costs should include details about the inpatient and/or outpatient costs including the names of hospitals and/or clinics where care will be provided and the basis for these costs.

Use current rates for patient care, special services, tests, or treatments. Rates can be obtained by contacting the appropriate UC San Diego business office for the services to be used.