Develop the Budget

• Faculty Academic Year Salary. Please follow these guidelines for requesting academic year salary.
• Faculty Summer Salary. Please follow these guidelines for requesting summer salary.
• Salary escalation in your budget. In a multi-year budget, salaries don’t stay flat — people receive raises and costs rise over time. Salary escalation is the practice of building a modest annual increase into the later years of your budget so those years stay adequately funded. Skip it, and a project budgeted at today’s salaries will quietly become underfunded by year two or three, forcing you to cut effort or absorb the gap.
  • Start from each person’s current institutional base salary and the effort (person-months or percent) committed to the project.
  • Apply a reasonable escalation rate to each subsequent year — a common convention is about 3% per year. The increase is a budgeting estimate, not a promised raise to any individual.
  • Escalate fringe along with salary since fringe is charged as a percentage of salary. 
  • Federal rules. Under the Uniform Guidance (2 CFR 200), salary charges must follow your institution’s established compensation policy and be reasonable — escalation should reflect realistic, policy-based increases, not an arbitrary bump.
  • NSF limits senior-personnel salary (generally up to two months across all NSF awards) and expects escalation to follow institutional policy and be justified in the budget narrative.
  • Check the application guidelines. Some sponsors fund a fixed amount with no escalation — in that case, increases come out of the project, so plan effort accordingly. Always check the specific solicitation, which may cap annual increases or per-year totals.
  • ORSP prepares your budget with you: provide current salaries and effort to your GCM, and they’ll apply WFU’s fringe rates and escalate the out-years.
  • Note that escalated salary stays in the MTDC base, so it also raises the F&A you recover, and graduate tuition is explicitly escalated each budget year.
  • When your actual raise doesn’t match what you budgeted. The escalation in your budget is an estimate; it doesn’t change the award amount or commit the sponsor to your actual raise.
    • If your University or school raise comes in higher than budgeted (or above a sponsor’s salary cap), the grant won’t automatically cover the difference — you’ll charge what the budget or cap allows and cover the rest by reducing the effort charged to the project, rebudgeting if the sponsor permits, or using departmental or discretionary funds.
    • If your raise comes in lower, you charge actual salary and the remaining funds stay in the project for other allowable costs, subject to the sponsor’s rebudgeting rules.
    • Your GCM can help you decide which approach fits your award.
• Salary cap
  • Some sponsors — most notably the NIH — limit the salary that can be charged to an award.
  • The NIH salary cap for 2026 is $228,000 for a 12-month appointment (about $171,000 for a 9-month academic-year appointment), tied to Executive Level II pay and effective January 1, 2026.
  • If your institutional base salary is above the cap, the excess can’t be charged to the grant — it must be covered by non-sponsored funds, and that “over-the-cap” portion is tracked in a separate account alongside the grant.
  • Build this in at the proposal stage if you’re affected, and revisit it when the cap changes. For active awards you may rebudget to absorb a higher cap, but NIH won’t add funding to cover it.
  • Your GCM and staff within ORSP Central can help you budget around the cap and set up the companion account.
• Postdoctoral Fellows
  • Postdoc hiring is supported by HR. Your GCM will work with our Talent Liaison in HR () to obtain salary ranges for you to use for budgeting purposes.
  • The NIH guidelines for postdocs on training grants are here. Postdocs on other sources of funding can follow institutional norms.
  • Partner with your department and Human Resources regarding compensation, and be mindful of departmental and university-wide equity guidelines that these offices can help you navigate.
  • Please refer to the Hiring section in the Initiate Project Step for sample position descriptions and more detail on the process.
• Lab staff salaries (except for postdocs)
  • Lab staff hiring is also supported by HR. Your GCM will work with our in HR to obtain salary ranges for you to use for budgeting purposes.
  • When your award includes salary for staff, one of the first decisions is what kind of position to create — because the employment category determines both the benefits the employee receives and the fringe-benefit costs you have to budget. Make this choice based on the real nature of the work, then build the budget around it.
    • First, confirm the person should be an employee at all; for outside individuals, use HR’s Employee vs. Independent Contractor checklist.
    • Regular position — for ongoing, core project work. Regular staff are benefits-eligible.
    • Temporary position — for short-term, finite, or variable-hour work.
  • What “full-time,” “part-time,” and “temporary” mean at WFU
    • Full- and part-time regular staff scheduled to work 1,000 or more hours per year are eligible for paid time off and the standard benefits package.
    • Staff scheduled for fewer than 1,000 hours per year, and temporary staff, are not eligible for paid time off (PTO) and the standard benefits.
    • Separately, under the ACA, anyone who works 30 or more hours per week on average must be offered medical coverage — regardless of a “temporary” label. A worker you call temporary who actually works full-time over time can trigger medical eligibility, so the classification has to match reality.
  • How the category hits your budget (fringe benefits)
    • Every salary or wage you budget also carries fringe benefits, and the fringe rate depends on the category.
    • Benefits-eligible (regular) staff carry the full fringe rate — health, retirement, PTO, and payroll taxes. It’s more expensive, but it’s the correct and required cost for an ongoing project role.
    • Temporary and student wages carry a lower fringe rate (primarily payroll taxes).
    • Budget the right rate from the start — under-budgeting fringe leaves you short later — and don’t classify a role as temporary just to lower the fringe charge, since misclassification creates ACA and compliance exposure. Your GCM has the current fringe rates.
  • Partner with your department and Human Resources regarding compensation, and be mindful of departmental and university-wide equity guidelines that these offices can help you navigate.
  • Please refer to the Hiring section in Initiate Project for sample position descriptions and more detail on the hiring process.
• Graduate student stipends and related costs.
  • Please refer to these additional details.
  • Tuition and Fees: Unless the sponsor does not allow it, tuition and fees should be requested in every budget that includes at least 1 semester of a graduate student’s time.
• Undergraduate student stipends
  • Undergraduates can be paid on a sponsored project in a few different ways, and the first question is how they should be paid — a stipend or an hourly wage. Start with the University’s student employment policy and the hourly rate determination sheet (there’s also a manager’s guide for supervisors).
  • Stipend or hourly? Ask who primarily benefits. The choice turns on who the primary beneficiary of the work is:
    • The student benefits — the experience is essentially a fellowship that advances the student’s own educational goals. In that case the student can be paid a stipend, which is typical in the summer.
    • The faculty member or institution benefits — the student is paid to accomplish specific tasks rather than to pursue an independent project of their own. In that case the student is paid hourly, which is more common during the academic year.
  • Ways to support an undergraduate
    • Hourly student employee — paid an hourly wage for hours worked, following the student employment policy.
    • URECA-funded student — supported through the Undergraduate Research and Creative Activities Center rather than charged to your grant. Students apply with support from a faculty mentor and if awarded, fellowships provide $4,000 to the student for 10 weeks of summer research. If requested, URECA will also pay for on-campus housing during the fellowship and up to $500 in supplies. Faculty members may supplement or exceed this amount using external grant awards. Updated campus housing rates are published annually on the University’s housing rates and terms page.
    • Grant-funded student — paid directly from your award, as either personnel or a participant (see below).
  • Personnel or participant?
    • A student doing project work is usually treated as personnel (paid hourly or by stipend). But a student taking part in a structured program — a research experience or training program — can be a participant.
    • Participant costs can include stipends, housing, travel, and program expenses (including some food), and they’re excluded from the modified total direct cost (MTDC) base, so no F&A is applied.
    • Your program officer can advise whether to budget undergraduates as personnel or as participants. (See Participant support costs for that category’s rules.)
  • For definitions and step-by-step guidance on paying students, see the Student disbursement guide.
  • Who to contact: Your GCM can help you apply the beneficiary test and decide whether an undergraduate should be budgeted as an hourly employee, a stipend recipient, or a participant — and set up payment correctly.
• Other personnel, including collaborators (see below)

• Every salary or wage you budget also carries fringe benefits, and the fringe rate depends on the category.  See Lab Staff salaries section for more details.
• Benefits-eligible (regular) staff carry the full fringe rate — health, retirement, PTO, and payroll taxes. It’s more expensive, but it’s the correct and required cost for an ongoing project role.
• Temporary and student wages carry a lower fringe rate (primarily payroll taxes).
• Budget the right rate from the start — under-budgeting fringe leaves you short later — and don’t classify a role as temporary just to lower the fringe charge, since misclassification creates ACA and compliance exposure. 
• Your GCM has the current fringe rates. Please check here for updated rates. For 2026:
  • The fringe rate for full-time staff salaries and faculty academic-year salary charged to a non-federal grant is 29.8% (part time: 19.8%).
  • The fringe rate for full-time staff salaries and faculty academic-year salary charged to a federal grant is 26.1% (part time with benefits: 18.4%; part time without insurance: 10%).
  • For faculty summer salary and temporary employees, the rate is 10%.
  • Fringe benefits are not calculated for graduate and undergraduate students. 

• Please check here for updated rates. For 2026:
  • Reynolda on-campus rate: 45.5% of modified total direct costs (MTDC). MTDC excludes equipment, tuition, and the portion of the total cost of all subawards (including indirect costs) over $25,000. 
  • Off-campus rate: 20% of MTDC.
  • For foundation proposals, the maximum allowable IDC rate must be applied.

• Explore the full policy here.
• The Basics:
  • Course buyouts are available to tenured and tenure-track faculty who want to be released from some classroom teaching to focus on research or creative activity.
  • A buyout reduces only some teaching — it does not relieve you of your service or other departmental and programmatic responsibilities.
  • You fund the release through sources outside the College or School budget — an external sponsor or eligible internal funds.
• Approvals and course-load limits
  • Every course-release request must be approved in writing — first by your department chair or program director, then by your Dean. Approvals are not guaranteed.
  • A simple course-release buyout generally can’t reduce your load below one course per semester unless your chair and Dean specifically approve. For example, if you’re funded for two or more buyouts in a year, you can’t completely buy out one semester and teach a full load the other.
  • Your chair and Dean assess each request’s impact on the department’s instructional mission. Address that impact in your written request, or have your chair note it in the approval communication to the Dean.
• Budgeting a sponsor-paid course release
  • Because of federal time-and-effort rules, an external sponsor pays for a percentage of your time — not the cost of hiring a replacement instructor.
  • WFU treats a typical 3–4 contact-hour course as requiring about 8 hours of effort per week — 8 of a 40-hour week, or 20%.
  • So to have a sponsor cover one course release, budget 10% of your annual base salary plus fringe. This is equivalent to 20% of your semester salary (which is half of your annual salary) plus fringe benefits for the semester. Please note that you must then certify 20% effort for the semester of the release. 
  • If the sponsor imposes a salary cap, the most you can charge is 20% of the cap. If your salary exceeds the cap, the difference between 20% of your actual salary and 20% of the cap is voluntary, uncommitted cost share — follow the University’s Effort Reporting policy to determine whether and how to show it.
• Paying for a release with internal funds
  • If you’re covering a release from internal funds — such as an ID, DM, SG, or CG account — the mechanism is different: a transfer is made from your account to a Dean’s account to pay the complete cost of the replacement instructor, including salary, fringe, and any related costs.
• Who to contact:
  • Your GCM can build the 10%-plus-fringe calculation into your budget; course releases require written approval from your department chair and Dean. 

There is no cost for baseline usage of the Distributed Environment for Academic Computing (DEAC) Cluster, WFU’s High-Performance Computing (HPC) Facility. Additional storage and high priority access can be acquired by contributing funds based on your project’s needs. This amount is calculated by multiplying the current Service Unit Rate times requested resources (compute, GPU, and/or storage). Researchers should to help determine their required resources and contribution amount to request. 

• Funds must be included in your application to cover open access fees for publications that charge them. Check sponsor guidelines to determine if this is allowable. 
• In some disciplines, faculty are expected to pay for color graphics in publications and reprints and must include these costs in the budget. 

• Sponsored-project travel is reimbursed on actual expenses, not per diems, so keep itemized receipts for everything — meals included. They show that what you charged was allowable (for example, that alcohol or an unusually expensive meal wasn’t charged to the grant).
• Federally funded domestic and foreign travel must use a U.S. flag carrier under the Fly America Act (limited exceptions apply). 
• If you’re traveling for fieldwork, data collection, training, or a project meeting rather than presenting, note the traveler, role, destination, dates, purpose, and benefit to the project in budget justification.
• Foreign travel often needs to be approved by the sponsor, so it is best if you include it in your original budget in your application

• “Equipment” has a specific meaning on a grant, and it’s budgeted and tracked differently from ordinary supplies. At Wake Forest, an item is capital equipment (a “Business Asset”) when it’s owned by the University, held for operations, has a useful life of more than one year, and has an acquisition value of $5,000 or more — including installation, training, and related costs. Anything below that threshold is treated as a supply and expensed in the year it’s purchased. 
• List each item of equipment separately and justify why the project needs it. Roll the full cost — purchase price plus shipping, installation, and required training — into the item, since that’s how WFU determines the $5,000 threshold.
• Equipment carries no indirect costs. It’s excluded from the modified total direct cost (MTDC) base, so no F&A is charged on it — which is why sponsors and WFU want equipment clearly identified and not buried among supplies.
• Check first whether the equipment already exists in a core facility or a colleague’s lab; sponsors expect you to use available shared instrumentation before buying your own.
• Get vendor quotes early — they support both your budget and the later purchase and may be required for your proposal. Check sponsor guidelines.

• Supplies are the consumable counterpart to equipment: the materials your project uses up, or items that cost less than WFU’s $5,000 equipment threshold. Getting this line right is mostly about estimating honestly and justifying clearly.
• What counts as supplies: Lab consumables (reagents, chemicals, glassware, plasticware, kits), project-specific materials, small tools, and software or computing devices that fall under the $5,000 threshold or have a useful life of less than a year.
• Anything $5,000 or more with a useful life over one year is equipment, not supplies, and is budgeted and treated differently — including being exempt from indirect costs (see Equipment)
• How to estimate the amount:
  • Build the number up from the science rather than a round guess: cost per experiment, per sample, per animal, per participant, or per month of lab operation, multiplied by your planned scale.
  • Group supplies into meaningful categories — “molecular biology reagents,” “cell culture,” “field sampling materials” — rather than one vague “miscellaneous supplies” line. Reviewers and sponsors discount budgets that look padded or unexplained.
  • Use current catalog or vendor prices, and apply a reasonable escalation (often 3–5% per year) across multi-year budgets.
  • Itemize and justify in the budget justification: what you’re buying, roughly how much, and why the project needs it.
• Keep it allowable
  • Supplies must pass the cost principles — reasonable, allocable to this project, and allowable under the sponsor’s and WFU’s rules (see Spending with the cost principles). Unlike equipment, supplies are included in the F&A base (modified total direct costs), so indirect costs do apply to them.
  • General office supplies, postage, basic printing, and routine computing are normally treated as indirect (F&A) costs at WFU and can be charged directly only when they’re integral to the project and specifically justified (see Direct costs and indirect costs). When in doubt, ask your GCM before budgeting these as direct.
  • A computing device under $5,000 can be budgeted as a supply when it’s essential and allocable to the project (meaning, only used for that specific project).
• A few practical tips:
  • Don’t over-budget “to be safe” — large, unexplained supply lines invite questions, and unspent funds can’t simply be redirected.
  • Retain the basis for your estimate (quotes, prior spending, a per-unit calculation); it’s exactly what your GCM or an auditor will look for later.
  • If a costly consumable is shared across projects, budget only this project’s proportional share and track use.

• Reimbursing conference participants presents a unique, labor-intensive challenge that must be included in a budget from direct costs to obtain approval from the sponsor
• Each sponsor will detail the specific costs that can be reimbursed and the maximum amount.  Read the guidelines carefully. 
• Please note that staff time for the reimbursement process must be requested and arranged since this is not a GCM responsibility

• Federal cost principles (the Uniform Guidance, 2 CFR 200) sort every expense on an award into one of two categories, and the test is how clearly the cost connects to your specific project.
• A direct cost can be identified specifically with your project, or assigned to it easily and with a high degree of accuracy. These are costs incurred because of your work that wouldn’t exist without it. Direct costs include:
  • Salaries and fringe benefits for the people working directly on the project
  • Travel for project-related trips
  • Materials and supplies used for the work
• An indirect cost — formally a Facilities & Administrative (F&A) cost, also called overhead — is incurred for common or joint objectives that support many projects and the institution as a whole, so it can’t be tied to any single award. Rather than billing these to your grant line by line, the University recovers them as a percentage of your direct costs (your award’s F&A rate). Indirect costs include:
  • Buildings, utilities, and maintenance (“Facilities”)
  • Library resources
  • Central and departmental administration, including Pre-Award, Post-Award, and HR staff (“Administration”)
• The same cost can fall on either side, depending on the circumstances. A cost that’s normally indirect may occasionally be charged directly — but only when it is integral to the project, specifically identified with it, justified in your budget, and not already recovered through the F&A rate. Administrative and clerical salaries, office supplies, postage, and local telephone costs are the usual examples: normally F&A, allowable as direct only with explicit justification. 
• Follow sponsor guidelines when formulating your budget. Some costs may not be allowable; some may not be allowable as direct costs except under certain circumstances; for example, office supplies, postage, and clerical salaries. These costs must be specifically justified in a Cost Accounting Exceptions Form.
• When a particular expense isn’t clear-cut, check the Direct Cost or F&A Matrix ORSP maintains, or ask your GCM before you charge it.

• Certain NIH budgets must be aggregated in $25K modules. A detailed budget must also be attached to the routing form for internal use and should equal the amount requested in the modular budget.
• A modular budget justification lists project staff, their percent of effort, and role on the project and explains any differences in the number of modules between years. Provide no other information. These NIH programs consider a detailed budget noncompliant.