Part I: The College as a Facilitator

The purpose of this write-up is to introduce new faculty to the external funding process at Penn State, to inform our existing faculty experienced in external funding about important revisions in policies and procedures, and to make all aware of the range of services and support available in the College.

As grant seeking becomes more and more competitive, the difficulties and pressures associated with external funding increase proportionately. Our staff understands the dimensions of the "hurdle" that trying to get a grant may present to those who are not accustomed to the grants process. Accordingly, we aim to reduce as much as possible any perceived or real difficulties that may be encountered.

To support the submission and resubmission process, our office stands ready to fund visits to program officers and to bring collaborators to Penn State to work on preparing especially significant proposals. If faculty members working on such proposals desire, we can also arrange pre-reviews of proposals by scholars who are knowledgeable in a particular disciplinary area. Should an honorarium be necessary, we will provide it. If released time or research assistance will increase the probability of a significant submission, we will work with the respective department head to provide such support. (for a complete list of Research Office Services go to Research Office Services

Assistance is available with proposal development, budget preparation, and other application requirements. Our staff will obtain required signatures, assist with completion of required forms, take care of University clearance procedures, and ensure that all proposals reach the sponsor by the stated deadline. We encourage faculty to consult with grants and contracts personnel as early as possible in any submission process. The more lead time we have before a deadline, the more we can help with your proposal. Our experience suggests that proposals rushed through channels a few days before a deadline get turned down much more frequently than do proposals which we have in our hands a few weeks before they are due to the sponsor and on which we have therefore been able to suggest budgetary or editorial revisions.

Part II: Identifying Potential Sponsors

Our staff will assist faculty with the identification of potential funding sources. We have access to numerous Internet-based informational services and databases and software that enables us to search The Foundation Directory and The Foundation Grants Index for funding priorities of and recent awards made by private sector sponsors. 

Part III: Ascertaining Sponsor Interest

After identifying a potential sponsor and/or program for a research project, we suggest that faculty obtain as much information as possible about program priorities and guidelines, types of eligible activities, recipient requirements, review cycles, funding mechanisms, and projected number and size of awards. Some of this information may already be available through our office, but some will have to be obtained directly from the funder. If the project still appears to be relevant for this particular sponsor, we strongly encourage faculty members to make direct contact with agency staff before attempting to write a proposal. The only exceptions would be certain foundations where direct contact is highly restricted. Our staff will be glad to provide agency staff names/phone numbers/e-mail addresses, and where available, web addresses.

Part IV: Gifts, Grants, and Contracts

Faculty should be aware of the fact that differences exist in the types of awards made by sponsors since the type of award determines the formal nature of principal investigator obligations and the extent of sponsor involvement in the project.

At the least formal end of the spectrum are GIFTS, which are sometimes called unrestricted grants. These are monies from industry or private organizations in support of a faculty member's research, in support of fellowships, or for the use of particular instructional programs. No formal reports or reviews are required by the sponsor, no formal documents are exchanged between the sponsor and the University, and no "deliverables" are specified. The sponsor has no involvement in the conduct of the project for which the money is given, and Penn State assesses no overhead. These awards are commonly received in the form of a check, which is often accompanied by a letter from the donor specifying the nature of the contribution (e.g., support for the research of Professor X). Faculty receiving such support should bring both the check and the letter to the Liberal Arts Research Office as soon as they are received. Grants and contracts personnel will process the award, and the faculty member should have access to the funds in a matter of days. Commonwealth Educational System faculty receiving such an unrestricted grant would ordinarily process the award through the business office of the respective campus.

At the other end of the spectrum are CONTRACTS, the most formal type of award made for any kind of project. The sponsor supports clearly defined activities, and has a considerable amount of involvement in the conduct of the project. Project performance is monitored, technical and detailed financial reports are required, and very specific deliverables are stipulated. A series of pre-negotiations between the sponsor and the principal investigator and formal negotiations between the sponsor and the University must take place before a contractual award is accepted.

GRANTS are the most common type of award in the academic environment. For a grant, the project has been described in a proposal, and the sponsor expects the researcher to work toward the stated objectives and goals on a "best effort" basis. Deliverables usually consist of a final performance report and a financial report supporting expenditures in general compliance with a previously approved budget. The sponsor has minimal involvement in the conduct of the project itself.

Part V: Proposal Preparation

Obviously, the probability of funding rests heavily on the selection of the appropriate sponsor and the competence displayed in designing and justifying the study. However, a large contribution to successful applications is made by the clarity and quality of writing in the narrative, and by the manner in which the proposal is organized and presented. Many excellent ideas are lost among the thousands of proposals submitted for funding because those ideas were poorly conveyed.

Most funding agencies issue specific guidelines and forms for the preparation of proposals. These guidelines can be extremely detailed and must be followed scrupulously to avoid the possibility of summary rejection without review. There may be limitations on page length, font, point size, size of margins, length of the title and any number of other items. Some RFPs will specify particular subheadings or topics to be covered and will calculate scores according to the relevant categories.

If formal guidelines are not provided by the sponsor (as is often the case with foundations), there are some generic steps to be followed. Your proposal should always have a cover page that states the title of the project, the name(s) of the principal investigator(s), the name(s) of the submitting unit, the dollar amount requested, and the beginning and end dates requested for the project. Space should be left for signature(s) of the PI(s) and for official university approval. It is essential that a proposal have page numbers and reviewers find a table of contents to be very helpful. 

Care should be taken with the abstract since this is usually the first -- and sometimes the only -- part of the proposal that will be read by some reviewers. It must therefore present a concise yet complete picture of the proposed study. We suggest that the abstract be written only after the proposal is completed. The proposal narrative should include a discussion of the project significance, objectives, methodology, any preliminary work already done by the researcher, and relevant studies conducted by others in the field. References should always be included and a full bibliography may be desirable. The budget should be detailed enough to allow a review to take place independently of the narrative. To the extent possible, all line items should be broken down into explanatory components (i.e., don't have a line item that stipulates "travel = $5,000"). It is also a good idea to provide budget notes with explanations of personnel functions, travel costs, equipment, and all items that may appear unusual to someone not intimately familiar with the scope of the project.

Part VI: Budget Building: A Quick Reference to Common Line Items

All University salaries and wages in a proposal budget must include an additional line item for fringe benefits. These are percentages of salary amounts negotiated annually with the federal agency having oversight of such matters (in the case of Penn State, this is the Office of Naval Research). Since the rates change every year, please check with grants and contracts staff before attempting to draft a budget for a proposal.

Fiscal 07-08 fringe benefit rates for full-time salaries are 25.8%; for graduate research assistant stipends 15.7%; for part-time staff and wage payroll 8.2%, for student wages .4%.

Salary increments should be built into any budget as of each July 1. These are generally estimated at 3.5%, depending on sponsor stipulations.  It should also be kept in mind that most academic salaries in Liberal Arts are based on 9-month appointments. If work on a project is to take place during the summer months, the 9-month salary must be annualized to 12 months.

Graduate assistant stipends are based on pre-determined figures according to the level of appointment chosen for project support. Please get in touch with us to ascertain current levels.

Although stipend amounts increase as the grade increases, tuition remission does not. For Fiscal 07-08, tuition for all regular grad assistants is $5,935 per semester, regardless of grade level. Tuition for ABD's varies. Please call the Grants Office (865-8030). 

These figures change each fiscal year. As part of our normal services, our staff will prepare all budgets and associated forms for you. However, in the event that you wish to draft your own budget or just get a ballpark estimate of what your expenses might be on a project, our office can help you determine the appropriate stipend level and tuition rate.

Facilities and Administrative Costs (often referred to as "overhead" or "indirect costs") are charged to all proposal budgets if the sponsor has no written guidelines stating that overhead will not be paid. These are calculated on the basis of Modified Total Direct Costs (unless the sponsor stipulates a different base) and represent the University's operational expenses for the entire research enterprise (not just your particular project). The rates are negotiated with the Office of Naval Research on the basis of a careful review of all research-related expenses University-wide. http://www.research.psu.edu/osp/proposal/rates.html

To determine the MTDC for your project, subtract from the bottom line (total direct costs): (a) capital equipment valued at more than $5,000 per item, (b) all tuition remission for grad students, and (c) all subcontract amounts in excess of $25,000. For example, if your project has a subcontract in the amount of $100,000, only the first $25,000 would be subject to the indirect cost charge. If the subcontractee remains the same on a multi-year project, indirect costs will be assessed only for the first year.

2007-10 F & A rates for on-campus research projects are 47.4% MTDC; on-campus instructional or continuing education projects are charged 44.6% MTDC. Corresponding off-campus rates are 25.7% MTDC and 21.3% MTDC, respectively. Again, please remember that these rates are re-negotiated each July 1. Check with College grants personnel before drafting any budget.

Important Information for Federal Budgets:

Federal regulations (Office of Management and Budget Circular A-21) prohibit charging as direct costs the salaries of clerical or administrative personnel, office supplies, postage, local telephone costs, and memberships in all but unusual and fully justifiable circumstances. This ruling is intended to establish the principle that such costs should normally be treated as F & A costs by universities. A project that includes major activities requiring clerical or administrative salaries must be able to demonstrate that these costs are easily identifiable specifically with that sponsored project. For example, a project might qualify for direct charging of clerical salaries if it requires assembling and managing teams of investigators from a number of institutions; if it is geographically inaccessible to normal departmental administrative services, such as a research field site remote from campus; if it involves extensive data accumulation and entry, surveying, tabulation, and reporting, such as a clinical trial or a retrospective clinical records study. Single investigator projects may also qualify for direct charging of clerical salaries if they require project-specific database management; individualized graphics or manuscript preparation; human or animal protocol Institutional Review Board (IRB) preparations and/or other project-specific regulatory protocols; and multiple project-related investigator coordination and communication. It is crucial to remember, however, that the special circumstances requiring the direct charging of these services must be justified to the satisfaction of the granting agency. If a justification is found to be unacceptable by the agency or if such budget line items are included without a justification, the charges will be automatically deleted by the agency. This applies not only to new proposals but also to non-competing continuation requests. Therefore, unless faculty are proposing complex projects and/or are reasonably certain that they can justify to the agency's satisfaction the inclusion of any of the costs specified above, Federal budgets should not include clerical or administrative salaries, general office supplies and postage, local phone charges, or memberships. Please contact grants personnel if you have any questions about these regulations.

Part VII: Moving the Proposal Through University Channels

After the proposal and all requisite sponsor forms have been prepared, approval signatures are obtained from the Principal Investigator(s). The proposal, accompanied by internal documents called Proposal Internal Approval Forms (PIAFs), must then be approved via signature by the appropriate department head(s). Project Directors are reminded that department heads need to be familiar with the proposal and budget before someone appears at their doors requesting an approval signature. This is especially true if any commitment is being made for academic year effort or any departmental resources. No commitments of any kind may be made without specific approval from the department head. Commonwealth College and other faculty not based at University Park must obtain the approval of their campus before clearance is sought at the departmental level. Dean Lombra then must approve the proposal (via Trish Alexander) before its transmittal to the Office of Sponsored Programs (OSP). Required University signatures are obtained by OSP, and the fully approved proposal is picked up by College staff. All required copies are packaged, and the proposal is shipped to the sponsor, usually via a courier service such as UPS.

There are several additional approval stages if your project is classified as instructional or continuing education, or if there are other colleges or Intercollege Research Programs (IRPs) involved. Please keep in mind the fact that our staff needs to have sufficient time for all internal approvals -- at least 36 hours before the proposal needs to be in the mail if multiple signatures are required.

Part VIII: The Project Will Be Funded: The Acceptance Phase

The University assumes fiscal responsibility for awards, and, in essence, guarantees that the project will be completed. As a result, the acceptance process is comprised of several steps.

In the case of a grant, the central grants office (OSP) receives an award notice from the sponsor. OSP then requests a recommendation from the College grants office. Our staff reviews the award's guidelines and any conditions that are appended to the grant. We then recommend acceptance "as is," or request minor changes in administrative details.

Should any award documentation be sent directly to the Project Director, this should be forwarded immediately to our office. Under no circumstances should Project Directors sign any forms or return any paperwork to the sponsor. Not only will such signatures be considered non-binding as far as the University and the sponsor are concerned, the acceptance of the award will be delayed since all documents will have to be re-routed through Sponsored Programs personnel for appropriate execution.

If the award is a contract, the review process actually begins before an award is offered. During a pre-negotiation phase, the researcher(s) and the sponsor discuss the content-based aspects of the proposal. The College grants and contracts staff then verifies all budgetary details and confirms all rates quoted in the proposal. OSP now begins formal negotiations with the sponsor on such aspects as copyright, patent, default, and termination clauses. The Research Accounting Office also enters the review cycle. Only after all parties agree on all aspects of the contract is the award accepted by the University.

Part IX: The Award Is Accepted: How Does One Get Access to the Money?

Funds are not released to the University until the official start date of the project. If the award is a grant, the start date is usually stipulated by the sponsor in the terms of the award. This date may or may not be exactly the same as requested in the proposal. If the award is a contract, the official start of the project may be specified in the terms of the contract or it may be predicated upon the date of the final signature on the document itself. Depending on the contract, the critical signature may be the University's or it may be the sponsor's. However this may occur, the determination of the start date is the signal for the Research Accounting office to establish a fund number for this particular award. Once this is done, the Research Office and the appropriate departmental staff set up the budget structure in the University's central accounting system.

Advance Fund Numbers

If the College receives information that points to a definite likelihood of funding for a particular proposal, and if the proposed start date of the award is known, a temporary budget structure can be created in order to permit necessary expenditures to be incurred against the project budget while waiting for the actual award documents to arrive. Under the expanded authorities granted to the University by certain Federal agencies (e.g., NSF, NIH, NASA), expenses may be incurred prior to the actual start date of the award if this becomes necessary due to the requirements of the research project. Approvals for both advance fund numbers and pre-award expenditures must be processed through our office. The department head must send an email request to the Research Office for advance account numbers. If the award does not materialize or if the start date turns out to be other than stated on the request for an advance fund number, the department is responsible for all expenses incurred.

Part X: The Proposal Is not Funded: What Are the Next Steps?

It is not unusual to have a proposal turned down for funding. Experienced researchers are aware of the fact that revision and resubmission are often necessary in order to be successful. New applicants, however, may become discouraged at the receipt of a "no." We encourage faculty to think of grant seeking as an on-going process, and to request reviewer comments as soon as notification of non-funding is received. A careful re-thinking of the proposal and the project in the context of these comments will often result in a favorable outcome upon resubmission.

Part XI: Project Director Responsibilities

Although the University assumes legal responsibility for externally funded projects, the Principal Investigator/Project Director is responsible for the day-to-day fiscal management of the project, for the proper conduct of the research activities themselves, and for all technical project reporting requirements. All programmatic and budgetary modifications must be initiated by the PI, and, where required, be approved by the sponsor's administrative or program contact. The PI must also ascertain that all project expenses are made in compliance with sponsor and university regulations, and that no conflict of interest arises during the course of the project.