The NIH modular budget format is attractive to PIs for a lovely, time-saving reason: the lack of a detailed budget justification. Modular budgeting may be used for research grant applications requesting up to $250,000 direct costs per year; funds are requested as direct costs in modules of $25,000. The logic behind modular budgeting is efficiency: less work for the PI, less work for the reviewers. Modular budgets give PIs a degree of flexibility during the course of the award (i.e. fewer rebudgeting requests).
If you are close to the $250,000 mark, however, modular budgeting may not be for you. Consider the following:
- Your competing renewal must be modular. This means, then, that you will be limited to $250,000 for the life AND future of the project. If your current submission is part of a grander plan, this could lead to some serious research growth-stunting. Additionally, if it is an NCI application, it generally cannot exceed an increase of 10% over the direct cost budget awarded for the last year of the prior project period. [NOT-CA-08-026]
- There will be no future year escalations. Annual modular budgets are average budgets for the entire award period; salary escalations may result in a request for more modules than needed for costs in the beginning years to cover escalations in future years.
- Underfunding is a reality. You may not have a firm grasp of the project costs at the time of submission, especially if you don’t do an internal detailed budget for yourself and/or SPA. Are costs of materials expected to increase in the out years? What about salaries? Space costs? Supply needs as the project grows? Without a full understanding of the totality of costs, the project could be faced with deficits as salaries and other costs increase annually. Increases in modules can be requested in exceptional circumstances, but the request must be thoroughly justified and acquiescence is rare.
Detailed budgets are nothing to be afraid of, and should be done internally anyway to ensure research is adequately funded. Modular budgets are a great tool for smaller projects but if you’re close to the border, check your figures again: the extra effort of a detailed budget could save you from the pain of future paucity. If you need help in auditing future needs or budget framework, RAS is here to help!
If you’re welcoming a new faculty member to your department, there’s a good chance that you’re welcoming a new project or two as well. Once you have received the NIH-approved relinquishing statement from the former institution, you’ll need to put together a new budget to satisfy both SPA and the Change of Grantee Organization SF 424. (On a related note, the NIH made some updates to the SF 424 Application Guide and released it last Friday, July 25, 2014. Edits are noted in purple.) When building your transfer budget, these points may be helpful:
- Your first year budget should match the amount on the approved relinquishing statement. Any following out years should match the awarded direct costs on the original Notice of Grant Award (NOGA).
- While direct costs must match the NOGA, indirects are permitted to be generated based on Wayne State University’s applicable F&A rates. This will change the overall dollar amounts awarded in each year; that’s OK.
- Modular submission is not permitted for a transfer/change of grantee organization. HOWEVER, if desired, an award that was submitted as modular during the proposal phase has the option during transfer to complete only the costs for the PD/PI (Section A), and include the remainder of the direct costs under Section F (Other Direct Costs) Item 8, and Section H (Indirect Costs). Otherwise, a detailed budget should be utilized.
If you’re fortunate enough to be transferring an award to your department, we’re here to help with any questions you may have! For further details, take a look at the text of PA-14-078.
Well, sweat the details a little bit.
Modular submissions to NIH calls for proposal are very attractive, especially due to the perceived lower level of scrutiny thee budgets receive (and, of course, the “25% Rebudgeting Rule” doesn’t apply to modular grants!). If you have a project requesting $250,000 or less in direct costs in all years, your project is likely qualified for a modular submission (otherwise known as the “PHS398 Modular Budget component”). Keep in mind, however, that you will still need to submit a detailed budget to SPA at the time of proposal submission; this is for accounting and set-up purposes once the project is awarded.
What do you need to know about submitting a modular budget?
A few things to keep in mind:
- A modular budget is not accepted for SBIR and STTR grant applications.
- There are only two justifications required for a modular budget:
- You must include a personnel justification, including the name, role, and number of person-months for every person on the project. Note: salary and fringes are not to be discussed in the justification.
- If you have a consortium or subcontract, you must have a corresponding justification which includes the total costs (direct + F&A), rounded to the nearest $1,000, for each consortium/sub. Any personnel should have roles and person-months defined. If the consortium is foreign, be sure to identify it as a foreign component.
- While not always required, you may also need to include an “Additional Narrative Justification” to explain any variations in the number modules requested annually. Also use this section to describe and direct costs that were excluded from the total direct costs (equipment, tuition, etc) and any work being conducted off-site.
Why does SPA require a detailed budget if NIH only requires a modular for my project?
There are many reasons SPA requires a detailed budget in all instances, and why it’s a good thing for the PI:
- Certain budgetary detail helps in determining exclusions from the base when calculating facilities and administrative (indirect) costs.
- The PI can ensure that adequate resources are being requested for the proposed research activity.
- Agencies can (and have) come back to ask for details; it’s good to have them at the ready.
- Your detailed cost categories and amounts are used for budgeting loading once the project is awarded.
Modular budgeting saves time, effort and (oftentimes) agency scrutiny, but it doesn’t completely negate the need for detailed preparation. For more detailed assistance on preparing a budget, check out the WSU-SOM Office of Research’s Proposal Prep page, or contact RAS for more specific guidance.