A proposal is a request for financial support of a project. In general, it consists of two parts: a technical or narrative section and a budget.
- A good technical proposal is a concise and coherent explanation of a project plan that has specific and reasonable objectives. It clearly states both the goals of the project, necessary background and support information, and the methods to be employed in reaching those goals.
- The budget is the Smithsonian’s best estimate of the financial support needed to carry out the technical proposal. It is as detailed as possible and should be based on Smithsonian accounting categories; the project director must justify each budget estimate proposed.
Sponsored project agreements are awarded to the Smithsonian Institution under the direction of the Principal Investigator, not to the Principal Investigator directly. Therefore, prior to preparing a request for external support, the PI must contact OSP. This does the following:
- Prevents delays in obtaining required authorizations
- Ensures that all agreements conform with Smithsonian policies and procedures
- Expedites funding after awards are received
This chapter explains the steps of proposal preparation as divided into the following categories:
- Pre-submission procedures
- Preliminary proposals
- Proposal preparation responsibilities
- Technical proposal preparation
- Cost proposal preparation
Furthermore, a checklist for developing a proposal is included in Appendix E.
For proposal clearance and submission process information, please refer to Chapter Six.
A proposal to a funding entity for a sponsored project may be either solicited or unsolicited.
- Solicited proposals are usually government-generated “Requests for Proposal” (RFP) or “Requests for Quotation” (RFQ) on a specific research, training, or technical assistance project. In such cases, the intended scope of work is pre-determined by the soliciting sponsor, and specific requirements for the format and content of both technical and cost proposals are presented in the published requests. The successful solicited proposal may result in either a contract or a grant. Government RFPs and RFQs are widely advertised in sources such as the Federal Register that are monitored regularly by OSP staff.
- Individuals may initiate unsolicited proposals at any time. Many funding entities have general requirements for the format of unsolicited proposals and deadline dates for submission of the proposal. OSP Grant and Contract Administrators may contact the sponsor for guidelines or other indications of sponsor requirements.
When submitting an unsolicited proposal, it is wise to contact a program officer within a government or private funding agency to discuss a project idea before preparing and submitting a formal proposal. Most program officers welcome advance contact of this sort because it allows them to help potential Principal Investigators focus project on areas of interest to their organizations.
Sponsor contacts are made by:
- Telephone Inquiry or Sponsor Visit - Principal Investigators are encouraged to make telephone inquiries after discussing projects with OSP staff. In some cases, the Grant and Contract Administrator or a development officer may make the initial sponsor contact on behalf of the Principal Investigator. Likewise, the Principal Investigator may visit a potential sponsor alone, or accompanied by a representative of OSP or a development officer. Throughout the course of such calls or visits, no commitment of Smithsonian resources should be made, nor should detailed budget figures be discussed.
- Letter of Inquiry - a letter of inquiry is a general presentation of a project idea, designed to elicit feedback from a potential sponsor. As in telephone inquiries or sponsor visits, no commitments should be made. Although no formal approval or sign-off is required, Principal Investigators are strongly encouraged to forward a copy of such correspondence to an OSP Grant and Contract Administrator.
- Letter of Intent - A letter of intent expresses the intention to submit a proposal in response to a particular program announcement or a Request for Proposal. Letters of intent are generally solicited by the sponsor in conjunction with announcements expected to generate widespread interest. Sponsors generally require that such letters present only a general statement of the intended project theme. If the letter of intent contains budget estimates or ranges, it must be reviewed and approved by OSP prior to submission.
Preliminary proposals, like letters of intent, are often solicited by sponsors. A preliminary proposal usually includes a one- to five-page description of the project. If a sponsor requires an outline budget or an indication of the Smithsonian’s willingness to support the project through commitment of resources (personnel, space, or equipment), the preliminary proposal must be cleared and approved as a full proposal prior to submission. The proposal is reviewed by OSP after the supervisor and unit director endorsements are obtained.
Prior to contacting a non-government sponsor, a Principle Investigator must first consult with OSP or a development officer (either the central or a unit development office) for clearance.
PROPOSAL PREPARATION RESPONSIBILITIES
In developing and preparing a proposal, the Principal Investigator works with OSP staff to ensure that a complete application, consistent with both sponsor and Smithsonian policies and procedures, is submitted to the sponsor. Both the Principal Investigator and OSP have responsibilities they must each uphold.
Responsibilities of Principal Investigator
The Principal Investigator must fulfill the following requirements:
- Contact his/her supervisor to obtain informal approval and support for the project. Issues of constraints on staff time and availability of adequate space and facilities are resolved at this time.
- Contact OSP at early stages of project conceptualization.
- Write the technical narrative.
- Draft a budget that lists all costs for the project, including both direct and indirect costs, and place costs in Smithsonian accounting categories (with guidance from OSP staff or unit Fund Managers).
- Allow sufficient time for institutional review and approval.
- Secure approval of relevant compliance committees (for example, for use of animals) with assistance of OSP staff.
- Notify OSP of involvement with hazardous/radioactive materials, recombinant DNA, or other items requiring internal review and approval, as listed in Chapter Six of this Guide.
- Complete the Proposal Submission Checklist for Principal Investigators found in Appendix V on OSP’s website.
Responsibilities of Office of Sponsored Projects
Additionally, the Office of Sponsored Projects has the following responsibilities:
- Assist in identifying possible funding sources.
- Finalize budgets within appropriate guidelines.
- Coordinate with other financial and administrative offices, as necessary.
- Complete proposal forms required by the Smithsonian and sponsor.
- Coordinate Smithsonian proposal review process, securing necessary approvals and signatures.
TECHNICAL PROPOSAL PREPARATION
When preparing a technical proposal, the PI should keep in mind the following goals and format.
A good technical proposal meets the following goals:
- Explains concisely and coherently the project plan
- States goals and methods clearly;
- Conforms to the interests and guidelines of the sponsor
- Demonstrates a need for the project
When preparing proposals, Principal Investigators must follow specific sponsor instructions regarding length, subject matter, and organization. OSP Grant and Contract Administrators work with Principal Investigators to ensure that all instructions for duplication, presentation, and submission of the proposal are followed.
Another important step in making a strong and competitive application is to identify colleagues or experts willing to review the proposal for programmatic concerns before submission. It is also important to check the document for spelling errors and to proofread the proposal in its entirety, prior to its final printing.
Most sponsors have specific format guidelines for preparing proposals. In the absence of such guidelines, the following format may be followed:
- Title page
- Table of contents
- Project description
- Management and staffing
- Budget and financial information
- Human subjects
- Vertebrate animals
- Resources and environment
The title page includes:
- Proposal title
- Name and address of the sponsor to whom the proposal is submitted
- The Smithsonian Institution representative’s name, address, telephone and facsimile numbers (OSP Director)
- The Smithsonian unit where the work will be carried out
- Proposed period of performance
- Total required support (in multi-year projects, the total for Year 1 is stated separately, as well as included in the total request
- Name, title, address, telephone and facsimile numbers of the Principal Investigator
- Signatures of the Principal Investigator and the OSP Director, the latter being the Smithsonian’s authorized official (specific circumstances may require additional signatures)
The abstract highlights the scope of the proposed project, including its objectives and the intended methodology, the anticipated results, and a statement of potential significance, including the relation of the project to the sponsor’s goals. An abstract is a highly effective means of presenting an overview of the project to a reviewer or review board.
The abstract is meant to serve as a succinct and accurate description of the proposed work, when separated from the application. It generally does not refer to figures, tables, past accomplishments, or literature appearing in any other part of the proposal.
Table of Contents (and List of Illustrations/Tables)
A table of contents for the proposal is included, if necessary.
Introduction to Proposal
The proposal introduction is a crucial component of the application. It must engage the reviewer’s attention, and encourage a full reading of the proposal.
In general, a proposal introduction includes:
- Statements that address the specific guidelines of funding criteria of the sponsor
- Statements of relevance or merit, emphasizing the reasons the Principal Investigator and the Smithsonian should be funded to address the problem
- Mention of previous Principal Investigator accomplishments in the area proposed
- A description of the Principal Investigator’s ability to carry out the project proposed
- A transition from the final paragraph of the introduction to the next section of the proposal
Introductions should be brief and comply with sponsor guidelines on length.
Description of Proposed Project
This description is a detailed extension of the proposal abstract. It includes a statement of past work that has suggested or made possible the proposed study, as well as a specific description of recent research. It also includes the following sections:
- Statement or Assessment of Need – states and documents the problem or hypothesis, and indicates the ways the project will relate to and reflect the current state of the art;
- Project Objectives or Goals – indicates the specific, measurable results of the proposed program;
- Preliminary Results or Progress Report – summarizes the previous work, provides a succinct account of published and unpublished results, and discusses any changes in the aims of the current proposal;
- Methods – describes how the measurable results will be achieved;
- Evaluation – provides a basis for interim project improvements, and end-of-year or end-of-project evaluation (this section may be combined with Objectives or Methods).
Management and Staffing
This section includes a discussion of the proposed project organization and the names of key project personnel.
Budget and Financial Information
In addition to the budget, the PI should provide a narrative, which is a line by line detail and justification for any unusual or expensive budget items (development of a complete line-item budget is discussed in this chapter under “Preparation of Cost Proposal”).
The proposal must describe the proposed involvement of human subject in the work, and the characteristics of the subject population, including their anticipated number, age, sex, and ethnic background.
The PI should describe the proposed use of animals in the work; identify the species, strains, ages, sex, and number of animals; justify the use of animals, and provide information on their care.
Resources and Environment
This section includes a description of the facilities to be used, their capacities, pertinent capabilities, relative proximity, and availability to the project.
This describe the importance of the consultant(s) on the project. Consultants are discussed later in this chapter. Also see Chapter Nine and Appendix F for more information on Consultants.
The PI should describe the important of the subcontractor and the subcontractor’s role in the project. Subcontracts are discussed later in this chapter under “sub-agreements.” (also see Chapter Nine for more information on subcontracts.)
The appendices include bibliographies, tables, charts, illustrations, reprints, and other supplementary materials that enhance the effectiveness of the presentation:
- Curricula Vitae for all senior project personnel also are submitted. OSP recommends that all curriculum vitae submitted follow a similar format. These may be included in the appendices.
- Other support is submitted with the curricula vitae. This includes all other financial support, whether Federal or non-Federal, for both current and pending applications on which the individual is participating and contributing time and effort.
Many sponsors limit the number of pages of text. Principal Investigators must check to determine if supplemental materials, such as appendices, are included in the page limit. This is very important—if a proposal exceeds the page limits, it may be returned without review.
Checklist for Developing a Proposal
The Checklist for Developing a Proposal found in Appendix E, although generic, may provide guidance to Principal Investigators in developing a high-quality, complete proposal.
COST PROPOSAL PREPARATION
A proposal budget details the anticipated activities and personnel of the project, thus providing an in-depth picture of the structure and conduct of the project. The budget, or cost proposal, is key and outlines the project in fiscal terms. Reviewers often use the budget to get a quick sense of both project organization and the Principal Investigator’s ability to determine the resources required to successfully complete a project.
A detailed budget has the following characteristics:
- Demonstrates careful planning of the project
- Supports project feasibility
- Provides explanations of budget items for reviewers
The Principal Investigator has primary responsibility for preparing the budget and ensuring that it complies with specific sponsor requirements. Principal Investigators begin estimating costs as soon as the parameters of the technical proposal are established. OSP assists in preparing a draft budget based on these estimated costs. A sample budget is provided in Appendix G and may be used as a guide to budget development.
Involvement of OSP at the earliest stages of budget development helps ensure that:
• Projected costs are comprehensive and reasonable.
• Appropriate budget categories are used in accordance with the Smithsonian accounting system.
• Budget line items for salaries, fringe benefits, indirect costs, and other costs accurately reflect Smithsonian policies.
• The proposal is expedited through the approval process.
A budget consists of two cost categories: direct and indirect costs. This section provides information on the following:
- Direct costs
- Indirect costs
- Indirect cost waivers
- Cost sharing
Direct costs are those that can be identified specifically with a particular sponsored project, an instructional activity, or any other institutional activity. Direct costs can be assigned to such activities relatively easily with a high degree of accuracy. Examples of direct costs include the following:
- Personnel (salaries and wages)
- Personnel benefits
- Supplies and materials
These items and other direct costs are discussed in following sections. Refer to Appendix H for a listing of Smithsonian Financial System accounting codes.
All personnel scheduled to devote time to the project are listed in the budget. The budget includes titles, the percentage of time to be spent on the project, base salaries, and the amount the sponsor is asked to pay to support each person for the budget period (or their individual period of performance). If not defined by sponsor guidelines, personnel are listed in the following order:
- Professional salaries (beginning with the Principal Investigator)
- Technical staff salaries
- Administrative staff salaries
- Part-time personnel
Principal Investigators consult with their supervisors or assigned Personnel Management Specialist to determine the appropriate grade-level designation for prospective positions. Vacation, holiday, sick leave, and other paid absences are included in salaries and wages, and therefore are not budgeted separately. Actual time spent on the project is recorded on the employee’s time sheet. Detailed information on the Institution’s system for reporting employee attendance is contained in the Time and Attendance Handbook (SIH 310).
SMITHSONIAN EMPLOYEES PAID FROM GRANTS AND CONTRACTS
Smithsonian staff paid with funds from an externally funded grant or contract (whether Federal or private) are considered Trust Fund employees, and their period of appointment is generally limited to the term of the award, unless other Smithsonian employment arrangements have been made. Smithsonian federal employees are not permitted to receive salary or other personnel compensation from private or Federal sponsors.
For Federal staff who participate in grant or contract activity, a fee for services and facilities may be charged to non-Federal sponsors. Such arrangements may be developed at the discretion of the unit or office director and OSP. Any resulting fees are to be returned to the unit or office’s program.
Salary estimates beyond the current calendar year should include merit increases (which are not guaranteed) based on current Smithsonian schedule and allowances for cost of living increases.
OSP assists in calculating these salary figures during the development of the budget proposal.
Salaries charged to sponsored projects may not exceed the proportionate share of the employee’s base salary. The salary charged is based on the level or effort applied to the project by the individual, and may never exceed 100% salary or effort.
COMMITMENT OF EFFORT
When an award is made, the salary section of a proposal becomes a binding agreement for commitment of the Principal Investigator’s time. It is therefore important to budget a proper level of effort. In addition, it is equally important that prospective Principal Investigators not over-commit their percent of effort or those of collaborating investigators, since investigators usually will have some general administrative and supervisory duties in addition to the sponsored project activity. 100% time commitments should be made only with great caution.
Personnel benefits are part of real employment costs and must be included in budgets, using approved rates and estimates for future years.
Fringe benefits consist of Smithsonian contributions to Social Security (FICA), a retirement program (such as TIAA/CREF), health insurance, disability insurance, life insurance, workers’ compensation, and unemployment compensation. Fringe benefits are calculated as a percentage of salary.
Staff hired for 90 days or more on regularly scheduled hours of duty are considered full-time positions that must be classified by, and recruited through, the Office of Human resources. These staff are eligible for certain benefits depending on the number of hours worked per pay period.
Staff hired for less than 90 days are not eligible for benefits other than FICA and workers’ compensation.
A consultant is a person having expertise in a particular field, who is engaged as an independent contractor to render advice or perform a special task in return for an established fee. It is often difficult to distinguish between an employee and a consultant. Because of the complexity of this distinction, contact OSP or Office of Contracting (OCON) for guidance. Further Guidelines are offered in Appendix F to help determine an individual’s status. Consultants must carry their own liability and health insurance policies in that they are not covered by the Smithsonian Institution.
When hiring consultants for sponsored project, Principal Investigators should consult the sponsor’s regulations. OSP assists Principal Investigators in obtaining approvals and documentation.
When the use of consultants is desirable for a sponsored project, the following must be considered:
- Qualifications of the consultant;
- Policies relating to engaging Smithsonian staff as consultants;
- Payment and documentation requirements for consultants;
- Requirement for a written contract between the consultant and the Smithsonian;
- Sponsor policy relating to the use of consultants
For Federally-sponsored projects, consultant compensation usually may not exceed an authorized daily rate (OSP should be contacted for the most current rate). This daily rate applies to preparation time, time spent on specific activities, and time spent writing reports and analyzing data.
Federal sponsors expect Principal Investigators to engage in an objective selection process designed to secure the most qualified consultant.
The use of the consultant should be justified in both the technical or narrative section of the proposal and the cost proposal. The technical proposal should justify using the consultant as the best individual to complete the job. The cost proposal should justify the costs of the consultant as fair, reasonable, and competitive.
CONTRACTS WITH RELATIVES OF SMITHSONIAN STAFF
Contracts with relatives of Smithsonian staff (including spouses) are subject to restrictions and review (see SD 103). If a Principal Investigator wishes to employ a relative of any Smithsonian staff member as a consultant, OSP must be contacted for assistance and guidance.
Sponsors generally pay travel costs if the travel is essential to the successful completion of project objectives. Separate detail is provided for foreign and domestic travel. The purpose of each trip is discussed in the technical proposal. It is Smithsonian and Federal sponsor policy that all international travel occurs using only U.S. flag carriers. Refer to the Smithsonian Travel Handbook for further information.
Specific expenses are listed for each proposed trip. Allowance is made for anticipated increases in travel costs. Per diem reimbursement is in accordance with Smithsonian travel regulations. These figures and the guidelines for per diem in domestic and foreign cities are available at OSP, the Smithsonian Travel Services Office, or at the Smithsonian internal web-site. PRISM.
Travel expenses to be listed for each trip include:
- Air fare
- Per diem (meals and incidentals)
- Local transportation costs (i.e., parking, taxis, car rentals, mileage)
- Other costs (i.e., conference registration fees)
Beverages and entertainment
Costs for alcoholic beverages and entertainment are not allowable expenses for government sponsors. These items are not to be included in a proposal budget for a government sponsor. Such costs in a non-government proposal may be included, depending on the sponsor’s guidelines.
Equipment purchased on sponsored projects is defined as having a unit cost of $5,000 or more and a life expectancy of two or more years. For further discussion of equipment, Principal Investigators should refer to the Reference Announcement sent out 10/02 by the Office of Contracting. Principal Investigators should discuss potential equipment purchases with an OSP Grant and Contract Administrator to ensure adherence to Smithsonian and sponsor policies.
In calculating the cost of equipment for a proposed project, Principal Investigators should include the cost of shipping and installation.
Most Federal agencies require a statement in the budget explaining the necessity for the requested equipment at the Smithsonian. All proposed equipment purchases are detailed by type, manufacturer’s name or “equivalent,” quantity, estimated cost and basis for estimate (vendor quotation or catalog price). The Smithsonian prefers that title to equipment purchased with funds from a sponsored project vest with the Smithsonian rather than the sponsor.
Supplies and Materials
Supplies and materials are consumable items, including:
- Desktop items (stationery, pencils, paper clips, etc.)
- Copying items (toner, copying paper, archival paper, fax paper)
- Program-related items (glassware, chemicals, pharmaceuticals, etc.)
Supplies are listed in the budget by general type (e.g., office supplies, computer supplies). Estimates for these may be based upon historical data, vendor quotes, or catalog pricing schedules. Justification is presented for items that aggregate to significant cost.
To assure funding for books, periodicals, or journals that will be needed for projects, OSP recommends inclusion of these costs in the budget portion of proposals. Smithsonian Libraries face the difficult challenge of meeting expanding Smithsonian needs on limited budgets. These costs should be budgeted under the “Supplies and Materials” category and justified as to their importance in successfully completing the project.
Documents generated throughout a sponsored project are often valuable and require preservation. The Smithsonian Archives seeks to avoid excessive cost of conserving poor quality paper by encouraging Principal Investigators to use archival paper. Detailed guidelines about archival paper can be found in SD 504 “Procurement and Use of Archival Quality Alkaline Paper for Permanent Records.” These costs should be included under “Supplies and Materials.” Adding approximately five percent to the line item for office supplies covers most of these costs.
Records worth preserving are not limited to the final report, but also may include:
- Any definitive correspondence
- Field notes, laboratory notes, and other records of significant observations
- Documentation of methodology
- Significant changes in drafts, leading to the final report or publication
- Any documentation that will survive for decades
A sub-agreement may be either a subcontract or a sub-grant, each of which is an agreement between the Smithsonian and a third party to transfer a portion of Smithsonian obligations to that party. Like consultants, a sub-agreement must also be justified in both the technical narrative and the cost proposal sections of the application.
If a proposal includes the use of sub-agreements, the Principal Investigator should include the contractor’s costs, and justify that they are appropriate and reasonable. Estimates obtained should be attached to the budget proposal. Federal agencies often require a separate Cost and Pricing Proposal and appropriate Subcontractor Certifications, in accordance with the Truth-in Negotiations Act. OSP should assist Principal Investigators in development of sub-agreement portions of a proposal.
Principal Investigators should identify each sub-agreement separately in the budget proposal. Sponsor approval of the proposal normally constitutes approval of the sub-agreements that are included in it.
A formal sub-agreement, outlining the fiscal and administrative responsibilities of both the Smithsonian and the contractor, is executed after receipt of an award, taking into consideration the terms of the award as required by the sponsor.
Other Direct Costs
While not an exhaustive listing, other direct costs may include:
|• Office machines rental
• Furniture rental
• Photocopy machine rental
• ADP equipment rental
• Other equipment rental
• Facsimile and On Line Services
• Messenger service
• Water – utilities
• Gas – utilities
• Electricity – utilities
• Other utilities
• Printing and reproduction
• Printing and duplication
• Books and binding
• Other printing and reproduction
• Other services
• Maintenance – general
• Equipment maintenance
• Computer use
• Membership dues
• Book service fees
• Miscellaneous expense
• Commissions and fees
• Entertainment (only permitted on non-Federal awards)
For a complete listing of Smithsonian Financial System (SFS) accounting categories and codes, please refer to the Office of the Comptroller.
Indirect Costs are general and administrative costs incurred by the Smithsonian in support of its projects, programs and activities, which cannot be easily allocated as direct costs to individual activities or projects and, therefore, are charged to the individual projects in some other reasonable and consistent manner. Indirect costs are those expenses for services provided by central administration such as accounting, legal services, contracting, research administration, human resource management, and facilities support.
The U.S. Office of Management and Budget has issued OMB Circular A-122, “Cost Principles for Non-Profit Organizations,” which applies to non-profit organizations. This circular identifies allowable direct cost categories and also prescribes a standard distribution and allocation method for calculation and recovery of indirect costs. Since 1 October 1995, the Smithsonian has been subject to OMB Circular A-122.
The Smithsonian prepares and submits to the Federal government an annual determination of indirect costs based upon operating expenditures, in conformance with the OMB Circular A-122. The submission is reviewed by Federal auditors, the Defense Contract audit Agency (DCAA), and renegotiated annually with representatives of the Smithsonian’s cognizant Federal agency, the National Aeronautics and Space Administration (NASA). OSP is responsible for calculating and negotiating the indirect cost rate and serves as the Smithsonian liaison to DCAA and NASA.
Principal Investigators should consult with OSP to obtain current indirect cost rates that are revised annually. Further information about indirect costs can be obtained from SD 304, “Guidelines for Administering Indirect Cost (Overhead) Rates and Charges.” Refer to Appendix I.
As outlined in Appendix J, indirect costs must be included in all proposals to government entities (Federal, state, local, or international), as well as in contracts with for-profit organizations. Current Smithsonian policy states that indirect costs will not be added to grants or contracts from a non-profit organization nor will they be added to grants from a for-profit organization.
As with government grants and contracts, the Smithsonian government indirect cost rates will apply for flow-through grants or contracts. For example, if the Smithsonian receives a grant from the World Wildlife Fund that states it received funding from the U.s. Agency for International Development, the grant would be categorized as a grant from a government sponsor, and Smithsonian indirect cost rates would apply.
Indirect costs should be calculated on all expenses within a proposal. However, the rates to apply will depend on the type of expense being budgeted. Note that since the rates can change from year to year, the information below refers to the type of rate and not the actual amount. Refer to the most recent Smithsonian Announcement on indirect cost rates for the current rates. The indirect cost rate categories under OMB A-122 are as follows:
- Salaries and Wages Rate (applied to salaries and fringe benefits)
- General and Administrative Rate (applied to the amount calculated as the salaries and wages indirect cost, plus all other direct costs).
The Smithsonian astrophysical observatory indirect cost rates and rate categories are different from those applied to other Smithsonian units.
Indirect Cost Waivers
Indirect cost waivers are rarely approved. However, requests for indirect cost waivers can be initiated by the Principal Investigator, and submitted to the Chief Financial Officer through the Director of OSP. The request should include a brief justification for the requested waiver. If the waiver is a result of sponsor requirements, a copy of the section of the written guidelines prohibiting (or reducing) the approved Smithsonian indirect cost rate should be attached.
The Director of OSP may approve indirect cost waivers on multiple submissions when the Chief Financial Officer has already granted a waiver to that particular sponsor and program.
As a means of determining the costs and benefits of waiver requests, the Director of OSP will take into consideration the following circumstances:
- Grounds on which the waiver is justified
- Total cost to the Smithsonian;
- Likelihood that an award would be seriously jeopardized without a waiver, and the potential effect of the loss on the Principal Investigator’s overall program
- Benefit of the waiver to new or junior Principal Investigator
- Support of efforts in new directions that otherwise might not be sufficiently developed to attract typical peer-reviewed awards
Indirect cost waivers are rarely granted in cases where:
• The project is sponsored by a for-profit organization.
• The project involves any sponsor requirements regarding intellectual property.
• Granting the waiver might appear to establish a precedent for future projects.
Cost Sharing (also “Matching” or “In-Kind”)
Sponsors sometimes require the Smithsonian to share in the cost of a project. The requirement may be for the Smithsonian to directly contribute to the project or to match the sponsor’s funding with other outside funding. There may be variations on how an organization can or is required to cost share. Therefore, this discussion does not attempt to address all possible scenarios.
It is most common for a sponsor to require that their contributions be matched by some given percentage (e.g., 50%, 100%). Principal Investigators are required to identify the expected sources of matching funds prior to submission of a proposal to sponsors with matching requirements.
Some government sponsors require the Smithsonian to share a small portion of total project costs. The range is usually one to five percent of total project costs. In such cases the Principal Investigator must identify the source of the Smithsonian contribution prior to submission of the proposal. The National Science Foundation (NSF) requires a one percent cost sharing on most research grants. However, NSF guidelines allow the Smithsonian to meet this requirement by cost sharing on the aggregate total cost of all NSF-supported projects each year. OSP records by memorandum each year indicating that, in aggregate, the requirement has been met from Smithsonian trust funds. Therefore, Principal Investigators need not worry about meeting this MSF requirement. Cost sharing requirements of NSF (or any other sponsor) on any grant must be discussed with the appropriate OSP representative.
The following is additional information to keep in mind:
- Occasionally, it may be appropriate for the Smithsonian to meet a cost sharing requirement by the contribution to the project of non-cash items such as services or supplies. This is commonly known as an “In-kind contribution.”
- Cost sharing requirements of Federal sponsors ordinarily must be met from trust funds rather than government funds.
- It is important for Principal Investigators to discuss cost sharing requirements of the sponsor with OSP in the early stage of proposal development.
- Expenditures representing cost sharing are subject to audit. Therefore, the Principal Investigator must keep adequate supporting documentation along with other required project records.
- The Principal Investigator is required to report sponsor-mandated cost sharing information to OSP (see form included at Appendix K, Report of Cost Sharing Expenditures).
Care should be used when including cost-sharing in a proposal. Failure to meet the cost-sharing requirements of the sponsor may result in partial or total forfeiture of the awards and/or all award funds received.