How Should I Determine Requested Salary in My Application when the Legislatively Mandated Salary Cap is a Factor in the Calculation?

When preparing an application with a detailed budget, requested salaries should be determined based on actual, institutional base salaries, and not based on legislatively imposed salary limitations. NIH will make adjustments at the time of award using the applicable salary level.

When preparing an application with a modular budget, since the modules should be a reasonable estimate of costs allowable and appropriate for the proposed project, applicants should use the most current legislatively imposed salary limitation when estimating the number of modules.

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9 thoughts on “How Should I Determine Requested Salary in My Application when the Legislatively Mandated Salary Cap is a Factor in the Calculation?

  1. My salary has exceeded the NIH cap at 2 different universities and neither one does it this way. They use the NIH cap in the budgets. If they did not, there might be a risk of exceeding the allowable ceiling of funds that can be requested (whether $ 500K for an R01 or another amount for an RFA, R21, etc.). Is this a change in procedures and how would this be handled when the budget might go over a funding limit? Will peer reviewers react negatively?

  2. What if by using this method my budget exceeds a cap on total allowable costs that can be requested? Or, total requested costs exceed the $500k limit on applications that require prior approval?

  3. This is not a new procedure. Please see Question 18 on the Frequently Asked Questions for NIH Salary cap for FY2012 web page. While the examples on the website apply to the FY 2012 Salary cap, question 18 is also responsive to your inquiry about the current (FY 2014) salary cap. The SF424 (R&R) Application Guide for NIH and Other PHS Agencies has always instructed applicants to enter the annual compensation paid by the employer. In lieu of actual base salary, institutions may elect to provide an explanation in the budget justification narrative indicating that the actual institutional salary exceeds the current salary limitation. NIH staff will adjust salaries to the appropriate level if an award is made. Any adjustment would reflect the most recent salary cap level. Peer reviewers will not react negatively if the actual salary exceeds the salary cap. In fact peer review guidance on budgets specifically indicates that reductions of salary rates may not be recommended by the SRG.

    • The response does not reflect the issue regarding the $500,000 cap on annual direct costs. A proposal will not get through the automated screening process if any year’s budget exceeds the limit, even if the reason is because actual salaries are requested.

    • The SF424(RR) application Guide indicates that for base salary you should “Enter the annual compensation paid by the employer for each Senior/Key Person. This includes all activities such as research, teaching, patient care, or other.”

      The application guide provides the following guidance for requested salary.
      “Regardless of the number of months being devoted to the project, indicate only the amount of salary being requested for this budget period for each senior/key person. This field is required.
      Some PHS grant programs are currently subject to a legislatively imposed salary limitation. Any adjustment for salary limits will be made at the time of award; therefore requested salary should be based on institutional base salary at the time the application is submitted and not adjusted for any limitation.”

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