Budget and Narrative

All applications must include a detailed budget and narrative that explains the federal and the non-federal expenditures broken out by the object class cost categories listed on SF-424A − Section B (Budget Category) for non-construction awards.

  • The detailed budget must match the costs identified on the SF-424A and the total costs on the SF-424.
  • The budget and narrative must be consistent with and support the Project Narrative.
  • The budget and narrative must be concrete and specific. It must provide a justification for the basis of each proposed cost in the budget and how that cost was calculated. Examples to consider when justifying the basis of your estimates can be ongoing activities, market rates, quotations received from vendors, or historical records. The proposed costs must be reasonable, allowable, allocable, and necessary for the supported activity.
  • NOFOs include the periods of performance from one to five years. Generally, awards will be for a one-year budget period but the period of performance may be up to five years. Submission and SAMHSA approval of the progress report(s) and any other required submission or reports is the basis for the budget period renewal and release of subsequent year funds. Funding beyond the one-year budget period but within the multi-year period of performance is subject to availability of funds and satisfactory progress of the recipient. Progress will be evaluated by submission of data on required performance measures, satisfactory achievement of identified goals and objectives, providing services to the projected number of individuals specified in the application, and satisfactory resolution of barriers and challenges that arise in the implementation of the project.
  • Refer to the program specific Funding Restrictions and Limitations and Standard Funding Restrictions, as well as to 45 CFR Part 75 (for applicable administrative requirements and cost principles).

Sample SF-424 and SF-424A Forms

The following PDFs are samples of the SF-424 and SF-424A forms:

Assurances and Certifications

When the Authorized Organization Representative (AOR) signs the Application for Federal Assistance SF-424 form, they certify that the statements contained in the SAMHSA List of Certifications (PDF | 11 KB) are true. Their signature also certifies that they agree to comply with the Assurances for Non-Construction Programs (SF-424B) (PDF | 65 KB).

SAMHSA Budget Template

To expedite review of your application, it is highly recommended you use the following PDF budget template to complete the Detailed Budget and Narrative for submission with your application:

NOTE: To download the SAMHSA Budget Template (PDF):

  • Right-click the link "SAMHSA Budget Template (PDF)"
  • Select "save link as" and save to a location on your computer
  • Go to the saved location and open the "SAMHSA Budget Template (PDF)"

IMPORTANT: For the PDF template to function as designed, it must be opened directly in Adobe Acrobat or Reader instead of the browser.

Guidance

The following documents provide guidance on using the budget template:

For a Section 508 accessible budget template, use the MS Word DOCX budget template:

Budget Cost Categories

Personnel Costs: Explain personnel costs by listing each staff member who will be working directly on the award by name (if possible), position title, percentage level of effort or proposed hours and annual salary. Award funds may not be used to pay the salary of an individual at a rate in excess of Executive Level II or $212,100. An individual's base salary, per se, is NOT constrained by the statutory provision for a limitation of salary. The rate limitation simply limits the amount that may be awarded and charged to SAMHSA awards and cooperative agreements. The salary limitation does not apply to consultants but does apply to all subawards and subcontracts.

NOTE: If an organization is selected for an award and chooses to move forward with hiring an individual for a Key Personnel position before receiving SAMHSA’s formal approval, this will be done at the organization’s own risk. If SAMHSA’s review of the Key Personnel request results in the proposed individual not being approved or deemed not qualified for the position, the expectation is that the organization must submit a qualified candidate to be placed in the Key Personnel position. SAMHSA will not be liable for any costs incurred or pay for salaries of a Key Personnel that is not approved or deemed not qualified for the program.

Fringe Benefits: Fringe benefits typically include items, such as health insurance, taxes, unemployment insurance, life insurance, retirement plans, tuition reimbursement and paid absences. Fringe benefits are recoverable in accordance with an organization’s federally approved indirect cost rate agreement, if applicable, or the organization’s accounting practices, provided those practices are consistent with federal cost principles and result in a fair and equitable allocation of fringe benefits.

Travel: List travel costs according to local and long-distance travel. For local travel, outline the mileage rate, number of miles, reason for travel and staff member/consumers completing the travel. The budget should also reflect the travel expenses (e.g., airfare, lodging, parking, per diem, etc.) for each person and trip associated with participating in meetings and other proposed trainings or workshops. Name the traveler(s) if possible, describe the purpose of the travel, provide number of trips involved, the destinations, and the number of individuals for whom funds are requested.

Equipment: List equipment costs and provide justification for the need of the equipment to carry out the program’s goals. Extensive justification and a detailed status of current equipment must be provided when requesting funds for the purchase of items that meet the definition of equipment (a unit cost of $5,000 or more and a useful life of one or more years). For example, large items of medical equipment.

Supplies: Include the programmatic items necessary to implement the proposed project (e.g., examination gloves, etc.). Conversely, general office supplies (e.g., paper, pencils, etc.) should be recovered through a federally-approved indirect cost rate or de minimis rate.

Per 45 CFR § 75.321, property will be classified as supplies if the acquisition cost is under $5,000. Note that items such as laptops, tablets, and desktop computers are classified as a supply if the value is under the $5,000 equipment threshold.

Vendor Contracts/Subawards & Subcontracts/Consortiums/Consultants: Provide a clear explanation as to the purpose, the basis for how costs were estimated, and the specific deliverables. You are responsible for ensuring that your organization has adequate procurement and merit review systems with fully developed written procedures for awarding and monitoring vendor contracts and subawards/subcontracts, respectively. Recipients must notify potential subrecipients to register in SAM and provide the recipient with their UEI number (see 2 CFR part 25). For consultant services, list the total costs for all consultant services. In the budget narrative, identify each consultant, the services he/she will perform, total number of days, travel costs, and total estimated costs.

NOTE: To assist with classifying costs and relationships, note that vendor contracts are for the purpose of obtaining goods and services (i.e., examination gloves provided by a medical supply company). Conversely, subawards/subcontracts are for the purpose of carrying out a portion of a federal award (i.e., a health care clinic providing substance use treatment services directly to patients). Your organization must ensure proper classification of costs and relationships. For subrecipient relationships, your organization must ensure written subaward/subcontract agreements are in place. These written agreements must require that subrecipients comply with the same terms and conditions as the prime recipient, as applicable (i.e., financial management requirements, audit requirements, etc.) In other words, the requirements imposed on the prime recipient must “flow down” to subrecipients. Written agreements should also describe the scope of work, deliverables, etc.

Other: Include all costs that do not fit into any other category and provide an explanation of each cost in this category (e.g., provider licenses, dedicated space rental, etc.).

Indirect Costs: Indirect costs are those costs incurred for common or joint objectives which cannot be readily and specifically identified with a particular project or program but are necessary to the operations of the organization, e.g., the cost of operating and maintaining facilities, depreciation, and administrative salaries. For some institutions, the term “facilities and administration” (F&A) is used to denote indirect costs.

Applicants may request full indirect costs, subject to statutory and regulatory limitations, and submission of an approved Negotiated Indirect Cost Rate Agreement (NICRA) established by the cognizant Federal agency (typically the agency that provides the most funds). If indirect costs are claimed, a copy of the NICRA must be submitted with the application. If unable to obtain a NICRA from the cognizant agency at the time of application, the applicant may elect to recover indirect costs using a de minimis rate as explained below. Otherwise, the applicant may only be reimbursed for allowable direct costs. Violation of cost accounting principles is not permitted when re-budgeting or charging costs to awards. Rather, costs must be consistently charged as either indirect or direct costs.

Applicants may elect a 10% de minimis indirect cost rate, subject to statutory and regulatory limitations.

Applicants who cannot obtain a NICRA from their cognizant Federal agency at the time of application may elect a 10% de minimis rate, subject to statutory and regulatory limitations.

The 10% de minimis rate may be used indefinitely and should be applied to Modified Total Direct Costs (MTDC). MTDC means all direct salaries and wages, applicable fringe benefits, materials and supplies, services, travel, and up to the first $25,000 of each subaward (regardless of the period of performance of the subawards under the award.) MTDC excludes equipment, capital expenditures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support costs and the portion of each subaward in excess of $25,000. Violation of cost accounting principles is not permitted when charging costs to awards. Rather, costs must be consistently charged as either direct or indirect costs. Additionally, once elected, the 10% de minimis rate must be applied to all existing awards. If the cognizant agency issues a NICRA subsequent to the award, the negotiated rate may not be retroactively applied.

Waived Indirect Costs – An applicant may elect not to request recovery of indirect costs. If so, the applicant should write None Requested in the same space allotted for Item J of the budget sheet.

Last Updated: 06/05/2023
Source: https://www.samhsa.gov/grants/how-to-apply/budget-and-narrative