Nearly every notice of funding opportunity (NOFO) instructs you as an applicant to request a budget that reflects the actual needs of the proposed project. Yet many new investigators wrongly assume that being as frugal as possible will make their application more likely to receive funding.
Background on Modular Budgets
You must use the PHS 398 Modular Budget Form in your application if all the following apply:
- You are at a U.S. applicant institution and submitting a new, renewal, resubmission, or revision (competing supplement) application.
- You are requesting $250,000 or less in direct costs per year, excluding facilities and administrative costs. Note: you will request total direct costs in $25,000 increments.
- Your Research Plan does not involve the use of human fetal tissue.
- You are applying for a research project grant or an equivalent cooperative agreement, whether investigator-initiated or in response to a program announcement or request for applications:
- Research project grant (R01/U01)
- Small grant (R03)
- Exploratory/developmental research grant (R21/UH2)
- Clinical trial planning grant (R34/U34)
- Research Enhancement Award (R15)
Applicants submitting a modular budget request must use the PHS 398 Modular Budget Form as part of the SF 424 R&R application package. Applications requesting more than $250,000 in annual direct costs must use the R&R Budget Form.
Why The Difference?
Simply put, a modular budget is easier to complete. NIH introduced the alternative budget form in 1998 to lessen administrative burden on applicants and other stakeholders.
The cut-off point for using the modular budget form, a budget request of $250,000 in annual direct costs, represents neither the average R01 award nor the budget amount most likely to satisfy peer reviewers. (Actually, the R01-Equivalent Grants: Average Size has increased significantly.)
Worth the Squeeze?
You may wonder, if your quick math is that your budget request will be around $250,000 in annual direct costs, whether you should endeavor to stay under that threshold to remain eligible to use the modular budget form. You may even be wondering the same thing for a scratchwork budget calculation of $275,000 or $300,000.
Our advice is as follows: request a budget sufficient to make your proposed project successful while staying within any listed budget cap. Do not risk peer reviewers judging your costs insufficient to the work or deeming you naive to the price of conducting successful research.
We recommend you read a blog post from our colleagues at the National Cancer Institute, Modular Versus Non-Modular Budgets: What's the Bottom Line?, in which they document a striking trend of applicants moving away from using the modular budget form—perhaps a reflection of inflationary cost pressures over time. They also find that investigators do not experience lower success rates when submitting a non-modular budget (keeping in mind that correlation does not imply causation).
Checks Against Bloat
To be clear, our advice that you request sufficient funding to complete your project is not an invitation to ask for more than you need.
Many notices of funding opportunities provide an upper bound for your award budget in Section II. Award Information. Also, as a rule, NIAID caps R01 renewal budgets at 20 percent over the direct costs of the last noncompeting award minus supplements, equipment, alterations and renovations costs, and facilities and administrative (F&A) costs for all subawards (refer to our Renewal Funding SOP).
Before submitting an unsolicited application with a budget of $500,000 or more in direct costs in any 1 year, you must seek approval from an NIAID program officer as stipulated by our Big Grants policy. Internally, we follow a separate approval process for applications with proposed annual budgets larger than $1 million. Also, our Advisory Council gives Special Consideration to applications submitted by investigators who currently receive a total of $2 million or more in annual total costs from unsolicited awards.
Finally, know that peer reviewers don't consider an application’s budget when assessing scientific merit. They discuss the budget after the application is scored, specifically to determine whether the request is realistic to conduct the proposed project.
For an application with a modular budget, reviewers may recommend the elimination or addition of one or more $25,000 modules or specific budget items. For an application with a non-modular budget, reviewers may recommend certain positions, effort levels, or line items be reduced if insufficiently justified based on the needs of the project (but not reductions in salary rates).
Ultimately, it’s more important your budget be comprehensive and well-justified than frugal or clever.