June 30, 2007 
MEMORANDUM

Please use the following recommendations  when budgeting salary and fringe benefits for sponsored projects. This memorandum supersedes my previous memo on the same subject dated June 30, 2006. Effective immediately, all proposal budgets for the 2007-08 academic year and beyond should use the following fringe benefit information:

• Faculty and Staff fringes will use the Identification (SI) method. Under SI, fringe costs are based on average actual costs and individual participation in retirement.  The following tools have been developed to help you budget under this new model:
  • General description of SI including  frequently asked questions FAQs
  • Web tool to calculate multi-year, multi-person salary and SI fringe rates:  Salary Budget Builder
  • Excel worksheet with formulas (8 Yrs) that can be copied into your existing worksheets:  SI Excel Worksheet 
  • PDF Chart that shows the relationship between salary rate and the SI fringe rate: SI Fringe Chart 
  • Web tool that shows current salaries for employees in academic departments and their SI fringe rates: login to the CGA reference information: AIS Authorization to CGA Info  then select the Salary Search.
• Academic-year faculty paid for summer school should be budgeted @ 7.65% of salaries.
• Part-time employees (< 50% appt or < 9 months) should be budgeted @ 7.65% of salaries
  • Please exercise caution when hiring a current MSU employee into a temporary position. MSU employee contracts differ on what qualifies as part-time and may involve bridging of past time worked that will make the current position/person benefit eligible, which then triggers full SI fringe charges. Also, part–time employees have been known to fill the remainder of their time with other MSU employment opportunities which again might make the employee benefit eligible and therefore full fringe. Questions should be addressed to Human Resources, but when in doubt, budget full SI fringe.
• Student labor should be budgeted at 0% of salaries paid during the academic year and 7.65% during the summer semester depending on the number of credits they are enrolled for.   If a student falls below a minimum number of credits set by the IRS, e.g., undergrads enrolled for less than 6 credits; master's level students enrolled for less than 5; and doctoral level students enrolled for less than 3 credits, then the account will be charged FICA and Medicare @ 7.65%.
• Graduate assistants fringe benefits (tuition, fees and health) will be proportionately charged to accounts each month. (see summary chart) *
  • Health - $844 per semester (Fall 2007 and Spring 2008) and $0 for Summer 2007 = $1,688 per year. 
    • The health amount should be increased by 8% in each succeeding year.
  • Tuition and Fees - $3,372 per semester for Fall 2007 and Spring 2008, and $1,755 for Summer 2008 = $8,499.
  • • These amounts should be increased by 8% in each succeeding year.
    • For awards issued using the overhead (F&A) rates that are effective 7/1/04, tuition and fees will be excluded from the overhead calculation.
• Graduate assistant salary ranges can be found at: HR Grad Assistant Salary Ranges
• The Grand-parent fringe rate that was created (three years ago) to provide time for those projects that were originally budgeting using the old salary rate system to prepare for conversion to SI has expired. All CGA accounts will be subject to SI fringes effective with the July 2007 ledgers.