Office of
Sponsored Programs

Salary Caps

GENERAL

Purpose

The following SHARPI provides information on the subject of salary/compensation level limitations imposed by the National Institutes of Health and the National Science Foundation.

NIH and the NSF impose restrictions on compensation levels for the direct salary support of principal investigators and other senior personnel.  Additionally, the National Science Foundation previously limited the amount a consultant could be reimbursed via NSF awards.  Commonly known as "salary caps," these limitations occur in the form of direct salary limitations (amount of institutional base salary) on NIH projects and NSF consultant costs; and as a limitation on the amount of time (but not the institutional base salary) that can be charged to a project account on NSF awards

Administration

The Office of Sponsored Programs is responsible for maintenance and review of this SHARPI Guideline.

SPECIFIC APPLICATION

NIH

Every year since 1990, Congress has legislatively mandated a provision limiting the direct salary that an inpidual may receive under an NIH grant.  For FY 2010, Public Law 111-117: Consolidated Appropriations Act, 2010 restricts the amount of direct salary to Executive Level I of the Federal Executive Pay scale.  The Executive Level I annual salary rate was $196,700 for the period January 1 through December 31, 2009.  Effective January 1, 2010, the Executive Level I salary level increased to $199,700. 

Practically, this means that for salaries earned in CY 2010 (for the period of 1/1/10 - 12/31/10), NIH will not allow salary reimbursement greater than $199,700 per year, i.e., $16,642/month for a 12 month appointment or $22,188 for a 9 month appointment.  When preparing proposals the actual faculty salary should always be shown, but if the salary rate exceeds the salary cap the agency will only fund up to the capped amount.  OSP will check each NIH award to ensure the cap is not exceeded.

NSF

The NSF announced a new Proposal and Award Policies and Procedures Guide (PAPPG) NSF 09-01 that is effective January 2009.  The new policy limits faculty to two month of salary per year from all NSF sources unless specifically budgeted and approved by the NSF.  It has removed the requirement that faculty salary must be taken only in the summer months.  NOTE:  this change means that if a PI has three active NSF awards, the total number of months for which support may be received may not exceed a total of two months from all three awards, not two months from each of the three awards.   Any deviation from this practice must be disclosed in the proposal budget, justified in the budget justification and must be specifically approved by NSF in the award notice.

Research scientists and similar inpiduals without a faculty appointment are not considered by NSF to be "Senior Personnel" for purposes of this revised salary policy.

NSF Consultant Rate

Previously, the annual Congressional appropriation for the NSF budget set the maximum daily rate that may be paid to consultants on NSF awards at an amount equal to the current Executive Schedule Level IV for Federal employees.  The Appropriation Act for Fiscal Year 2006 removed the limitation on the amount that consultants could be reimbursed; however, previous year's maximum is available at the NSF pision of Grants and Agreements Policy Office website.  This information may be needed in order to determine the allowability of previously budgeted costs in NSF awards.