Thursday, February 24, 2011


Supplanting and Budget Cuts

(Or, why I can send an English professor to a math conference, but I can't send a math professor to a math conference.)

Earlier this week, I mentioned an interaction with the campus Money Guy that strained the limits of absurdity. In fairness, I should mention that sometimes I have to be the apparatchik, too.

Federal (and many other) grants typically come packaged with rules against “supplanting” college resources with grant resources. In plain English, that means that we can't use grant money to pay for things that the college would have paid for otherwise. The idea is to prevent colleges inventing projects, and getting grant money, to fund basic operations.

From the funding agency's perspective, this rule generally makes sense. Grants are usually intended to enable or foster something new, or at least something narrowly targeted. Generally, they aren't intended to be 'slush funds' to be used in whatever way the recipient sees fit. In extreme cases, that's essentially what open-ended supplanting would amount to. The agencies want to prevent a college from being able to say “thanks for the five million for the tutoring project, but we've decided to use it to offset state cuts instead.” He who pays the piper calls the tune; it's unsurprising that people or agencies who hand over significant cash want to maintain some level of control over it. If a college finds the strings attached to a given grant too onerous, it can simply choose not to apply. (We've actually done that.)

In isolation, that makes sense.

One of the tests often used to determine whether a given expense amounts to “supplanting” is whether the college has covered that expense before.

When you have reasonably steady-state (or growing) budgets, that's a pretty fair test. If the college paid for several faculty to attend, say, the CCCC conference (for teachers of composition) each of the last several years, then it would be hard-pressed to argue that using grant money to cover that cost this year isn't supplanting. It's hard to say that you wouldn't have done something this year that you've done routinely for the last several.

But when operating budgets are dropping fast, the 'supplanting' rule becomes a lot murkier.

Given rapidly dropping state aid and a host of fixed (or growing) costs, things like “travel” tend to be the first to be cut. That's not because we don't see the value of travel; it's just that the money isn't already committed, the way that money for salaries and physical plant is. Cutting a salary means losing a person; cutting travel just means cutting travel. Neither is great, but when it's one or the other, travel tends to lose.

After a couple of years, it's entirely possible to land in a spot wherein an otherwise intelligent administrator has to deny funding for the English professor to attend the writing conference, since that has to come out of college money that has been cut, while saying yes to the math professor who wants to attend the writing conference, since the grant can cover that. You say 'no' to the obviously valid proposal, and say 'yes' to the one that's a bit of a stretch, simply because the former had traditionally been covered internally and the latter hadn't. The rule against supplanting interacts with the operating budget cuts in ways that nobody intended, but that would be incredibly hard to prevent.

I'd love to be able to convince the Feds that historical patterns become irrelevant when operating cuts hit a certain level. But it’s tough to prove that absent the grant, you would have cut that particular item anyway. I can argue until I’m blue that the travel budget from two years ago is irrelevant now, since we’ve sustained so many cuts since then, but it’s an awfully difficult distinction between “replacing” cuts and “supplanting” them.

Wise and worldly readers, has anyone found a clever (and legal!) way around this?

Get grant money to partner with the large professional organizations and have the conference on/near your campus. You've never done that before, right?
On the Federal grants (HRSA and USDA) and state level grants that I worked on that we received, travel was a part of our proposal. We were offering classes in underserved/rural areas and faculty had to drive there. The college would've paid anyway but the grant covered it. It could've been a function of the granting body though to approve those sorts of things.
I think you have to work with your program director from the granting agency (the person who is your liaison with the agency) to get these costs approved. If you can show that the grant would cover travel that would not have been undertaken if the grant didn't exist or that is part of the professional development required for the people working on the grant you should be able to justify the funds, even if professional development was part of the college budget in the past. But your grant partner will be the final arbiter of this - the key is to discuss it in advance and then get everything in writing (in case the program director changes or there are questions about the decision later.) Honestly, travel to conferences is a minor expense compared to hiring people or giving them release time so I’d imagine you’d get some flexibility from most agencies.
I think the granting agencies are primarily concerned that you don't double up on F&A costs. Travel is not typically considered an F&A cost, so, as an above commenter has mentioned, it's reasonable to include as part of your proposal budget. Then the travel can become part of your upfront budget discussions with the sponsor. If you'd like to use already awarded funds for travel, you should get prior written approval from your program officer. We've recently been successful to gaining approval to use grants funds for both travel and administrative assistance, both of which would have been covered by the University in better times.
Do you have an indirect cost rate on the books? The jury is out as to whether or not such a rate is helpful or harmful (or neither) in a proposal. But many successful proposals build them in. Back when Stanford was "threatened" to have their Los Alamos funds pulled, I remembered its being reported that their rate was 50%. That's 50% of every dollar for grant projects used to "maintain structures".

The bogey in all of this is that the entity/campus needs to have an instituted policy for a cost-rate. And that requires certain accounting maneuvers that may or may not be desired by upper admin (and often for good reason. Instituting a rate can bind your hands in some ways).

I have found what Ivory has said to be true also. Granting agencies are lovable neurotic bean-counters. If you can show by numbers that such-and-such would not occur without the money, that can make for a good argument.

Example: we got a grant for a truck when the guidelines clearly stated "no durable goods". We called up the grantor and said, essentially, "can we say that the money is being used to limit man-hours on a project in stead of buying a truck? Wink-wink?" We got the truck...uh, I mean the funder provided the dollars to help us limit costs and a spiraling time-clock.
Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?