Grant Admin News: NIH Policy on Grad Compensation

[Research Services <Research_Services@orsa.uoregon.edu>]

The National Institutes of Health (NIH) has announced an increase in the
compensation level for graduate student assistants paid on research
grants.  The announcement in the NIH Guide is found at:
<http://grants.nih.gov/grants/guide/notice-files/NOT-OD-02-017.html>
http://grants.nih.gov/grants/guide/notice-files/NOT-OD-02-017.html.  The
policy increases the "reasonable" compensation level (in effect, a
"ceiling") for graduate student employees from $26,000 set in 1998 to
$28,260, which is the same as the FY 01 postdoctoral fellowship stipend
at the beginning level.  These guidelines are effective immediately with
new and competing awards issued on or after the date of the NIH
announcement (12/10/01).  As before, the amount provided for graduate
student compensation includes salary or wages, fringe benefits, and
tuition remission (see example below). 

These guidelines apply to individuals who are employees of the grantee
institution (i.e., GTF/GRA appointments), not to individuals in a
training status.  NIH guidelines state, "The stipends provided to
recipients of NRSA (training grant) support offset the cost-of-living
during the period of training and are not considered equivalent to
salaries or other forms of compensation provided to individuals
supported on research grants.  Nevertheless, the entry-level
postdoctoral NRSA stipend provides a useful benchmark for an award
amount that approximates a reasonable rate of compensation for graduate
students. The NIH developed guidelines to establish the maximum award
for graduate student compensation in 1995.  The maximum award amount was
modified in 1996 and again in 1998."

The maximum amount awarded by the NIH for a graduate student supported
on a research grant or a cooperative agreement is tied to the FY 01
stipend amount awarded for a National Research Service Award (NRSA)
stipend (at the 0-years of experience level) in effect at the time the
grant award is issued.  No adjustments will be made to any competing FY
02 awards already issued.  However, grantees may rebudget to accommodate
the higher compensation level.  In FY 02 until a NIH budget is
finalized, any competing awards issued will use the FY 01 level of
$28,260.  Once FY 02 stipend levels are established, awards will be
issued using the new (yet-to-be-determined) higher level.  As in the
past, no adjustments will be made to noncompeting total cost award
levels or future year commitments.  Institutions may continue to
rebudget funds to charge more than the awarded amount, provided that OMB
cost principles requiring reasonable compensation are observed.  In
general, graduate student compensation will not be considered reasonable
if in excess of the amount paid to a first-year postdoctoral scientist
at the same institution performing comparable work.

Following is an example of how to apply this rule to GTF/GRA positions:

The minimum annual 9-month full-time salary rate specified in the GTFF
bargaining agreement for a GTF III is $20,574, or $2286/month at 1.0
FTE.  (Note that a 1.25% salary increase for minimum rates was
implemented in April 1, 2001.)  A GTF III at .49 FTE for 12 months would
earn $13,442 (GTF appointments cannot exceed .49 FTE in a given term
without special approval).  Added to the salary are 1% OPE, insurance
costs ($2376/yr on average), and 3 terms of tuition ($2222/term) and
fees ($150.50/term).  Total salary, benefits, tuition and fees in this
example is $23,070, well below the postdoc stipend level of $28,260.
However, under the GTFF bargaining agreement, academic and
administrative units may pay at a higher level than the minimum, so long
as salary equity by level of appointment for GTFs is maintained in the
department, program, or administrative unit.  Some departments or units
do pay higher than the minimum salary rates established in the GTFF
contract, and these units should review their total compensation levels
following this example.

Contact ORSA at 6-5131 with any questions concerning the new NIH
graduate compensation policy or other budget issues.

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