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Guidelines for Charging Faculty Summer Salary

Purpose: The following guidance is provided for faculty who, in addition to their academic year base salary, choose to devote additional effort and receive compensation during the summer months of June, July and August.

Key Definitions:

  • Academic Year: The fall and spring semesters.
  • Externally Sponsored Agreement/Grant: External funds provided to MSU of Denver as a result of a funded grant or contract.
  • Institutional Base Salary (IBS): The annual salary of the employee as it appears in the employment contract.
  • Principal Investigator (PI): An individual who has primary responsibility for the design, execution, and management of the research, training, or public service project and who will be involved in the project in a significant manner.
  • Summer Salary: Compensation paid during the months faculty are not under contract. The summer period is defined to be the period outside the base salary period of the academic year appointment. Summer salary is paid from external funded programs and thus originates from a different source than that generated by their regular appointment. Faculty members on a 9 or 10 month contract may receive summer salary for periods during which their contracts are not in effect.

Description: The University is obligated to comply with all federal policies related to the fiscal management of grants and contracts under guidelines established by the Code of Federal Regulations (CFR), Title 2, Part 200-Cost Principles for Educational Institutions.

Requirements: The principles are as follows:

  • Charges for work performed by faculty during the summer months will be determined for each faculty member at their Institutional Base Salary (IBS) (full time 9 or 10 month academic year) rate divided by the period to which the base salary applies. The externally funded summer salary will be calculated by one of the following:
    • A percentage of salary based on IBS. For example, a 9-month faculty member is eligible to receive 33% (11.11% or 1/9 per month) of salary during the summer months; 10-month faculty 20% (10% or 1/10 per month).
    • Calculated on a daily basis using the faculty member’s daily rate, based on IBS.
  • Faculty may charge salary for up to three full summer months depending on contract, unless sponsor restricted. MSU Denver does not provide compensation for faculty when they are on vacation. Therefore, faculty members who take vacation may not be paid for 100% effort during that month.
  • Faculty may fund effort expended over the summer by charging salary to sponsored research and other sponsored projects.
  • All effort and corresponding salary charged to any sponsored project(s) must be in compliance with sponsor and Institute policies. Further, the effort committed during the period should be devoted exclusively to the activities supported by that project or projects, with the salary charges to each aligning on a monthly basis with the effort provided.
  • It is understood that, as part of their normal work, faculty may participate in "other academic, administrative or research activities" during the summer. These activities include but are not limited to: advising students (outside the scope of the sponsored research charged), unsponsored research, administrative committees, preparing new or renewal proposals, teaching, curriculum development, peer reviews, refereeing and/or writing other scholarly publications. Effort associated with these activities during the summer months, may never be charged to any federally sponsored research project.

Reference Materials:

Code of Federal Regulations (2 CFR 200.430)

Additional Reference Materials:

NSF Salary Limitations

(a) Senior Personnel Salaries & Wages Policy

NSF regards research as one of the normal functions of faculty members at institutions of higher education. Compensation for time normally spent on research within the term of appointment is deemed to be included within the faculty member’s regular organizational salary.

As a general policy, NSF limits the salary compensation requested in the proposal budget for senior personnel to no more than two months of their regular salary in any one year. (See Exhibit II-7 for the definitions of Senior Personnel.) It is the organization's responsibility to define and consistently apply the term "year", and to specify this definition in the budget justification. This limit includes salary compensation received from all NSF-funded grants. This effort must be documented in accordance with 2 CFR § 200, Subpart E, including 2 CFR § 200.430(i). If anticipated, any compensation for such personnel in excess of two months must be disclosed in the proposal budget, justified in the budget justification, and must be specifically approved by NSF in the award notice budget.

NIH Salary Cap

Since 1990, Congress has legislatively mandated a limitation on direct salary for individuals under NIH grant and cooperative agreement awards (referred to here as a grant). The mandate appears in The Department of Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 (Public Law 115-245), signed into law on September 28, 2018, which provides authority for NIH to incur obligations for FY 19.

The Department of Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019, restricts the amount of direct salary to Executive Level II of the Federal Executive pay scale. The Office of Personnel Management has recently released new salary levels for the Executive Pay Scale. Effective January 6, 2019, the salary limitation for Executive Level II is $192,300.

For awards issued in those years that were restricted to Executive Level II (see historical record of salary cap link below), including competing awards already issued in FY2019, if adequate funds are available in active awards, and if the salary cap increase is consistent with the institutional base salary, grantees may rebudget funds to accommodate the current Executive Level II salary level. However, no additional funds will be provided to these grant awards.


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