Yeah, it is Effort time again and I have a salary cap question

[Noel Schumacher]

Hi All, 

Question to everyone working with 9 month academic year appointments and the NIH salary.  In the past I have always taken that 9 months and done the math to get to the 12 month and used that 12 month amount to determine if someone is over the NIH salary cap. Now I'm working with a number of PIs who have never had the cap calculated this way and only had their Fiscal Year salary counted, so if they did not pay for a month or two during the summer in terms of dollars they were under the cap. 

I would assume best practice is to go with what I had been doing in the past, but is this a requirement?

Thanks

[David Hagen]

Hi Noel,

Your approach is the more accurate of the two.  The salary cap is considered to be a rate of pay.  NIH stopped putting examples in their announcements a few years ago, but the 2012 guidance demonstrates that they view it as a rate of pay that needs to be prorated based on a person's appointment as well as on the percent of time they work on a project: https://grants.nih.gov/grants/guide/notice-files/NOT-OD-12-035.html

My approach is to divide the NIH salary cap by 26.1 to arrive at a bi-weekly rate of pay, and then multiply by the number of pay periods they worked on the project and by the percent of time spent on the grant (percent effort).

For the effort period that is currently being certified, there were two salary caps in effect, so two calculations are needed.  Through January 5th the cap was $189,900.  Beginning January 5th the cap was $192,300.  $189,900/26.1 = a biweekly rate of pay of $7,275.86.   $192,300/26.1 = a biweekly rate of pay of $7,367.82.  The current effort statements cover Pay Periods 14 through 26.  The prorated rate of pay in effect during PP13 and PP14 was $7,275.86.   The rate for PP15 - PP26 was $7,275.86.

The existing job aid says to divide the cap by 26, but that job aid will be revised later this summer to instruct users to divide the cap by 26.1. Using 26 is consistent with the number of pay periods in the University's fiscal year (in most years), but it is more accurate to use the number of days in a calendar year or grant year (26.1 pay periods x 14 days in a pay period = 365 days), so we will be revising the job aid accordingly.

David