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Changes announced for policy on tuition waivers for grant-funded research assistants

As of July 1, 2020, Miami University discontinued waiving the full amount of in-state tuition for grant-funded graduate research assistants. Under the new policy, in-state tuition waivers will be scaled to the amount of direct costs in a grant. The additional out-of-state surcharge above in-state tuition will continue to be waived for all grants. Investigators are now required to include a minimum of 4.3% of the direct costs of a project as tuition for each graduate student stipend, unless a funding agency specifically prohibits charging tuition. If you are requesting more than $250,000 per year in direct costs, or there is no limit on the amount that can be requested, full in-state tuition must be included at the current rate of $523 per credit hour. Tuition is not subject to facilities and administration (F&A) charges. The established minimum percentage will be evaluated annually and may change as tuition rates change.


As part of a benchmarking exercise during strategic plan formulation, the research office learned that as recently as five years ago, most universities in our research expenditure bracket in Ohio and in the Midwest made it a common practice to waive fully both in-state and out-of-state tuition on grants that included a stipend for a graduate research assistant. Last year, as the research office updated its strategic plan, the same benchmarking exercise demonstrated that nearly every university that had, five years ago, been waiving full tuition was now expecting principal investigators to cover at least a portion of tuition on smaller grants and to cover full in-state tuition on major grants (≥$250,000 per year). This change means that Miami’s practice of waiving full tuition made us an outlier. The new policy aligns our practices to national norms.

As a result of the benchmarking and program review, beginning this past academic semester, Research & Sponsored Programs staff started asking some PIs to include partial tuition on their grants. On June 4, Jim Oris, then-Vice President for Research & Innovation, held an online forum with over 30 attendees to discuss a possible change in policy. Provost Osborne subsequently approved the change to take effect July 1, 2020.

The percentage calculation

Nearly all universities consider an NIH R01 grant the standard for a “major grant” and require grant budgets to cover the full cost of in-state tuition for their graduate research assistants. Typically, an R01 uses a modular budget that allows up to $250,000 in direct costs per year.

Using this same standard – an NIH R01 grant with a modular budget (i.e., $250,000 per year) – full in-state graduate tuition for a single research assistant was calculated as a percentage of the annual direct costs. Assuming full time graduate enrollment of 9 hours during each fall and spring and 3 hours during summer, for a total of 21 credits per calendar year, full in-state graduate tuition for a single research assistant amounts to 4.3% of $250,000. The fairest approach is to apply the 4.3% standard evenly across all grants that include stipends for GAs, as an offset to the cost of tuition. In cases where the 4.3% does not cover full in-state tuition, the remaining in-state tuition will be waived (as will the full out-of-state surcharge).


NIH grant

Our most common NIH grant is an R15 (AREA) mechanism, which is $300,000 in direct costs over three years, or $100,000 per year. Applying the 4.3% to such a budget will require the proposed budget to include $4,300 per year per GA in tuition, for a total of $12,900. The balance will be covered by a tuition waiver.

An NIH R21 has a direct cost limit of $275,000 over two years. This is typically budgeted as $150,000 in Year 1 and $125,000 in Year 2. Applying the 4.3% minimum tutition requirement, the proposed budget will include $6,450 in tuition for Year 1 ($150,000 x .043) and $5,375 in tuition for Year 2 ($125,000 x .043). The balance will be covered by a tuition waiver.

NSF grant

A typical NSF grant averages $123K in direct costs per year for three years. Applying the 4.3% to a budget of that size will require that $5,289 per year be included for tuition for each GA. The balance will be covered by a tuition waiver.

Image by Nick Youngson for Alpha Stock Images via The Blue Diamond Gallery, used under Creative Commons license.

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Changes to Federal labor rules will affect some research personnel

A blank IRS W-2 Wage and Tax Statement form.

UPDATE: On November 30, Miami University announced that in response to the federal judge’s injunction it will suspend, indefinitely,  changes it  planned to comply with the new FLSA overtime eligibility rules.
UPDATE: On November 22, a federal judge in Texas issued an injunction agains the FLSA action described below. It is likely these changes will not take effect December 1 as planned.

Recently the U.S. Department of Labor announced changes to the Fair Labor Standards Act (FLSA). This post summarizes those changes, discusses how they are being implemented at Miami University, and explains how those changes might affect researchers’ grant budgets.

What is FLSA?

The FLSA is a law that contains overtime pay provisions for U.S. workers. Currently, U.S. workers earning an annual salary of less than $23,660 are entitled to overtime compensation if they worked greater than 40 hours per week. U.S. workers who are paid an annual salary of at least $23,660 and are engaged in executive, administrative, or professional duties are exempt from this provision.

What changes are being made to the FLSA?

The changes made to the FLSA relate to the salary level that determines if an employee is exempt from the FLSA provisions for overtime (such as is the case for unclassified staff at Miami) or non-exempt from those provisions. In other words, the new FLSA provisions affect which employees are overtime eligible.

Effective December 1, 2016, the minimum annual salary threshold for exemption from overtime provisions will be set at $47,476 and will increase every three years thereafter.

What does this mean for grant budgets and for grant-funded employees?

In general, this means that  full-time employees who earn less than the $47,476 threshold will be required to track their work hours and must be paid overtime if they work greater than 40 hours a week. Researchers cannot allow or expect these non-exempt employees to work more than 40 hours per week without paying overtime.

Which grant-funded positions are most likely to be affected?

Postdoctoral researchers are the most likely to be affected by these changes. Postdoctoral candidates currently making under the threshold will be overtime eligible. Grantees may be able to raise the postdoc salary above the exemption threshold if there is room in the budget and if budget revisions are allowed by the sponsor. Alternatively, researchers who oversee grant-funded employees must monitor employees’ work hours and compensate them for any overtime beyond 40 hours per week.

How should I plan for future grant budgets?

For all new proposals, researchers are encouraged to budget their postdoc compensation at a minimum of $48,000, with 3% increases yearly.

What are some of the Federal-granting agencies doing to help researchers compensate for the increased threshold for exemption?

The National Institutes of Health (NIH) will increase postdoctoral stipends to levels at or above the proposed FLSA revisions. Projected postdoctoral stipends for Federal FY2017 can be found here. Look for the NIH to post guidance in the NIH Guide to Grants and Contracts regarding re-budgeting for current postdocs and employees over the new exemption threshold.

The National Science Foundation (NSF) postdoctoral fellowship programs already includes a stipend in excess of the FLSA final threshold. For grant-supported postdoctoral researchers making under the new threshold, NSF is leaving it up to principal investigators (PIs) and their institution to re-budget existing awards to comply with the new federal overtime rule. If additional funds are needed to cover any overages, grantees should contact their NSF Program Officer to discuss supplemental funding. See the NSF FLSA FAQs for additional information.

What is Miami doing about reclassification of impacted positions?

Definitions of unclassified and classified service can be found in the Miami University Policy Library. Specific questions regarding FLSA and employment at Miami University should be directed to Human Resources or Academic Personnel, as appropriate.

Starting August 1, 2016, Miami is centrally funding any increase in postdoctoral salary necessary to bring an individual above the new FLSA minimum so that all postdoctoral associates will be exempt from overtime. Because it is funded centrally, the salary increase will not affect current grants this fiscal year. However, central university funding will not be available indefinitely, so PIs affected by this increase are expected to seek supplements from their funding agencies during the upcoming year.

Updated November 28 to include information about the Federal court injunction. Updated November 30 to include information about Miami University’s response to the federal judge’s injunction. 

Written by Tricia Callahan, Director of Proposal Development, Office for the Advancement of Research & Scholarship, Miami University.

W-2 photo by 401(K) 2012 via Flickr. Time photo by Thomas Hawk via Flickr. Both used under Creative Commons license.