Salary Savings Return Policy

Background of Policy

Certain external granting agencies make available to faculty funds that can be used to support a faculty member's academic/fiscal year salary.  When these funds are awarded as part of the grant funding and the faculty member charges his/her salary to the award account, salary savings is generated.  If salary savings is sufficient, a teaching release is sometimes granted.  The actual salary savings money has historically been used by the College to support replacement instruction, mandatory salary supplements for university fellowships & PRF research assistantships and other college-wide instruction and research needs.  Until July 2000, no financial incentives existed within the College of Liberal Arts to encourage faculty researchers to request funds to support their AY and/or FY salaries. At that time a “Research Incentive Program” was introduced that allowed faculty and departments to share in the distribution of the salary savings generated when their salaries were charged to externally sponsored research accounts. As of October 10, 2012, we are further improving these research incentives.

Program Goals/Objectives

The goal of this program is to encourage and support research and scholarship in the College of Liberal Arts.  In addition, this program is designed to:

  1. Be consistent and equally applicable across all Liberal Arts Departments.

  2. Provide sufficient resources for the College to cover the cost of replacement instruction.

  3. Provide a source of financial support for the PI and/or department to assist with infrastructure costs associated with departmental research programs or general S&E and travel expenses.

  4. Be easy to calculate.

Charging AY Salary to External Research Grants May Affect PIs Teaching Responsibilities 

  1. When 20% or more of a PI’s AY salary is paid from an external grant, the PI’s teaching responsibilities may be reduced by one course per year (i.e., the PI is allowed to buy out of a course).  PIs may, if their department or school head approves, have additional course buy-outs if grant funds pay for some multiple of 20% of their salary.  For example, they could buy out of two courses for 40% of AY salary.  (Note that faculty members need not reach the 20% figure in a single year.  For example, faculty who budget 10% AY salary in Year 1 of a grant and 10% AY salary in Year 2 of the grant would be entitled to a course buy-out in Year 2.)

    As mentioned above, department/school heads are expected to use a portion of the salary savings transferred to their departments to provide replacement instruction, that is, to pay instructors to teach courses that compensate for course buy-outs.  For example, a head may appoint a Graduate Instructor to teach a course that would have been taught by a PI who has a course buy-out.  Alternatively, a head may appoint a Graduate Instructor to teach another course that enrolls at least as many students as the course bought out.  In addition, heads may also consider other options to ensure that course buy-outs do not have a negative effect on their department’s or school’s course offerings.  The dean will regularly review how heads adjust course offerings to compensate for course buy-outs.

  2. When less than 20% of a PI’s AY salary is paid from an external grant, the PI would generally have their normal teaching responsibilities (i.e., no course buy-out).  When special circumstances warrant it, however, heads may request that the dean authorize a course release in these cases.

Determining Salary Savings

Salary savings are generated when a faculty member charges a portion of his/her budgeted academic year or fiscal year salary to funds they have received from an external sponsor.

Return of Salary Savings 

Most generally, one third (1/3) of the salary savings from external research grants is retained by the college and two thirds (2/3) is transferred to the department or school, where, after any expenses for replacement teaching have been subtracted, the remainder is shared equally between the department/school and the PI.

The program is reviewed and may be revised every two years.  Based on a review in the fall of 2012, the program was revised with revisions taking effect at the start of the spring semester of 2013.

The portions of salary savings allocated to departments, and then by department heads to PIs, will be distributed bi-annually, after faculty have certified their effort on their Personnel Activity Reports for the fall and spring semesters.  Funds will be allocated to special departmental general fund accounts (21010000 4017XXXYYY, where XXX = deptartment number and YYY designates PI).

Use of Returned Funds

Use of distributed salary savings will be in accordance with the same spending guidelines that apply to the University general fund.  Some examples of allowable expenditures include:

  • Summer salary (may require prior approval -- see Business Manager for assistance)

  • Student support

  • Travel (including international meetings)

  • Honoraria

  • Equipment

  • Supplies

  • Phone and data network lines

  • All equipment and supplies purchased will be university property.

Additional Information

Specific questions about the program can be directed via e-mail to Melissa Remis, Associate Dean, College of Liberal Arts or Kirke Willing, Director of Financial Affairs, College of Liberal Arts.  Other questions can be directed to your Business Manager.  Whether other external awards (such as fellowships) qualify for this program will be considered on a case-by-case basis.  Please contact Kirke Willing if you have these types of awards.


Professor Jones has an annual salary of $60,000.  She receives a $300,000 award from NIH.  Included in the budget are funds to support 40% of her academic year salary.  The project period is July 1, 2014 through June 30, 2015. 

Professor Jones contacts the department head and they agree that Professor Jones will devote 40% effort to this project for the year. 

At the end of the Fall and Spring Semesters Professor Jones completes her PARs and certifies the salary distribution at 40% organized research on the grant and 60% under instruction or departmental research on general funds. 

Salary savings for the academic year is calculated - $60,000*.40 =  $24,000

Annual Distribution  (if the department policy is 50/50 split between department and PI)

PI 33.35% $ 8,004
Department 33.35% $ 8,004
College  33.30% $ 7,992
Total 100.0% $24,000

The funds for the PI and Department will be made available for expenditure in the special accounts.

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