Join Karl Kapp for an in-depth discussion in this video Budget, part of Grant Writing for Education.
- The budget section of your grant proposal is one of the most critical elements you will write. It defines the grant's priorities, provides reviewers insight into what will be accomplished, and indicates how the funding agency's money will be spent. In the exercise files are two budget narratives, and a copy of a budget for a five year grant, as well as a budget template from the US Department of Education. Before writing your budget you need to sit down with your team, and a person knowledgeable about institutional costs and personnel costs, and determine the overall cost structure of your grant.
That person will probably talk to you about direct and indirect costs. Direct costs are costs directly attributable to the grant activities. Typical examples of direct costs are salary, fringe benefits, travel, equipment, supplies, and make sure your direct costs listed in your budget are mentioned in your project narrative. Determine how much time from each person will be allocated to the grant work. Determine equipment costs, and figure out what can be reasonably accomplished given funding recommendations or guidelines by the funding agency.
Indirect costs are also sometimes called general and administrative cost, GNA, or some other similar name. These are costs that are required to run the institution, but are not directly attributable to the activities of the grant. Some items within indirect costs would include utilities, rent, legal services, insurance cost, and other items necessary to run an organization, but difficult to be allocated directly to one project. Most funding organizations place a limit on the amount of indirect costs an organization is allowed to include in the budget, and in some cases the organization won't allow any indirect costs.
Sometimes the indirect costs can only be calculated as a percentage of personnel costs, and other times it's a percentage of the entire project costs. If the grant is with the United States Federal Government, your institution will typically have a negotiated indirect cost rate. Read the grant solicitation carefully, or the organization's indirect policy to determine what is allowable and what is not. Now that you're actually ready to write the budget there will typically two items in the budget section, the budget itself and the budget narrative.
The first is the budget summary, or just the budget. This section contains the numbers. It is the list of items that are to be funded and the associated costs. The other section is the budget narrative, sometimes called the budget justification or budget description. In this section the rationale behind the budget is explained. The budget narrative can be a list of footnotes explaining each item, or it can be more of a text based narrative. The text based narrative is especially helpful if there are a number of unusual items contained within the budget such as special equipment, or special travel requirements.
Now you might want to consider the format of your budget. Many government funding agencies have a budget template to guide you through the process of preparing your budget, along with guidelines for completion. However, not all foundations or private funders have templates, and sometimes the format will be left to your discretion. If the funding agency doesn't have a template, you may consider using a template created by a federal agency to help with the preparation process.
Let me leave you with a handful of tips to help you present your budget in the best possible way. Make sure the amount you request equals the amount funded for that grant solicitation, meaning you want to be as close to the award amount as possible without going over. Make sure your allocation of expenses and personnel costs align with the goals of your project. Make sure you only request what the agency will actually fund, meaning don't ask for professional development funds if that's not something the agency will fund.
Consider that costs may increase year after year if it's a multiyear grant, and finally read and know the funding guidelines inside and out. A good solid budget is an important element of your grant proposal, perhaps the most important. First, understand the funding agency's requirements, format, and priorities, then carefully craft your budget to meet all those requirements.
- Finding a private or governmental funding agency
- Locating collaborators
- Understanding an RFP
- Dissecting the anatomy of a grant proposal: front matter to appendices
- Avoiding common grant-writing mistakes