For many writers of grant proposals, the budget component can be very intimidating. However, knowing some basic principles of writing grants, such as how costs are presented, can make writing a grant less stressful.
Budget Preparation for GrantsPresent your grant proposal budget in a way to make a very good impression on the reviewer.
- Print it on a new page
- Align figures properly
- Double-check your figures
- Include column headings, such as:
- Budget Category, Requested Funds, Local Contributions, and Project Total
Organize your budget so it is easy to read and understand.
Direct Costs for GrantsDirect costs for your grant are perhaps the most important component in your grant’s budget. They represent the funds you are seeking from the funding source. The costs described below are considered direct costs.
Personnel: If your program requires that you cover staff costs, you will include that salary under the category “personnel”. If you are hiring new staff, determining the actual salary can be tricky. One place to start is by checking with similar organizations to find out what they are paying program employees. State whether wages are based on annual salary or hourly wage If hourly, show the breakdown of hours and weeks. Such as: $10.00 per hour X 40 hours per week X 52 weeks = $20,800)
Fringe Benefits: Fringe benefits are those taxes and benefits that the employer must pay for an employee. They are primarily based upon gross salary and average about 21% to 27%. Fringe benefits that are required by law include FICA (Social Security and Medicare), FUTA (Federal Unemployment Taxes/Insurance), SUTA or SUI (State Unemployment Taxes/Insurance), and Worker’s Compensation (on-the-job accident insurance). Other benefits include medical insurance and paid sick leave. When listing fringe benefits in your budget, be sure to note “Standard Government Fringe Benefits Package as Required by Law,” in case a reviewer does not know what fringe benefits include.
Travel: Many times travel can be included in the proposal’s budget. While travel expenses are a heavily scrutinized item, there are ways to get them approved. Make sure to provide clear formulas and documentation for why travel is necessary. Include the cost for a plane ticket, the cost of a hotel per night and the number of nights you will be staying, and a food allowance. Be sure and use realistic but conservative figures and avoid using round numbers, such as use $1,280 instead of $1,000.
Equipment: Funding sources often scrutinize the purchase of equipment. To help them understand equipment costs, provide them with documentation of the program need for the equipment. Equipment costs should be well defined and include specifications. For example, you might include a high–speed copier system to be used to reproduce reports and other documents for committees, staff members, and volunteers. You should explain how the copier will help you in administering the program.
Supplies: Funding sources qualify or define supplies differently. Always check with the funding source before proceeding with this section. It is also important to explain how the supplies will assist in running the program. It is also helpful to break down supplies into categories such as general office supplies, educational and training supplies, and computer supplies.
In-Kind Contributions: In-kind contributions are goods or services that are donated to the organization. These services/contributions can oftentimes be used as “match” by many funding sources. Examples of in-kind contributions include:
- use of a building and utilities
- donation of books
- pro-bono professional services
The value of these services or goods is estimated based on their “market value.” For example, a volunteer working in an unskilled position would be calculated at minimum wage dollar value. To indicate this in a budget, you might include a formula such as: 5 volunteers X $5.15 hourly X 5 hours per week X 36 weeks = $4,635 In-kind contributions can impress reviewers as they present evidence of community support for the program.
Indirect Costs for GrantsIndirect costs for your grant (“overhead”) are costs associated with administration and facilities. Such as:
- Building costs
- Garbage Service
Usually a percentage of total direct costs can be reimbursed by a funding source only if an indirect cost rate has been negotiated and approved by the grantor. Before including an indirect costs category in your budget, make sure you thoroughly read the RFP and Grant Guidelines. It will tell you know whether or not indirect costs apply to the grant program.
Back to How to Write a Grant Proposal.