Using the Budget to Tell Your Story

by Michael Wells

For some grantwriters, the budget seems cut and dried. It tells how much money you need to do the project described in your narrative. It's often left to the fiscal or program folks to develop.

This approach misses the opportunity to use the budget to support your narrative and strengthen your proposal.

Budgeting is another way of telling your story through the process of translating your project into fiscal terms. It's important that it describe the same project, and the reader should be able to guess what the project is just from reading the budget. This works in two ways:

A single program theme should run through your whole proposal. The written narrative, goals and objectives, timeline, evaluation and budget should describe the same project and include the same items.
Your budget categories should tie to the narrative. Since in many nonprofits personnel can be 80% of your costs, "personnel" shouldn't be just one line -- line item out each position. Be sure that you use the same job titles in the narrative and the budget -- not "counselor" in one section and "case manager" in another. If you attach job descriptions, they need to have the same titles too.

SHOWING TOTAL FUNDING

Use the budget to put your best foot forward. If you're only requesting partial funding for a project, show the whole budget -- especially if you're spending your own funds. If you have or are seeking other funding, tell where it's from. Showing other funds for the project always strengthens your position, even when no match is required.

The budget below was for a small performing arts organization to expand its marketing efforts and build audience. The group was already spending 10 % of its budget on marketing, so the "other funds" didn't require any extra expense. But it showed that the foundation was only being asked for 60% of the cost, even though the other sources of funding aren't identified.

Also look at the budget categories. This is pretty obviously a marketing grant, you could get an idea of their project strategy without even looking at the narrative. If you knew it was a performing arts organization, you could guess it was for audience development.

	Year One		Year Two		Year Three
	Other	Grant	Other	Grant	Other	Grant
	Funding	Funds	Funding	Funds	Funding	Funds

Mailings	6,500	3,000	6,500	9,500	6,500	9,500
Print Ads	0	5,000	0	5,000	0	5,000
Bus Ads	0	1,760	0	2,000	0	2,000
PR Materials	0	1,500	0	1,000	0	1,000
Programs	0	2,700	0	3,000	0	3,000
Marketing Plan	0	1,000	0	0	0	0
Graphic Design	0	1,000	0	1,000	0	1,000
Development	2,000	2,000	3,000	3,000	3,000	3,000
Exec Director	6,666	3,333	13,332	6,666	13,332	6,666
Rent	600	600	600	600	600	600
Telephone	600	600	600	600	600	600
Postage	120	120	120	120	120	120
Supplies	300	300	150	150	150	150
Copying	60	60	60	60	60	60

Totals	$16,846	$22,973	$24,362	$32,696	$24,362	$32,696

				THREE YEAR	TOTAL	$153,935
				THREE YEAR	Other	$65,570
				THREE YEAR	This Grant	$88,365

SUSTAINABILITY

Increasingly,funders are asking about project sustainability. They want to know how your project will continue to be funded after their grant period and how the grant project will help your organization. Since this is often a question in the guidelines, it's generally addressed in the narrative (with some hemming and hawing). If you know how you're going to continue funding, you can also show future funding in the budget.

The example below was for a multi-program Community Action Agency. As is often the case, as their government funding was cut they were looking to preserve programs by aggressively seeking private funds. The proposal was for a 3-year grant to develop fundraising capacity -- strengthen their development program and increase their private funding across the board. We wanted to show how the development program would not only pay for itself, but strengthen the agency's social service programs during and after the grant period.

			Period of Grant
Income from Fundraising	1998 Actual	1999 Actual	2000	2001	2002	2003	2004
Direct Mail	35,444	39,696	50,000	70,000	100,000	110,000	120,000
Events	57,414	43,211	50,000	57,000	75,000	100,000	110,000
Major Donors	26,600	20,000	40,000	77,000	120,000	170,000	175,000
United Way	70,000	232,938	182,000	182,000	182,000	190,000	200,000
Corporations	11,500	95,751	145,000	185,000	195,000	200,000	210,000
This Grant			120,000	80,000	50,000
Other Foundations	18,428	25,760	20,000	90,000	140,000	160,000	170,000
Community	33,036	51,031	60,000	92,000	138,000	120,000	125,000
TOTAL	252,422	508,387	667,000	833,000	1,000,000	1,050,000	1,110,000

Development Expense	170,000	170,000	310,000	320,000	330,000	340,000	350,000
Funds Contributed to Agency Programs	82,422	338,387	357,000	513,000	670,000	710,000	760,000

DEVELOPING THE BUDGET TO SUPPORT YOUR STORY

In good practice you develop your grant project, establish staffing, then do the budget. But don't stop there. Take the budget to the program staff who will implement it and see if they have any additions or see any holes. Then use the budget categories to judge your narrative. See if everything in the budget is included in your program description and goals and objectives. You may have to go back and add to language make them consistent. Of course, turn this around and be sure everything in your narrative is budgeted for, even if it's to be paid from other sources.

When writing your budget narrative or justification, don't just include minimal information. Briefly tell what the major project staff will do and show how you arrived at significant numbers (Staff paid at agency rates, equipment bids from suppliers, rent prorated according to FTE project personnel, 400 chairs @ $5 each, etc.).

Finally, make the budget easy to read. I like to present everything on one page so the reader can get an overview of the project and see relationships at a glance. This can just be a summary. In some cases with complex projects or building construction you'll need to include a more detailed budget as an attachment.

Michael Wells

Michael Wells is a partner in the consulting firm Grants Northwest. He has been working with non-profits for over 30 years and consulting on grants since 1987. He has worked with dozens of nonprofit organizations, health clinics, Indian tribes, school districts and local governments and has helped them to raise over $50 million. He is a Certified Fund Raising Executive (CFRE) and has a Masters degree in humanities. He is adjunct faculty at Portland State University where he teaches Grantwriting. He is editor of the CharityChannel online Grants and Foundation Review. Michael is a past national board member of the American Association of Grant Professionals (AAGP), current board member of the Grant Professionals Certification Institute (GPCI) and author of the Grantwriting Beyond the Basics series: Proven Strategies Professionals Use to Make Their Proposals Work (2005) and Understanding Nonprofit Finances (due for publication in February, 2006).

Grantwritng books by Michael Wells include: Grantwriting Beyond the Basics Book 1: Proven Strategies Professionals Use to Make Their Proposals Work

And its companion book in the series: Grantwriting Beyond the Basics Book 2: Understanding Nonprofit Finances

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