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

Michael Wells Photo

Copyright 2005 Michael Wells. All rights reserved.

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