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The Who, What, When, Where, and How ofGrant Budgets

-This AFP Information Exchange resource is provided by:

Waddy Thompson, Grantadviser.comContact: 917-657-4094· waddy@grantadviser.com

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ASSOCIATION OF FUNDRAISING PROFESSIONALS

4300 Wilson Boulevard, Suite 300· Arlington, VA 22203-4168800-666-3863 (U.S. & Canada) .703-684-9410. 001-866-837-1948 (Mexico) • 703-684-0540 fax

www.afpnet.org • afp@afpnet.org

The Who, What, When, Where, and How of GrantBudgets

You probably remember the mnemonic in the title from grade school English class on how to write anews article. In teaching budget preparation I have long stressed that a budget must be able to stand onits own and answer questions about your grant proposal (not raise questions). It occurred to me that inthis way, a grant budget is like a good news article and that by using the familiar formula the grant writerwill remember to include all important activities in the budget. These words are also good ways to groupexpenses and income for a clear presentation. Of course, "why" is missing from the list of points tocover. I've not yet discovered how to explain that in numbers -- yet.

How to make your budget tell your story

WhoWho will carry out your project? Staff, consultants, and volunteers all have a place in this part of yourbudget. In thinking about staff, don't forget support staff and supervisory staff. They may spend only afraction of their time on a project, but some portion of their salaries should be included. And think aboutwhat you'd have to pay people to do the work of your volunteers. If you include volunteers in yourstaffing, list them on a separate line and put a corresponding line for the same amount in the Incomesection of the budget as donated services.

WhatList all your direct expenses (supplies, postage, mailing expense, shipping, special space rentals, servicefees, equipment, transportation, etc.) that you must have to do the project. Don't leave out the value ofsupplies you have on hand; you'll have to replace them after the project has consumed them, so theseshould be counted, too. You will probably need a line for indirect expenses. These are expenses that youcan't justify as being part of the project, but you must incur these expenses to operate your organization.Examples are rent, utilities, insurance, and accounting and banking fees. Of course, if your budget is foryour entire operations, everything is a direct expense. (Indirect expenses and how to allocate them areexplained in depth in my book, and the Budget Builder Tool on the CDturns a complicated calculationinto flll-ln-the-blanks.)

WhenWhen will your project take place? What period is the grant meant to cover? Sometimes, those won't bethe same thing. Let the funder know when you need the money by clearly labeling the column ofexpenses or in the title on the page. And if the project dates and grant date aren't the same, you mayneed to list the specific costs you want the funder to cover in a separate column. That way, they can seethe total costs, as well as what part their grant will play in the overall project.

WhereThe location of the project can be expressed in several ways. If yours is an operating budget, you'llinclude all your occupancy costs (rent, utilities, etc.) and costs of any additional spaces you'll have torent. You project grant budget will include a percentage of your occupancy costs as indirect expenses,

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indicating that at least part of the program will take place in your offices. Specific rental costs will showthat you are operating outside your space. And if that extra space is donated, include a fair market valuefor the space in your expenses and show a corresponding space donation line in the Income section.

HowThe statement of all of your income sources will tell the funder just how you expect to carry out theproject. Will there be service fees charged to clients? Will audiences pay admission? In addition to thefunder for whom you're preparing this budget, what other funders do you expect to support yourproject? Which have already made a commitment and which are pending? Will you have any in-kindincome, that is, will anyone be donating goods or services (like your volunteers) to the project? Listeverything here. The more sources supporting your project, the better it will look to the funder.

Footnotes and Budget NarrativesSometimes, everything just can't be clear from numbers alone, so feel free to add footnotes or to write ashort narrative putting some of the important expenses into context. Your largest expenses will mostoften need explanation, especially if their role in the project is not clear. For example, if you have largetravel costs, and your project takes place locally, you might want to explain that the travel costs willallow you to bring in an expert from across the country to take part in the project.

Attached is a sample budget created using the above guide. Take a look and see just how much you cantell about the project just from the budget!

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Project BudgetExpensesProgram Director (2%)Assoc. Prog. Director (5%)Assistant (2%)Fringe and benefits @ 18%

Subtotal salaried personnel

Project coordinatorLibrary space usage fee (10 @ $500)Artist Fees (10 @ $1,000)

Subtotal other personnel

SuppliesPostage/freightWeb siteTravel (local)Marketing (posters & bookmarks)Advertising

Subtotal other expenses

Indirect @ 12%

Total ExpensesIncomeConEdisonLibrary systems space donationFoundation 1Foundation 2City agency challenge grant

Total IncomeSurplus (Deficit)

$1,600$2,500$6,000$1,818

$11,918

$8,000$5,000

$10,000$23,000

$800$500

$1,000$160

$16,000$2,500

$20,960

$3,945

$59,823

$30,000$5,000$5,000$5,000

$15,000

$60,000

$177

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Association ofFundraising Professionals

The Who, What, When, Where, and How of Grant Budgets was provided by:Waddy Thompson, Grantadviser.com

Contact: 917-657-4094 • waddy@grantadviser.com

Waddy Thompson has had career in fundraising for New York City arts organizations spanning more than 20 years.Currently Director of Development at Symphony Space, he previously held development or external affairs positionsat OPERA America, New York Foundation for the Arts, Poets & Writers, and the Whitney Museum of American Art,

among others. He is also the author of The Complete Idiot's Guide to Grant Writing (Alpha Books, 2nd edition 2007),and frequently gives grant writing workshops. His website is http://www.grantadviser.com.

ASSOCIATION OF FUNDRAISING PROFESSIONALS

4300 Wilson Boulevard, Suite 300· Arlington, VA 22203'-4168800-666-3863 (U.S. & Canada) • 703-684-0410· 001-866-837-1948 (Mexico) • 703-684-0540 fax

www.afpnet.org • afp@afpnet.org

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