Using the Budget to Tell Your Story

To some grantwriters, the budget seems cut and dried. It tells how much money you need to carry out the project described in your narrative. It’s often left for the fiscal or program folks to develop. This “hands off” 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 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 budget 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 use 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 project whole budget — especially if you’re spending your own funds. If you have or are seeking other funding, tell where it’s coming 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 project 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 this 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 strengthen your organization. Since this is often a question in the funder’s guidelines, it’s generally addressed in the narrative (with some hemming and hawing). If you know how you’re planning to continue funding, you can strengthen your case by showing future funding in the budget.

The example below was for a multi-program Community Action Agency. In a common scenario in recent decades, 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


The budget layout for this 3-year grant covers 8 years. The two years before, three years of declining grant funding, and two years afterwards. Aside from a big jump in corporate giving (which they had already been working hard), there isn’t a huge income increase in the first grant year (2000). But by the end of the grant period, every category has been incrementally strengthened, building a diversified funding base that continues to support the agency’s services. (By the way, in 2003 they raised $1.1 million in private funds).


COMBINING BUDGET WITH PROJECT PHASES

You can also develop a functional budget, which allocates funds to project phases for funders who reimburse for milestones, or if you want to show your cash flow needs. You’d probably also want to provide a conventional line item budget. This example also allows you to tie your budget to goals and objectives and to the timeline.


DEVELOPING THE BUDGET TO SUPPORT YOUR STORY

In good practice you design your grant project, establish staffing, then develop the budget. But don’t stop there. Take the budget to the program manager 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 wording to 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 basic information. Briefly tell what the major project staff will do and show how you arrived at significant numbers (Staff will be 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 a complete budget on one page so the reader can get an overview of the project and see relationships at a glance, even if its just a summary can just be a summary. In some cases such as complex projects or construction you may need to include a more detailed budget breakdown as an attachment.

Developing the grant budget can be part of your grant strategy. Can you strengthen your case for funding through your choice of budget format? Does the budget make the project easier for the reader to understand? By thinking of the budget as another narrative element which helps tell a story, like the needs statement or evaluation, you can add interest to the dry numbers at the end of your proposal.