Creating a Monster Budget Package

When you’re seeking grant support for a complicated five- to 10-year program, developing the budget can be challenging. Take a five- to 10-year program plan, throw in two or three collaborating organizations as sub-recipients, pile on a required annual matching contribution, and you’ll find yourself in a swamp of numbers you must somehow sort into an easy-to-understand financial plan. 

“You’ll have to detail and justify the costs for every year,” said Barbara Floersch of The Grantsmanship Center in Los Angeles. “While you can show sub-recipient costs as a lump sum in your organization’s budget, the complete  package must also include detailed subrecipient budgets and budget narratives for each year.” 

First, as with any budget, both you and your sub-recipients must figure out the line items you’ll need, set the value of each line item, and build in appropriate indirect costs. “Most budgets vary from year to year so be sure to consider these two questions,” said Floersch.

  1. Will salaries and fringe benefits increase annually? At what rate? 
  2. Will some start-up expenses be unnecessary in subsequent years? Conversely, are there expenses that won’t surface until after start-up?

If the funder provides forms, use them. If the funder provides instructions, follow them. But if you’re left to design the budget yourself, the guiding principles are accuracy, clarity, specificity, and justification. “With this sort of monster budget, you’ll be developing a budget package composed of numerous components,” said Floersch. For example, the budget package might include the following:

  • Summary spreadsheet showing total annual costs and matching resources for all years by major budget category. This summary will give a bird’s-eye view of the entire financial plan.
  • Applicant agency line-item budgets and budget narratives (justifications) for each program year. Both the line-item budgets and narratives should identify and explain use of matching resources. Each budget and narrative will be a deep-dive document that leaves no question unanswered.
  • Sub-recipient agency line-item budgets and budget narratives for each program year.  If sub-recipients are also bringing matching resources to the project, be sure those are identified and explained. These are deep-dive documents, as well.

Because a budget package for a long-term, complicated program will be quite extensive, Floersch suggests numbering the pages consecutively and providing a table of contents. 

Plan the budget as you plan the program. Keep copious notes and ask sub-recipients to do the same. If you’ve based line-item costs on estimates, organize those estimates so you can locate them quickly if the funder has questions. “When you’re working on programs of this magnitude, you’ll likely be working in a large team,” said Floersch. “It’s highly effective to designate a subcommittee of the team for budget development and packaging.” © Copyright 2020, The Grantsmanship Center