A proposal budget and budget justification (also called a budget narrative) are an essential part of a competitive grant proposal. They connect the ideas in the proposal with the realities of implementation, help convince reviewers that the project is well-planned, and demonstrate the value of the planned project.
In project budgeting all expenses are grouped into broad categories, such as Personnel or Materials. A budget should be viewed as a financial expression of the work to be conducted. In this way, the budget serves a very practical purpose of documenting the financial needs of the project.
Budget Justifications are short two to three sentence descriptions that provide context to the budget forms required for the application. Successfully written justifications allow reviewers to clearly understand the necessity of all costs.
Your RSP pre-award manager will discuss your project with you and help you prepare your budget. The budget will list our best estimate of the costs required to perform the project.
Sponsors will include budget requirements and necessary categories within the RFP. Typical budget categories include:
Personnel costs are the costs associated with salaries (including hourly wages and graduate assistant stipends) and corresponding fringe benefits for ISU employees working on the grant.
Please note that many sponsors limit the amount (e.g., no more than 2 months of salary) or type (e.g., no salary for faculty, only for students) that the grant will pay. These restrictions should be noted when reviewing the RFP.
The budget narrative for Personnel should describe the responsibilities and activities for each person or position listed in the budget.
Rates are set by the State of Illinois and will be provided by your RSP Pre-Award Manager. Fringe benefits comprise medical and other insurance, SURS retirement payments, and Medicare contributions and therefore are likely to differ for each individual involved in the project.
Travel expenses tend to fall in two main categories: directly supporting the project activities and disseminating the project results. Common travel expenses include airfare, ground transportation, lodging, per diem allowance for meals, and conference registration fees.
Equipment (also instrumentation or special purpose equipment) for a sponsored project is generally defined as a single item (or an item that functions as a single unit comprised of multiple components purchased separately) that costs $5,000 or more. Items that do not meet this cost threshold should be listed under Materials and Supplies.
Please note that certain funding agencies or opportunities may have a different definition of equipment. The definition of what would constitute as equipment should be noted when reviewing the RFP.
Materials and supplies include durable items costing less than $5,000, as well as consumable items that are used in the performance of the project. General office items (e.g. paper, toner, etc.) and centrally purchased supplies (e.g., reagents, etc.) can be included as long as the costs can be directly tied and allocated to the project.
Many grants will allow publication costs. You should include these in the budget if this is appropriate for your discipline.
Consultant or Contractual Service costs are expenses paid to an individual or vendor to perform a service (e.g., create something, provide expert advice, etc.) for the project. ISU employees cannot be paid as consultants. Consultant services, as opposed to subawards, are for services that are typical of what the consultant or vendor would provide to any other customer.
Subawards are for funds going to external parties that, unlike contractual services, perform work with intellectual and technical independence, and are evaluated by the program requirements of the project, rather than simply supplying deliverables. Subrecipients are most commonly other Universities, although private (non-profit and for-profit) and public (local government and education agencies) can be subrecipients as well.
Subrecipients should have a distinct budget and budget narrative that follows these guidelines that is then referenced in the main proposal budget as a total for the subawardee.
As defined in the Federal guidelines, participant support costs means direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees (as described in the Travel section above) paid to or on behalf of participants or trainees (but not employees) in connection with conferences, or training projects. Please note that the RFP will generally indicate whether participant support costs are or are not allowed on a given proposal.
Indirect Costs (also Facilities and Administrative Costs), are the institutional expenses that cannot be directly attributed to a specific sponsored project. These include items such as space, maintenances, utilities, administration services, etc. These costs, set by negotiation with the Federal government, are included in budgets in order to recover the full costs of conducting a project.
Some sponsors require a financial commitment from the University to support the project. In these cases, the budget and budget narrative should include the costs being contributed as cost sharing, including the dollar value and the relationship to the project. Prior to submission, RSP will need approval from the Unit providing the cost share.