1-dollar-billsIf you’ve written a significant number of grant proposals, you might have noticed there are two narratives that funders often request as a part of an application. The first is the narrative that contains your statement of need, your goals and objects, your methodology for carrying out the project, and your description of the staff members who will be responsible for doing this. The second narrative accompanies the budget for your proposal and is called the “budget narrative.”

We typically think of budgets as numbers, so the request for a “budget narrative” might seem unusual. However, the budget narrative gives an applicant the chance to explain in words how the numbers were derived. Budget figures often are the result of mathematical equations, and it’s important for reviewers to understand these calculations. If you think about it, just providing reviewers with a budget full of numbers doesn’t explain how these figures were chosen–and can leave reviewers wondering if they were just pulled from thin air.

Budget narratives should explain every line item that appears on the budget form that contains a dollar figure. Salary and benefit line items, for example, should explain the annual salary for the position(s) of the people working on the project, their required experience or education, the percentage of their time they will spend on the project, and the percentage of fringe benefits that corresponds to the salary amount requested. To illustrate, here is a sample personnel segment of a budget narrative from the Office of Safe and Drug Free Schools on the ed.gov web site:
Project Director (1.0 FTE):      $50,000
The project director will have oversight of the program and provide supervision, recruitment, and training of the program liaisons. At a minimum, this position requires a master’s degree with an emphasis in social work or other related field.
Program Liaisons (2 @ 1.0 FTE):     (2 x $35,000) = $70,000
Two program liaisons will be responsible for day-to-day school/community outreach activities. At a minimum, staff will hold a bachelor’s degree (or equivalent) in the social services field. It is anticipated that each liaison will be responsible for 25 annual events.

Staff Assistant (1.0 FTE):     $25,000
The staff assistant will perform all clerical duties for the project staff. This position requires a high school diploma or equivalent.

Here is the sample fringe benefits section from the same proposal:

Happy Days pays 100 percent medical, dental, vision, life, and disability for full-time employees, and is calculated at .25 percent of annual salary. The calculations are as follows:
Program Director ($50,000 x .25):    $12,500
(2) Program Liaisons ($70,000 x .25):    $17,500
Staff Assistant ($25,000 x .25):    $6,250

If you are including matching funds in the budget for your grant proposal, you should also include them in the budget narrative. List the matching funds amount with the corresponding budget line item, and indicate the source of the matching funds.

If you are purchasing equipment, it is helpful to indicate where the cost for the equipment originated. This might be a web site, for example, or from a vendor quote. Again, let the reviewers know that these numbers are actual numbers provided by a reputable source.

Remember that a budget narrative is another source of information for reviewers as they look at your budget to determine if the amount you are requesting is reasonable. There are many samples of budget narratives on the internet that can help you create a narrative that’s easy to understand and supports a credible budget request.