July 15, 2019 | Read Time: 2 minutes
It’s no secret that nonprofits need money to run their programs and cover the day-to-day costs of staying afloat, including electricity, rent, salaries, and other basic needs. Yet only 31 percent of fundraisers feel comfortable talking with grant makers about the need for general operating support, according to the 2015 Nonprofit Finance Fund survey of nearly 5,500 charities.
Whether you’re seeking resources for “overhead” or a specific program, experts say, you should show foundations the true price of your work. “Don’t just calculate revenue and expenses, but the full costs of doing business,” said Kathy Reich, director of the Ford Foundation’s Build program, which provides general operating support to nonprofits, during the Chronicle webinar “General Operating Support: Making the Case to Grant Makers.”
When creating a budget for a grant proposal, said Mindy Aldridge, president of the Nelson Foundation, outside of Philadelphia, you should provide context that will help the program officer easily understand your needs.
For example, she likes to see financial information for at least the past two years rather than just the coming year. She also appreciates notes that explain or give more details about the purposes of the amounts requested.
To help your organization present to grant makers the true cost of your results, Aldridge shared a sample budget from a Nelson Foundation grantee. This example shows the charity’s revenue and expenses over a two-year period and clearly lays out its costs in two categories:
Direct expenses: salaries and other costs directly related to the program, such as transportation, materials for activities, and snacks for the participants.
Indirect expenses: general operating needs, like insurance and utilities, and a percentage of the time spent by the executive director and an administrative employee.
The sample budget also offers a breakdown of what certain line items include.
“The result is completeness and transparency,” Aldridge said. “And all of that helps to build trust with the potential funder or in the history of your funding relationship.”
Download and adapt this program budget for your next grant proposal.
