Budget Development


A proposal budget is a careful calculation and documentation of all the money needed to conduct a proposed project. It has two parts: budget and budget justification. Both are important elements of a persuasive proposal.

Request Budget Assistance 

Budget Details

  • A persuasive budget flows logically from the proposal's research and methods. It is broken into one-year segments and presents each line item separately.
  • A strategic budget accurately fits the proposed project. A budget that seems skimpy or padded can count heavily against the project. An unrealistic budget suggests that the investigators don't know what they're doing.
  • A budget is both an estimate and a firm offer on the part of the University. Once an award has been made, changes to the budget must be renegotiated based on the funder's guidelines.
  • Some sponsors establish dollar limits for first-year direct costs, with maximum increases for the following years. Proposals that exceed the limits may be rejected.
  • A strategic budget complies with the sponsor's guidelines. If the sponsor will not allow office equipment purchases, or limits costs for travel or publication support, follow the instructions and only ask for what is allowed. 
  • Be sure to include indirect costs. Check the F&A (indirect) Cost Rate Chart for current rates. If the sponsor allows only a certain rate, get a written document listing that rate and submit it to SPA with your proposal.
  • Sub-award proposal development materials are available through SPA.
  • Use current inflation and fringe rates. The Electronic Grants Management System (EGMS) will automatically calculate correct rates for budgets prepared online.

Budget Justification

Most federal agencies require applicants to justify the need for each budget line item. To identify which items must be justified and what information to include, read the grant application instructions carefully. The budget justification is usually a separate prose section of the project description. When the justifications are brief and straightforward, they may be inserted in the budget itself beneath each line item. 

Costs may include:

  • Personnel (position title, % effort or person months, name of each person if known)
  • Fringe benefits (list rates used)
  • Honoraria (by name of each person, if known)
  • Travel (destinations, durations, transportation, lodging, meals)
  • Equipment (individual pieces listed separately)
  • Materials (specific types)
  • Subcontracts (name of company, tasks, duration)
  • Direct and indirect costs
  • F&A (indirect) cost rates and base
  • Special categories related to the project, such as photocopying or reproduction; fees (for example, at archives), consultants, participant incentives, etc.

Budget Resources