The budget narrative expands on line items, explaining how the author arrived at dollar amounts and giving enough detail to tie the costs to the project’s activities and goals already described. When costs seem unusually high or low, the budget narrative can provide the needed explanation. As with the entire proposal, budget narratives should be clear and forthright. Three additional considerations will help the narrative avoid raising any unnecessary red flags.

1. Make sure the narrative matches the line-items exactly.
2. Make sure the total amount is commensurate with the outcome.
3. State fair, reasonable costs and stipends.

1. Narrative Matches the Line-item Budget. It is difficult for evaluators to take an application seriously if the budget narrative does not match the numbers in the budget itself. Even if the mistake is small, it suggests that the proposal was hurried rather than thoughtfully considered and constructed.

2. Amount Commensurate with Outcome. Remember that evaluators are reading, and have read, many proposals. They have some idea of the reasonable range of costs associated with different kinds of activities.

3. Fair and Reasonable Costs and Stipends. It is impossible to set rigid guidelines for stipends and other costs, because the appropriateness of payments will depend on many contingencies and particularities too numerous to catalog and account for. That said, it seems appropriate to pay honoraria in the range of $50 to $250 a day for attendance at a conference or workshop; perhaps $200 to $1000 depending on what the participant’s official role and responsibilities will be and how much pre-conference preparation time will be necessary (say, for the preparation of a conference paper, or the design and leadership of workshop activities). It is not inappropriate to request funds for travel and accommodation costs, nor to budget funds for hospitality and/or meals during a gathering. It is sometimes appropriate to pay small stipends to encourage “buy-in” and a sense of obligation and responsibility on the part of the participants. Project Directors can be deserving of a stipend when there are extensive activities involved in administering the grant or organizing a gathering.

One way to determine an appropriate stipend might be to compare the time expenditure with, say, teaching a course or faculty administrative work, and then compare the monetary remuneration to adjunct/replacement salaries or course-release time and administrative bonuses.

Reasonable stipends and moderate project costs suggest a worthwhile endeavor in which busy professionals are being fairly compensated for their participation. Excessive expenses in any area suggest that participants are being motivated by money rather than by the nature of the enterprise. The Wabash Center adheres to the general budgetary guidelines of Lilly Endowment Inc.

One important subset of fair and reasonable costs involves funding for institutional support. Wabash Center grants allow up to 10% “overhead” for the various administrative functions provided by a host institution.

Examples of Budget Narratives:
Budget Narrative Example #1
Budget Narrative Example #2