-
Personnel
costs: Include the salaries and benefits, or portions
thereof, for the people who will work on your project. Full-time employees
who will work part time on the project should be included at the appropriate
percentage of time. For example, if a research assistant will spend
20 hours per week on the project for its first year, he should
be budgeted for 50
percent of his total salary and 50 percent of his fringe benefits.
Fringe benefits include
Social Security taxes, health insurance, dental insurance and other
benefits that your agency provides.
-
Non-personnel
costs: The second category of direct costs includes expenses such as project-related
travel costs, equipment, office supplies,
postage, telephone expenses, etc. This is where you would include space costs
(calculated as the percentage of total space allocated to your project).
The proportionate cost of utilities, maintenance services, renovations (if
allowed), insurance on the facility and other applicable costs may also be
included here.
-
Indirect
costs: Sometimes called “overhead,” these are
expenses to your agency that aren’t directly related to the project
but are nonetheless required to implement the project (e.g., environmental
management – heating, cooling, water; protection and security; custodial
services; depreciation; equipment maintenance). Indirect costs are usually
calculated as a percentage of direct costs. Experienced budgeters and contractors
know what their approved overhead rate is. Be sensitive to limits established
by funders; for example, some states and foundations limit indirect costs
to a fixed, small percentage of direct costs.
-
Total
budget is the sum of direct and indirect costs, including in-kind contributions
and amounts already donated or secured.