Writing and Submitting the Grant Proposal—Section 3
Writing the Budget and Budget Narrative
Your budget is not just a spreadsheet; it’s your project plan in financial terms. The Budget Information form (Part 2, ED Form 524) details the costs, and the Budget Narrative (Part 5) justifies every dollar. These should be developed by your Business Manager in close collaboration with the grant writer to ensure perfect alignment with the Project Narrative.
This part of your application, then, contains information about the Federal funding you are requesting. Remember that you must provide all requested budget information for each year of the project and complete the total column in order to be considered for Federal funding. This budget information should (a) include a breakdown of personnel, benefits, training, equipment, travel, and indirect costs; and (b) match the proposed budget to project objectives and activities.
NOTE: Administrative costs for applicants that are LEAs and consortia of LEAs may not exceed 5 percent of the annual grant award. Administrative costs for applicants should be included in their overall budget request for each year of the grant.
Application Part 2—Budget Information Non-Construction Programs (ED Form 524)
ED Budget Form 524—Sections A and B
Application Part 5—Budget Narrative Attachment Form
Budget Narrative
Instructions for completing ED Form 524
This part of your application contains information about the Federal funding you are requesting. Remember that you must provide all requested budget information for each year of the project and the total column in order to be considered for Federal funding. Specific instructions for completing the budget forms are provided within this application package.
Step-by-Step Directions
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Action 1: Complete the Budget Information Form (Part 2)
Instructions for completing ED Form 524 Section A:
- Name of Institution/Organization: Enter the name of the applicant in the space provided. Personnel (line 1): Enter project personnel salaries and wages only. Include fees and expenses for consultants on line 6.
- Fringe Benefits (line 2): The institution’s normal fringe benefits contribution may be charged to the program. Leave this line blank if fringe benefits applicable to direct salaries and wages are treated as part of the indirect cost.
- Travel (line 3): Indicate the travel costs of employees and participants only. Include travel of persons such as consultants on line 6.
- Equipment (line 4): Indicate the cost of tangible, non-expendable personal property that has a usefulness greater than one year and acquisition costs that are the lesser of the capitalization level established by the applicant entity for financial statement purposes or $10,000 per article. Lower limits may be established to maintain consistency with the applicant’s policy.
- Supplies (line 5): Show all tangible, expendable personal property. Direct supplies and materials differ from equipment in that they are consumable, expendable, and of a relatively low unit cost. Supplies purchased with grant funds should directly benefit the grant project and be necessary for achieving the goals of the project.
- Contractual (line 6): The contractual category should include all costs specifically incurred with actions that the applicant takes in conjunction with an established internal procurement system. Include consultant fees, expenses, and travel costs in this category if the consultant’s services are obtained through a written binding agreement or contract.
- Construction (line 7): Construction funds are not authorized.
- Other (line 8): Indicate all direct costs not covered on lines 1-6. For example, include costs such as space rental, required fees, honoraria and travel (where a contract is not in place for services), training, and communication and printing costs. Do not include costs that are included in the indirect cost rate.
- Total Direct Costs (line 9): The sum of lines 1-8.
- Indirect Costs (line 10): Indicate the applicant’s approved indirect cost rate, per sections75.560 – 75.564 of EDGAR. If an applicant does not have an approved indirect cost rate agreement with a cognizant Federal agency, the applicant must apply to the Department for a temporary indirect cost rate if it wishes to charge indirect costs to the grant. For moreinformation, go to the Department’s website at: https://www.ed.gov/about/ed-offices/ofo#Indirect-Cost-Division.
In addition, a grantee, if it is eligible, may also use De Minimis rate as provided for under 2 CFR 200.414(f).Training Stipends
- (Line 11): Not Applicable for this program.
- Total Cost (line 12): This should equal to sum of lines 9-11 (total direct costs + indirect + stipends). The sum for column one, labeled Project Year 1 (a), should also be equal to item 15a on the application cover sheet (SF Form 424).
Downloadable Form for this Step:
Instructions for Completing the Budget Narrative
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Action 1: Complete the Budget Narrative (Part 5)
This section should be attached as a single document to the Budget Narrative Attachment Form in accordance with the instructions found on Grants.gov. It should be organized in the following manner and include the following parts in order to expedite the review process. Ensure that you attach the Education approved file types detailed in the Common Instructions for
Applicants to Department of Education Discretionary Grant Programs published in the Federal Register August 29, 2025 (90 FR 42234) and available here.
Also, do not upload any password-protected files to your application.
When attaching files, applicants should limit the size of their file names. Lengthy file names could result in difficulties with opening and processing your application. The Department recommends your file names be less than 50 characters.
Each application must also provide a Budget Narrative (which serves to meet the requirements of ED Form 524, Section C) for requested Federal funds. The Budget
Narrative for requested Federal funds should provide a justification of how the money requested for each budget item will be spent.
This section requires an itemized budget breakdown for each project year and the basis for estimating the costs of personnel salaries, benefits, project staff travel, materials and supplies, consultants and subcontracts, indirect costs and any other projected expenditures. Be sure to complete an itemized budget breakdown and narrative for each year of the proposed project.
The Budget Narrative provides an opportunity for the applicant to identify the nature and amount of the proposed expenditures. The applicant should provide sufficient detail to enable reviewers and project staff to understand how requested funds will be used, how much will be expended, and the relationship between the requested funds and project activities and outcomes.
In accordance with 34 CFR 75.232, Department of Education staff perform a cost analysis of each recommended project to ensure that costs relate to the activities and objectives of the project, are reasonable, allowable and allocable. The Department may delete or reduce costs from the budget during this review.
Important Notes
Applicants are encouraged to review the Guidance for Federal Financial Assistance in preparing their budget and budget narrative, which may be found at the following link: https://www.ecfr.gov/cgi-bin/text-idx?tpl=/ecfrbrowse/Title02/2cfr200_main_02.tpl.
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Suggested Guidelines for the Budget Narrative
1. Provide an itemized budget breakdown, and justification by project year. The budget narrative fulfils the requirement of Form ED 524, Section C Budget Narrative. Find information below in Part 5 on completing the budget narrative. For this program, applicants do not need to fill in non- Federal funds or resources listed in Section B.
2. If you are requesting reimbursement for indirect costs on line 10, this information is to be completed by your Business Office. Specify the estimated amount of the base to which the indirect cost rate is applied and the total indirect expense. Depending on the grant program to which you are applying and/or your approved Indirect Cost Rate Agreement, some direct cost budget categories in your grant application budget may not be included in the base and multiplied by your indirect cost rate. Please indicate which costs are included and which costs are excluded from the base to which the indirect cost rate is applied.
www.ed.gov/fund/grant/apply/appforms/appforms.html
Provide other explanations or comments you deem necessary.
Links to the Pages of this Website
Activities and Timelines Before the Request for Proposals (RFP) is Published
Activities and Timelines Once the Request for Proposals is Published
Writing and Submitting the Grant Proposal—Section 1
Writing and Submitting the Grant Proposal—Section 2
Writing and Submitting the Grant Proposal—Section 3
Writing and Submitting the Grant Proposal—Section 4
Writing and Submitting the Grant Proposal—Section 5
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