The vocabulary of budget development is part of the language required for writing a winning grant proposal. Revised and expanded in mid-2016, this set of entries covers words and phrases from F to I. Its context is the United States of America.
FLOOR AMOUNT: The minimum amount allowed as a grant request, often stated as the lower limit of an anticipated funding range. Also see: Ceiling Amount.
FORM 990-PF: A yearly Internal Revenue Service (IRS) form required of all private foundations (hence the -PF) that provides a public record of the financial status and grant-making activity of a private foundation. In some respects, Form 990-PF is the equivalent of an annual federal income tax return to be filed by private foundations.
FORMULA GRANT: A non-competitive grant whose amount is established by applying a formula based upon criteria described in a law and amplified in that law’s subsequent regulations, and awarded after a yearly formal application process; it may also called an Entitlement Grant or an Allocation Grant or a Mandatory Grant.
FRINGE BENEFITS: A cost category for non-salary and non-wage modes of staff compensation that accrue to those who qualify for them. Examples of typical fringe benefits are: health insurance, dental insurance, unemployment insurance, workers’ compensation, paid holidays, paid sick leave, paid personal leave, paid vacation days, and FICA (social security). Fringe benefits are usually calculated as percentages (%) of salaries or wages.
FULL-TIME EQUIVALENT (FTE): The financial obligation for one full-time staff member. Two or more persons may split the position in the budget to add up to one full-time equivalent. FTE may be written as a percentage (often abbreviated as % FTE) or as a specific number (N) of hours per week (sometimes abbreviated as N hrs/wk).
FUNDING CYCLE: A sequence of events that starts with a formal public notice that funds are available, and includes the deadline for submission of applications, the review of applications, the award of grants, the completion of contractual documents, and the release of funds; the same sequence may recur in subsequent years if funds are available.
FUNDING OFFER: A proposal by a grant maker, in oral or written form, to award a successful applicant an amount of funding that is less than it had requested; such an offer may occur when the grant maker either does not allow certain proposed line items in an applicant’s budget or does not have enough funds to fund the project or initiative at the full amount requested.
FUNDING PRIORITIES: Project-related factors that grant makers may use to award extra rating-points to otherwise-qualified applicants. Priorities may also include such non-project factors as geographic distribution of grant awards and the diversity of types of funded applicants. Many federal grant programs announce absolute priorities, competitive priorities, or invitational priorities in their requests for proposals. They are also called Funding Preferences.
GENERAL GRANT: A grant designed to subsidize the organization-wide operating expenses of a worthy applicant rather than to provide support for a specific project or initiative. Also called an Operating Support Grant or an Operational Grant. Example: Facility rent and utilities.
GRANT: An award of funding for an eligible recipient to do pre-defined activities using pre-defined resources over a pre-defined time-span to achieve pre-defined objectives and advance towards one or more pre-defined goals, but whose outcomes are less certain than those expected from a contract.
GRANT AGREEMENT: A legally binding and enforceable understanding entered into by a grant recipient with a grant maker; it is commonly based on an approved application made by the grant recipient and it commits the grant recipient to implement certain activities and pursue certain objectives, within a pre-defined time-span, for a specific amount of funding. By reference, it may incorporate other municipal or state or federal statutes and regulations beyond those enabling the grant program.
GRANTEE: The organization or individual that receives the grant funds and is responsible for implementing and administering the project or initiative and managing the grant funds; it is also called a grant recipient. Also see: Grantor and Sub-grantee.
GRANTOR: The organization (e.g., corporation, foundation, or governmental unit) that awards grants; it is also called the Funder, the Funding Agency, or the Grant Maker. Also see: Grantee and Sub-grantee.
GRANT PERIOD: The total time-span for which a grant maker has committed to funding a grant recipient; it may or may not last exactly as long as a budget period or a project period. Also see: Budget Period and Project Period.
GUIDELINES: The instructions that describe what the grant maker wants to fund, what applications for funding must contain, how applications – including their budgets – must be prepared and submitted, and how proposals will be reviewed. Also see: Request for Proposals.
HARD FUNDS: A non-technical term for the funding of staff positions or other resources that support a program or initiative by using annual tax levies or similarly predictable and renewable revenues rather than by using grant funds; its character reflects the perception that such assets are more secure, over the long term, than those funded using grant funds. Also see: Soft Funds.
IN-KIND CONTRIBUTION: A non-cash donation of labor (paid staff or unpaid volunteer), facilities, equipment, materials, or supplies to carry out a project. Applicants for grants must exercise extraordinary care in calculating the cash value of in-kind contributions and in identifying, tracking, and reporting the sources of such contributions. Also see: Matching Funds.
INDIRECT COSTS (IDC): A cost category for costs that are not readily allocable to or identifiable with operating a specific grant program; it is also often called Overhead. Indirect costs equal direct costs multiplied by the approved indirect cost rate (IDC = DC x rate). Such costs commonly relate to administration and facilities. Generally, a government agency, as a grant maker, reimburses indirect costs only after it has negotiated and approved an indirect cost rate with the grant recipient. As grant makers, foundations are less apt to allow full or partial recovery of an organization’s indirect costs than are units of government. Also see: Direct Costs.
A later post will cover entries in this Glossary starting with letters I to N.