5 “hidden” costs to a proposal – and how to save on them

Sometimes, you have to spend money to make money. But doesn’t this feel anti-intuitive when it comes to grant funding? After all, you are asking for money, which usually means you don’t have any to spend, right?overhead-costs

But to seek funding and prepare a competitive proposal, you should be aware of the “hidden” costs. I have included five below which, in my experience, have been the most surprising to my PIs. And in case you are really strapped for cash, I have included some ideas for saving a little on the way!

  1. Database Memberships
    • Why the cost? While it’s free to search Grants.gov for federal grants, to look through lists of foundations, you might need to pay for access to a database. Companies such as Foundation Directory Online and GuideStar are good places to start. (Click here to read a great article that goes more in-depth on these databases)
    • What’s the cost? Premium packages can run as much as $2,000 per year, and can be paid for on a bi-yearly, yearly, or monthly basis. Some databases charge per list.
    • How can I cut costs? If you are a professor at a university, talk to your development office about free databases that you might have access to. Visit your local library and see if they subscribe to databases that you can use. Otherwise, save money by researching databases thoroughly, and making sure the one or two you select will be proper for your organization, and not waste money on those that aren’t (you can take many on a free-trial test drive!).

      If you work at a university, you might have access to a database like Grant Forward
      If you work at a university, you might have access to a database like Grant Forward
  2. Grant Writer
    • Why the cost? After all, you can write yourself – or call in a favor from your cousin with the English degree – or ask your administrative assistant to write the narrative in her spare time. But unfortunately, grant-writing is just one of those things that you have to do (and fail at) for at least a year before you get the trick of it.
    • What’s the cost? Freelance grant writers charge anywhere from $20-$200 per hour, and professional grant writing agencies usually charge over one thousand dollars per proposal. If you work at a university, your research office may have a proposal development office, though these services often have an associated fee. (Click here for an article on questions to ask before hiring a grant writer)
    • How can I cut costs? Paying for grant writing on a commission basis is unethical, so that is definitely not a cost-saving solution. But if your institution simply cannot afford a grant writer, try and work with universities to see if you can offer an internship to non-profit management or technical writing students who are studying grant-writing, and might appreciate the opportunity to contribute to their portfolio.
  3. Startup for Project
    • Why the cost? Many sponsors (especially on the federal and state level) want to see work being done on the project, before they get involved. It’s a way of showing that the institution is committed to the project, and increases the chances that work will continue once sponsor funding ends.17123254699_c2f412c9ee_z
    • What’s the cost? However much it takes to get things rolling. Usually, costs consists of personnel, preliminary supplies, and associated overhead.
    • How can I cut costs? Instead of using up your own time beginning the project, work with your volunteer or intern pool, and see if there is someone who would be interested in beginning the project. Work with community collaborators on fundraising efforts for preliminary costs.
  4. Cost-Share
    • Why the cost? Though cost-sharing for federal awards is growing rare (yay!), many foundations and state sponsors still want to see a cash or in-kind commitment. This way, the project seems more like a collaborative effort that is supported by the university and/or community. (Don’t know anything about cost-sharing? Click here for a good Power Point presentation on the topic!)
    • What’s the cost? Anywhere from 10% of the total project costs, up to and beyond a 1:1 match. (Always be sure to note whether the cost-share requirement is a percentage of the request or a percentage of total project costs)
    • How can I cut costs? Carefully assess what you are certainly going to put into the project, whether the grant funds it or not. Is overhead not allowed to be charged to the sponsor? Ask the sponsor if you can cost-share with the unrecovered overhead. Will your graduate student, who is paid by the department, be working on the project? That sounds like cost-share to me!
  5. Overhead
    • Why the cost? You usually cannot help paying overhead when applying for grants. You will work on the proposal on your computer, use your phone system to call collaborators, schedule meetings in a conference room with lights…so on and so on.
    • What’s the cost? Overhead is hard to calculate, but they are real costs to the institution, and proposal-development overhead costs are almost never allowed to be recovered in the case of an award.
    • How can I cut costs? There’s no way to go without these costs – but make sure and request full overhead recovery from the sponsor for the award period! Your research overhead helps to pay for proposal development systems and general research costs. (Did you just balk at my suggestion? Click here to find out why overhead is so important!)

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