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Michele Sczerbinski Diaz is Head of Institutional Advancement at The Wheeler School in Providence, Rhode Island. She sends a question we are asked quite often.

Question: What is the best way to include expenses in a campaign budget? You obviously include all direct expenses (case statement, kick-off, parties, and so forth). Those expenses obviously go away after the campaign is over. But what about staff salaries, support staff, and equipment which are part of the present office?

Answer: I can’t think of any exception (and that includes over 1700 campaigns) where there hasn’t been a separate budget established for the campaign program. That budget includes such things as: Printing, postage, campaign literature, travel & entertainment, and things of that sort.

The budget is developed prior to the campaign and most usually reviewed and approved by the Development Committee of the Board or by the Board itself. All of the expenses are appropriately paid by the funds that are raised in the campaign program.

The organization may have to allocate funds from its annual budget (to be repaid) or in some cases, borrow money in order “to front” the campaign until funds start coming in. Now here’s where it gets a bit tricky! The organization can decide at its discretion, what it chooses to charge to the campaign that might be considered indirect costs.

For instance, some campaigns charge a portion of the CEO’s time and salary because time is spent on the campaign. And many campaigns charge all or a portion of the Chief Development Officer’s time to the campaign. There’s no role, or for that matter, rhyme nor reason to what you could do or what is appropriate. It is up to the organization to make that decision.

There are many campaigns where there is need in the office for new equipment and this is charged to the campaign. To be kept and used after the campaign by the institution.

One thing that’s important is that whatever you decide to do, the total cost of the campaign needs to be kept within bounds— probably no more than ten or twelve percent or a small capital campaign and much less for a sizable project.

- Jerry Panas