I am knee deep in creating budgets for one of my clients. It always amazes me that the less money a government entity gives you, the more hoops there are to jump through. When I worked on a $400 million dollar budget, there was plenty of wriggle room, but in a $260,000 budget, not so much.
Where to start? First step is to lay out the programs/services the money requires you to provide and determine how you meet the requirements. Is it just a matter of assigning a task to a staff member or will you need to identify a dedicated position? If you need a dedicated position, how many hours a week and at what cost per hour? Will the individual qualify for benefits? Which ones? What supplies, equipment, physical space is needed?
In most cases, you will end up apportioning the funds over more than one position. Once you have done that for each requirement, go back to see which full time employees positions have not been fully funded. Of the remaining funds, which are best applied to each position? Still have money remaining? - which of your part time staff or contract positions still need funding?
If there is any money left over, you will need to cover the fixed expenses - rent, heat, lights, insurance. The leftovers, if there are any, go to supplies, equipment and other miscellaneous expenses.
If it is a federal grant, take out the indirect cost first so you don't forget it. Nothing worse than allocating all the money and then realizing you have to start all over again because of that pesky indirect cost.