Velocity and Burn Rate Budget

This is a great summary of where to get to in how you budget projects.

http://www.agileadvice.com/2011/02/04/agilemanagement/calculating-a-budget-for-an-agile-project-in-six-easy-steps/

Most importantly,

Using the definition of “done” add pre- and post- Iteration budgets

Every agile team is supposed to be “cross-functional” but in reality, there are limits to this.  For example, in most software project environments, teams do not include full-time lawyers.  This limited cross-functionality determines what the team is capable of delivering in each cycle – anything outside the team’s expertise is usually done as either pre-work or after the iterations (cycles) are finished.  Sometimes, this work can be done concurrently with the team.  In order to understand this work, it is often valuable to draw an organization-wide value stream map for project delivery.  This map will show you the proportion of time spent for each type of work in the project.  Subtract out all the work that will be done inside the agile team (their definition of “done”) and you are left with a proportion of work that must be done outside the agile team.  Based on the proportions found in the value stream map, add an appropriate amount of budget based on the project’s cycle labor costs.