How can nonprofits position themselves to compete for and manage grants?
Public/private partnership. Return on investment. Social capital. Data-driven decision making. Diversification.
While common in the business community, understanding these terms and putting them into practice are essential for nonprofit organizations seeking grants. In the past, grant making was based heavily on relationships. An agency executive or program manager would build a relationship with the grant’s program officer or foundation staff. Often, a story of how the organization was changing lives was shared. The story alone might convince the grant maker that the organization was doing good work and a grant would follow. Simply fill out a couple forms and the check would be in the mail.
Today, when nonprofit staff members hear the word grant, many often run the other direction, saying the process is complicated; there are too many forms and unrealistic deadlines. This is often because program staff are asked to help fund special projects or fill this year’s budget shortfall by writing grants in their free time. Few nonprofits have the resources to adequately train staff in grant writing, and even fewer have the resources needed to make grant writing someone’s full time job. How then do nonprofits position themselves to compete for and manage grants?
Organizations can spend a great deal of time and energy applying for grants. The Foundation Center reports nearly 86,200 foundations in the United States. Together, they hold over $715 billion in assets and are projected to award grants in excess of $54.7 billion. In addition, there are 26 federal agencies offering more than 1,000 grants each year, and dozens of other opportunities at the state level.
So how does an organization know where to look or what to apply for? The first part of this question is easy. A simple internet search reveals thousands upon thousands of possible grants and free listservs that catalog grant opportunities by area of interest. What to apply for, or better yet, what not to apply for is the true question.
Rule #1: Stay true to the organization’s mission and vision. Do not write grants and chase funding because it seems like a good idea. Stretching your organization can bring about dynamic change, but in grant writing, it can spell disaster. Funders will quickly see the disconnect and hesitate to award funding outside the organization’s area of expertise—especially if it strays from the mission.
Organizations must also remember that every grant is a competition. No matter how long the organization has held the grant, every grant cycle is a new competition and continued funding is not guaranteed. This is due in part to the limited funding available, but also because the number of organizations applying for those funds continues to increase. The IRS recently reported approving more than 110,600 applications for tax-exempt status in 2014, bringing the total number of tax-exempt organizations to 1,723,315. So how does an organization set itself apart?
Rule #2: Organizations must focus on and highlight their strengths throughout the proposal. This includes what makes the program unique in terms of population served, services and the program model. It also includes staff qualifications and capacity to deliver quality services in a cost-effective manner. But most importantly, organizations must be able to document results—results that go beyond counting the number of people served and capturing individual success stories. Organizations must clearly document measurable changes in knowledge and behavior and illustrate how services created meaningful changes with a lasting impact on those served. This can be quite challenging, especially when the services are time-limited (often less than six months) and the client’s needs are great.
Although grant opportunities abound, organizations must also remember that grants are not the answer to sustaining an operating budget. According to data collected by the Foundation Center, the median grant awarded by foundations in 2012 was $30,000. The majority of grants are awarded for direct program support. No-questions-asked, multi-year awards are rapidly disappearing. In fact, the majority of funders require diverse funding support—most providing less than 50 percent of the total cost for each project or program. In other words, grants are one piece of a well-rounded fundraising strategy that also includes the solicitation of annual gifts, major gifts and special events. So how does an organization use grants to sustain its services?
Rule #3: Whenever possible, grants should be used to build capacity and leverage other funding at the program level. Yes, grants may help reduce a budget deficit, but this is not a long-term solution. Grants can help build capacity to pilot a new program model, ensure underserved populations receive the services they need, secure training or resources needed by staff to be more effective, or enhance existing services. When combined with strong program performance, the average foundation grant may also provide enough funding to apply for or sustain another, larger grant that requires matching funds.
After the organization identifies a grant that is consistent with its mission and a staff person with the time and talent to write a compelling narrative, there is one more critical element to successful grant writing: the organization must carefully read and follow the directions. Every grant is a little different. Some have a half-page of instructions and no required forms; others have 80+ pages of instructions and dozens of required forms and attachments. The grant writer must review the instructions in great detail, making note of due dates, required attachments, special instructions and any mention of costs that are required (such as travel to a grantee meeting) or prohibited. Many grant applications are disqualified before they are reviewed because something was overlooked in the directions. iBi
Julie Siebert has over 15 years of experience in program development and grant writing at Children’s Home Association of Illinois. She is an affiliate member of the graduate faculty in the College of Education & Health Sciences at Bradley University, teaching a graduate-level course on grant writing.