Fundraising Part II: ABCs Fundraising Part II: ABCs of Grantseekingof Grantseeking

6th Annual Club MACJune 15, 2006

Elizabeth Pentak Averill, CFREDirector of Philanthropy

North Texas Food Bank214.330.1396 elizabeth@ntfb.org

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Topics of Discussion

Organizational ReadinessSources of Grant FundsTypes of GrantsSuccessful Grantseeking

Private Sector Sources & ProcessPublic Sector Sources & Process

Research

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Critical Concepts

SynergyKeys

PlanningSystems

Grantsmanship is a process, not simply a writing exercise

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Organizational Readiness

Mission & VisionStrategic PlanThe Development Process

Case StatementDevelopment PlanPolicies

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Factors That Determine Grantseeking Success:

1. Quality of the nonprofit organization

2. Critical importance of the proposed project

3. Appropriateness of funding source or the level of competition in a grantmaking cycle

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Factors That Determine Grantseeking Success

4. Skills of writer in building a compelling case

Many people think this last item is the only important factor and do not take the first three into consideration!

- grantproposal.com

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Sources of Grant Funds

Foundations

Government Sources

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Foundations

Types of Foundations

1. Independent (private)

2. Community

3. Corporate

4. Operating

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Types of Foundations

1. Independent (private)Endowed funds from a single source

Examples: Meadows Foundation, The Moody Foundation, Sid W. Richardson Foundation, Robert J. and Helen C. Kleberg Jr. Foundation, The Cullen Foundation, Hillcrest Foundation

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Types of Foundations (cont.)

2. Community Pooled funds from multiple donors

Examples: Communities Foundation of Texas, Inc., The Dallas Foundation, Community Foundation of North Texas

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Community Foundations

Types of Funds

a. Unrestricted

b. Field of Interest and Named

Funds

c. Donor Advised

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Types of Funds

a. UnrestrictedDonors give to the community

foundation without restrictionFoundation’s trustees determine how

to distribute themExperience the greatest demandSmallest “pocket” of funds

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Types of Funds (cont.)

b. Field of Interest and NamedDonors specify an area of interest, such

as education, medical research, etc.Foundation’s trustees determine how to

distribute themFoundation usually determines which

proposals match area of interestSecond largest “pocket” of funds

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Types of Funds (cont.)

c. Donor AdvisedDonors place funds with community

foundation rather than create ownDonors benefit from investment managementDonors direct how funds are distributedTypically requests are made directly to

donorsLargest “pocket” of funds

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Types of Foundations (cont.)

3. CorporateEndowed by annual contributions from a corporation, usually bearing the corporation’s name. Percentage of contribution is determined on an annual basis.

Examples: J. C. Penney, Exxon/Mobil, Verizon, IBM, Kimberly Clark, Texas Instruments

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Types of Foundations (cont.)

4. OperatingEstablished for the benefit of one non-profit organization

Examples: Baylor Health Care System Foundation, VNA Foundation, McKinney Education Foundation

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Government Sources

1. Federal

2. State

3. City/County

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Types of Grants

1. Capital2. Endowment3. Challenge4. Matching5. Operating6. Project or Designated7. Research8. Seed

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Types of Grants (cont.)

1. Capital Funding provided for construction, renovation, equipment.

2. EndowmentFunding set aside in perpetuity. Interest generated benefits the organization. Trustees of organization decide how to use funds

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Types of Grants (cont.)

3. MatchingFunds given in direct proportion to additional funds raised from other sources. A specific match ratio of 2:1 or 1:1 is predetermined and then documented as gifts are received.

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Types of Grants (cont.)

4. ChallengeFunds given with the provision that a specific amount of contributions be secured from other donors within a certain time period.

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Types of Grants (cont.)

5. Operating

Funding provided for day-to-day expenses.

6. Project or DesignatedFunding provided for a specific program or activity, usually within the operating budget.

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Types of Grants (cont.)

7. ResearchFunding provided for the specific development of a project.

8. SeedFunding provided to initiate a project or an agency.

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Grantseeking

Successful Grantseeking is:

2/3 Planning1/3 Writing

Complete all planning before writing!

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Program Planning

Do you really have your ducks in a row?

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SuccessfulGrantseeking Requires

Understanding funders’ needs:Build relationships with funders

Appropriately match mission & program goals to the funder’s expressed interests

Follow the funder’s instructions - explicitly!

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SuccessfulGrantseeking Requires (cont.)

Effective working relationships:Create a “team” culture

Demonstrate credibility

Provide services with equal access for target clients

Network, collaborate, partner

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Successful Grantseeking Requires (cont.)

Effective processes:Shop proposals around

Demonstrate accountability

Secure needed resources, staff, facilities, etc.

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Successful Grantseeking Requires (cont.)

Effective processes: (cont.)Gather input from a client-based

advisory body

Create processes for collecting outcome measurements

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SuccessfulGrantseeking Requires (cont.)

Clearly communicating the story:

Craft a compelling needs statement

Reveal implementation detail: how, when, who, where

Include outcome measurements

Include evaluation criteria

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SuccessfulGrantseeking Requires (cont.)

Clearly communicating the story:(cont.)Use jargon-free narrativeReflect names & spell accuratelyRespond to requests for specific

information while weaving in the key points that make your case compelling

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Successful Grantseeking Requires (cont.)

Accurate financial data:Establish financial systems:

That allocate administrative overhead (see handout - Budget Allocation Worksheet)

Capable of managing the projectAttach a financial auditInclude a detailed budget

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Whatever you do . . .

Don’t chase funding!

and

Remember that people give to people!

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Private Sector Sources:

Have many different personalities

Can not be treated the same

Rarely fund an entire project

Grant a portion in relation to the whole

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Private Sector Sources (cont.):

Never give to what has already been done

Always want to know how their grant will enable you to do something you wouldn’t otherwise be able to do!

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Public Sector Sources

Will tell you what they want, but not how to implement the program

Do not “want to control the project”

Want you to spend all you are granted

Want you to spend it according toyour detailed budget

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Public Sector Sources (cont.)Have reporting requirements

Require a federal audit for grantstotaling over $300,000

Provide a 1st quarter advance, & then reimburse expenses

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Public Sector Sources (cont.)

May require a local private sector matching (cash or in-kind)

Specify “allowable costs”

Will pay a portion of administrative overhead expenses

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Public Sector Sources (cont.)

Will monitor your rate of spending

Will establish a permanent “overhead” or “indirect cost” ratio,usually between 8 – 30%

Will fund an entire project

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Public Sector Sources (cont.)

Will not “supplant” private sector funding

Usually don’t fund a new organizationthe first time they submit

Will negotiate budget changes

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Public Sector Sources (cont.)

Usually make multi-hundred thousand or million dollar grants

Require funds be placed in a separate audit-traceable account

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Public Sector Sources (cont.)

Require excellent record keeping – expenses, volunteer time, etc.

Will pay for the federal audit &audit-traceable account

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Public Sector Sources (cont.)Are required to allow 45 days

between grant announcement & deadline

Require that service delivery beginthe day funding is approved

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Research

Private Sector

Public Sector

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Private Sector Research

Who knows who - Foundation Questionnaire handout

The best research possible!

Qualified prospects are individuals to whom you have a “link”

Get Nonprofit Resource Center’s List of Texas trustees (www.nprc.org)

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Private Sector ResearchFoundation directories

Foundation Center (www.fndcenter.org)Directory of Texas Foundations

(www.nprc.org)Directory of Dallas County Foundations

(Dallas Public Library - 6th floor)Directory of Tarrant County

Foundations (Funding Information Center, Fort Worth)

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Private Sector Research (cont.)

PeriodicalsChronicle of PhilanthropyNonprofit Times (free to nonprofits)Local Business JournalBook of Lists Local newspaper columnistPhilanthropy Magazine

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Private Sector Research (cont.)

Foundation Profiles

Tax Year Sample Grants Areas of

Interest Restrictions

Application Process

Deadline Trustees &

Officers Contact

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Private Sector Research (cont.)

Foundation Profiles (cont.)Average Grant Calculation

Number of Grants GivenTotal Amount Grants MadeSubtract High & Low AmountsDivide by 2 less than “# of Grants”

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Private Sector Research (cont.)

Foundation Profiles (cont.)

Stemmons Foundation53 Grants Made$352,300 GrantedLess $25,000 & $1,000 = $326,300Divided by 51 = $6,398

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Private Sector Research (cont.)

Foundation Profiles (cont.)Sample - Perot Foundation

121 Grants Made Totaling $5,354,880High: $375,000; Low: $250Restrictions: No unsolicited applications

are accepted.

Identify Link or Send Permission Letter

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Private Sector Research (cont.)

Foundation Directory Indices

Areas of Interest

Types of Support

Trustee and Officer

City or State

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Public Sector Research

Federal sourceswww.cfda.gov

The online Catalog of Federal Domestic Assistance provides access to a database of all Federal programs available to State and local governments (including the District of Columbia)

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Public Sector Research (cont.)

Federal sources (cont.)www.firstgov.gov

Federal government web site allowing access to data and statistics

www.access.gpo.gov/su_docs

The Federal Register online

Hardcopy = $700

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Public Sector Research (cont.)

State sourceswww.governor.state.tx.us/divisions/

stategrants The State Grants Team’s mission is to

alert entities throughout Texas about funding opportunities.

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Public Sector Reseach (cont.)

State sources (cont.)

www.narc.org/links/member.html

National Association of Regional Councils – links to Council of Governments

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Credits:

The Center for Nonprofit Management, Dallas, TX

Linda Wassenich, CFRE, Dallas, TX

Grants Unlimited, Glenda J. O’Neal, Danville, CA

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Thank you!