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Slide 1: Grantwriting for Credit Union Leagues Megan E. McNally megan@mdsNorthwest.com
Slide 2: Workshop Overview  The Nonprofit & Funding Landscape  Fundamentals of Fundraising  Grantseeking from Private Sources  Public Funding 2
Slide 3: Landscape Nonprofit Sector (2005) All nonprofits………………...……………………….. 1.4 million Reporting nonprofits……………………………………………… 530,376 Revenues……………………………………………………$1.6 trillion Expenses……………………………………………………. $1.4 trillion Assets……………………………………….………………… Public charities, 501(c)(3)………………………………………. 876,164 Reporting public charities…………………………………….. 310,368 Revenues……………………………………………………$1.1 trillion Expenses…………………………..………………………… $1.1 trillion Assets…………………………………………………..………$1.98 trillion 3 $3.4 trillion
Slide 4: Landscape Credit Union Leagues IRC exemption 501(c)(6) 501(c)(9) 501(c)(14) Total Total 127 2 4 133 Active Revenues 41 1 3 45 $93,463,003 $2,684,454 $5,096,075 $101,243,532 Assets $235,106,332 $108,247 $10,337,947 $245,552,526 Source: National Center for Charitable Statistics search of IRS records, July 2009 4
Slide 5: Landscape Credit Union Foundations IRC exemption 501(c)(3) 501(c)(3) pf Total Total 35 7 42 Active Revenues 27 5 32 $18,353,646 $8,816,383 $27,170,029 Assets $26,782,200 $24,828,541 $51,610,741 Source: National Center for Charitable Statistics search of IRS records, July 2009 Cross referenced w/ Guidestar.org & likely missing any CU Foundations that don’t have “credit union” or “C U” in their organization names 5
Slide 6: Landscape Nonprofit Revenues (2005) 6
Slide 7: Landscape 2008 Charitable Giving = $307.65 Billion 7
Slide 8: Landscape What’s impacting nonprofit funding?     New federal funding & attitude State & local budget crises Economic meltdown = reduction in private grants Individual giving slowing more than many projected 8
Slide 9: Landscape Trends:  2008 inflation adjusted decrease of 5.7% • is only second since 1956  Giving is 2.2% of GDP = good sign  Human Services funding (9% of total) • • 54% reported increase in demand for services 53% reported being under-funded  Biggest impacts expected in 2009-10 9
Slide 10: Landscape General qualities of organizations getting funded: Clarity of:  mission, vision & values  theory of change Grounded in understanding of:  key development principles  unique resource & capacity realities Nimble enough to:  adapt based on unique strengths & opportunities  innovate within risk tolerance Authentically connected to stakeholders 10
Slide 11: Landscape What’s gaining attention in asset building:  Innovative approaches to helping those most in need  Programs/ projects with high leverage • Private dollars that access public dollars  Matches to public grants  Programs that help people connect to public benefits/ work supports • • • • Grants/ gifts that compel others to match Vehicle purchase programs tied to asset building opportunities Financial education linked to voluntary income tax prep assistance Access to benefits tied to higher education access 11  Filling gaps in continuums of service/ linking services
Slide 12: Fundamentals Fundraising typically is:  top>down (lead gifts identified & solicited first) &  inside>out (closest allies engaged first for best leverage) 12
Slide 13: Fundamentals Communication is key: Donor Centered Fundraising*  Understand & deliver what donors want 1. Prompt, personalized acknowledgement of their gifts 2. Confirmation that their gifts have been put to work as intended 3. Measurable results on their gifts at work prior to being asked again Shift in fundraising focus: • • Rule of 7 Touches  Traditional school of thought:  New school of thought: Personalization & effectiveness of touch as/or more important * Penelope Burke, 2003 13
Slide 14: Fundamentals Preparation matters: Organizations are ready to invite donors closer in when:  The case for support is clear & compelling  Leadership embraces & embodies a culture of philanthropy  The house is in order Organizations have the capacity for effective fundraising when:  Roles are clear & people are in place to fill them  People have the time, tools & training to fulfill their roles  Those responsible for goals have a role in shaping the goals 14
Slide 15: Grantseeking Stewardship/ Manage Relationship Research & Validate Leverage Highest Link Report Acknowledge LOI/ Concept or Introduction Site Visit/ Due Diligence Proposal/ Application 15
Slide 16: Grantseeking Internal Revenue Code outlines activities of: Private Foundations* Funded by one or few Independent Family Corporate Public Charities Funded by many (the public) Community Foundations Fundraising Organizations Type/ behavior Operating Non-Operating *109,852 in US in 2006 16
Slide 17: Grantseeking Step One: Research & validate prospects  Establish search criteria  Build a suspect list  Due diligence to validate prospects & prioritize  Commit to ongoing research, validation & prioritization * * * Alignment is everything * * * 17
Slide 18: Grantseeking CRITERIA SCORING Alignment Score Strengh of match to funder's priorities No match Potential match Strong & clear match Capacity Size of potential grant Link Strength of connection to funder No link Weak to mod/ or inactive Strong & active Leverage Potential of support to leverage other public or private support No leverage Could be used as match Would motivate others 0 1 2 < $25k $25k to $100k $100k + PRIORITY RATING 1 2 3 High Priority Med Priority Low Priority 6 to 8 pts 4 to 5 pts Below 3 pts 18
Slide 19: Grantseeking Organization: Fabulous State League of Credit Unions Raising Funds For: Engaging FSLCU members in a pilot IDA program targeting LMI high school students saving for higher education PROSPECTS RATED BY PRIORITY RATING SCORE PROSPECT Alignment Strong - aligns programmatically w/ Pathways Out of Charles Stewart Mott 7 Poverty asset Foundation building interests, and geographically w/ Fdn's local Strong - Evidence Community shows this type of 7 Foundation for IDA program could Southeast Michigan have long term impact on the region Not a fit for a current Battle Creek initiative, but could 4 Community be competitive for a Foundation community grant Funder Capacity Avg of last 10 awards 2 in this program was $181k Five years ago, CFSM's match to a 2 similarly sized pilot of a housing IDA program was $50k Largest award from 1 BCCF in past was $2,500 Link FSLCU & Mott program officer co2 presented last year at nat'l conferences on new IDA strategies FSLCU & Fdn's leadership well 1 acquainted & in frequent dialogue Past funding, no 0 active dialogue Leverage Grant would be used to inspire community 1 fdn's in piloted areas to makesmaller grants A grant from CFSM is often incentive for 2 other, smaller CFs to add their support Each small CF grant helps us get other 1 CFs to consider joining 1 2 1 2 2 2 19
Slide 20: Grantseeking Step Two: Leverage highest link  Key: Highest appropriate connection  First contact critical: don’t miss an opportunity to start at the top if it exists  Always take advantage of an opportunity to discuss your organization or project first * * * Outsource production, but not relationships * * * 20
Slide 21: Grantseeking Step Three: Outline case in LOI  When required, often 2-3 page introduction • • • • Clear identification of alignment High level snapshot of organization Specifics: amount, timeline, program/ area Contact information 21
Slide 22: Grantseeking Step Four: Write the proposal or complete application  Sometimes, guidelines provide for you to write a document  Sometimes, an online application w/ space limited responses  Always, provide information requested, in order requested  Often supplementary documentation required * * * Plan the work with a checklist & timeline * * * 22
Slide 23: Grantseeking  Why proposals get funded  Solid alignment with funder priorities  Clear, organized responses to requested information  Budget adds up, makes sense, can be substantiated  Professional and credible presentation of the organization’s capacity for the work 23
Slide 24: Grantseeking  Why proposals get rejected:  Don’t align w/ funders’ priorities  Don’t follow guidelines/ answer requested info  Budgets don’t add up or support narrative  Don’t demonstrate knowledge of field or competition  Not measurable or realistic  OR not compelling enough 24
Slide 25: Grantseeking The goal 25
Slide 26: Grantseeking Common Proposal Elements:         Cover sheet and/or cover letter Overview or executive summary Statement of the need, problem or opportunity Solution or theory of change & explanation of how the applicant is qualified and positioned to deliver this solution Project specifics: timeline & workplan/actions, objectives & outcomes Evaluation: plan for measuring outcomes Budget & sustainability: costs, revenues and how the project will be funded once this particular grant is spent Supporting documentation as requested 26
Slide 27: Grantseeking Other questions often asked:  Provide baseline information and metrics in the areas that this project is intended to improve.  Describe how you hope the successful completion of the project will benefit individuals and/or a community after the grant has ended.  How will this work contribute to the field?  What challenges do you anticipate, and what plans are in place for mitigation? 27
Slide 28: Grantseeking  Tools, like logic models, help organize the writing: 28
Slide 29: Grantseeking   29
Slide 30: Grantseeking   30
Slide 31: Grantseeking Evaluation  Organizational Values About Evaluation • • • • • • Why measure results? What do you do with the information? How have you measured results before? What systems, metrics, tools might you use? Who does the evaluation, and how is it funded? Is it reflected in the budget?  Approach & Methodology  Alignment w/ the work you’re proposing • Use logic model as guide to identify outcomes • What are the indicators of success toward outputs/ outcomes? 31
Slide 32: Grantseeking Sample of what funders look for in a project budget:  Does it make sense?  Does it support the work described?  Is it consistent with the organization’s budget and size?  Is the staffing adequate?  What is the cost per client/ outcome?  Do the costs seem reasonable relative to similar work?  Are the income expectations realistic and supported?  What is the plan for sustainability/ our exit? 32
Slide 33: Grantseeking …vs. in an organizational budget:  Are there appropriate sources of income?  Are they appropriately diversified?  How is the budget structured – does it make sense?  Does it demonstrate smart financial management?  Is there appropriate cash on hand? A healthy reserve?  Does it reconcile to cash flow?  Are administrative costs appropriate and sufficient? 33
Slide 34: Grantseeking Budget basics:  Revenues should reflect • Committed funds • For a project/ program, the portion allocated from the organization  Expenses should reflect • Direct & indirect costs • Total cost of the work, not just the parts requested  Use budget narrative to explain • How/ from whom you expect to raise other funds needed for the work described • Path to “sustainability” – meaning how the work will go on once grant funding runs out 34
Slide 35: Grantseeking Budget Example: Funder’s Grant Delineated From Other Funds 35
Slide 36: Grantseeking Budget Example: Multi-Year Roll-Up Without Funds Delineated 36
Slide 37: Grantseeking Common Supporting Document Requested What You Are Asked For: Organizational budget Audited financials and/or recent statements (P&L/ Asset) Form 990 Donor/ Funder List IRS Determination Letter Articles of Incorporation Relevant Licenses/ dependent upon area of work Board Roster Key Staff Bios What The Funder Wants To Know: Is the project aligned? Can the org support it? Are books consistently reviewed, and is there evidence of smart fiscal management? Are your stories the same? What’s the balance of program v. admin expenses? Who supports you? Do those closest to you? Are you tax exempt? Can they fund you? Are you running a legitimate business? Do you have what you need for the work you do? Who governs and leads? What is their experience, connection, expertise? Are you in good hands? Are key staff experienced for the work? 37
Slide 38: Grantseeking Notes on Style & Language: Make it easy to read      Don’t be too creative Highlight section breaks clearly Use bullets appropriately Protect document intregrity: use footers w/ org name & Page X of Y PDF when permitted Make it easy to understand  Avoid jargon  Explain acronyms  Graphics only that clarify or highlight a point  Cite evidence/ support claims 38
Slide 39: Grantseeking Final Points on grantwriting: Elevate the field  Demonstrate knowledge of others’ work  Show how you’ll complement or build on it  Never criticize others’ work & never claim superlatives Make life easy for the reviewer  A person will review your request, but often they don’t make the final decision  They have feelings, biases & passions, just like you do  They have a job they’re responsible for, just like you do  Make it easy for them to want be your ally, they aren’t obligated to 39
Slide 40: Grantseeking Step Five: Site Visits/ Funders’ Due Diligence  Learn as much as possible about what they hope to learn from the visit or their inquiries  Schedule site visits at a time/ venue that allows them to really see your best work  Prepare, but don’t script  ALWAYS follow up w/ email and voice mail to the person/ people who spent time learning more about your work * * * Be responsive & helpful while they do their job * * * 40
Slide 41: Grantseeking Step Six: Acknowledgement once funded To Funder:  Sign & return contract/ keep signed copy  Formal letter from leadership acknowledging receipt & restating details  Personal thank you to visitors To Public:  Get Grantor’s permission  Press release only if newsworthy (rare)  Web/ annual report/ newsletter etc… BE CONSISTENT with how you acknowledge funders 41
Slide 42: Grantseeking Step Seven: Reporting Formal:  Ask & get clarity on requirements including dates, formats/ templates  Always a final report, even if not asked Informal:  Ask the PO how often they want to hear from you  Communicate substantive changes re: leadership, budget, deliverables  Reach out strategically 1-2x during grant period * * * Keep open channels of communications * * * 42
Slide 43: Grantseeking Step Eight: Steward the Relationship Be a resource:  Share key lessons, research, findings in mutual field of interest  Extend an offer to share lessons/ collaborate w/ other grantees Be respectful:  Know & honor policies about repeat funding  Communicate strategically & thoughtfully, not opportunistically Be resourceful:  If appropriate, invite dialogue about PRI’s or other resources  Ask for 1-2 specific, strategic introductions or referrals 43
Slide 44: Public Funding Public Funding = government funding  Federal  Tribal  State  County  Municipal  District 44
Slide 45: Public Funding Keys to accessing public funds:  Follow policy priorities & trends  Track budget, authorization & appropriations processes  Study how each level of government is organized as it relates to your work  Bookmark the websites of those departments & agencies and pay attention to what they’re doing to know in advance of Notices of Funding Availability 45
Slide 46: Public Funding Federal Funds:  Notices published in federal register  Most agencies coordinate grants via Grants.gov • No registration required to get notices, but lengthy registration required to submit applications  Must have adequate capacity to manage rigorous application, implementation & reporting requirements  Typically very specific funding opportunities  Often ≥ 20% private match required  Right now focus on ARRA & new federal budget 46
Slide 47: Public Funding 47
Slide 48: Public Funding 48
Slide 49: Public Funding Federal Budget Significant funding w/in Depts & Agencies for Nonprofits  Department of Education • $10M - Promise Neighborhoods (planning grants to development plans modeled on Harlem Children’s Zone)  Health & Human Services • $1.7B - Social Services Block Grant • $741M - programs serving refugees  Housing and Urban Development • $1B - Housing Trust Fund • $8.1B - project based rental assistance • $250M – Choice Neighborhood Fund (link to Promise Neighborhoods) 49
Slide 50: Public Funding Federal Budget Capacity & Technical Assistance  within agency budgets, ie: • Treasury - CDFI • HUD - Neighborhood Stabilization  specific programs • Strengthening Communities Fund • Social Innovation Fund • Nonprofit Capacity Building Initiative 50
Slide 51: Workshop Review Key Take Aways & Burning Questions:  The Nonprofit & Funding Landscape  Fundamentals of Fundraising  Grantseeking from Private Sources  Public Funding 51
Slide 52: Thank You. Megan E. McNally megan@mdsNorthwest.com