grantwriting for credit union leagues

Grantwriting for Credit Union Leagues

Megan E. McNallymegan@mdsNorthwest.com

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Workshop Overview

The Nonprofit & Funding Landscape

Fundamentals of Fundraising

Grantseeking from Private Sources

Public Funding

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LandscapeNonprofit Sector (2005)All nonprofits………………...……………………….. 1.4 millionReporting nonprofits……………………………………………… 530,376

Revenues……………………………………………………$1.6 trillionExpenses……………………………………………………. $1.4 trillionAssets……………………………………….………………… $3.4 trillion

Public charities, 501(c)(3)………………………………………. 876,164Reporting public charities…………………………………….. 310,368

Revenues……………………………………………………$1.1 trillionExpenses…………………………..………………………… $1.1 trillionAssets…………………………………………………..………$1.98 trillion

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LandscapeCredit Union Leagues

IRC exemption Total Active Revenues Assets

501(c)(6) 127 41 $93,463,003 $235,106,332

501(c)(9) 2 1 $2,684,454 $108,247

501(c)(14) 4 3 $5,096,075 $10,337,947

Total 133 45 $101,243,532 $245,552,526

Source: National Center for Charitable Statistics search of IRS records, July 2009

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LandscapeCredit Union Foundations

IRC exemption Total Active Revenues Assets

501(c)(3) 35 27 $18,353,646 $26,782,200

501(c)(3) pf 7 5 $8,816,383 $24,828,541

Total 42 32 $27,170,029 $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

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LandscapeNonprofit Revenues (2005)

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Landscape2008 Charitable Giving = $307.65 Billion

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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

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LandscapeTrends: 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

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LandscapeGeneral 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

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LandscapeWhat’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

Filling gaps in continuums of service/ linking services• 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

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FundamentalsFundraising typically is:

top>down (lead gifts identified & solicited first) & inside>out (closest allies engaged first for best leverage)

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FundamentalsCommunication 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: Traditional school of thought:

• Rule of 7 Touches New school of thought:

• Personalization & effectiveness of touch as/or more important

* Penelope Burke, 2003

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FundamentalsPreparation 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

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Grantseeking

Research & Validate

Leverage Highest Link

Stewardship/Manage

Relationship

Report

Acknowledge

Site Visit/Due

Diligence

Proposal/ Application

LOI/ Conceptor Introduction

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GrantseekingInternal Revenue Code outlines activities of:

Private Foundations*

Funded by one or few Independent FamilyCorporate

Type/ behaviorOperatingNon-Operating

*109,852 in US in 2006

Public CharitiesFunded by many (the public)

Community Foundations Fundraising Organizations

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GrantseekingStep 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 * * *

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Grantseeking

CRITERIA SCORING Alignment Capacity Link Leverage

ScoreStrengh of match to funder's priorities

Size of potential grantStrength of connection to

funder

Potential of support to leverage other public or

private support

0 No match < $25k No link No leverage

1 Potential match $25k to $100k Weak to mod/ or inactive Could be used as match

2 Strong & clear match $100k + Strong & active Would motivate others

PRIORITY RATING 1 High Priority 6 to 8 pts2 Med Priority 4 to 5 pts3 Low Priority Below 3 pts

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Grantseeking

Organization: Fabulous State League of Credit UnionsRaising Funds For: Engaging FSLCU members in a pilot IDA program targeting LMI high school students saving for higher education

PROSPECTS RATED BY PRIORITYRATING SCORE PROSPECT

1 7Charles Stewart Mott Foundation

Strong - aligns programmatically w/ Pathways Out of Poverty asset building interests, and geographically w/ Fdn's local

2Avg of last 10 awards in this program was $181k

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FSLCU & Mott program officer co-presented last year at nat'l conferences on new IDA strategies

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Grant would be used to inspire community fdn's in piloted areas to makesmaller grants

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1 7Community Foundation for Southeast Michigan

Strong - Evidence shows this type of IDA program could have long term impact on the region

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Five years ago, CFSM's match to a similarly sized pilot of a housing IDA program was $50k

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FSLCU & Fdn's leadership well acquainted & in frequent dialogue

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A grant from CFSM is often incentive for other, smaller CFs to add their support

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2 4Battle Creek Community Foundation

Not a fit for a current initiative, but could be competitive for a community grant

1Largest award from BCCF in past was $2,500

0Past funding, no active dialogue

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Each small CF grant helps us get other CFs to consider joining

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Alignment Funder Capacity Link Leverage

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GrantseekingStep 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 * * *

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GrantseekingStep 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

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GrantseekingStep 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 * * *

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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

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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

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GrantseekingThe goal

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GrantseekingCommon 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

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GrantseekingOther 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?

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Grantseeking

 Tools, like logic models, help organize the writing:

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Grantseeking

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Grantseeking

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GrantseekingEvaluation Organizational Values About Evaluation

• Why measure results? • What do you do with the information?

Approach & Methodology• 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?

Alignment w/ the work you’re proposing• Use logic model as guide to identify outcomes• What are the indicators of success toward outputs/ outcomes?

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GrantseekingSample 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?

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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?

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GrantseekingBudget 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

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GrantseekingBudget Example: Funder’s Grant Delineated From Other Funds

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GrantseekingBudget Example: Multi-Year Roll-Up Without Funds Delineated

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GrantseekingCommon Supporting Document Requested

What You Are Asked For: What The Funder Wants To Know:

Organizational budget Is the project aligned? Can the org support it?

Audited financials and/or recent statements (P&L/ Asset)

Are books consistently reviewed, and is there evidence of smart fiscal management?

Form 990 Are your stories the same? What’s the balance of program v. admin expenses?

Donor/ Funder List Who supports you? Do those closest to you?

IRS Determination Letter Are you tax exempt? Can they fund you?

Articles of Incorporation Are you running a legitimate business?

Relevant Licenses/ dependent upon area of work Do you have what you need for the work you do?

Board Roster Who governs and leads? What is their experience, connection, expertise? Are you in good hands?

Key Staff Bios Are key staff experienced for the work?

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GrantseekingNotes 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

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GrantseekingFinal 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

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GrantseekingStep 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 * * *

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GrantseekingStep Six: Acknowledgement once fundedTo 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

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GrantseekingStep Seven: ReportingFormal: 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 * * *

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GrantseekingStep Eight: Steward the RelationshipBe 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

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Public FundingPublic Funding = government funding

Federal Tribal State County Municipal District

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Public FundingKeys 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

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Public FundingFederal 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

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Public Funding

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Public Funding

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Public FundingFederal BudgetSignificant 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)

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Public FundingFederal BudgetCapacity & Technical Assistance within agency budgets, ie:

• Treasury - CDFI• HUD - Neighborhood Stabilization

specific programs• Strengthening Communities Fund• Social Innovation Fund• Nonprofit Capacity Building Initiative

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Workshop ReviewKey Take Aways & Burning Questions:

The Nonprofit & Funding Landscape

Fundamentals of Fundraising

Grantseeking from Private Sources

Public Funding

Thank You.

Megan E. McNallymegan@mdsNorthwest.com