Broward Grant Trends1

Grantwriting Beyond The
Basics
1.
Trends Affecting Grantwriting
2.
Strategic Grantwriting
3.
Using Logic Models
4. Federal Grantwriting
Michael Wells
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Trends Affecting Grantwriting
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Is it “The Economy, Stupid?”
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1
The Financial Market’s “Wiley Coyote” Moment.
The worst stock market crash since the Great Depression. The dotcom crash of 2000-2002 lost 4,244 points
over 2 1/2 years. This one lost 7,427 points in 1 1/2 years, to less than half of its peak value.
Many foundations lost 40% of their assets on paper (although they’ve recovered somewhat).
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This recession is different than other recent ones.
12/08
Now
12/09
Recession officially began December, 2007. So 12 months is Dec, 08 and 24 months is Dec, 09.
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In addition to stocks, the over-inflated housing market and its drop caused many people losses
to their biggest asset.
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2
States are facing large budget shortfalls
CNBC says Florida is the 5th worst off in 2010,
with a $6 billion budget gap, 27% of general fund.
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Total Private Giving to Nonprofits is Down.
Current dollar giving has only gone down two times: 1987 & 2009.
(Some say this Giving USA study is too rosy, many nonprofits giving is lower)
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Stimulus Funding
The American Recovery and Reinvestment Act (ARRA)
of 2009, aka Federal Stimulus, injected $747 billion into the
US Economy.
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Most went directly to States or individuals, but billions
also went into Federal agencies to be released as grants.
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One time funding to be used (in most cases) by the end of
2010 - but RFP’s are still coming out of the agencies. Look
at agency websites, not for stimulus websites.
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3
A New Economic Environment?
Richard Florida and some other economists say that this is more than a recession, it’s a
Reset. The economy is undergoing fundamental change and the jobs that come back
won’t be the jobs that were lost. Oregon economist Joe Cortright says that
“Recovery” is a misnomer and calls it “out of sample” for forecasting, meaning that we
can’t use past experience to predict the future. This has multiple causes: Technology,
globalization, the Internet, worldwide immigration, international capital flows, etc.
What does this mean for grants?
(Straight line thinking won’t work)
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How are Foundations Doing?
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BUT foundation giving grew five-fold in 17 years from 1991 to 2008 -- from $9.2 billion to
$46.8 billion.
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The number of foundations has skyrocketed, more than tripling since 1980.
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Growth in Foundations
Foundation growth is driven by demographics and economics, and shows no signs of
declining in the near future. At least four things are happening:
• Rich people are dieing and creating or enlarging foundations in their wills.
• Rich people are aging and creating or enlarging foundations as part of their estate
planning.
• Newly rich people are creating foundations (the most famous being the Bill &
Melinda Gates Foundation, the world’s largest).
• The stock market went berserk in the 1990’s, with the Dow Jones Industrial
Average more than tripling in value from about 2,700 to over 11,000. Because
most foundations are invested in stock markets, this increased the assets of existing
foundations.
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Dow Jones from 1930 to 2010
Foundations have benefited from unprecedented
stock market growth since 1980, and especially in
the 1990’s.
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5
Florida Grants Context
Florida has the 4th largest number of foundations and 7th highest total
foundation assets by state.
The number of 501(c)(3) public charities in Florida grew 135% from
8,075 in 1998 to 18,992 in 2008. (small & non-reporting nonprofits
grew from 15,761 to 27,993.)
The number of private grantmaking foundations in Florida grew
108% from 3,119in 1998 to 6,506 in 2008.
- National Center for Charitable Statistics
- Florida Philanthropic Network
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Largest Florida Foundations
Location
John and James Knight Fdn
Arthur S. DeMoss Foundation
Publix Super Markets Charities
Picower Foundation
Flight Attendents Med Research
Wallace H. Coulter Foundation
Ted Arison Foundation USA, Inc.
Batchelor Foundation
Jessie Ball duPont Fund
Koch Foundation, Inc.
Dade Community Fdn
Comm Fdn Palm Beach
Comm Fdn Broward
Miami
W. Palm Beach
Lakeland
Palm Beach
Miami
Miami
Miami
Miami
Jacksonville
Gainsville
Miami
W. Palm Beach
Ft Lauderdale
Assets
2005 to 07
2,000,000,000
404,000,000
561,000,000
604,000,000
299,000,000
418,000,000
195,000,000
123,000,000
293,000,000
160,000,000
127,000,000
111,000,000
60,000,000
Assets
2008
1,900,000,000
291,000,000
495,000,000
Lost to Madoff
216,000,000
354,000,000
577,000,000
316,000,000
229,000,000
87,000,000
167,000,000
144,000,000
90,000,000
Source
Newspapers
Life Insurance
Supermarkets
Investments
Tobacco Settlement
Medical
Cruise Ships
Corporate Fdn
duPont Chemicals
Beauty products
Community
Community
Community
Interests
General/Natl Journalism
Conservative Christian
General
Tobacco Research
Health Care
New York & Isreal
Gen purpose (Miami)
Jessie's Interests
Catholic Organizations
Dade Co
Palm Beach Co
Broward Co
Characteristics of Florida Foundations:
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M a ny special interest, not general purpose.
S e veral moved from other states (Knight, Ohio) (DeMoss, Penn) (Coulter, Delaware).
Only 60% of grants from large Florida Foundations stay in Florida.
Over half of Florida’s large foundations founded since 1990, and 17% between 2000 & 2007.
S e veral large community foundations, four in SE Florida.
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On The Other Hand
Grants Trends of the 21st Century
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6
Funders are looking for, and receiving, better proposals
• P artly as a result of the increased competition, the quality of grant submissions is
improving. I’ve been told this by foundation staff as well as my own observations.
• Both public and private funders are looking for measurable results, better client
outcomes and lasting change. Reporting numbers of people served is no longer
enough.
• G overnment and some private funders are starting to require “evidence-based” or
“best practices”, literature reviews, logic models for “outcome-based evaluation”.
• T he importance of relationships with foundations is increasing. Like major donors,
this has to be built over time, and relationships need to be between organizations,
not just individuals.
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Foundation Behavior in 2010
After the 2000 dot-com crash and the 2008 financial meltdown, foundations are being more
cautious. Even if their endowments are recovering, they’re not sure that they can count on it
in the future.
• Many are focusing on strengthening established organizations they’ve funded
before, especially shoring up ones that were hurt by the downturn. Some are making
“operating funds” grants to these groups for at least a limited time.
• Good for hospitals, universities, large nonprofits.
• A hard time for startups, grassroots organizations.
• There was a move towards basic needs, funding groups that help people impacted by
unemployment and poverty -- food banks, shelters, low income housing, etc.
• Good for social services.
•A hard time for arts organizations.
• There’s been an acceleration of the trend to look beyond the project to the strength
of the applicant. Can you show a strong financial statement, diversified funding? Can
you demonstrate program success with data, stories, testimonials?
• Again, this favors established organizations.
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Foundation Behavior in 2010
continued
• Foundations that cut staff during the downturn are looking for
nonprofits to operate leaner too.
• Don’t want to fund “business as usual.”
• Differences in Foundation Grants
• S maller grant amounts
• Shorter multi-year grants (2 years instead of 3)
• L ess capital campaign funding
• G rants to facilitate mergers, organizational survival
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Predictions
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G rants will become more important as individuals cut back giving.
Foundation grants will become more important and strategic.
State funding will be low for years.
Federal grants won’t decline as much as state, may grow in some areas.
More foundations will be formed.
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G et known by local foundations, even if with smaller proposals.
Be aware of new foundations as they come along.
P osition your organization for national foundations by successful local grants.
Focus on building relationships with grantmakers. Involve your board.
Build & maintain communications with current funders.
E xplore constructive collaborations and relationships with other nonprofits (even
possibilities for mergers).
L earn about federal grants, sign up on grants.gov, know your congressional offices.
W atch costs and your balance sheet.
Diversify your funding, including grant sources and types.
P osition your organization for better times.
Recommendations
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Inserting Green Into Your Grant
Both government and private funders are increasingly looking at green programs, especially
for capital projects. The Kresge Foundation for example, has incorporated green requirements
into their challenge grants.
• Green Guide to the 2009 Stimulus Package: www.greenstimulusguide.com
While the ARRA is already in full force, this guide is a useful tool when you’re considering a
green element in any federal grant.
• The Green Schools Initiative: www.greenschools.net
The initiative has collected a comprehensive directory of information for every type of green
education you could imagine, including their report ‘The Little Green Schoolhouse’.
• USDA’s National Agriculture Library: www.nal.usda.gov/afsic/pubs/susag.shtml
USDA’s guide to Sustainable Agriculture provides both a wealth of information on
the topic as well as a guide to what is popular in government agriculture grants.
• EPA’s Green Building Guide: www.epa.gov/greenbuilding
The EPA’s guide provides a sound background on the green building movement.
• U.S. Green Building Council: www.usgbc.org
As the home of LEED, the US Green Building Council is your one-stop for information
on producing a certifiably green building.
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-- Bailey Boyd Associates
Other Grant Trends
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8
There’s more competition for grants
• In 1992 there were 516,000 nonprofits; Today there are over 1,200,000. About 25% have
income over $500,000, with the ability to apply for and receive large grants.
• L ocal governments are increasingly seeking private funding and are starting to succeed.
Some are forming parallel 501(c)(3) organizations to raise money for popular services.
(The Schools Foundation, The Parks Foundation, The Zoo Foundation).
• A s state & local government funding for social services declines, nonprofits which
previously relied mostly on government contracts are seeking private funding, including
grants. There’s also a trend for these agencies to start seeking federal grants.
Growth of nonprofits since 2000 (from Giving USA).
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The Internet is having a huge impact in every aspect of grants
Online funder searches:
• Foundation Directory Online http://foundationcenter.org/findfunders/fundingsources/fdo.html
• G r a ntStation http://www.grantstation.com/
Online 990 searches:
• GuideStar http://www2.guidestar.org/
• Foundation Center http://foundationcenter.org/findfunders/990finder/
Other Internet effects:
• T he Web is replacing the library for all kinds of research -- demographics, community need.
• T he Federal Government posts RFP’s on grants.gov, and most agency websites are very good. States
and local governments are following this trend, with mixed results.
• T he Feds and larger foundations are going to online applications. Nobody has it right yet.
• Most large foundations have good web pages and are posting their guidelines, application forms and
annual reports (that they used to print) online as downloadable pdf’s.
• Proposal drafts are traded back and forth between grantwriter and program staff as e-mail attachments.
• S o cial media is an unknown, but will have a large impact.
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The grants world is getting more organized
Grantmakers for Effective Organizations: A group of foundations dedicated to improving
the organizational stability of the nonprofits they fund. http://www.geofunders.org/home.aspx
Project Streamline: A cooperative effort of major foundations and nonprofit organizations to
reduce bureaucratic requirements on grant seekers.
http://www.projectstreamline.org/project-streamline
Glass Pockets: A project of the Foundation Center to increase funder transparency.
http://www.glasspockets.org/
AAGP, GPCI, NGMA: Grantwriting and grant management is becoming a profession with
its own membership associations & credentials.
• A merican Association of Grant Professionals http://grantprofessionals.org/
• G rant Professionals Certification Institute http://grantcredential.org/
• National Grant Managers Association http://www.ngma-grants.org/
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Non-Grant Issues
Affecting Grantwriters
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Threats to Tax Exempt Status
1) Expired state corporate status
Is your organization keeping its Incorporation papers current with your state?
• In Florida: Annual reports to Dept. of Agriculture and Consumer Services, Corporation Division.
• F a ilure to stay current can result in the organization’s corporate status being revoked.
If your corporate status expires, so does your tax exemption!
• S t ates are posting their databases of corporate statuses on their Web sites.
• T he IRS is starting to mine these public databases, looking for expired corporations.
2) Tipping (into private foundation status)
• Too much of your funding comes from too few sources (disqualified persons.)
A really large gift or grant can “tip” you into private foundation status. Check with your accountant.
3. Very small nonprofits are now required to file Form 990-N (an e-postcard)
Previously didn’t have to file if income was under $25,000 year.
• For more information go to: http://www.irs.gov/charities/article/0,,id=169250,00.html
Up to 400,000 nonprofits are at risk of losing their tax exemption in 2010.
The IRS has promised leniency, but the law requires them to cut groups that don’t file 990’s for 3 years.
4. Expired IRS advance ruling letter
• No longer required to file for permanent status, new applications automatically get public charity
status.
• BUT if a letter expired before 6/9/2008, need to appeal. Talk to a tax lawyer.
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Changes in the 990
The IRS form 990 that nonprofits are required to file has become more important. It used to be obscure
and accounting-oriented. Now it’s well known and has become a legal and marketing document too.
Every nonprofit’s 990 is freely available, and foundations and large donors are looking at them.
• G u i deStar http://www2.guidestar.org/
• Foundation Center http://foundationcenter.org/findfunders/990finder/
The federal government got involved in corporate oversight as a result of the Enron scandal (SarbanesOxley Act of 2002). The IRS is the mechanism for oversight of nonprofits.
• T he 990 now has a governance section. You need to have a lawyer look over your filing.
• T he new 990 gives more attention to your mission and charitable activities. Because foundations and
donors are looking at it, it becomes a marketing and public relations document.
• G r a ntwriters need to be aware of what’s in their agency’s 990, because foundations are asking for
and looking at them.
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Old 990
New 990
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Old 990
New 990
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