September 2005

Moving Beyond the Money: Forging Effective Relationships Between Funders and Workforce Providers

Speakers: Patrice Cromwell, Senior Fellow, Family Economic Success, Annie E. Casey Foundation; Joseph Jones, President and CEO, Center for Fathers, Families, and Workforce Development; Kevin Jordan, Vice President, Bon Secours of Maryland Foundation; Pat McLaughlin, SSND, Executive Director, Caroline Center; Betsy Nelson, Executive Director, Association of Baltimore Area Grantmakers; Melanie Styles, Program Officer for Workforce Development, Abell Foundation

Moderator: Jason Perkins-Cohen, Executive Director, JOTF

Grantmakers and service providers enjoy a symbiotic relationship: providers depend on grantmakers’ generosity to accomplish vital work in the community, and funders rely on grantees to help effect change at a societal level. However, at the program implementation level there are often disconnects between the expectations of grantmakers and those of providers. Speakers representing the grantmaking and service provider communities discussed ways that service providers and funders can work together effectively to realize their shared goals.

The proposal process

Organizations should not “chase funding” by changing programs’ structure or goals to fit with the guidelines of a particular grantmaking program or request for proposal (RFP), but instead bid only on those funding programs that constitute a good fit with their existing programs and capacity. Grant seekers should already have a clear sense of their own goals and capacity, as well as a solid understanding of the problem that an RFP hopes to address. If a provider grasps the problem, but lacks a solid sense of exactly how its program can address that problem, the provider should not respond to an RFP. Careful research of a foundation’s grantmaking priorities and of the problem at hand can enhance a grant seeker’s chances of receiving funding.

L-R: Betsy Nelson, ABAG; Patrice Cromwell, OSI-Baltimore; Melanie Styles, Abell Foundation

It is important to be knowledgeable about the particular philosophy and funding style of particular foundations, since different funders have different orientations. Some g rantmakers will refer applicants to other funders if not an applicant’s program does not fit within a foundation’s grantmaking areas.

The Abell Foundation is open to receiving proposals from startup organizations, whereas other funders tend to only make grants to established nonprofits. Some foundations respond to unsolicited funding applications, while others extend invitations for nonprofits to apply.

The Open Society Institute looks for three key elements when determining which organizations to fund:

1. Collaboration – What is the organization’s strength, and is it open to partnering with other organizations to supplement its capacity?
2. Replication – If the program is successful, can it be duplicated elsewhere or on a different scale?
3. Focus on systemic change – Applicants should “tell their stories” about how their programs fit with the foundation’s broader societal goals.

The Annie E. Casey Foundation focuses on the potential Leverage, Influence, and Impact of a particular program in making its funding decisions. [N.B.: Definitions below in quotation marks are taken from the AECF website.]

1. Leverage – "Changes in investments (monetary or in-kind contributions) by other public or private funders, institutions, or organizations that help to create or support impact or influence changes related to powerful strategies."
2. Influence – "Changes in community environments, relationships, institutions, organizations, or service systems that impact individuals and families, including changes in issue visibility, community norms, partnerships, public will, political will, policies, regulations, service practices, or business practices."
3. Impact – "Changes in a condition of well being for the children, adults, or families directly service by programs, agencies, planned strategies, or service systems."

Many funders expect providers to be partners in the work; however, the reality is that the playing field is not level. Providers should be up front about their strengths and weaknesses and not “over-promise and under-perform,” as this can quickly sour a grantmaker-grantee relationship.

Providers should involve program staff in the proposal process, since front-line personnel have a distinct perspective on the strengths and weaknesses of the program, and of the problem the program seeks to address.

Kevin Jordan, Bon Secours of Maryland Foundation

Implementation and reporting

Funders “live vicariously” through their grantees. Program officers must report to their boards to justify their recommendations for initial or ongoing funding, and to report on grantees’ performance. Grantees can help program officers help them by maintaining communication that is both open and honest. The best way is to accomplish this is through regular contacts in person and by phone, beyond those mandated by the grant reporting requirements.

Grantees should be forthright about whatever challenges they are facing as they seek to implement the terms of the grant; this enables funders to address problems before they grow too large. Site visits are another good way for funders and their boards to become more familiar and comfortable with grantees and their programs.

Providers can strengthen their chances of receiving funding and of sustaining positive relations with funders by:

• Cultivating an effective board of directors: individuals who are not only strongly committed to the mission of the organization, but also have the connections, fundraising experience, or programmatic expertise to truly strengthen the organization;

• Involving clients: by sharing their own stories and perspectives on the work of an organization clients can contribute greatly to strategic planning meetings, site visits, advocacy opportunities, and presentations to funders;

• Developing partnerships: effective collaborations with other organizations can increase a grantee’s ability to fulfill the conditions of the grant and help the funder achieve its own systemic reform goals. This is particularly true in the area of public policy advocacy, because of the federal restrictions on lobbying by nonprofits.

Reports are “not just a way to get more money,” or to abide by the terms of a grant. The reporting process should help providers build on strengths, alleviate weaknesses, and measure outcomes. Reports should include both quantitative and qualitative outcomes, as well as shorter-term results. In addition to their assessment of a program’s long-term outcomes, foundations also pay attention to interim benchmarks, such as the number and type of constituents reached by newsletters and other public education efforts.

Foundations have other resources to offer besides money. They also can be valuable sources of research, technical assistance, organizational development expertise, and knowledge of different programs that work to address the same problem. Grantees should feel comfortable asking program officers about other types of assistance available besides funding.

Participants at JOTF/OSI's "Moving Beyond the Money" forum

Maintaining an ongoing relationship

As a rule, grantmakers will not fund organizations indefinitely. While some foundations will provide multi-year grants or issue renewals of single-year grants, grantees must take steps to develop alternate sources of funding. Demonstrated efforts to seek out new revenue streams and leverage existing ones can be a significant method of instilling faith in a funder that a grantee is healthy, stable, and sustainable.

Because of this, it is critical for grantees to have integrity in their ongoing relationships with funders. The foundation community is a relatively small one, meaning that a grantees reputation – for better or for worse – will precede it as it looks to expand its sources of income. It is rare for a foundation to rescind grant funding (this only happens about 10 percent of the time), but a failed relationship between grantmaker and grantee can severely impact the likelihood that an organization will receive new funding.

In order to foster and maintain positive relations with funders, development officers should be knowledgeable and passionate about the work of the grantee organization. Nonprofit CEOs should ensure that the staff member or contractor in charge of fundraising is familiar with their organizations’ mission, vision, and operations.

Some programs pose more of a challenge to ongoing funding. GED and literacy programs, for example, often experience difficulty in sustaining funding levels because outcomes are difficult to measure and depend on a host of variables.

Additional resources

• Guidestar (http://www.guidestar.org): An online database or information and resources for grant seekers, funders, and others in the nonprofit sector.
• Guidestar E-Docs (http://www.guidestar.org/help/faq_edocs.jsp): An online subscription service that allows nonprofits to upload their most recent Form 990's, letters of determination, annual reports, audited financial statements, and other documents.
• Chronicle of Philanthropy (http://www.philanthropy.com): News, resources, and other information about grantmaking in the nonprofit sector.
• Nonprofit Good Practice Guide (http://www.npgoodpractice.org): A project of the Dorothy A. Johnson Center for Philanthropy and Nonprofit Leadership, this online guide offers information about preferred practices, pitfalls, and nonprofit trends within 10 topic areas.

Atrium of the Thumel Center, Merrick School of Business, University of Baltimore

This event is part of Forging Open Society: Generating Ideas, Partnerships, and Solutions, forums convened by OSI-Baltimore to encourage community leaders with diverse perspectives to craft solutions to challenges facing the Baltimore region.

JOTF acknowledges the Jacob France Institute and the University of Baltimore for their generous upport of this forum.

[Back to Top]