Chapter 46. Planning for Sustainability | Community Tool Box

Finding and maintaining the resources needed to carry out community work can be challenging. Financial sustainability helps an organization or initiative maintain the staffing, services, partnerships, infrastructure, and other resources needed to produce meaningful community benefit over time.

Financial sustainability should be considered early, as the initiative is being designed, and revisited as the organization, community, funding environment, and work change.

Financial sustainability does not mean preserving every program indefinitely or pursuing every available source of revenue. The goal is to build a resource strategy that is aligned with mission, responsive to community priorities, financially realistic, and resilient enough to support the parts of the work that remain valuable.

Strategies for financial sustainability

Organizations usually rely on a combination of strategies rather than one source of support. The appropriate mix depends on the mission, legal structure, programs, community, staffing, funding restrictions, and financial risks involved.

Communicating value and building relationships

Strong relationships can support fundraising, partnerships, participation, referrals, advocacy, volunteer engagement, and community trust.

Communication should help people understand:

• What the organization does
• Why the work matters
• Who is involved and affected
• What results or learning have emerged
• How resources are used
• How people can participate, partner, donate, or obtain services

Every interaction can affect trust and organizational reputation. This includes how people are treated when they call, email, visit a program, apply for services, make a donation, volunteer, attend an event, or raise a concern.

Effective communication is not simply "image-building." It should be accurate, accessible, transparent, and consistent with the actual quality and values of the organization.

Relationship-building may include:

• Community engagement
• Donor and funder relationships
• Membership development
• Partnership development
• Public education
• Advocacy and public-policy engagement consistent with applicable law
• Communication with people who participate in or are affected by the organization's work

Sharing positions, services, and resources

Collaboration can reduce duplication, increase access to expertise, and allow organizations to use resources more efficiently.

Organizations may share:

• Office or program space
• Equipment
• Technology
• Administrative services
• Professional services
• Training
• Purchasing arrangements
• Staff positions
• Grant development or evaluation capacity

Before entering a shared arrangement, clarify:

• Purpose and expected benefits
• Responsibilities
• Supervision
• Cost allocation
• Insurance and liability
• Data privacy and confidentiality
• Ownership of equipment or intellectual property
• Decision-making authority
• Procedures for ending the arrangement

Use written agreements when the complexity, risk, or value of the shared resources makes them appropriate.

Becoming part of an existing institutional budget

One way to sustain effective work is to incorporate its costs into the recurring budget of an organization or institution that has an ongoing responsibility for the activity.

For example:

• A school district might incorporate an effective mentoring or student-support program into its regular budget.
• A health system might assume ongoing costs for a community health worker program that improves access and outcomes.
• A local government might include a successful community service in its annual operating or capital budget.
• A community or faith-based organization might incorporate a partnership activity into its regular operations.

Institutionalization can provide more stability than repeatedly seeking short-term grants, although no budget allocation should be assumed to be permanent.

Clarify what costs the host organization will assume, what outcomes it expects, who will oversee the work, and how the activity will continue to be evaluated.

Integrating activities or services into another organization

A project does not always need to become a permanent independent organization.

Sometimes the strongest sustainability strategy is to transfer or integrate an effective activity into an organization that already has the mission, staff, infrastructure, relationships, and long-term capacity to maintain it.

Whenever possible, involve the future host organization early in planning.

Discuss:

• Whether the activity fits its mission
• Evidence that the activity is useful
• Full operating costs
• Staffing
• Data and record transfer
• Participant relationships
• Funding
• Quality standards
• Community involvement
• Ownership of materials and intellectual property

Examples might include transferring an after-school activity to a youth-serving organization, incorporating a substance use prevention program into a school or health system, or transitioning a housing-stability service to an organization with established housing expertise.

Applying for grants

Grants can support new initiatives, expansion, evaluation, capacity-building, equipment, staffing, or other work.

Potential grant sources may include:

• Federal, state, tribal, territorial, or local government agencies
• Private foundations
• Community foundations
• Corporate foundations or giving programs
• Other nonprofit or philanthropic organizations

Grant funding is not automatically sustainable funding. Grants may be temporary, restricted, reimbursement-based, highly competitive, or administratively demanding.

Before applying, consider:

• Mission alignment
• Allowable costs
• Whether indirect and administrative costs are adequately covered
• Reporting requirements
• Payment timing
• Staffing required to manage the award
• Whether matching funds are required
• What happens when the award ends

Avoid pursuing grants simply because funding is available. Funding that pulls an organization away from its mission or creates obligations it cannot sustain may weaken rather than strengthen financial sustainability.

Using shared staffing, volunteers, interns, and other personnel resources

Personnel arrangements can expand capacity, but each should be used for an appropriate purpose.

Possibilities may include:

• Shared staff positions
• Volunteers
• Internships
• College work-study positions
• Fellowship or service programs
• Temporary staff assignments from partner organizations
• Donated professional services

Clarify supervision, training, confidentiality, insurance, accessibility, responsibilities, employment classification, and applicable wage and labor requirements.

Volunteers and interns can contribute meaningful expertise and community participation, but they should not automatically be treated as a substitute for paid staff. Essential work that requires consistent professional capacity should be included realistically in the organization's staffing and financial plan.

Soliciting in-kind support

In-kind support includes donated goods, equipment, facilities, or qualifying services that the organization would otherwise need to purchase.

Examples may include:

• Donated meeting space
• Equipment
• Food or supplies
• Printing
• Technology
• Professional services
• Transportation

Evaluate in-kind contributions based on usefulness, quality, ongoing maintenance costs, storage needs, restrictions, and whether accepting the contribution actually reduces expenses.

Organizations should also maintain appropriate documentation and accounting for donated goods and services when required. Donors should receive accurate information about tax treatment rather than assuming that all donated time, goods, or services create the same charitable deduction.

Developing individual giving and recurring-donation programs

Individual giving can provide flexible support and may reduce dependence on institutional funders.

Strategies may include:

• One-time donations
• Monthly or recurring giving
• Major gifts
• Peer-to-peer fundraising
• Digital giving
• Donor campaigns tied to specific organizational priorities

Sustainable individual giving depends on trust, communication, responsible stewardship, appropriate donor acknowledgment, and relationships rather than repeated emergency appeals alone.

Developing fundraising activities and campaigns

Fundraising may involve events, campaigns, merchandise, benefit activities, peer-to-peer outreach, crowdfunding, or other methods.

Evaluate fundraising based on net revenue, not simply gross receipts.

Consider:

• Staff and volunteer time
• Event and platform expenses
• Donor acquisition and retention
• Accessibility
• Insurance and risk
• Tax and disclosure requirements
• Whether participants receive goods or services in return
• Whether the activity strengthens or distracts from the mission

Fundraisers can also build relationships and community awareness, but those benefits should not be used to justify activities that consistently consume more organizational capacity than they produce.

Pursuing reimbursement, contracts, sponsorships, and other third-party funding

In some situations, the person receiving a service is not the organization or entity paying for it.

Funding may come through:

• Government service contracts
• Insurance or health-plan reimbursement
• Schools or educational systems
• Employers
• Businesses
• Managed-care organizations
• Other institutions purchasing or supporting services

Before relying on this revenue, understand eligibility, billing requirements, reimbursement rates, documentation, payment timing, contractual obligations, privacy requirements, and administrative costs.

A funding arrangement should support rather than distort the quality and mission of the service.

Developing fee-for-service and other earned-revenue activities

An organization may charge for services, training, products, memberships, consulting, facility use, or other activities.

Earned revenue can provide flexible resources, but fees can also create access barriers.

Depending on the mission and service, organizations may use:

• Sliding-scale fees
• Scholarships
• Fee waivers
• Third-party reimbursement
• Different pricing for individuals and institutions
• Cross-subsidization, in which revenue from one activity supports another

Establish transparent policies and consider the effect of fees on equity and participation.

Tax-exempt organizations should also determine whether a revenue-generating activity furthers their exempt purpose. Regularly carrying on a trade or business that is not substantially related to the organization's exempt purpose may create unrelated business income tax and reporting obligations.

Acquiring public funding

Public funding may come from federal, state, tribal, territorial, or local governments.

Depending on the program, funding may take the form of:

• Appropriations
• Grants
• Contracts
• Cooperative agreements
• Reimbursement
• Public insurance payments
• Recurring agency or departmental budget allocations

Public funding can provide significant support but may also be affected by annual appropriations, political priorities, procurement rules, reporting requirements, reimbursement delays, or policy changes.

Organizations may educate policymakers and advocate for public investment in accordance with the rules applicable to their tax status and funding.

Building reserves and financial resilience

Financial sustainability is not only about bringing in new revenue. Organizations also need enough liquidity and reserves to manage delayed funding, unexpected expenses, economic changes, or temporary revenue declines.

A reserve strategy may address:

• The purpose of reserves
• Target reserve levels
• Who may authorize use of reserves
• How reserves will be replenished
• Where funds will be held or invested

Reserve goals should reflect the organization's actual revenue volatility, obligations, risk, and operating model rather than one universal rule.

Establishing endowments

An endowment is a fund established to provide financial support over an extended period.

Endowments may include donor-restricted permanent or term endowments and board-designated funds that function like endowments.

The amount that may be spent and the purposes for which funds may be used depend on donor restrictions, governing documents, board policy, applicable accounting standards, investment policy, and state law.

Do not assume that every endowment simply requires preserving the original principal and spending only interest.

Endowments can provide long-term support but also require:

• Investment governance
• Spending policies
• Accounting and reporting
• Donor-restriction tracking
• Fees and professional management
• Long-term stewardship

Organizations should determine whether building an endowment is appropriate before restricting resources that may be needed for current operations or reserves.

Developing planned-giving opportunities

Planned giving refers to charitable gifts structured as part of a donor's financial, estate, or legacy planning.

Arrangements may include:

• Bequests
• Beneficiary designations
• Charitable gift annuities
• Charitable remainder or lead trusts
• Gifts of securities or other property
• Other arrangements permitted under applicable law

Planned gifts can involve significant tax, legal, investment, disclosure, registration, and administrative considerations. Organizations should use qualified legal, tax, accounting, and gift-planning expertise as appropriate.

Establishing membership dues or fees

Membership dues can provide recurring revenue for organizations whose structure and mission include membership.

Potential advantages include:

• Predictable recurring revenue when membership is stable
• A direct financial relationship between members and the organization
• Support for member benefits, activities, or shared infrastructure

Potential concerns include:

• Dues may create participation barriers
• Revenue may be modest relative to administrative effort
• Members may receive benefits that affect the tax treatment of their payment
• Mandatory payment may conflict with an organization's accessibility or inclusion goals

Sliding scales, organizational rates, hardship waivers, or voluntary supporting memberships may be appropriate.

Describe payments accurately. Do not relabel required dues as "donations" simply to avoid acknowledging that payment is a condition of membership or that members receive benefits in return.

Developing mission-aligned earned-income or social-enterprise activities

Some nonprofits generate revenue through commercial or business-like activities.

Examples may include:

• Training
• Consulting
• Publications
• Products
• Facility rental
• Employment or social-enterprise programs
• Other mission-aligned services

A business plan can help assess:

• Mission fit
• Demand
• Pricing
• Startup and operating costs
• Staffing
• Cash flow
• Competition
• Risk
• Expected net revenue
• Tax and legal implications

Revenue-generating activity conducted directly by a tax-exempt organization may create unrelated business income tax when it is regularly carried on and not substantially related to the organization's exempt purpose.

Some organizations establish a separate taxable subsidiary for particular commercial activities. A subsidiary should not be created merely as a way to "avoid" nonprofit regulation. The legal, tax, governance, liability, capitalization, staffing, and financial relationships between the entities require careful planning and professional advice.

Choosing among strategies

No single financial sustainability strategy is right for every organization, and combining revenue sources can reduce dependence on one funder or funding type.

Diversification, however, should not be pursued for its own sake. Every revenue source has benefits, costs, restrictions, risks, and administrative requirements.

Decide who will participate in the decision

Depending on the organization, financial sustainability planning may involve:

• Board members
• Executive and financial leadership
• Program staff
• Fundraising or development staff
• Community partners
• Participants or community advisors
• Qualified financial, legal, tax, or fundraising advisors

Shared decision-making can help prevent financial strategy from becoming disconnected from programs, community priorities, or organizational capacity.

Begin with mission and sustainability goals

Review the organization's mission, strategic priorities, current financial position, and what programs or benefits it intends to sustain.

Revenue should support the mission rather than become the mission.

Assess the full cost of the work

Before selecting revenue strategies, understand what the organization actually needs to fund.

Include:

• Salaries and employee benefits
• Facilities
• Technology
• Insurance
• Administration
• Evaluation
• Fundraising
• Communications
• Accessibility and language access
• Training
• Equipment replacement
• Participant supports
• Reserve contributions

Funding strategies that cover only visible program expenses while leaving essential administrative and infrastructure costs unfunded may not be sustainable.

Evaluate each potential strategy

Consider:

• Mission fit: Does the funding support or distort organizational priorities?
• Flexibility: Is the revenue unrestricted, restricted, reimbursement-based, or otherwise limited?
• Predictability: How stable is the source from year to year?
• Net financial benefit: What remains after staffing, compliance, fundraising, service-delivery, and administrative costs?
• Cash flow: When does money become available relative to expenses?
• Capacity: Does the organization have enough staff and systems to manage the source responsibly?
• Equity and access: Would the strategy make services or participation less accessible?
• Legal and tax implications: What registrations, contracts, tax rules, disclosures, or other requirements apply?
• Risk: What happens if the source ends or changes?
• Community impact: How does the strategy affect relationships, trust, and the people connected to the work?

Examine revenue concentration

An organization that depends heavily on one grant, contract, donor, customer, or public funding stream may face significant risk if that source changes.

Consider whether additional revenue sources, reserves, multiyear commitments, partnerships, or other strategies could reduce that concentration.

At the same time, adding many small funding sources can create substantial administrative burden. Diversification should improve resilience, not simply create more work.

Gather input

Talk with people who understand different parts of the organization, including staff, board members, funders, donors, partners, participants, and community members when appropriate.

Ask not only where money might come from but also how proposed revenue strategies could affect programs, accessibility, staffing, community relationships, and mission.

Select a balanced resource strategy

A sustainable strategy might combine:

• Grants or contracts
• Individual giving
• Earned income
• Public funding
• Membership revenue
• Partnerships
• In-kind support
• Reserves
• Planned giving or endowment resources

The right mix depends on the organization. A strategy that is highly effective for one organization may be inappropriate for another.

Build on strengths without becoming dependent on them

Organizations should learn from strategies that have worked well, but they should also examine concentration risk.

A strong grant-writing team may make grants an important part of the strategy, for example, but applying for every available grant can consume substantial staff time and create mission drift.

Strong relationships with public officials may support public funding, but annual appropriations can change.

Use organizational strengths while building enough flexibility to respond when circumstances change.

Monitor and revise the strategy

Financial sustainability planning should be ongoing.

Monitor:

• Revenue by source
• Restrictions
• Net revenue
• Fundraising costs
• Cash flow
• Reserves
• Revenue concentration
• Grant and contract renewal risk
• Earned-income performance
• Staffing capacity
• Administrative burden
• Equity and accessibility effects

Revise the resource strategy when community needs, programs, costs, laws, funding conditions, or organizational priorities change.

In Summary

Financial sustainability is the ability to maintain the resources and financial capacity necessary to carry out valuable work over time. It should be planned for early and reviewed throughout the life of an initiative.

Organizations may use grants, public funding, individual giving, fundraising activities, earned revenue, fees for services, membership dues, shared resources, partnerships, in-kind support, reimbursement, reserves, endowments, planned giving, or other strategies.

No source is automatically sustainable. Each has different levels of flexibility, predictability, administrative burden, legal and tax requirements, access implications, and risk.

A strong financial strategy begins with mission and the full cost of the work. It considers net revenue rather than gross revenue, avoids relying on chronic unpaid labor, protects accessibility and equity, and ensures that new funding does not create obligations the organization cannot sustain.

Diversification can reduce dependence on a single source, but more revenue streams are not always better. Organizations should develop a balanced mix they have the capacity to manage, maintain appropriate reserves, monitor concentration and cash-flow risk, and update the strategy as circumstances change.

Ultimately, financial sustainability is not about raising money for its own sake. It is about creating a reliable resource base that allows the organization and its partners to sustain meaningful community benefits for as long as those benefits remain needed.

Tactics for Sustaining the Work: Together on Diabetes Sustainability Tools

The Together on Diabetes initiative assembled sustainability resources drawn from the Community Tool Box. The custom tips and Together on Diabetes-related examples of sustainability are supports for the ToD projects as they plan for the long-term sustainability of their initiatives. This mashup was done in collaboration with the KU Center for Community Health and Development, an evaluation partner in the ToD initiative.

___Financial sustainability is an essential goal of your organization.

___You have decided that you will pursue financial sustainability.

___You have decided who will make the decisions.

___Your mission, vision, and objectives where in mind as you began this work.

___You have brainstormed possible strategies for your organization.

___Key people such as current staff, funders, volunteers, and clients have given input.

___You have decided which strategies are best for your organization:

• Marketing your organization
• Sharing positions and resources with other organizations
• Becoming a line item in an existing budget
• Incorporating activities or services in organizations with a similar mission
• Applying for grants
• Tapping into personnel resources
• Soliciting in-kind support
• Developing and implementing fundraisers
• Pursuing third-party funding
• Developing a fee-for-service structure
• Acquiring public funding
• Securing endowments and planned giving arrangements
• Establishing membership fees and dues
• Making a business plan

Tool: Twelve Tactics for Sustainability

For a downloadable worksheet in Microsoft Word, click here.

You believe in the value of your work, and you may want other organizations, institutions, community members, funders, or decision-makers to support similar goals.

Broader adoption can increase the reach and durability of effective community work. Another organization may incorporate one of your practices into its services, a public agency may adopt a related policy, a funder may support implementation, or a community partner may take responsibility for maintaining an activity.

The goal is not simply to persuade others to agree with your organization. It is to identify genuine areas of alignment, share credible information about what has been learned, develop mutually beneficial relationships, and determine whether another group is willing and able to contribute to shared community goals.

What do we mean by promoting adoption of the initiative's mission and objectives?

Promoting adoption means helping other people and organizations understand your initiative's purpose and inviting them to incorporate compatible goals, practices, policies, services, or responsibilities into their own work.

Adoption can take many forms. Another organization might:

• Provide financial or in-kind resources
• Become a formal program or implementation partner
• Incorporate an effective practice into its own operations
• Adopt a compatible policy
• Provide referrals or other complementary services
• Help advocate for a shared community priority
• Integrate an activity into its regular budget or staffing structure
• Adapt an evidence-informed approach for another population or setting
• Help sustain relationships, infrastructure, or community capacity developed through the initiative

Adoption does not require another organization to accept every part of your mission or become identical to your initiative.

Two organizations may share one goal while differing on other priorities, strategies, values, or responsibilities. A productive partnership makes the areas of agreement and difference clear.

Mission and objectives

A mission statement describes the organization's fundamental purpose - what it exists to accomplish and why.

Objectives translate that mission into more specific results or milestones the organization seeks to accomplish.

Objectives should be meaningful, realistic, and measurable enough to help the organization assess progress. They may address implementation, participation, access, organizational or policy change, behavior, community conditions, or longer-term outcomes.

When asking another organization to support your work, distinguish between the broader mission and the specific objective you want that organization to help advance.

Why encourage broader adoption of the initiative's mission and objectives?

To expand community benefit

One organization rarely controls all of the conditions affecting a complex community issue.

Schools, health systems, community organizations, businesses, funders, public agencies, residents, service providers, and policymakers may each control different resources, practices, policies, or environments.

When several appropriate partners contribute to a shared goal, the initiative may be able to address more of the conditions affecting the issue.

To sustain effective practices and outcomes

An initiative may eventually end, change its structure, lose a particular funding source, or shift to other priorities.

Broader adoption can help valuable practices, relationships, policies, services, or knowledge continue even when the original initiative changes.

Sustainability should not require preserving the original organization forever. Sometimes a strong outcome is for another institution or community partner to incorporate the work into its regular responsibilities.

To strengthen systems rather than create isolated programs

A program may have greater long-term impact when its successful elements become part of established systems.

For example, an effective referral process might become routine practice across several health and human service organizations. A school-based program might become part of the district's regular student-support services. A community accessibility practice might become part of municipal policy.

To bring additional perspectives and expertise to the work

Partners may identify barriers, risks, strengths, or opportunities that the original initiative overlooked.

Broader adoption should therefore be understood as a learning process rather than simply spreading a finished model.

Current evaluation practice emphasizes collaboration with people who bring both lived and professional experience, attention to differences in power, and using what is learned to improve programs and decisions.

Whom should you encourage to adopt your mission and objectives?

Do not begin only by asking which organizations are most similar to yours.

Instead, ask who:

• Shares a relevant community goal
• Is directly affected by the issue
• Has lived experience relevant to the work
• Has relationships with communities involved
• Controls a service, policy, resource, or environment connected to the issue
• Has expertise or infrastructure needed for implementation
• Can help address an important barrier
• Could appropriately sustain part of the work

Depending on the issue, potential collaborators may include civic and neighborhood organizations, businesses, grassroots organizations, school systems, labor organizations, parent and caregiver organizations, faith and spiritual communities, community and news media, health organizations, social service organizations, funders, and local, state, tribal, territorial, or federal government entities.

Community members and people directly affected by the work should not be considered only after institutional leaders have been recruited. Their knowledge and priorities can help determine what should be adopted, how it should be implemented, and whether the proposed approach is appropriate.

Look for complementary roles, not only similar organizations

The most useful partner may not have the same mission as your organization.

A youth-serving organization, public transportation agency, employer, health system, housing organization, school district, or local government may influence a community goal in very different ways.

Ask what each potential partner can realistically contribute rather than assuming that only organizations similar to yours will be useful.

Consider who has decision-making authority

Some objectives require changes in institutional policy, funding, staffing, procurement, facilities, or other organizational systems.

In those situations, identify the people with appropriate authority while also involving staff and community members who understand how the proposed change will affect implementation.

Consider trusted community relationships

Some organizations or community members may not control formal resources but may have trusted relationships, local knowledge, cultural expertise, or community credibility that are essential to the work.

Do not treat these partners simply as messengers for decisions that have already been made. Involve them meaningfully when their knowledge is important to the design, implementation, or evaluation of the work.

Example: A community child abuse and neglect prevention initiative

Imagine a community partnership focused on preventing child abuse and neglect and strengthening conditions that help children and families thrive.

Its mission might be:

To promote safe, stable, nurturing relationships and environments for children and families by strengthening family supports, community partnerships, organizational practices, and access to appropriate services.

Objectives might include:

• Increase access to evidence-informed parenting and caregiver supports
• Strengthen referral pathways among schools, health care organizations, family-service providers, and community organizations
• Train staff in participating youth-serving organizations on appropriate prevention, recognition, reporting, and response procedures
• Improve access to economic, behavioral health, childcare, and other family supports associated with protective conditions
• Track implementation, service access, protective factors, and other appropriate prevention indicators over time

A decrease in reports of child abuse or neglect should not be used by itself as proof that prevention succeeded. Reporting may change for many reasons, including changes in awareness, access to mandated reporters, service use, and reporting practices.

Potential partners might include:

• Parent and caregiver organizations
• Child- and family-serving public agencies
• Schools and youth-serving organizations
• Health and behavioral health organizations
• Domestic violence and survivor-support organizations
• Substance use prevention and treatment organizations
• Head Start and other early-childhood programs
• Faith and spiritual community organizations
• Housing and economic-support organizations
• Community members and caregivers with lived experience

Different partners might contribute to different objectives. There is no need for every partner to adopt the entire mission or carry out the same activities.

How do you encourage others to support or adopt your mission and objectives?

1. Identify the specific outcome you want from the relationship

Before approaching another organization, know what you are asking for.

You might want the organization to:

• Endorse a shared goal
• Provide funding
• Commit staff time
• Change an organizational policy
• Provide referrals
• Host or deliver a service
• Share data under an appropriate agreement
• Join a coalition
• Integrate a practice into its routine operations
• Advocate for a policy or funding change

A specific request is easier to evaluate than a general request to "support our mission."

2. Learn about the potential partner

Understand the organization's:

• Mission
• Community responsibilities
• Current priorities
• Programs and services
• Decision-making authority
• Resources and limitations
• Existing community relationships
• Legal or funding restrictions

Do not develop a persuasive "spin" that tells each organization whatever you believe it wants to hear. Identify genuine areas of alignment and be transparent about areas where goals differ.

3. Build authentic relationships

Relationships can begin informally through community meetings, professional networks, conferences, coalition activities, introductions, or conversations between organizations.

Trust should come from:

• Reliability
• Respect
• Transparency
• Following through on commitments
• Sharing information appropriately
• Acknowledging disagreements
• Making room for partners to influence the work

Personal relationships can help collaboration, but adoption should not depend primarily on personal charm, status, or access to influential people.

4. Communicate through appropriate channels

Visibility can help people learn that an initiative exists, but media attention alone does not create trust or commitment.

Depending on the audience, communication may include:

• Direct meetings
• Community presentations
• Websites and digital communication
• News and community media
• Social media
• Professional networks
• Community newsletters
• Public reports or dashboards
• Conferences or workshops

Choose communication based on who needs the information and what decision you hope they will make.

5. Share evidence and learning honestly

Potential partners need credible information about the initiative.

Share:

• The need or priority the initiative addresses
• What was implemented
• Who participated and who may have been missed
• Evaluation findings
• Community feedback
• Costs and staffing requirements
• Accessibility and equity considerations
• Challenges and unintended consequences
• What adaptations were made
• What remains uncertain

Avoid claiming that an initiative has been "proven" simply because participants liked it or because outcomes improved after implementation.

The strength of your claims should match the strength of the evaluation evidence.

6. Focus on genuine shared interests

Explain how the proposed partnership relates to the potential partner's actual responsibilities or goals.

For example, several organizations may care about children's well-being but for different reasons:

• Schools may be concerned with student safety, development, attendance, and learning
• Health organizations may focus on physical and behavioral health
• Family-support organizations may focus on caregiver resources and family stability
• Public agencies may have statutory responsibilities related to child and family well-being
• Community organizations may focus on strengthening relationships, access, and local support

These differences can produce complementary roles without requiring every organization to describe the issue in exactly the same way.

7. Be transparent about disagreements and boundaries

Organizations do not need to agree on every issue to collaborate.

A partnership may be possible around one objective even when organizations differ on another.

For example, organizations involved in adolescent sexual and reproductive health may have different institutional, cultural, religious, or policy positions. Rather than assuming in advance what a particular faith, health, education, or community organization will or will not support, discuss:

• Which goals are shared
• Which activities each organization can participate in
• What evidence and professional standards apply
• What areas remain outside the partnership

Do not conceal significant disagreements simply to secure an endorsement.

8. Make specific partnership proposals

Once alignment has been established, describe the proposed contribution clearly.

For example, you might ask a partner to:

• Fund a defined portion of the work
• Provide space
• Assign qualified staff
• Provide transportation or childcare
• Share outreach responsibilities
• Participate in evaluation
• Adopt a policy or procedure
• Integrate a service into its budget

Clarify the estimated financial and staff costs before asking an organization to commit.

9. Define responsibilities and decision-making

Partnerships are more sustainable when everyone understands what has been agreed upon.

Depending on the arrangement, document:

• Purpose
• Roles
• Funding or in-kind commitments
• Staffing
• Decision-making authority
• Community participation
• Data sharing and privacy
• Communications
• Evaluation
• Ownership of materials
• Timelines
• Procedures for resolving disagreements or ending the partnership

A memorandum of understanding, contract, grant agreement, data-sharing agreement, or another written document may be appropriate depending on the relationship.

10. Allow appropriate adaptation

Another organization may not be able to implement an activity exactly as your organization did.

Before encouraging replication, identify:

• Which elements appear essential to achieving the intended outcome
• Which elements can reasonably be adapted
• What resources and staffing are necessary
• Whether the approach has been evaluated in settings similar to the new one
• What community input is needed before implementation

Adaptation should respond to local context without discarding components that are essential to safety, effectiveness, ethics, or fidelity to the underlying purpose.

11. Share ownership rather than simply transferring instructions

Long-term adoption is more likely when partners help shape decisions and understand why practices are being used.

Invite partners and affected community members to participate in:

• Planning
• Implementation
• Interpretation of evaluation findings
• Adaptation
• Decisions about continuation or expansion

Shared ownership does not mean every person has the same authority in every decision, but roles and power should be explicit rather than hidden.

12. Evaluate the partnership and adoption process

Do not evaluate only the original program.

Ask:

• Did the partner actually implement the agreed activity?
• Was implementation feasible?
• Were adequate resources available?
• How did community members experience the change?
• Were outcomes equitable?
• What adaptations occurred?
• Did the partnership create unintended burdens?
• Is the adopted practice still useful?
• Should responsibilities or resources change?

Current evaluation guidance emphasizes collaborative engagement, fair and just evaluation practices and outcomes, learning throughout the process, and acting on findings rather than treating evaluation as a final report.

In Summary

Broader adoption of an initiative's mission and objectives can increase community impact and help valuable practices, services, policies, relationships, and knowledge continue beyond the original project.

Adoption should not be treated as a sales process in which organizations identify targets and develop the right "spin" to win them over. Strong partnerships begin with genuine shared goals, respectful relationships, transparent communication, credible evidence, and clear understanding of what each organization can contribute.

Engage people and organizations because their responsibilities, expertise, lived experience, resources, relationships, or decision-making authority are relevant to the work - not simply because they are influential or similar to your organization.

Be specific about what you want a partner to adopt or support. Another organization may contribute to one objective without endorsing the entire mission. Document substantial commitments, clarify decision-making authority, and allow appropriate adaptation to local context.

Finally, treat adoption as a collaborative learning process. Involve affected communities, assess implementation and outcomes, discuss differences honestly, and remain open to changing your own approach based on what partners and community members learn.

The goal is not to make other organizations think exactly as you do. It is to build enough shared understanding, responsibility, and capacity that effective community work can spread, become embedded in appropriate systems, and continue producing meaningful benefits.

Tool 1: Shared Interest Worksheet

In the column on the left, list any groups or individuals that you're considering approaching to adopt your mission or objectives. In the column on the right, write any ideas you have about interests that you share with those groups or people. Try to word in a way that will appeal to that particular group or individual.

Groups or individuals you're thinking of approaching:	Interest(s) that you share with each group or individual:

 

___You understand what missions and objectives are.

___You understand what it is to promote adoption of your initiative's mission and objectives.

___You understand the reasons for promoting your initiative's mission and objectives.

___You understand that you need to connect with people or groups that are similar to you or your group.

___You understand that you need to try to appeal to broader audiences as well.

___You have decided who you want to adopt your mission and objectives.

___You have cultivated bonds with those persons or groups.

___You have gotten the word out through the media.

___You have shown that your initiative has been tested in practice and has proved to yield positive results.

___You have focused on mutual interests.

___You have avoided issues that aren't pertinent to your shared interests.

___You have made specific proposals and offers.

A program may be producing meaningful benefits, but its current organizational home, staffing, or funding may not be able to support it indefinitely. In other situations, another organization may be better positioned to provide the service over the long term.

Building support for a specific program can help sustain valuable services, practices, relationships, infrastructure, or outcomes without requiring the organization that created the program to operate it forever.

Sustainability does not necessarily mean making a program permanent. Programs should continue for as long as they remain useful, effective, equitable, and responsive to community priorities. In some situations, the appropriate next step may be expansion or institutionalization; in others, it may be adaptation, transfer, integration into another organization, or planned conclusion.

What do we mean by attracting support for specific programs?

Building support for a specific program means securing the partnerships, resources, organizational commitments, or infrastructure needed to sustain a particular service or activity rather than seeking general support for the entire organization.

Support can take several forms:

• Another organization assumes responsibility for the program. A program may be transferred to or integrated into an organization whose mission, staffing, relationships, and infrastructure are appropriate for maintaining it.
• Another organization provides financial resources. A funder, public agency, business, foundation, or partner may provide grants, contracts, budget allocations, sponsorship, or other appropriate financial support.
• A partner contributes staffing or expertise. An organization may provide qualified staff, technical assistance, training, evaluation support, or other professional capacity.
• A partner provides facilities or infrastructure. This might include meeting or office space, equipment, technology, administrative services, transportation, or other resources.
• The program becomes part of an existing organization's routine operations. A school, health system, community organization, public agency, or other institution may incorporate an effective program or practice into its regular services and budget.
• Several organizations share responsibility. A partnership or coalition may distribute funding, staffing, outreach, service delivery, evaluation, or other responsibilities among several organizations.

The appropriate arrangement depends on what the program needs and which organizations are genuinely positioned to provide those resources or responsibilities.

Why build support for specific programs rather than only for the entire initiative?

To sustain effective benefits

If evaluation and community experience show that a program is producing meaningful benefits and a continuing need exists, it may be appropriate to sustain it.

Sustainability does not require preserving the exact program structure forever. What matters is maintaining the effective practices, services, relationships, or benefits that remain useful.

To work with organizations that share a specific goal

Another organization may not share your entire mission but may strongly support one program or objective.

For example, a health organization, school system, community organization, or faith and spiritual community may have different overall missions but share an interest in improving access to preventive health services, strengthening families, supporting young people, or another specific community goal.

Partners should not be expected to endorse activities that conflict with their legal responsibilities, mission, professional standards, or organizational policies.

Identify the areas of genuine agreement and be transparent about significant differences.

To continue a time-limited program when the need remains

Programs created through a temporary grant or pilot project may continue to provide value after the original funding ends.

Before seeking continued support, assess:

• Whether the need still exists
• What evidence suggests the program is useful
• What participants and community partners think should continue
• Whether the program should be adapted
• What the full cost of continuation would be
• Whether another organization is better positioned to operate it

To reduce dependence on one source of support

Heavy dependence on one grant, donor, contract, organization, or individual can create risk.

A broader support base may include several funding sources, institutional partners, community organizations, shared staffing, public funding, recurring organizational budget allocations, and other resources.

Diversification can reduce concentration risk, but it does not guarantee stability. Each source may have different restrictions, costs, administrative requirements, and risks.

To strengthen relationships and organizational capacity

Supporting one effective program can sometimes lead to broader collaboration among organizations.

These relationships may later support referrals, shared training, policy change, funding, evaluation, technical assistance, or other work.

Do not treat support for one program as an opportunity to pressure a partner into endorsing the rest of your organization's agenda. Allow broader collaboration to develop from genuine alignment and experience working together.

When should you try to build support for specific programs?

Consider sustainability and partnership needs throughout the life of a program rather than waiting until the original funding or staffing is about to end.

Early planning can help determine:

• Which organizations should be involved from the beginning
• What outcomes should be evaluated
• What staffing and infrastructure are necessary
• What the program actually costs
• Whether an existing organization might eventually provide an appropriate long-term home
• What legal, funding, data, contractual, or other requirements might affect a future transfer

Other useful times to assess support include:

• When a pilot or grant-funded program is approaching the end of its current funding
• When the organization that developed the program no longer plans to operate it
• When evaluation suggests that the program should be expanded or incorporated into routine practice
• When leadership or staffing changes create continuity risks
• When another organization has stronger infrastructure or closer relationships with the people the program serves
• When community priorities or conditions change

Example: Planning a transition for a young-parent support program

Imagine that a community service organization operates a program providing education, navigation, peer connection, and practical support for young parents.

The program's coordinator will soon leave, and the organization is restructuring. A grant will support the program for another year, but the current organization does not expect to operate it after that period.

Rather than waiting until the final months of the grant, program leaders begin a transition process.

They examine:

• Whether participants still value and need the program
• What outcomes and services should be preserved
• Whether the model needs to be adapted
• What staffing and supervision are required
• What funding will remain and what will happen when it ends
• Which community organizations already serve young parents
• Which organization has appropriate facilities, staffing, community relationships, financial systems, and program expertise

The goal is not simply to find any organization willing to accept the program. It is to identify an arrangement capable of sustaining its valuable elements responsibly.

Whom should you try to attract support from?

Potential partners depend on the program and community.

Consider organizations and people that:

• Share a relevant goal
• Have a responsibility connected to the issue
• Serve or have trusted relationships with participating communities
• Have appropriate staff or expertise
• Control resources, facilities, services, policies, or infrastructure the program needs
• Could appropriately incorporate the program into existing operations
• Have lived experience or community knowledge important to the work

Civic and community organizations

Neighborhood associations, community coalitions, civic organizations, cultural organizations, advocacy groups, and other community-based organizations may provide partnerships, facilities, volunteers, funding, outreach, knowledge, or other support.

Public agencies and elected or appointed officials

Local, state, tribal, territorial, and federal agencies may have responsibilities, programs, funding, facilities, data, or expertise related to the work.

Elected and appointed officials may also have roles in budgets, legislation, oversight, or public policy.

Organizations should understand the advocacy and lobbying rules that apply to their legal and tax status and to the particular funding they receive.

Section 501(c)(3) organizations may engage in some lobbying within applicable limits, but they may not participate or intervene in political campaigns on behalf of or in opposition to candidates for public office.

Health and human service organizations

Depending on the program, potential partners may include:

• Public-health agencies
• Health systems and clinics
• Behavioral health organizations
• Family-service organizations
• Domestic violence and survivor-support organizations
• Housing organizations
• Substance use prevention, harm-reduction, and treatment organizations
• Disability organizations
• Other community-based service providers

Schools and educational institutions

Schools, colleges, universities, early-childhood organizations, and other educational institutions may contribute facilities, staff, evaluation expertise, referrals, outreach, training, or long-term institutional support.

Community leaders and people with lived experience

People with relevant lived experience, community relationships, or trusted roles can help determine whether a program is useful, how it should be adapted, and which organizations may be appropriate partners.

Do not involve people simply because they are considered influential. Consider whose knowledge, responsibilities, relationships, and decision-making authority are actually relevant.

Funders and grantmakers

Foundations, public agencies, businesses, individual donors, community foundations, and other funders may provide important financial resources.

Financial support is one part of sustainability, but it is not automatically the most important form of support.

Sustainable programs may also depend on:

• Organizational capacity
• Appropriate staffing
• Evaluation
• Partnerships
• Community ownership
• Leadership
• Adaptability
• Institutional infrastructure

Understanding potential partners' perspectives

Before asking for support, learn why an organization may or may not want to participate.

Avoid labeling organizations as resistant, indifferent, or uninformed. Their concerns may be reasonable.

An organization may:

• Disagree with the proposed strategy
• Lack staff or funding
• Have different priorities
• Face legal or contractual restrictions
• Be concerned about evidence or program quality
• Have experienced problems in a previous partnership
• Need additional information
• Support the goal but believe another organization should be responsible

Listening to those concerns can help determine whether a partnership should be developed, redesigned, or not pursued.

Example: Harm-reduction partnership

A community HIV and hepatitis prevention initiative may operate or partner with a syringe services program for people who inject drugs.

Another substance use organization may have questions about how the service fits with its treatment model.

Rather than labeling the organization as resistant and trying to "win it over," discuss:

• The evidence supporting the program
• The services each organization provides
• Shared goals related to health and safety
• Referral opportunities
• Areas of disagreement
• Whether meaningful collaboration is possible

How do you build support for specific programs?

1. Decide what should be sustained

Do not begin with the assumption that the entire existing program must continue.

Review:

• Continuing community need
• Evaluation findings
• Participant experience
• Equity
• Costs
• Staffing requirements
• Program strengths and limitations

Identify which elements should continue, be adapted, be transferred, or conclude.

2. Decide what kind of support is needed

Be specific.

The program may need:

• Long-term organizational ownership
• Funding
• Staff
• Facilities
• Technology
• Transportation
• Evaluation
• Administrative infrastructure
• Outreach or referrals
• Advocacy or policy support

3. Identify organizations with genuine alignment and capacity

Potential partners should be selected based on more than their likelihood of saying yes.

Assess:

• Mission fit
• Community relationships
• Program expertise
• Governance and leadership support
• Staffing capacity
• Financial stability
• Facilities and technology
• Accessibility
• Quality and safety systems
• Evaluation capacity
• Willingness to assume responsibility

A financially stressed organization should not be selected merely because grant funding associated with the program would provide it with additional operating revenue.

4. Involve participants and affected communities

Program participants and community members may have important views about a proposed transition.

Ask:

• What parts of the program are most valuable?
• What should change?
• Would the proposed new organization be accessible and trusted?
• Would location, staffing, hours, transportation, language, privacy, or other factors change?
• What should be protected during the transition?

A transfer that is convenient for organizations but creates new barriers for participants is not a successful sustainability strategy.

5. Understand the full cost of continuation

Do not describe a program as fully funded simply because one grant currently pays its direct expenses.

Consider:

• Salaries and benefits
• Supervision
• Facilities
• Technology
• Insurance
• Administration
• Financial management
• Accessibility and language access
• Evaluation
• Participant supports
• Training
• Communications
• Indirect costs

Also identify when current funding ends and what responsibilities the receiving organization will have after that point.

6. Prepare a clear proposal

A request may take the form of a conversation, concept paper, letter, presentation, memorandum, or detailed proposal depending on the complexity of the arrangement.

Explain:

• The program and its purpose
• The continuing community need
• Available evidence and evaluation findings
• Participant and community perspectives
• Why the potential partner may be an appropriate organizational home or supporter
• Exactly what support is being requested
• Staffing and resource requirements
• Current funding and future funding risks
• Proposed timeline
• Roles and decision-making responsibilities
• What assistance the current organization will provide during transition

The proposal should help the potential partner make an informed decision rather than simply make the program appear attractive.

7. Conduct appropriate due diligence

Before transferring responsibility for a substantial program, both organizations should examine the practical and legal implications.

Depending on the program, this may include:

• Funding agreements
• Funder approval
• Contracts
• Employment issues
• Participant consent or notice
• Privacy and data transfer
• Record retention
• Insurance and liability
• Licensure or accreditation
• Equipment and other assets
• Intellectual property
• Accessibility requirements

Obtain appropriate legal, financial, human-resources, or other professional guidance when the transition requires it.

8. Formalize significant commitments

Substantial partnerships or program transfers should generally be documented.

Depending on the relationship, the organizations may use:

• A memorandum of understanding
• A contract
• A grant or subaward agreement
• A data-sharing agreement
• An asset-transfer agreement
• Another appropriate written agreement

Clarify responsibilities, costs, decision-making, reporting, quality expectations, use of funds, and procedures for modifying or ending the arrangement.

9. Develop a transition plan

Program transfer involves more than moving files from one office to another.

A transition plan may address:

• Staff responsibilities
• Training
• Supervision
• Participant communication
• Referral relationships
• Data and records
• Technology
• Supplies and equipment
• Financial accounts and grant requirements
• Facilities
• Evaluation
• Community partnerships
• Communication with funders

Preserve enough institutional knowledge that the receiving organization understands not only what the program does but why particular practices were developed.

10. Communicate the transition clearly

Participants, staff, partners, funders, referral organizations, and other people affected by the transition may need advance notice.

Explain:

• What is changing
• When the change will occur
• What will remain the same
• Whether participants need to take any action
• Where services will be available
• Who can answer questions
• How privacy and records will be handled

Provide communication in accessible languages and formats.

11. Provide transition support

The organization transferring a program may need to provide training, documentation, introductions to partners, technical assistance, or other support.

Establish how long that assistance will continue and who is responsible.

Avoid making the departing program leader the only source of information. Document important knowledge so the program does not remain dependent on one individual.

12. Monitor the transition and longer-term outcomes

Follow-up should examine whether the program remains accessible, useful, equitable, and adequately resourced in its new setting.

Ask:

• Is the program being delivered as intended?
• What adaptations have been made?
• Are participants still able to access it?
• Are outcomes changing?
• Are staff adequately supported?
• Are costs consistent with expectations?
• Are community partners satisfied with the arrangement?
• Are new inequities or barriers appearing?

The goal is not to preserve the original program exactly if experience shows that responsible adaptation would improve it.

General practices for building and maintaining support

Build reciprocal relationships without treating assistance as a debt

Help partners when it advances shared goals and community benefit.

Do not approach relationships as an exchange in which a previous favor creates an obligation to support your program later.

Strong partnerships are based on trust, reciprocity, clarity, and mutual respect rather than informal debts.

Recognize supporters appropriately

Thank funders and partners in ways that are accurate, appropriate, and consistent with their preferences and with any acknowledgment requirements.

Some partners may welcome public recognition; others may prefer limited or no publicity.

Continue learning about participants and community conditions

Gather and interpret information about:

• Participants
• People who are not being reached
• Community priorities
• Service gaps
• Emerging needs
• Partner capacity
• Changes in policy, funding, or the local environment

Protect privacy and collect information only for legitimate program, planning, or evaluation purposes.

Share meaningful feedback with partners

Partners should know how their contributions are being used and what is being learned.

Share:

• Implementation progress
• Outcomes
• Participant and community feedback
• Challenges
• Financial or resource issues
• Needed adaptations

Invite partners to help interpret findings and improve the work.

Share evidence rather than trying to impress supporters

Potential and current supporters need credible information about whether the program is useful.

Provide an accurate picture of:

• Community need
• Implementation
• Reach
• Outcomes
• Equity
• Participant experience
• Costs
• Challenges
• Limitations of the evidence

Do not report only favorable findings or tailor evidence simply to match a funder's interests.

Engage in advocacy appropriately

Organizations may educate policymakers, participate in public-policy discussions, provide research and community information, and engage in permitted advocacy.

Organizations should understand the legal rules that apply to their tax status and funding.

In particular, a section 501(c)(3) organization may conduct some lobbying within applicable limits but may not participate or intervene in a political campaign in support of or opposition to a candidate for public office.

Do not make candidate campaigning part of an organizational strategy for building program support.

In Summary

Building support for a specific program can help sustain effective services, practices, relationships, and community benefits when the organization that created the program cannot or should not operate it indefinitely.

Support may involve funding, staffing, facilities, technical assistance, partnerships, integration into another organization's operations, or a complete transfer of responsibility.

Begin sustainability planning early. Determine what is actually worth sustaining, assess community need and evaluation evidence, understand the full cost of the program, involve participants and affected communities, and identify organizations with genuine mission alignment and adequate capacity.

A program should not be transferred simply to whichever organization is easiest to persuade. Examine governance, staffing, financial stability, accessibility, community relationships, program expertise, infrastructure, and long-term funding before deciding where the work belongs.

Significant arrangements should include clear responsibilities, appropriate written agreements, transition planning, communication with participants and partners, knowledge transfer, and follow-up evaluation.

Finally, build support through transparent and reciprocal relationships rather than favors, pressure, or persuasion. Share evidence honestly, recognize supporters appropriately, follow applicable advocacy and tax rules, and continue learning after a transition takes place.

The goal is not necessarily to make every program permanent. It is to ensure that effective and still-needed community benefits have the partnerships, resources, capacity, and organizational home necessary to continue for as long as they remain valuable.

Example 1: Sexual Abuse Nurse Examiners Program

Tulsa, Oklahoma

In Tulsa, the Sexual Abuse Nurse Examiners Program, a national program, has been recognized by the Ford Foundation and Kennedy School of Government for its innovation and effectiveness. The program, which brings together police, forensic nurses, and health and legal agencies to provide fast and humane treatment to victims, has worked to treat over 500 sexual assault victims. Victims are examined in a peaceful area of the hospital, warmly decorated in a homelike manner to provide a supportive, welcoming environment. Tulsa police officials have found the program to be effective in improving the quality of forensic evidence, and they've been able to increase the rate of convictions because victims are more willing to undergo the examinations.

We spoke with Kathy Bell, SANE coordinator for Tulsa, about how the program has managed to attract support from the many agencies and offices involved.

CTB: Can you tell me a little bit about how the SANE program got started?

Bell: What was happening here in Tulsa is that rape victims went to any one of the five hospital emergency departments. Law enforcement came out, and then they sat and waited their turn. A lot of rape victims (gave up and) went away. The people that actually did do the exams hadn't been trained in evidence collection. So there were just a lot of frustrating situations for everybody involved--the victim, the advocacy program, law enforcement, and prosecutor's office.

So we developed a task force and started doing some problem identification and problem solving. In the course of that, we found out about some nurse examiner programs that were out there, in places like Memphis, Amarillo, and Minneapolis. We got information from them, and then took the things that made sense for this community. Then we got a group of nurses together--there were thirty that were originally trained--and then developed a training program. The task force had met for about a year, up to a year and a half. And then they started doing exams in July of 1991.

They started with about 15 or 16 nurses that had been trained. One of the main issues that came up early on was a site to do the exams. They had been being done in all of the hospitals. We originally decided that they weren't even going to do the exams in a hospital; they were going to do them outside the hospital at the College of Medicine. But about two weeks before we were going to start, the College of Medicine backed out as a site for the exams for security reasons. They're not a 24 hour facility, and I think they hadn't really thought through that the exams aren't all done Monday through Friday during business hours. It's evenings, nights and weekends, holidays--times when people aren't around. So they were trying to figure out something else because the ER is not an appropriate spot for rape victims. With that, the mayor got involved and pulled together all the powers that be within the different organizations : law enforcement, prosecutor's office, health department, all the hospitals, victims advocacy programs, etc. Various community leaders then just volunteered the things that the program needed to go. the CEO of Hillcrest Medical Center volunteered their building as a site for the exams. So then we got it set up, and they started doing exams on July 1, just like they had originally planned.

CTB: Wow. So it was this task force that you mentioned earlier that really started the ball rolling on getting all of these groups together?

Bell: Yes. And it primarily was led by the police department and the advocacy program. It was a joint push there to develop the task force and get everybody to sit down at the table.

CTB: So how do you keep all of these different pieces involved now that the program is going? What kind of things do you have to do to maintain those relationships ?

Bell: Just mainly open communication with them. You know, we're going to be working hand in hand with each one on a very regular basis. The nurses are in the exam room with law enforcement and with the advocacy program every time we do an exam. We interact with the health department each time that we refer someone to them for STD follow-up. Every time we do an exam we interact with law enforcement. And then the law enforcement, the prosecutor's office, and our examiners interact in the filing of the charges. Ongoing, constant communication is the key. We have regular meetings every other month. We've asked the defense attorneys to come participate in our training and they don't want to do that, but we don't see ourselves as a prosecutor's witness only. That's how the defense sees us. I also have a monthly newsletter that goes out to all of these people plus a lot of other people. There are 65 people on my mailing list that regularly get communication from me. Those are probably the main ways.

CTB: So, aside from the groups that are immediately involved, what other groups or persons do you look at as being really important to keep interested in supporting for the program?

Bell: I would say maybe not necessarily any group, per say, but maybe just the community as a whole. And they're going to do that with educational programs out in the community, whether Call Rape (the local victims' advocacy group) is presenting them, whether the police department is presenting them, whether the nurses are presenting them. We get some media attention with that.

CTB: It sounds like a very effective program, and a perfect example of bringing together people from a bunch of different segments of the community and putting together a really effective program.

Bell: Right. And what makes it work is the respect each group will have for the other groups. We each have our role, and even though the roles may overlap a little bit, we each have our own distinct piece of the pie. For example, I'm not going to step in and do the investigation because that's law enforcement's role. It's my role to provide medical treatment. I'm not going to try the case; the prosecutor's office is going to do that. And so we have to respect the other groups involved and know that they're going to take the ball when it gets to them and they're going to carry it until it moves to the next person.

 

Example 2: Gaining Support for Specific Programs: The Sanitary Towels and Undergarments Program for Disadvantaged Young Women in Kiambu County, Kenya, by Fountain of Hope Youth Initiative

Sarah Mintz, who brought a donation to the program, with James Waruiru, project manager of Fountain of Hope Community Initiative.

 

Background

The Sanitary Towels and Undergarment Program for Disadvantaged Young Women was established, rather inadvertently, by James Waruiru and Grace Mutura, and is now coordinated by Polly Kamau and Penina Muthoni.

One afternoon in 2007 while the team was handing out food donations to needy households, a poor single mother brought her daughter to the center for counseling. The daughter had bled through a rag she utilized as a makeshift sanitary pad. The menstrual blood saturated her dress, showing an embarrassing red stain. This made her peers laugh and ridicule her, which was traumatizing. She vowed never to return to that school with no desire to place herself in an environment where she faced shame and scorn from her classmates, both boys and girls.

Through the Fountain of Hope Youth Initiative (FOHYI), which was founded to respond to the psychosocial needs of families affected by or infected with HIV/AIDS, the team counselled the girl and bought her a single packet of sanitary pads. The following month she turned up again and the team contributed about half a dollar to buy her another packet. On the third month she showed up with five friends, all in the same predicament, suffering in silence. This is how the program was born.

FOHYI needed to gather more information to better understand the issue and respond appropriately. A study was conducted by reviewing published reports from humanitarian agencies and compiled citations that offered brief but concise information on the problem.

Problem Statement

Significant barriers to high-quality menstrual hygiene management (MHM) persist across Kenya and remain a challenge for low-income women and girls. Research shows they face monthly hardships, with 65% unable to afford sanitary pads. Only 50% openly discuss menstruation at home. Just 32% of rural schools have a private place for changing menstrual products, and only 12% of young women and girls are comfortable receiving related information from their mother. More jarring statistics signal that menstruation is tied to fundamental risks and issues of gender inequality, with studies showing two out of three users of pads in rural Kenya receive them from sexual partners and one in four girls do not associate menstruation with pregnancy. (Reference: Menstrual Health in Kenya|Country Landscape Analysis http://menstrualhygieneday.org.)

According to a 2007 UNICEF report, a girl in primary school between grades six and eight (three years) loses approximately 18 weeks out of 108 school weeks due to her menstrual period. A girl in high school (four years) loses 156 learning days, which is equivalent to almost 24 weeks out of 144. Most impoverished women use dirty pieces of rags, cotton or wool, leaves, and paper as improvised menstrual napkins. This unsanitary and degrading practice exposes women to a number of diseases, including bacterial vaginosis and yeast infections. It also brings discomfort and lowers self-esteem.

Current Menstrual Hygiene Management

Menstrual Hygiene has remained a taboo subject, stigmatized even among practical engineering circles that are accustomed to dealing with unmentionables such as excreta. Women and girls make up 50% or more of the users of Water, Sanitation, and Hygiene (WASH) services, which seem to ignore the needs of half the population that menstruate on an average of 3,000 days over their lifetime. These are basic needs regarding water, space for washing, personal cleaning, menstrual materials, and facilities for the proper disposal of used materials.  Women need to be able to manage this biological function with safety and dignity. – Reference: Preparatory Input on MHM for End Group by Archana Patkar, Year 2001

WHO/UNICEF Joint Monitoring Program for Water Supply & Sanitation - http://www.unwater.org/publication_categories/whounicef-joint-monitoring-programme-for-water-supply-sanitation-hygiene-jmp/

Beneficiaries of the sanitary towels program.

 

Why try to attract support for specific programs instead of the whole initiative?

To make a program permanent

By examining how this program was started, we see that a fundamental need drove the FOHYI team to respond. The team was passionate about helping disadvantaged girls stay in school during their menstrual periods, but the organization struggled with raising funds for a program while the number of those in need kept increasing. The anticipated funds from the government and local corporations was not forthcoming, and the risk of closure was inevitable. The team needed to find other means of support for this project to ensure sustainability.

In order to achieve that goal, they sought support from the following groups and organizations:

Women’s Groups

They spoke to women’s church groups and urged members to consider buying just one extra sanitary pad each month to donate to the project. Many found this easy, so the donations started to trickle in. Before long the project was collecting enough supplies to keep a number of girls in school. The project now enjoys the solid support of volunteers who serve in the distribution of supplies while educating girls on hygiene, sexuality, Christian purity, abortion, and career mentorship. These services are free, provided by the women who support the project. It has greatly relieved financial strain, allowing the small funds that are collected to pay off fiscal debts for the program.

School Leaders, Guidance Counselors, and Teachers

School leaders, guidance counselors, and teachers have all helped in the selection of program beneficiaries. Because of a very tight budget, it’s important to ensure that the neediest recipients, who would most likely stay at home during their periods, are the ones first served.

Schools and Churches

During distribution and training, church and school halls were used for meetings. These spaces were donated by the community, equipped with chairs, tables, and projectors, which offered a fitting environment for learning.

Transport by Expat-to-Expat

The significant growth of this program can be attributed to the generous support from Expat-to Expat, a company owned by a Dutch business man based in Nairobi, Kenya. Expat-to-Expat focuses on helping expatriates settle in Nairobi. For years, with its fleet of cars, the company has provided reliable assistance whenever the program needs to transport supplies and volunteers for its activities.

Program volunteer Mrs. Wambui Kigoiyo provides reproductive health and hygiene education.
 

Support from Unlikely Sources

Menstrual Supplies Donated from Post-Menstruating Women.

The program has sparked the interest of older, post-menopausal women who donate to the project as a show of solidarity and support. This has become a morale booster for the team and a competitive challenge for menstruating women in the churches to offer their support to the program.

Former Beneficiaries as Program Ambassadors

To ensure sustainability of the program, former beneficiaries are recruited to become ambassadors after they have completed school or after marriage to return and offer support by either fundraising or volunteering. Currently a number of young women offer assistance during distribution as a show of gratitude to the program. This has greatly lessened the workload of the program team.

 

Making a Limited-Time Program Last Longer

A year after inception, the number of beneficiaries keeps increasing. What started as a one-off helping one girl has given birth to a program commanding attention and sustainability. The impact has been phenomenal. Many teachers attest that academic performance has improved for girls who missed school during their periods, prior to the program. They have noted more engagement in extracurricular activities as well.

Because this program is not dependent on a single source of support, there are increased survival possibilities. Diverse contributors make sustainability a reality. There is also increased local ownership of the project, and every stakeholder feels obligated to keep this program going.

 

Raising Support for the Whole Organization

When FOHYI began this sanitary towels program, the organization had no idea it would grow in terms of impact and popularity, more than any other programs run by the organization. It has won a number of accolades including second place in 2010’s Out of the Box Prize competition run by the Community Tool Box. Proceeds raised through this project have gone a far to ensure sustainability of other programs run by the organization.

As a result of the sanitary towels program, FOHYI has been featured in print and electronic media. The praise and recognition it receives has helped the organization gain much-needed publicity and support mobilization.

 

Conclusion

When designing a project it is advisable to have a wide resource mobilization strategy. A project can be shut down if it depends on a single donor as its source of support. Diverse contributors make sustainability a reality. When you increase local ownership of a project, every stakeholder feels obligated to keep the program going.

 

Contributed by James Waruiru, founder of Fountain of Hope Life Centre, 2016 Community Solutions Program Leader, and Intern with the Community Tool Box.

 

___You understand that attracting support for a specific program can mean having someone else run the program.

___You understand that attracting support for a specific program can mean having someone else provide funding or resources for the program.

___You understand that attracting support for a specific program can mean having someone else house the program.

___You understand that attracting support for a specific program can make your program permanent.

___You understand that attracting support for a specific program can get support from people who might not normally support your overall initiative.

___You understand that attracting support for a specific program can make a limited -time program go on for a longer period of time.

___You understand that attracting support for a specific program can make you less dependent on any one source of support.

___You understand that attracting support for a specific program can raise support for your organization as a whole.

___You understand that you should try to attract support for specific programs throughout the life of the program.

___You understand that you can also try to attract support for a specific program when the program isn't something your group plans to continue doing, but it is something you'd like to see go on.

___You understand that you can also try to attract support for a specific program when the program was the result of a "one-time" grant and you don't have the resources to continue it.

___You understand that you should try to attract support for specific programs from civic organizations, governmental officials or bodies, other social service or public health agencies, key community influentials, and foundations and other grant-makers.

___You understand that t hose who aren't supportive can be broken down into three distinct groups: those who are resistant to supporting you, those who are indifferent to your cause, or those who are under-informed about your cause.

___You have decided what program you want to attract support for.

___You have decided what kind of support you want to look for.

___You have decided who is most likely to provide that support.

___You have come up with a written request for the support that includes exactly what sort of support you're requesting, or at least an invitation to meet and discuss these details, when you want the support to begin, and why the potential supporter should go for it.

___You have followed up by making yourself available for any questions or concerns the potential supporter might have, contacting the potential supporter to find out their decision, and being ready to help them begin.

___You understand the general tips for attracting and keeping support.

Community organizations need resources to carry out their missions. Those resources may include money, staff, volunteers, facilities, equipment, partnerships, expertise, technology, public funding, or other forms of support.

Organizations also need to communicate clearly about who they are, what they do, why the work matters, what results they are achieving, and how people can participate or contribute.

Marketing concepts can help organize some of this work, but fundraising and nonprofit communication should not be treated simply as commercial persuasion. Effective resource development depends on trust, transparency, ethical fundraising, responsible stewardship, strong relationships, evidence, and meaningful community benefit.

What is marketing?

Marketing is a broad process of understanding audiences, communicating value, developing relationships, and making it easier for people to engage with an organization, service, product, or idea.

In a nonprofit or community setting, marketing may support:

• Community awareness
• Participation in programs or services
• Membership
• Volunteer engagement
• Partnerships
• Fundraising
• Public education
• Advocacy
• Organizational reputation and trust

Marketing for financial sustainability is one part of a broader resource-development strategy. It helps potential supporters understand the organization and provides appropriate, voluntary ways for them to contribute.

It should not substitute for effective programs, accountable leadership, sound financial management, evaluation, or community relationships.

Every organizational interaction can affect trust

People form opinions about an organization through many experiences: visiting its website, calling the office, attending an event, participating in a program, receiving an email, applying for a service, speaking with staff, making a donation, or raising a concern.

Those interactions should reflect the organization's actual values and service standards.

This is different from trying to create a favorable image regardless of reality. Strong reputation comes from:

• Useful and effective work
• Respectful treatment
• Accessibility
• Reliability
• Transparency
• Accountability
• Responsible financial stewardship
• Honest communication

Resource development is broader than asking for money

Depending on the organization, resource development may involve:

• Individual giving
• Grants
• Public funding
• Contracts
• Earned revenue
• Membership
• Sponsorships
• In-kind contributions
• Volunteers
• Partnerships
• Shared facilities or staff
• Planned giving
• Other mission-aligned resources

Communication can support these strategies by helping people understand the organization's mission, work, needs, results, and ways to participate.

Distinguish organizational fundraising from social marketing

Marketing an organization for financial support is different from using social marketing to influence a health or community behavior.

A resource-development campaign might ask people to donate to an initiative addressing impaired driving. A social marketing campaign might instead focus on behaviors such as arranging sober transportation or reducing impaired driving.

These activities may overlap in communication methods, but they have different objectives and should be evaluated differently.

Why develop a deliberate resource-development and communication strategy?

To secure resources needed for mission-aligned work

Organizations need sufficient resources to provide quality services, compensate staff appropriately, maintain facilities and technology, evaluate their work, communicate with communities, and meet other organizational responsibilities.

Clear communication can help appropriate supporters understand:

• What the organization does
• Why the work matters
• What resources are needed
• What evidence or community experience supports the work
• How resources will be used
• How supporters can participate

To understand supporters, partners, and communities better

Resource-development planning can include research and listening.

You might ask current and prospective supporters, participants, community members, partners, and funders:

• What do you understand about our mission?
• Which parts of our work seem most important or useful?
• What questions or concerns do you have?
• What information would help you evaluate our work?
• What factors influence whether you choose to support an organization?
• How do you prefer to receive communication?

The purpose is not simply to learn how to persuade people to give more. The findings may reveal weaknesses in the organization's communication, programs, accessibility, reputation, stewardship, or relationships that should be addressed.

To use resources strategically

Fundraising and communication require staff time and money.

A plan can help an organization decide which audiences, funding opportunities, communication channels, and relationship-building activities deserve the greatest investment.

Prioritize according to mission fit, likely community benefit, organizational capacity, expected net resources, relationship value, and risk rather than simply pursuing every available funding source.

How do you market your initiative for financial support?

A contemporary resource-development and communication strategy can be organized around the following steps:

1. Identify who will lead the planning process.
2. Involve appropriate people across the organization and community.
3. Clarify the organization's mission, role, and boundaries.
4. Set resource-development and communication goals.
5. Assess current conditions and establish a baseline.
6. Identify possible sources of support.
7. Understand supporters' and partners' perspectives.
8. Prioritize appropriate opportunities.
9. Build ethical, professional relationships.
10. Develop a written strategy and budget.
11. Pretest communication and giving processes when appropriate.
12. Implement, evaluate, steward relationships, and adapt.

1. Identify who will lead the planning process

A small planning group can coordinate the work.

Depending on the organization, this might include:

• Staff responsible for fundraising or development
• Executive leadership
• Board members
• Program staff
• Communications staff
• Finance staff
• Volunteers
• Community advisors

Include people who understand both the organization's mission and the practical realities of fundraising, communication, programs, finances, and community relationships.

2. Involve the people who need to understand or influence the strategy

Not everyone needs to write the plan, but staff, volunteers, board members, and others who represent the organization should understand the basic strategy.

Program staff and participants may also identify concerns that fundraisers or communications staff would otherwise overlook.

For example, a fundraising campaign should not share participant stories or images without appropriate permission simply because the story may attract donations.

3. Clarify the organization's mission, role, and boundaries

Before asking people to support the organization, be able to explain clearly:

• Why the organization exists
• What communities or issues it works with
• What it does
• What distinguishes its role from that of other organizations
• What results or benefits it seeks
• What it does not do

Instead of asking only, "How do we want people to see us?" ask:

What should people accurately understand about our purpose, responsibilities, work, results, and values?

Develop a concise organizational description

Create a short description that explains the mission and the most important things people should understand about the organization.

For example:

The Community Learning Partnership provides accessible adult education, digital-skills training, and career-navigation support. Working with learners, employers, libraries, and community organizations, the partnership helps adults pursue education and employment goals while addressing barriers such as technology access, transportation, and language needs.

Use the description consistently across appropriate communication channels, such as:

• The organization's website
• Grant and partnership materials
• Digital and print outreach
• Annual or impact reports
• Staff and board presentations
• Media materials

Decide what opportunities do not fit the mission

Funding opportunities can create pressure to expand into areas that are only loosely connected to the organization's mission.

Before pursuing a new opportunity, ask:

• Does it advance our mission?
• Does the community consider this work important?
• Do we have or can we responsibly develop the needed expertise?
• Will the funding cover the full cost of the work?
• Will it draw staff and resources away from higher priorities?
• What happens when the funding ends?

Do not broaden the mission primarily to become eligible for a grant.

4. Set resource-development and communication goals

Goals should connect to the organization's strategic and financial plans.

Examples may include:

• Increase unrestricted individual giving by a defined amount
• Increase recurring donors
• Reduce dependence on one major funder
• Secure multiyear support for an effective program
• Build an appropriate operating reserve
• Increase community awareness of a particular service
• Develop new institutional partnerships
• Improve donor retention
• Improve accessibility of online giving

Goals should be specific enough to measure and realistic in relation to the organization's current resources and capacity.

Long-term aspirations can be useful, but break them into shorter-term objectives that can guide action.

5. Assess current conditions and establish a baseline

Before setting a strategy, understand where the organization currently stands.

Review:

• Current revenue sources
• Revenue concentration
• Donor retention
• Fundraising costs
• Cash flow
• Community awareness
• Website and digital accessibility
• Communication reach
• Partnerships
• Reputation and trust
• Staff capacity
• Technology and data systems

A SWOT analysis or another strategic assessment may help identify strengths, weaknesses, opportunities, and threats, but it should be connected to actual decisions rather than completed only as an exercise.

6. Identify possible sources of support

Potential sources may include:

• Individual donors
• Members
• Foundations and community foundations
• Businesses and corporate giving programs
• Public agencies
• Grants and contracts
• Federated giving campaigns
• Earned revenue
• Service fees
• Sponsorships
• Planned giving
• In-kind support
• Partner organizations

Do not assume every source is appropriate simply because funding is available.

7. Understand supporters' and partners' perspectives

Current and prospective supporters may have different motivations, questions, information needs, and communication preferences.

Use interviews, surveys, listening sessions, donor feedback, conversations, digital analytics, or other appropriate methods to learn.

Possible questions include:

• What do you understand about our mission and work?
• What questions do you have about how resources are used?
• Which results or information are most useful to you?
• What factors influence whether you support an organization?
• How do you prefer to receive communication?
• What makes a fundraising experience respectful or frustrating?
• What concerns would make you choose not to give?

Respect a person's decision not to donate.

Ethical fundraising is based on voluntary action. Research should help improve communication, stewardship, and organizational practice, not identify increasingly effective ways to pressure people.

8. Prioritize appropriate opportunities

Organizations have limited time and capacity.

Evaluate potential sources according to:

• Mission fit
• Potential net revenue
• Flexibility or restrictions
• Likelihood of renewal
• Administrative burden
• Staff capacity
• Community and relationship value
• Legal and tax considerations
• Equity and access implications
• Risk of mission drift

Concentrate effort where there is genuine alignment and a reasonable likelihood that the relationship can be managed responsibly.

9. Build ethical, professional relationships

Relationships with donors, funders, businesses, public agencies, and community partners can strengthen resource development.

Build those relationships through:

• Reliable communication
• Professional conduct
• Transparency
• Appropriate acknowledgment
• Respect for donor intent
• Respect for privacy and communication preferences
• Accurate reporting
• Responsible stewardship

Personal connections can open doors, but funding decisions should not depend on cultivating insiders or presenting a misleading picture of organizational capacity.

10. Develop a written plan

A resource-development and communication plan may identify:

• Goals
• Priority audiences and funding sources
• Key messages
• Communication channels
• Fundraising activities
• Staff and board responsibilities
• Timeline
• Budget
• Baseline measures
• Evaluation measures
• Privacy and data practices
• Accessibility considerations
• Donor acknowledgment and stewardship procedures

Using the traditional 4 Ps as one planning lens

The traditional marketing framework of product, price, place, and promotion can still help organize thinking, but it should not be treated as a complete nonprofit fundraising framework.

Ethical fundraising also requires attention to donor choice, transparency, stewardship, privacy, accessibility, community accountability, legal requirements, and long-term financial sustainability.

Product: What are you asking people to support?

In nonprofit resource development, the "product" is not simply the organization itself or an image the organization hopes to sell.

Supporters should be able to understand:

• The mission
• The work being carried out
• Who is involved and affected
• The evidence and community need behind the work
• The outcomes or benefits being pursued
• How resources will be used

The strongest fundraising strategy cannot compensate for poor-quality programs, inaccessible services, weak governance, or irresponsible financial practices.

Every person's experience with the organization matters

Staff and volunteers who interact with the public should receive the training, information, authority, and support needed to respond respectfully and accurately.

Avoid treating lower-paid employees or frontline workers simply as instruments for creating a good impression. Their working conditions and organizational experience are part of the organization's values and sustainability.

Instead of asking what a millionaire would see upon entering the building, ask:

• What would a participant experience?
• What would a community partner experience?
• What would a volunteer experience?
• What would a donor or funder experience?
• Is the organization welcoming and accessible?
• Do our public communications match what people actually experience?

Price: What burdens or barriers affect support?

Different people and institutions have different financial capacities and different ways they may choose to contribute.

Make giving and participation accessible without pressuring people to sacrifice more than they wish to give.

Options may include:

• One-time donations
• Recurring donations
• Gifts of different amounts
• In-kind contributions
• Volunteer participation
• Sponsorship
• Grants
• Planned gifts

Do not assume that a person should provide the form of support that is easiest for the organization. Let supporters choose among appropriate options.

Also consider the nonfinancial implications of a contribution. Businesses, institutions, and individuals may consider whether supporting the organization aligns with their own mission, values, responsibilities, public commitments, or policies.

Do not create or change programs primarily to make a donation politically or morally easier for a particular donor when doing so would undermine evidence, professional standards, community priorities, or organizational mission.

Value and stewardship

Supporters should have confidence that the organization will use resources responsibly and according to stated purposes.

Demonstrate value through:

• Clear mission
• Credible evidence
• Participant and community feedback
• Appropriate financial reporting
• Responsible governance
• Honest acknowledgment of limitations
• Respect for donor intent

Recognition, belonging, or personal satisfaction may be meaningful to some donors, but philanthropy should not be presented as an exchange in which the donor must receive more value than the amount contributed.

Place: Make support accessible

"Place" can refer to how easily people can learn about the organization, participate, contact staff, or make a contribution.

Depending on the audience, provide appropriate options such as:

• Secure online giving
• Mobile-friendly giving
• Recurring giving
• Mail
• Electronic bank transfer
• Phone support
• In-person giving
• Planned-giving contacts

Protect payment and personal information and clearly explain how donor data will be used.

If a contribution may be tax-deductible, describe that accurately. Do not call donations "tax-exempt."

Organizations should also follow applicable acknowledgment and disclosure requirements, including requirements associated with certain charitable contributions in which donors receive goods or services.

Promotion: Communicate strategically

Promotion means communicating about the organization's mission, services, results, opportunities, and resource needs through channels appropriate to intended audiences.

More communication is not automatically better.

Select channels according to:

• Audience preferences
• Accessibility
• Cost
• Trust
• Privacy
• Reach
• Purpose

Communication may include:

• Websites
• Email
• Social media
• Text messaging when appropriate and consent-based
• Community newsletters
• Annual and impact reports
• Community meetings
• Presentations
• News and community media
• Direct mail
• Events
• Peer-to-peer communication
• Professional and community networks

Ongoing organizational communication

Organizations should communicate throughout the year rather than appearing only when asking for money.

Useful communication may:

• Share results
• Explain challenges
• Recognize partnerships
• Announce services or opportunities
• Invite community feedback
• Share financial or governance information
• Explain how support has been used

The goal is relationship-building and accountability, not constant promotion.

Possible approaches include:

• Community presentations
• Newsletters
• Open houses or community events
• Program tours when privacy and safety permit
• Websites and social media
• Public reports and dashboards
• Community forums
• Media outreach
• Conferences and professional networks

When featuring participants in stories, photographs, video, or media coverage, obtain appropriate permission and consider privacy, dignity, power differences, and whether participation is genuinely voluntary.

Inviting financial support

Direct fundraising should clearly identify the organization, explain what support is being requested, and provide accurate information about how contributions will be used.

Approaches may include:

• Individual giving campaigns
• Recurring-giving programs
• Digital fundraising
• Direct mail
• Grant applications
• Major-gift fundraising
• Corporate or business partnerships
• Peer-to-peer campaigns
• Fundraising events
• Planned giving

Telephone, text, email, and other direct outreach should follow applicable law and respect people's communication preferences.

Protect donor choice and privacy

Donors should be able to make informed, voluntary choices.

Organizations should:

• Communicate truthfully
• Explain the intended use of funds
• Respect restrictions placed on gifts
• Provide appropriate acknowledgments
• Protect personal and financial information
• Respect requests for anonymity
• Respect communication and opt-out preferences
• Clearly identify paid fundraising vendors or third parties when applicable

Transparency and donor privacy are central to ethical fundraising and public trust.

Communicate tax treatment accurately

Do not promise that every payment to a nonprofit is fully tax-deductible.

Tax treatment may depend on:

• The organization's tax status
• The type of contribution
• Whether the donor receives goods or services in return
• The amount of the contribution
• The donor's individual tax circumstances

Provide required acknowledgments and disclosures and encourage donors to seek their own tax advice when appropriate.

Keep fundraising and partisan political activity separate

Advocacy and public-policy engagement may be legitimate parts of an organization's mission, but organizations should understand the rules associated with their tax status and funding.

Section 501(c)(3) organizations are prohibited from participating or intervening in political campaigns for or against candidates for public office.

Some lobbying and nonpartisan civic-engagement activities may be permitted, subject to applicable rules and limitations.

Do not use organizational fundraising communication to imply candidate endorsement where such activity is prohibited.

11. Pretest the strategy

Before launching a major campaign, test key elements when practical.

This may include:

• Donation pages
• Email messages
• Print materials
• Fundraising appeals
• Explanations of the organization's work
• Giving forms

Ask whether materials are:

• Accurate
• Understandable
• Accessible
• Respectful
• Clear about how funds will be used
• Easy to navigate
• Free of unnecessary pressure or misleading claims

12. Evaluate, steward, and revise

Fundraising evaluation should consider more than gross dollars raised.

Monitor:

• Net revenue
• Cost of fundraising
• Donor retention
• Recurring giving
• Revenue concentration
• Communication engagement
• Donor and community feedback
• Accessibility
• Privacy or data concerns
• Staff workload
• Mission alignment
• Unintended consequences

Evaluate different methods according to their actual purpose. A community forum should not be judged only by the donations it produces, and a fundraising email should not be considered successful simply because many people opened it.

Stewardship continues after a gift is received.

Depending on the contribution and relationship, stewardship may include:

• Prompt acknowledgment
• Appropriate recognition
• Reporting on use of funds
• Updates on results and challenges
• Respecting restrictions and donor preferences
• Maintaining accurate records

Use what you learn to revise the strategy. Stop or change fundraising approaches that are ineffective, excessively expensive, intrusive, inaccessible, ethically problematic, or inconsistent with the organization's mission.

In Summary

Marketing concepts can help community organizations communicate their value and build financial support, but nonprofit fundraising is not simply commercial marketing applied to a charitable cause.

Ethical resource development begins with mission, community benefit, effective programs, responsible governance, and financial stewardship. Communication should accurately explain what the organization does, what resources are needed, how contributions will be used, and what results or learning have emerged.

Organizations should build professional relationships with supporters while respecting voluntary choice, donor intent, privacy, communication preferences, and the right not to contribute.

Resource-development planning may include individual giving, grants, contracts, public funding, memberships, sponsorships, in-kind support, partnerships, earned revenue, and other approaches. Prioritize strategies according to mission fit, net benefit, capacity, risk, accessibility, and long-term sustainability rather than trying to pursue every available source.

Traditional marketing concepts such as product, price, place, and promotion can still provide one planning lens, but they should be used alongside contemporary fundraising principles of transparency, ethics, accessibility, stewardship, donor privacy, community accountability, and accurate communication.

Finally, evaluate and adapt. Sustainable financial support does not come simply from making an organization more visible or persuasive. It grows from trustworthy work, strong relationships, credible evidence, responsible use of resources, and clear opportunities for people and institutions to support a mission they genuinely choose to advance.

Tool #1: What your donors want from you

What follows is a list of desires that are typical of many groups of donors, such as government agencies, foundations, and individual donors. By knowing what members want, you will be able to target your marketing to their desires.

All of these suggestions should be taken as a starting point. Just as different nonprofit organizations want very different things, different donors will have their individual desires as well. It's your job to figure out what they are, and how your organization can best fulfill them.

Government agencies (federal, state, city, or county) want:

• A carefully defined set of services, provided by a carefully defined set of people , in a set period, often in a set manner, with no audit exceptions and with all paperwork in on time.
• Generally, government representatives want you to know regulations cold.
• You should meet all of their regulatory and bureaucratic requirements.
• You might also design materials (such as reports or brochures) targeted specifically toward government donors. They should emphasize outcomes, quality, and certification levels.

Members want:

• Clear, tangible benefits that they actually receive.
• Updates on what the organization is doing.

Foundations want:

• Innovative projects that meet their criteria.
• A demonstration of strong community support
• Self-sustainability within approximately three years.
• Usually, they want general information, such as your mission, history and goals.
• Letters of endorsement from community leaders or collaborators can be helpful

We should note here that foundations are a slightly different case than other potential donors. Many times, they are located across the country, and each may be unique in its desires and goals. Talk to program officers of foundations if you can, and ask what they like to see most and least in applications. Read the foundation press and consider getting help from an experienced, successful grant writer.

United Ways are an excellent source of funding for many small community organizations. They want:

•  Guidelines for funding met precisely.

If your United Way does needs assessments, make sure that you participate so that your service area needs are included.

Donors, both individual and corporate, have wants that vary widely. Some want:

• To support a program.
• To support an endowment.
• Some want to be visibly thanked for your contribution; many others don't. Ask.

Organizations should learn who is most likely to donate, and focus energies on these potential donors.

Users who pay fees want;

•  High quality and value for their money. Note that we say value, not low prices. Many people who pay fees won't balk at a high price tag if they feel they are getting a lot out of it. For example, a group of tourist may willingly pay ten or twenty dollars to tour a historical site if they have heard that it is particularly beautiful, or that the guide is exceptionally charming.

While this list gives many of the more common ways for a nonprofit organization to raise money, it isn't meant to be a complete list. Does your group have other potential means of funding? What are they?

Information from Peter Brinckerhoff's Mission-based marketing. Reprinted by permission.

Tool #2: Fundraising Effectiveness Chart

Ways/places for asking for support	Definition	Effectiveness tips	Prospect ratio	Cost per dollar raised
Direct Mail	Money raised through the mail by sending a solicitation package to a broad base of potential supporters.	Most effective way to achieve these NEW donors: Repeated solicitations	100:1	$.80-$1.25
Telemarking	Money raised through the telephone by calling with a solicitation script to a broad base of potential supporters.	Most effective way to achieve these NEW donors:Repeated solicitations	10:1	$ .10-$ .20
Fundrasing Event	Money raised from individuals who are new to the universe of your organization or upgrading to a higher level through the sale of tickets and other event collateral	Most effective way to achieve these donors: Multiple solicitation tactics	Direct mail sales 100:1; Face to face sales 4:1	$.50
Corporate Sponsorship	Money raised from corporations who support the work of your organization and/or are seeking recognition opportunities	Most effective way to achieve these donors: Face to face solicitations	4:1	Widely variable; approxi-mately  $ .10-$ .
Grants	Money raised from private and public foundations and/or various branches of the government	Most common way to achieve this money: Grant applications	11:1	For program grants $1; For operating grants <$.15
Individual Donors	Money raised from individuals who support the work of your organization at a philanthropic level	Most effective way to achieve these donors: Face to face solicitation	4:1	<$ .10

 

___You want to secure financial support through marketing your initiative

___You know what marketing is

___You know what marketing includes

___You know why you should market your initiative for financial support

___You know how to market your initiative

___You are familiar with the 12 points in marketing your organization

___You know the "4Ps" of marketing

A community health organization provides meeting and counseling space to a domestic violence prevention program. A workforce-development organization provides employment services to participants in a housing program while the housing organization provides navigation support to participants in the workforce program. Several small nonprofits jointly contract for accounting and information-technology services that none could efficiently maintain on its own.

Sharing staff, facilities, technology, professional expertise, purchasing arrangements, data systems, or other resources can strengthen organizational capacity and improve services. It can also reduce duplication and help organizations coordinate around shared community goals.

Resource sharing is not automatically less expensive or easier than working independently. Shared arrangements can create new responsibilities involving supervision, employment, accounting, insurance, privacy, technology, contracts, grant compliance, decision-making, and communication.

Successful arrangements therefore require more than goodwill. Partners should understand what they are sharing, why they are sharing it, who is responsible for what, what the arrangement actually costs, how risks will be managed, and how the relationship can be changed or concluded if circumstances change.

This section discusses:

• Why organizations may want to share positions or other resources
• When a sharing arrangement may make sense
• Different forms of resource sharing
• Resources that can be shared
• How to design and manage a sharing arrangement
• Common risks and how to address them

Why share positions or other resources?

Organizations may share resources for financial reasons, but cost should not be the only consideration.

Resource sharing may help organizations:

• Obtain expertise or infrastructure they could not efficiently maintain independently
• Improve access to services
• Coordinate related programs
• Reduce unnecessary duplication
• Strengthen organizational capacity
• Improve continuity across services
• Develop new partnerships
• Share learning and professional development
• Respond to emerging community needs
• Make more efficient use of facilities, technology, or specialized personnel

Financial and operational capacity

Small and community-based organizations may need accounting, human-resources, legal, evaluation, technology, clinical, communications, facilities, or administrative capacity that would be expensive to maintain individually.

Several organizations may be able to share those resources through:

• A jointly funded position
• A shared-services organization or provider
• Group purchasing
• Shared facilities
• Shared technology
• A collaborative grant
• Reciprocal service arrangements

Cost savings should not be assumed. Some collaborations require additional coordination, technology, legal work, management, and administrative capacity.

Before entering an arrangement, estimate both the savings and the new costs it may create.

Better and more coordinated services

Sharing may improve services when organizations contribute complementary expertise.

For example, a housing organization and an adult-education provider might coordinate so that people experiencing housing instability can access education without navigating two disconnected systems.

A health organization and a transportation provider might coordinate access to appointments. Several community organizations might share interpreters, outreach staff, evaluation expertise, or training.

The purpose should be to improve the experience and outcomes of the people involved, not merely to reduce organizational expenses.

Shared goals and collective capacity

Organizations may also share resources because they are working toward compatible community goals.

Several public-health organizations might coordinate communication, jointly train staff, share evaluation tools, or support complementary advocacy efforts.

Partners do not need identical missions or perspectives. They do need enough alignment on the purpose of the arrangement, ethical standards, responsibilities, and expected outcomes to work together effectively.

Mission should remain central

A new grant, donated facility, staff-sharing opportunity, or technology platform may appear financially attractive while pulling an organization away from its mission.

Before agreeing, ask:

• Does this arrangement advance our mission?
• Does it address an actual organizational or community need?
• Do we have the capacity to manage it?
• Will it improve or maintain service quality?
• What new costs and risks will it create?
• Does it create burdens for staff or participants that have not been considered?

When should an organization consider a sharing arrangement?

When a needed resource becomes available

An organization may learn that another group has available space, technology, staffing capacity, expertise, or funding that aligns with a need already identified.

Availability alone is not enough. Determine whether the arrangement makes strategic and operational sense before committing.

When several organizations are addressing the same or related community need

Organizations may be able to coordinate more effectively than each could work independently.

For example, an increase in unmet HIV prevention or care needs might lead health organizations, community organizations, and outreach programs to coordinate staff, referral systems, testing access, or communication.

An economic downturn might lead workforce, education, housing, and human-service organizations to coordinate services for people experiencing unemployment or financial instability.

When a specialized resource is needed only part of the time

An organization may not need a full-time:

• Accountant
• Human-resources professional
• Information-technology specialist
• Evaluation specialist
• Interpreter
• Communications professional
• Grants professional
• Attorney or compliance professional

Sharing access to specialized expertise can sometimes be more practical than each organization creating a separate position.

When a short-term disruption requires a temporary solution

A temporary arrangement may help when:

• Facilities suddenly become unavailable
• Equipment fails
• A key position becomes vacant
• A service faces an unexpected interruption
• A community emergency creates additional demand

Emergency arrangements should still address safety, confidentiality, supervision, accessibility, insurance, and other essential requirements.

When organizations want to explore deeper collaboration

Resource sharing can also be a deliberate strategic choice rather than a response to financial pressure or crisis.

Organizations may jointly explore whether shared services, coordinated programs, affiliation, co-location, or another arrangement could improve community impact and organizational sustainability.

Different types of sharing arrangements

Donated or in-kind resources

Businesses, organizations, individuals, public agencies, faith and spiritual communities, property owners, and other partners may donate or provide access to:

• Goods
• Supplies
• Equipment
• Facilities
• Professional expertise
• Staff assistance
• Transportation
• Technology

Clarify the nature and value of the contribution for accounting purposes and do not make assumptions about its tax treatment.

In particular, the value of donated time or professional services is generally not treated the same way for federal charitable-deduction purposes as a donation of qualifying property. The use of facilities or equipment may also have different tax treatment from an outright property contribution.

Organizations and donors should obtain appropriate tax or accounting advice when necessary.

Reciprocal service or resource exchanges

Two or more organizations may agree to provide resources or services to one another.

For example:

• One organization may provide career-navigation services while another provides educational services.
• One partner may provide meeting space while another provides training.
• Organizations may exchange specialized professional support.

Even when little or no cash changes hands, document the arrangement.

Clarify:

• What each organization will provide
• Expected volume or level of service
• Timing
• How the resources will be valued for accounting purposes when necessary
• What happens if one organization can no longer provide its part

Reciprocal arrangements may have accounting, employment, tax, insurance, or contractual implications even when they are informally described as barter.

Shared costs

Organizations may jointly pay for:

• Facilities
• Personnel
• Technology
• Equipment
• Insurance
• Training
• Purchasing
• Professional services

Costs do not necessarily need to be divided equally.

They may instead be allocated according to:

• Staff time
• Number of users
• Square footage
• Transaction volume
• Expected use
• Another documented allocation method

Agree on the allocation method before costs are incurred and review it periodically to determine whether it remains fair and accurate.

Collaborative grants, subawards, and contracts

Two or more organizations may collaborate on a funded project.

Possible structures include:

• One organization serving as the primary recipient and providing subawards to other organizations
• One organization purchasing defined goods or services from contractors
• Several organizations carrying out clearly assigned portions of a project
• A consortium or other formally structured collaboration

For federal awards, the distinction between a subrecipient and a contractor is based on the substance of the relationship, not merely what the parties call the agreement.

A subrecipient generally carries out part of the federal program, while a contractor generally provides goods or services needed for the project.

A pass-through entity may have responsibilities involving:

• Subaward terms
• Risk assessment
• Monitoring
• Financial and performance reporting
• Recordkeeping
• Corrective action
• Closeout

Review the specific award terms and current federal, state, local, tribal, territorial, or private-funder requirements rather than relying on informal descriptions such as "lead agency."

Different types of resources that can be shared

Shared staffing

Organizations may share a staff member when each needs only part of a position or when one employee's expertise supports several related programs.

Examples might include shared:

• Finance staff
• Human-resources staff
• Information-technology staff
• Interpreters
• Community outreach workers
• Counselors or clinicians
• Evaluators
• Grants professionals
• Communications staff

Shared-staff arrangements require especially clear planning.

Determine:

• Which organization is the employer of record
• Who issues payroll and provides benefits
• Who supervises the employee
• Who sets priorities
• How time is allocated and documented
• Who conducts performance reviews
• How leave and scheduling are handled
• Which policies apply
• How workplace accommodations are handled
• How confidentiality and data access are managed
• How conflicts between organizations are resolved
• What happens if one partner withdraws

Depending on the arrangement, employment-law questions may arise concerning the employer relationship, wages, benefits, workers' compensation, supervision, or other obligations. Obtain appropriate professional guidance when necessary.

Involve the employee from the beginning

Do not design a shared position entirely at the leadership level and then hand the resulting responsibilities to the employee.

The person doing the work should understand:

• Duties
• Workload
• Reporting relationships
• Scheduling
• Performance expectations
• Access to systems and information
• Confidentiality obligations
• How conflicting priorities will be resolved

A shared position should not function as two full jobs compressed into one position.

Shared professional development

Organizations may jointly provide:

• Staff training
• Leadership development
• Compliance training
• Clinical training
• Technology training
• Conferences
• Communities of practice

Joint learning can reduce costs while strengthening relationships among organizations.

Space and facilities

Organizations may:

• Use the same facility at different times
• Divide a facility among several organizations
• Co-locate complementary services
• Sublease space
• Obtain donated space
• Jointly lease or purchase property

Co-location can make referrals and coordinated services easier, but it also requires attention to:

• Lease or sublease authority
• Landlord approval
• Zoning and occupancy requirements
• Disability accessibility
• Safety and security
• Insurance
• Utilities
• Cleaning and maintenance
• Storage
• Scheduling
• Confidential conversations
• Participant privacy

Joint property ownership can provide long-term stability, but it also creates substantial financing, maintenance, governance, capital-repair, insurance, and exit responsibilities. It should be evaluated as a major long-term commitment rather than simply as a way to lock in occupancy costs.

Equipment and technology

Shared resources may include:

• Computers
• Printers and scanners
• Telecommunications systems
• Vehicles
• Specialized program equipment
• Software
• Cloud platforms
• Data systems
• Internet or network infrastructure

Address:

• Ownership
• Licensing
• Maintenance
• Replacement
• Scheduling
• Technical support
• Cybersecurity
• User access
• Data backup
• Responsibility for loss or damage

Administrative and back-office services

Organizations may share:

• Accounting
• Payroll
• Human resources
• Benefits administration
• Purchasing
• Information technology
• Legal services
• Insurance administration
• Evaluation
• Grant administration

Shared back-office arrangements can strengthen infrastructure, particularly for smaller organizations, but savings should not be assumed. Adequate implementation and management capacity may require additional investment.

Information, referral systems, and data

Organizations may share information about:

• Community resources
• Referral options
• Grant opportunities
• Training
• Publicly available research or planning data

Sharing identifiable participant, client, student, patient, employee, donor, or member information requires much more care.

Do not casually exchange mailing lists, contact lists, case information, or other personal data simply because organizations are partners.

Determine:

• What information is actually necessary
• Whether people have been appropriately informed or have provided required permission
• What laws, contracts, and organizational policies apply
• Who may access the information
• How it will be secured
• How long it will be retained
• What happens when the partnership ends

A formal data-sharing or data-use agreement may be appropriate.

Purchasing and supplies

Organizations may reduce some costs through cooperative purchasing of:

• Office supplies
• Technology
• Insurance
• Training
• Professional services
• Program supplies

Consider purchasing authority, payment procedures, ownership, warranties, vendor terms, procurement requirements, and how costs will be allocated.

How do you create and manage a shared position or other resource?

1. Define the need first

Begin with the organizational or community need rather than with an available partner or funding opportunity.

Ask:

• What problem are we trying to solve?
• What resource is actually needed?
• Do we need it permanently, periodically, or temporarily?
• Would sharing improve quality, access, capacity, or sustainability?
• Would another solution be simpler or more effective?

2. Identify appropriate partners

Potential partners do not need to share an identical worldview, but they should have enough compatibility to manage the proposed arrangement responsibly.

Consider:

• Mission alignment
• Organizational capacity
• Reputation and reliability
• Financial stability
• Governance
• Service quality
• Ethical standards
• Community relationships
• Accessibility
• Communication style
• Experience with collaboration

3. Involve the people affected by the arrangement

Leadership should not design a collaboration in isolation when staff, volunteers, participants, or community partners will experience its consequences.

Depending on the arrangement, ask affected people about:

• Workload
• Access
• Scheduling
• Privacy
• Service continuity
• Transportation
• Technology
• Cultural and language needs
• Concerns about the proposed partner

4. Conduct due diligence

Understand the organizations and resources involved before making a commitment.

Depending on the arrangement, review:

• Financial condition
• Insurance
• Existing contracts
• Lease restrictions
• Employment policies
• Technology and cybersecurity
• Licensure or professional requirements
• Grant requirements
• Privacy obligations
• Past partnership experience

5. Calculate the full cost

A shared resource may cost less than maintaining one independently, but include the costs of:

• Staff time
• Supervision
• Coordination meetings
• Legal and accounting work
• Insurance
• Technology
• Administration
• Training
• Compliance
• Evaluation

Do not create a collaboration that appears inexpensive only because one organization or its staff are absorbing uncompensated costs.

6. Define responsibilities clearly

Agree on:

• Purpose
• Scope
• Roles
• Decision-making authority
• Staffing
• Supervision
• Costs and payment
• Performance expectations
• Participant communication
• Data and privacy
• Ownership of property and intellectual property
• Insurance and liability
• Reporting
• Evaluation

7. Put significant agreements in writing

A written agreement might take the form of:

• A memorandum of understanding
• A service agreement
• A lease or sublease
• A cost-sharing agreement
• A data-sharing agreement
• A contract
• A subaward
• Another agreement appropriate to the arrangement

The agreement should be detailed enough that the partners do not have to rely on memory or informal assumptions when a disagreement occurs.

Depending on the relationship, include:

• Effective dates
• Renewal procedures
• Financial terms
• Deliverables
• Reporting
• Confidentiality
• Insurance
• Dispute-resolution procedures
• Corrective-action procedures
• Termination provisions
• Transition responsibilities

Obtain legal, accounting, human-resources, insurance, or other professional review when warranted.

8. Establish governance and communication

Decide who communicates with whom, about what, and how often.

Shared staffing may require regular contact among supervisors and the employee. A joint program may require implementation meetings. Shared space may require a facilities contact. A collaborative grant may need financial, programmatic, and evaluation meetings.

Establish:

• Regular meeting schedules
• Named contacts
• Decision-making procedures
• Escalation procedures
• Documentation expectations

9. Plan for continuity and exit

Every important shared arrangement should consider what happens when:

• Funding ends
• A key employee leaves
• A partner withdraws
• The organizations disagree
• The resource is no longer needed
• One organization closes or restructures

An exit plan may address:

• Notice requirements
• Participant continuity
• Records and data
• Equipment
• Financial obligations
• Staff transitions
• Communication with funders and partners

10. Evaluate and adapt

Review the arrangement periodically.

Ask:

• Is it meeting the original need?
• Are services better or more accessible?
• Are costs consistent with expectations?
• Is workload manageable?
• Are responsibilities clear?
• Are participants experiencing new barriers?
• Are there privacy, technology, compliance, or safety concerns?
• Is the partnership still aligned with each organization's mission?

Modify the agreement when appropriate rather than preserving an arrangement simply because it already exists.

Common barriers to sharing and how to address them

Role, resource, authority, or identity conflicts

Organizations may disagree about:

• Which organization leads
• Who receives funding
• Who receives public recognition
• Which organization controls a service area
• How decisions are made
• Whose procedures apply

These disagreements are sometimes described as "turf issues," but they may reflect legitimate concerns about financial stability, accountability, community relationships, institutional identity, or different service approaches.

Address them explicitly rather than dismissing them as ego.

Clarify leadership, funding, credit, communication, service responsibilities, and decision-making at the beginning of the relationship.

Differences in mission, values, or professional practice

Partners do not need to agree on everything, but significant differences may make some arrangements inappropriate.

Discuss:

• Program standards
• Professional ethics
• Nondiscrimination
• Accessibility
• Confidentiality
• Evidence and service models
• Advocacy positions when relevant

Compromise can help resolve operational differences, but organizations should not compromise legal requirements, participant safety, professional ethics, or essential service quality merely to preserve a partnership.

Unequal power and resources

A larger organization may control the money, facilities, technology, or grant relationship while a smaller organization contributes community relationships or specialized expertise.

Avoid arrangements in which one partner absorbs disproportionate uncompensated work or has little meaningful influence over decisions that affect its responsibilities.

Community-based expertise, relationship-building, coordination, and outreach are real resources and should be budgeted and valued appropriately.

Lack of communication

Communication should be structured rather than left to chance.

Determine:

• What information each partner needs
• Who provides it
• How often
• How urgent concerns are raised
• How decisions are recorded

Performance or capacity problems

A partner may miss deadlines, provide lower-than-expected service levels, lose key staff, experience financial problems, or be unable to meet compliance requirements.

Address problems promptly and specifically.

A response may include:

• Clarifying expectations
• Identifying the cause
• Providing appropriate technical assistance
• Adjusting roles or timelines
• Developing a corrective-action plan
• Exercising remedies specified in the agreement
• Ending the arrangement if necessary

Staff overload or conflicting supervision

Shared employees can experience conflicting requests from several supervisors or organizations.

Prevent this by defining:

• Priority-setting authority
• Workload limits
• Scheduling
• Escalation procedures
• Performance-management responsibility

Monitor the arrangement for burnout and workload imbalance rather than assuming employees will resolve competing demands themselves.

Confidentiality and data problems

Co-location, shared technology, shared staff, or integrated services can increase the risk that information is accessed by people who should not receive it.

Use appropriate:

• Access controls
• Data-sharing agreements
• Confidential spaces
• Staff training
• Secure technology
• Record-retention and destruction procedures

Financial misunderstandings

Problems can arise when organizations have different assumptions about:

• Which costs are included
• Who pays indirect or administrative expenses
• When invoices will be paid
• How staff time is documented
• Who owns purchased equipment
• What happens when funding ends

Develop a complete budget and payment process before implementation.

Grant and contract compliance

Jointly funded work may create responsibilities that differ considerably from a simple informal collaboration.

Review:

• Award terms
• Allowable costs
• Procurement requirements
• Subrecipient requirements
• Recordkeeping
• Monitoring
• Reporting
• Audit requirements
• Closeout

Do not assume that every partner has the same legal relationship to a funder simply because all organizations participate in the same project.

In Summary

Sharing positions and other resources can help organizations strengthen capacity, improve services, coordinate related work, and use specialized resources more efficiently.

Shared arrangements may involve staff, space, equipment, technology, professional services, information, purchasing, donated resources, reciprocal exchanges, cost sharing, collaborative grants, contracts, or subawards.

Cost should not be the only reason to collaborate. Evaluate whether the arrangement advances mission, improves community benefit, maintains quality and accessibility, and is realistic for the organizations and people involved.

Shared staffing requires especially careful planning. Clarify the employer relationship, supervision, workload, compensation, time allocation, confidentiality, performance expectations, and procedures for resolving conflicting priorities. Involve the employees who will actually carry out the arrangement before commitments are finalized.

Shared data, technology, and facilities also require contemporary safeguards involving privacy, cybersecurity, accessibility, insurance, contractual authority, and service continuity.

Collaborative grants require clear understanding of each organization's legal and financial role. When federal funds are involved, distinguish subrecipients from contractors according to the substance of the relationship and follow applicable monitoring and compliance requirements.

Put significant arrangements in writing. Define roles, costs, decision-making, communication, performance expectations, data responsibilities, dispute resolution, evaluation, and termination or transition procedures.

Finally, continue evaluating the arrangement. Partnerships do not need to continue simply because they were once useful. Adapt, expand, reduce, or conclude the relationship when evidence, staff experience, community needs, organizational capacity, or funding conditions change.

You know the reasons to consider sharing positions or resources:

___Money

___Creating better services or stronger initiatives

___Shared philosophy

You know when to consider a sharing arrangement:

___When money or resources are available

___When there's an emergency or deadline

___When there's a particular community need to address

___When it's just a good idea whose time has come

You know the different types of sharing arrangements:

___Donations

___Bartering

___Sharing of costs

___Joint grants

You know the different resources that can be shared:

___People

___Space

___Equipment

___Miscelleneous

You have done the following in your attempt to create and manage a sharing arrangement:

___Taken the initiative to organize an arrangement

___Found partners you get along with

___Been honest and clear with your proposal

___Haven't been discouraged with refusal

___Drafted a written agreement

___Communicated with the other members of you arrangement

___Continued reevaluations of the arrangement

You have addressed the following barriers:

• Turf issues

___Chosen your partners carefully and thought out beforehand your compatibility

___Planned for the good of the collaboration as a whole

___Kept your real purpose in mind

___Been prepared to compromise

___Drafted a written agreement

• Lack of communication

___Set up a good system of communication

___Specified its use

___Defined and upheld clear communication agreements

• Non-performance

___Considered your partners carefully

___Made sure written agreement includes clear explanation of repercussions should a party not fulfill its obligations

___Addressed problems immediately

Example: Kansas City Develops MOU and Shares Space with Community Organizers

Case study: the Kansas City, Missouri Health Department has developed a long-term close and synergistic relationship with Communities Creating Opportunity, a largely faith-based community organizing group. The relationship has enriched both organizations’ capacity to do meaningful community engagement and enact upstream policy change. Read more.

For several years, a community youth-development program has provided mentoring, academic support, leadership development, and other services for young people facing significant barriers. Evaluation and participant feedback suggest that the program is valued and is contributing to positive educational and developmental outcomes.

The program was launched with time-limited pilot funding. That funding is ending, however, and the original funder does not support ongoing operations.

Program leaders now need to determine whether the service should continue, whether it should be adapted, and what long-term organizational and financial structure could support it.

One possibility is recurring support through a city, county, public agency, school system, health organization, or another institution whose responsibilities and priorities align with the program.

That support might take the form of a recurring appropriation, institutional budget allocation, grant, contract, reimbursement arrangement, or integration of the program into another organization's regular operations.

The goal is not simply to place the organization's name permanently in a budget. It is to determine whether effective and still-needed services should receive recurring institutional support and, if so, what funding and accountability structure is appropriate.

What do we mean by becoming part of an existing budget?

An organization or program becomes part of an existing budget when a public agency, government, school system, health organization, nonprofit, foundation, business, or other institution formally allocates resources to support the work.

Depending on the setting, this might include:

• A recurring appropriation for a program or service
• A budget allocation to a government department that then administers the service
• A grant program through which eligible organizations compete for funding
• A contract for specified services
• A recurring institutional budget allocation
• Integration of the program and its staff into a larger organization
• Reimbursement through an established financing system
• A shared funding arrangement among several organizations or jurisdictions

The exact meaning of a "line item" varies by budget system.

In some budgets, a line item identifies a specific expense category, program, organization, or purpose. Other governments increasingly organize budgets around programs, services, outcomes, or departments rather than naming individual community organizations.

Do not assume that being mentioned in an adopted budget automatically creates an unconditional payment or permanent entitlement to future funding.

Depending on the jurisdiction and funding structure, additional requirements may include:

• Appropriation authority
• Procurement
• Grant competition
• Contract negotiation
• Performance requirements
• Insurance
• Reporting
• Audit or monitoring requirements
• Renewal or reauthorization

Government Finance Officers Association guidance emphasizes understanding services, costs, performance, demand, trade-offs, and long-term financial sustainability in public budgeting. A recurring funding request should therefore be connected to the public service or community outcome being purchased, not simply to the continued existence of a particular organization.

Public budget allocations

A city, county, tribal, territorial, regional, or other government may appropriate funding for a particular service or program.

Depending on local law and practice, the budget may:

• Identify a specific organization
• Fund a government department that contracts for the service
• Establish a competitive grant program
• Fund a service category available to several eligible providers
• Incorporate the service into government operations

Organizations should learn how the specific jurisdiction structures and administers its budget rather than assume that one model applies everywhere.

Agency or departmental budgets

A program may receive recurring funding through a particular public agency or department rather than through a separate organization-specific appropriation.

For example, a county youth-services department might include funding for community-based mentoring, education, mental health, recreation, or violence-prevention services within its operating budget.

The department may provide those services itself or use grants or contracts with outside organizations, depending on applicable law, policy, procurement requirements, and service-delivery decisions.

Organizational budgets

A nonprofit, school system, health organization, university, faith or spiritual community organization, foundation, or other institution may incorporate a program into its regular operating budget.

This could involve:

• Contracting with another organization to provide the service
• Employing staff who previously worked for the original program
• Integrating the program into existing operations
• Providing facilities, administration, or technology
• Sharing responsibility with the original organization

A long-term arrangement should clarify governance, staffing, funding, program standards, evaluation, data responsibilities, intellectual property, and what happens if the supporting organization later changes priorities.

When might you seek recurring budget support?

Recurring institutional funding may be appropriate when a program or service has demonstrated a continuing community purpose and requires a more predictable resource base.

It should not be pursued simply because the organization wants to survive.

When a successful pilot is ending

Time-limited grants often support testing or initial implementation rather than permanent operations.

Before seeking recurring support, ask:

• Does the need still exist?
• Was the program implemented as intended?
• What outcomes occurred?
• What can reasonably be attributed to the program?
• Who participated and who was missed?
• Did participants and community partners find the program useful?
• What should be changed before continuation?
• What will the program cost at full scale?

When a community service has an ongoing public purpose

Some services address continuing responsibilities or priorities that may be appropriate for ongoing public or institutional financing.

Examples may include:

• Youth development
• Public health
• Behavioral health
• Housing stability
• Transportation
• Education
• Disability services
• Child and family services
• Community safety

A request for public funding should explain how the service contributes to legitimate public goals and how the proposed funding fits within broader community priorities and available resources.

When current financing is fragmented or administratively burdensome

An organization may rely on many small, short-term grants or contracts that require substantial staff time to obtain and administer.

Recurring institutional support may reduce some of that burden.

However, recurring funding can still involve reporting, contracting, compliance, monitoring, procurement, and renewal. Do not describe it as unrestricted or guaranteed unless that is actually the case.

When another organization is better positioned to sustain the program

The best sustainability outcome may be for another organization to incorporate the program rather than for the original organization to secure its own recurring budget allocation.

Consider:

• Mission fit
• Staff expertise
• Community relationships
• Facilities
• Administrative capacity
• Funding
• Accessibility
• Long-term governance

When might recurring budget support not be appropriate?

When the program has not demonstrated value

Do not seek permanent or recurring public support merely because an organization has operated for many years or because staff strongly believe in the work.

Use appropriate evaluation to understand:

• Implementation quality
• Reach
• Outcomes
• Participant experience
• Equity
• Costs
• Unintended consequences

Observing that participants improved after receiving services can be useful evidence, but it does not automatically establish that the program caused the improvement.

When another organization can provide the service more effectively

Organizational survival should not take priority over community benefit.

If another capable organization can provide a needed service more effectively, accessibly, equitably, or sustainably, integration, transfer, collaboration, or another arrangement may be preferable.

When the funding mechanism would create unfair or unnecessary barriers

An organization-specific appropriation may be inappropriate if it bypasses required competitive processes, creates avoidable inequities among providers, or restricts a government's ability to evaluate different service-delivery options.

Current public-finance practice emphasizes careful analysis of service quality, performance, costs, risks, and alternatives when deciding how a public service should be delivered.

When continued funding would create mission drift

Funding conditions may require an organization to change its services, population, methods, data practices, or priorities.

Before accepting a recurring arrangement, ask whether those requirements remain consistent with:

• Mission
• Professional standards
• Ethics
• Community priorities
• Organizational capacity

Potential benefits of recurring institutional funding

Greater financial predictability

A recurring budget allocation may make planning easier than relying entirely on short-term grants.

It may help an organization:

• Retain staff
• Plan services over a longer period
• Maintain facilities or technology
• Invest in evaluation and quality improvement
• Reduce time spent repeatedly seeking replacement funding

Recurring does not mean guaranteed. Government and organizational budgets can change because of revenue, law, leadership, performance, economic conditions, policy decisions, emergencies, and changing community priorities.

Better integration into service systems

Budget inclusion may make a program part of a broader service system and strengthen:

• Referrals
• Coordination
• Data and evaluation
• Professional relationships
• Planning

Recognition of an ongoing public or institutional responsibility

A recurring appropriation can indicate that a government or institution has chosen to treat a service as part of its ongoing responsibilities.

That decision should be based on community priorities, evidence, public value, and available resources rather than on organizational prestige alone.

Potential risks of recurring budget support

Dependence on one funder or institution

Replacing several grants with one public or institutional allocation may simplify funding while creating concentration risk.

If that allocation is reduced or eliminated, the organization may face a substantial financial shock.

Continue assessing revenue concentration, reserves, contingency plans, and alternative funding options.

Reduced organizational autonomy

A government or larger organization providing substantial funding may establish:

• Program requirements
• Performance measures
• Reporting requirements
• Eligibility criteria
• Staffing standards
• Financial controls

Clarify these requirements before entering the arrangement.

Competition or conflict among community providers

Public resources are limited. Funding one organization may reduce resources available for another service or provider.

Consider:

• Community need
• Service overlap
• Equity
• Quality
• Cost
• Whether collaboration or a broader funding category would better serve the community

Budgeting should not become a contest based primarily on which organization has the strongest personal relationships with decision-makers.

Complacency

Predictable funding should not eliminate evaluation, innovation, or accountability.

Continue reviewing:

• Whether the need still exists
• Whether the program remains effective
• Whether services are equitable and accessible
• Whether costs remain reasonable
• Whether another service model would provide greater public value

How do you pursue recurring funding in a local government budget?

Local budget processes vary considerably. Some governments use annual budgets, others use biennial processes, and the structure, timeline, public-engagement requirements, procurement practices, and roles of elected and administrative officials vary by jurisdiction.

Begin by learning the actual process.

1. Understand the budget calendar and decision process

Learn:

• When departments develop requests
• When revenue forecasts are prepared
• Who prepares the executive or proposed budget
• Which governing body adopts the final budget
• When public input occurs
• What documentation is required
• Whether outside organizations may receive direct appropriations
• Whether competitive grant or procurement processes apply

GFOA guidance emphasizes that meaningful public engagement should occur early enough to inform service priorities and trade-offs rather than only after most decisions have already been made.

2. Determine what funding mechanism is appropriate

Do not assume that an organization-specific line item is the best or only option.

Alternatives may include:

• A program appropriation
• A grant program
• A service contract
• Funding through an existing department
• A competitive procurement
• A shared initiative with several providers

Discuss options with appropriate budget, finance, procurement, legal, and program staff.

3. Define the public need and the service being requested

Frame the request around the community outcome or service, not simply the organization's financial need.

Explain:

• What need exists
• Who is affected
• What service is proposed
• Why the proposed service model is appropriate
• What evidence supports it
• What it will cost
• What outcomes will be monitored

4. Provide credible evidence

Use evidence appropriate to the decision.

This may include:

• Community needs assessments
• Administrative data
• Program evaluation
• Participation and access data
• Outcome measures
• Community and participant feedback
• Cost information
• Evidence from comparable programs

Do not claim a universal economic return such as "$1 invested saves $4" unless a credible current economic evaluation supports that estimate for the particular program and context.

5. Include community experience ethically

Lived experience can help decision-makers understand how programs and policies affect people.

Participation should be:

• Voluntary
• Informed
• Supported
• Accessible
• Respectful of privacy

Do not pressure participants to disclose traumatic, stigmatizing, medical, financial, immigration-related, or other sensitive personal information because an emotional story might strengthen a budget request.

When appropriate, compensate community members for substantial time and expertise involved in planning or public engagement.

6. Understand advocacy and lobbying rules

Organizations may educate policymakers and participate in public-policy discussions.

For section 501(c)(3) organizations, however, communications intended to influence legislation can constitute lobbying. The IRS definition of legislation includes action by a local council or similar legislative body.

A 501(c)(3) organization may conduct some lobbying within applicable limits, but organizations should understand the rules that apply to their tax status, funding, and activities and track lobbying activity when required.

Candidate campaign activity is different. Section 501(c)(3) organizations are prohibited from participating or intervening in political campaigns for or against candidates for public office.

7. Participate transparently in the public process

Appropriate activities may include:

• Meeting with relevant agency or budget staff
• Providing written budget information
• Participating in public hearings
• Providing testimony
• Responding to requests for data
• Participating in community budget-engagement processes
• Educating community members about opportunities for public participation

Relationships with public officials can help organizations understand policy and budget processes, but public funding should not be described as a personal favor from an official.

8. Understand trade-offs

Public budgeting involves choices among many legitimate needs.

Be prepared to discuss:

• Why this service should be publicly supported
• What alternatives exist
• What resources would be required
• What may receive less funding if this request is approved
• Whether collaboration with other providers would create greater value

GFOA's current budgeting framework emphasizes making trade-offs visible and connecting spending decisions to programs, services, demand, performance, and long-term financial health.

9. Follow procurement and contracting requirements

An adopted budget allocation may be only one step in establishing a funding relationship.

Depending on the jurisdiction and arrangement, the organization may still need to participate in:

• Competitive procurement
• Grant application
• Contract negotiation
• Insurance review
• Vendor registration
• Financial or compliance review

Current public-finance guidance recommends evaluating service-delivery alternatives based on service level, quality, performance, revenue, cost, transition requirements, and other relevant factors.

10. Maintain accountability after funding is approved

Recurring funding should be accompanied by continuing accountability.

Report:

• What services were delivered
• Who was reached and who was not
• Outcomes
• Equity and accessibility
• Costs
• Challenges
• Unintended consequences
• Needed adaptations

Budget monitoring should help the funding organization and the public understand whether promised services and outcomes are being delivered.

11. Reassess the arrangement during future budget cycles

Do not assume that a recurring allocation should continue unchanged forever.

Periodically ask:

• Does the need still exist?
• Is the current program still the best response?
• Have costs changed?
• Have community priorities changed?
• Is performance meeting expectations?
• Should funding increase, decrease, change form, or conclude?

How do you become part of another organization's budget?

An organizational budget arrangement differs from a public appropriation but requires many of the same questions about mission, accountability, costs, and sustainability.

1. Assess mission and program alignment

Ask:

• Do the organizations share relevant goals?
• Are service standards compatible?
• Are approaches to equity, accessibility, privacy, and professional ethics compatible?
• Would the arrangement benefit participants and communities?

2. Build relationships across appropriate organizational roles

Leadership support is important, but operational staff, finance staff, program staff, and people who will actually administer or receive the services should also understand the arrangement.

Do not make a major commitment based solely on a strong personal relationship between two executives.

3. Understand what each organization contributes

Clarify:

• Funding
• Staff
• Facilities
• Technology
• Administrative support
• Community relationships
• Expertise
• Data and evaluation
• Governance

Community relationships, lived-experience expertise, outreach, and program knowledge are valuable contributions even when they are harder to price than facilities or cash.

4. Calculate the full cost

Include:

• Direct program expenses
• Salaries and benefits
• Supervision
• Facilities
• Technology
• Insurance
• Administration
• Evaluation
• Accessibility and language access
• Communications
• Indirect costs

A recurring allocation is not sustainable if the receiving organization consistently absorbs unfunded costs.

5. Clarify governance and autonomy

Determine:

• Who controls program decisions
• Who employs and supervises staff
• Who controls funds
• Which policies apply
• How performance is evaluated
• Who owns program materials or intellectual property
• What happens if the organizations disagree

6. Involve affected participants and staff

If a program is moving into another organization, ask how the change may affect:

• Service location
• Eligibility
• Hours
• Staffing
• Language access
• Disability access
• Privacy
• Community trust

7. Put substantial arrangements in writing

Depending on the relationship, use an appropriate:

• Contract
• Memorandum of understanding
• Grant agreement
• Subaward
• Program-transfer agreement
• Data-sharing agreement

Clarify funding, roles, reporting, performance, staffing, data, insurance, renewal, termination, and transition responsibilities.

8. Maintain the relationship while it remains useful

Continue communication, evaluation, and problem-solving for as long as the organizations share responsibilities.

A partnership does not need to continue indefinitely simply because it once worked well. Adapt or conclude the relationship when community needs, mission, capacity, funding, or service conditions change.

In Summary

Recurring support through an existing government or organizational budget can provide greater financial predictability for effective community services, but it should not be understood as a permanent guarantee of funding or as a mechanism for preserving an organization for its own sake.

Begin by determining whether the service is still needed, whether evidence supports continuation, and whether the current organization is the best entity to provide it.

Public budgets involve trade-offs among community priorities. Funding requests should therefore explain the public need, service model, full cost, expected outcomes, accessibility, equity, and evidence rather than relying primarily on political connections or organizational visibility.

Learn the local budget process, including timelines, public-engagement opportunities, procurement and contracting requirements, and the roles of elected officials, agency staff, budget officers, and the public.

Nonprofit organizations should also understand the rules governing advocacy and lobbying. For section 501(c)(3) organizations, some attempts to influence legislative budget decisions may constitute lobbying and should be conducted within applicable limits. Candidate campaign intervention remains prohibited.

Participant and community voices can contribute important information, but participation should be voluntary, informed, accessible, and respectful of privacy. Do not rely on highly personal or traumatic stories simply because they are emotionally persuasive.

Once recurring funding is established, continue evaluating implementation, outcomes, equity, costs, and community need. Public and institutional budgets should be capable of changing when evidence and conditions change.

Ultimately, the purpose of recurring institutional funding is not to keep an organization alive indefinitely. It is to provide an appropriate, accountable, and sustainable financing structure for services and community benefits that continue to be valuable.

Becoming a line item in a state budget

Becoming a line item in a state budget should only be attempted when your financial back is against the wall. It's really an issue of being unable to find funding any other way: there's really no other reason to engage in this process.

Not being able to find funding doesn't mean that you're not sure whether some of your proposals will be funded, or that finding funding is difficult. It means that you've actually exhausted every other possible avenue to get money for your organization. There are no apparent sources of funding - now or in the foreseeable future - and you're going to cease to exist unless you can become a line item in the state budget.

There are several reasons for our insistence that a state line item should be a last resort. While becoming a state line item carries with it the advantage of long-term, stable funding, both the politics involved and the results are almost always inherently unfair.

• You are implicitly trying to convince a legislator or group of legislators that your program is worthy of statewide funding, while others are not. That casts doubt on the competence and effectiveness of other organizations, without any regard for their actual achievements.
• You may be diluting the bargaining power of an already-underfunded field. If the field can't present a united front to advocate for money from local officials , because people see getting their own line item as a better deal, its ability to gain and maintain an adequate level of funding is severely compromised.
• You could make it impossible for others to have the same privilege. When a certain critical mass of specific line items is reached - often not more than four or five - legislatures usually decide to allot no more, and even to eliminate those that already exist. They may also scrutinize the budget for that issue, and everyone may end up with less than they had before.
• You are risking the anger of your colleagues, and may therefore find it harder to work with them in the future.
• You are risking placing yourself in a position where the interests of the field - and therefore of the target population statewide - are in direct conflict with the financial interests of your organization.

The exceptions here are if your organization operates statewide, and/or is the only one of its kind in the state. Under those circumstances, a line item in the state budget might be appropriate.

That said, we'll examine how to become a line item in the state budget. States are, in most cases, not as different from one another as local governments may be. Let's take a look at a typical state budget process, one that's similar to that in a large number of states. (The process in your own state or commonwealth, of course , may differ.)

A typical state budget process 

Each state has a governor and a legislature. Most legislatures, like Congress, are bicameral (have two branches, a House of Representatives and a Senate). While some legislatures are full time, and meet, except for set recesses around holidays, year-round, others meet only a few weeks or months a year. Part-time legislators are often paid very little, and may continue to work at their regular jobs even during legislative sessions. It's important to find out how your particular state operates, since that will dictate how its budget process is similar to and different from the one described here.

First, the Governor, in conference with his Cabinet and other advisors, puts together a budget that highlights his priorities, and sends it to the legislature. The Governor 's budget goes first to the Ways and Means Committee of the House of Representatives, which (often with the participation or under the direction of the Speaker of the House) reworks it - sometimes so that it is all but unrecognizable. It then goes to the membership of the House, where it's debated and voted on. As part of the debate - which may go on for weeks - amendments (additions or changes) by individual members, often having to do with specific funding for their districts, are proposed, debated, and voted on. Eventually, a final budget, including the amendments that have been accepted, is approved on a vote by the full House.

The budget next goes through a similar process in the Senate.

We now have three budgets: the Governor's original budget (no longer relevant, but the Governor may lobby the legislature to include full funding for at least some of his priorities); the House budget; and the Senate budget. To work out the differences between their budgets, the House and Senate form a small, evenly-divided Conference Committee. The chairs of the Ways and Means Committees may co-chair it, and its members wield considerable power while it meets.

The Conference Committee, amid lobbying from other members of the legislature, eventually produces a mutually agreeable budget, which then goes to the House and Senate, where it may be debated and amended again. The final budget, approved by both houses, is sent back to the Governor.

The Governor can't add anything to the budget, but most governors have a line-item veto, meaning that they can reduce or eliminate funding for particular line items. So the Governor can approve the budget as it is; veto the whole thing (which virtually never happens); or, as is most often the case, use his line-item veto to eliminate or reduce funding for line items he doesn't like (or whose elimination will make his political enemies unhappy). The House and Senate then get the budget back, and may try to override at least some of the Governor's line-item vetoes with a 2/3 majority in each house. The budget that remains after the override process is what the state will operate on for the next fiscal year.

In most states, the aim is to have a budget in place by July 1, the beginning of the fiscal year. In reality, if there is serious disagreement between the houses or between the governor and the legislature, there may be no budget until well into the fall.

A step-by-step guide to becoming a line item in the state budget 

Find a legislative champion. Virtually the only way to get into the state budget is to have a legislator put you there. Therefore, you need to find a legislator who's willing to go to bat for your organization. The most likely candidate is one who represents the district your organization operates in, because her constituents are directly affected. If your organization has broader appeal, a legislator specifically interested in your issue may also be a possibility.

In most states, your legislator's party affiliation or relationship with the leadership may be a major issue. Being in the minority might mean that she has no clout at all. Being in the bad graces of the leadership, regardless of her party affiliation, could mean that she'll never get anything she asks for. If she's in a key leadership position, on the other hand - chair of the Ways and Means Committee, for instance - she can probably get just about whatever she wants. Look for a sponsor who can deliver.

You have an even better chance if you can get both your representative and your senator involved. If your organization works in more than one legislative district, try to get all the legislators in all the districts on board. The larger the group, the better your chances.

You might work with the legislator directly, or you may be able to accomplish your purpose through an aide. In either case, you'll have to convince her either that your organization provides an irreplaceable and necessary service to her constituents, and/or that her ability to get you into the budget means votes for her.

There are a number of ways to approach this:

•  Numbers help. If you can say something like, "We serve over 300 people a year in your district," that's a powerful motivator.
• Need helps, too. Establish the need: "Over 9,000 people in the district show up (on the Census; in an independent study; according to the county Human Service Board; etc.) as needing this service."
• Get her to visit your organization, talk to participants, walk the neighborhood with you, etc. to understand the issue better.
• Bring individual participants or small groups to visit her - at the State House if the size of the state doesn't make that too difficult - so that she can get to know some real people who experience the issue and the results of your organization 's work firsthand.
• Ask prominent members of your Board, supporters from the business community, other legislators you know, experts on the issue, etc. to talk to the legislator, and to urge her to meet your organization's need for funding.

Once you've convinced a legislator to sponsor your line item, you have to help her by putting pressure on other legislators to go along, if you can, through the remaining steps of the process. If you have connections to other legislators, you should use them. Mobilize community members or participants or both to call, write , telegraph, or e-mail legislators in support of your line item. Work with your legislative sponsor to come up with strategies to convince other legislators, and then take charge of carrying them out. You can't expect one legislator to do this in a vacuum.

Your champion asks someone in the leadership or on the House Ways and Means Committee to put your line item into the House budget. Unless she's on the Ways and Means Committee herself, or has a good deal of power in the legislature, things like this normally work on a quid pro quo basis: your legislator has to promise to return the favor, or has to have done a favor for those she's asking, so that they currently owe her one. You have to give her a good reason for putting herself in that position: she has to believe strongly in the cause, or has to believe that her support for your organization will help her in the district over the long term.

You may notice we've bypassed the Governor's budget here. It's generally not politically possible for the Governor to include a line item for a local program - he'd probably be roundly criticized in the media as soon as news people found out. It doesn't hurt to try to get to know someone in the Governor's office, however, in order to garner support or head off a line-item veto farther down the road.

If the line item isn't in the Ways and Means version of the House budget, your champion has to try to get it in by amending the budget on the House floor. Once again, this means putting herself in debt to the leadership or calling in more favors: she has to believe that her actions will help large numbers of her constituents , and/or that they'll help her own reelection chances and continued popularity in the district.

Once the House budget is done, whether or not your line item made it in, you have to play the game of garnering support all over again in the Senate. Making sure you have your state senator on your side from the beginning will make things easier. If he's been working the senate to get your line item into the budget, you may have an easy time of it. If not, you and your legislative sponsor may have to scramble. She's likely to have some contacts in the Senate, and you may have Board members, community supporters, or others who have contacts as well.

By and large, a small line item (and, in a large state with an enormous budget in the billions of dollars, "small" can mean several hundred thousand or even a few million dollars) that comes through in the House budget would be left in by the Senate as a courtesy to a colleague, unless it's part of a larger item that gets cut. If there's a budget crisis, however, or if your sponsor has powerful enemies in the Senate, there's always the chance that your line item will be eliminated there. It makes much more sense to do everything you can to make sure it's included in the Senate version in the first place than to have to try to get it in later.

The ideal here is to end up with your line item appearing in both the House and Senate budgets with the same amount of money allotted to it in each. If that happens, the Conference Committee will leave it alone, and your effort is done unless the Governor vetoes it.

If your line item doesn't make it into the House budget, the Senate is obviously crucial. Getting it into the Senate budget means that it will at least be a matter of discussion in the Conference Committee. If it doesn't get into the Senate budget, your chances of success almost disappear.

Almost, but not quite. If your line item isn't included in either budget, you still have one (slim) chance: the Conference Committee. It's possible to convince members of the Conference Committee to put your line item in the budget...but there 's almost no reason they would if it hasn't gotten in to this point. It's your last chance, however, so you better take it. Otherwise, you're out of the race.

The budget, with your line item in it, now has to be signed by the Governor to become official. (Here's where having a friend or contact in the Governor's office can come in handy.) If he leaves your line item alone, you're home free; if he vetoes it or reduces its appropriation, you have only one chance left.

Override. If you and your sponsors can muster a 2/3 vote in both houses, you 're finally in the clear. Once again, it's a matter of bringing to bear any pressure you can muster in any way you (ethically) can.

Although a state budget, and each line item in it, is only good for one year, line items like this, once they're in the budget, tend to remain undisturbed until the economy goes bad or there's an effort to reform the budget (the two often come together). Then, every line item might be scrutinized, and yours may be in jeopardy. By then, you may no longer need it...but if you do, you may have a problem. The legislator who sponsored it may be gone, and unless you've maintained contact with her successor(s), you may be left with no defenders. In that case, you'd better find another source of funding.

It's also your job to be ethical about your situation. If and when you get to the point where your organization no longer needs its own special line item in the state budget - either because you've gotten public funding on your own or because you've found other funding adequate to support your work - have yourself taken out. Your colleagues will thank you, your legislators will be impressed with your integrity , and you'll feel better about the organization's ability to be self-supporting. Even if you get to that point, however, don't be a fair weather political friend. Maintain your state and local contacts: you owe them something, they're important in any case, and you never know when you may need them again.

What do we mean by becoming a line item in an existing budget?

___You understand what a line item is.

___You're aware of the different ways of becoming a line item in a local public or organizational budget.

When would you want to become a line item in an existing budget?

___You're trying to become a line item because your financial back is against the wall, and there are simply no other funding sources available to you.

___You're trying to become a line item to stabilize your funding, and to avoid spending so much time searching for and applying to small funding sources.

___You're attempting to become a line item as part of your basic local funding.

___You're attempting to become a line item to change policy on your issue, to increase your credibility, or to take advantage of a one-time opportunity.

Why would you want to become a line item in an existing budget?

___You know the advantages of becoming a line item:

• Your organization will stay alive and continue to operate.
• You'll get a large chunk of stable funding that you don't have to compete for every year.
• You'll gain the attention and protection of whoever put you in the budget.
• Having stable funding may allow you to be more creative in what you do.
• It can free you from administrative drudgery.
• It can expand the range of services of your organization by giving you access to those of another organization as well.
• It can leave you with a mutually beneficial collaborative relationship with another organization.
• It can establish you as a partner of a larger organization, and may thus work to improve your standing in the community.

___You're aware of the potential disadvantages of becoming a line item:

• You may anger colleagues by bypassing a funding process they still have to contend with.
• You may be taking money away from other, equally-needed services.
• Rather than freeing you to be creative, it may make your organization complacent :
• It may not be ethically consistent with your organization's view of the world.
• You may be dependent on another organization's funders.
• You may be dependent on another organization's continued interest in sponsoring your work.
• You may have to give over control of your organization and your work to another organization in return for the budget line item.
• The other organization could use its position to push you in directions different from those you'd prefer to go in, or even to take over your work.
• You may find that you have serious philosophical differences with the other organization, or that your methods of operation are incompatible.

How do you become a line item in an existing local government budget?

___You are totally familiar with the budget process and timelines.

___You have personal contacts with most or all of the people who might have some influence on whether you become a line item or not.

___You make sure that all the appropriate people understand all the possible arguments for making you a line item, and have all the information they need to make those arguments to others.

___You maintain contact with those involved in the budget, and continue to push your point.

___You continue to follow up once you have become a line item, so that you can maintain your status.

How do you become a line item in an organizational budget?

___You consider carefully the mission, philosophy, methods, target population, etc. of the organization you're considering.

___You make personal contacts at more than one level of the organizations.

___You think about what each organization can offer the other.

___You establish mutual trust before you enter into any agreement.

___You work out any agreement carefully beforehand.

___You put it in writing.

___You continue to maintain and build your relationship, even if you reach a point where you no longer need the line item.

A community youth-leadership initiative was created as a time-limited pilot. Over several years, it has developed leadership training, mentoring, peer-support opportunities, and community projects led by young people.

Evaluation and participant feedback suggest that important parts of the work should continue. The pilot funding is ending, however, and the organization has not identified a sustainable way to continue independently.

One possible path is to transfer or integrate the program into another youth-serving organization that has compatible goals, stronger infrastructure, and the capacity to sustain the work.

Such a transition may preserve valuable services, staff expertise, community relationships, and institutional knowledge. But it should not be treated simply as finding another organization willing to "take over."

A major organizational transition may involve governance, employment, finances, contracts, restricted funds, assets, liabilities, participant records, donor information, intellectual property, insurance, technology, grants, leases, licensing, and legal dissolution or merger requirements.

The organizations should therefore evaluate the transition carefully and involve appropriate legal, financial, human-resources, tax, insurance, information-security, and other professional expertise when needed.

What does it mean to transfer or integrate operations into another organization?

There is no single structure for transferring community work from one organization to another.

Possible arrangements include:

• Program transfer. A specific program, service, or activity moves to another organization while the original organization continues other work.
• Asset transfer. Selected assets used for charitable work are transferred to another eligible organization under applicable legal, donor, grant, and contractual requirements.
• Merger. Two organizations legally combine according to applicable state nonprofit-corporation law and other requirements.
• Affiliation. Organizations create an ongoing relationship while retaining some degree of separate legal identity.
• Controlled affiliate or subsidiary structure. An organization remains legally separate but becomes part of a larger organizational structure with defined governance relationships.
• Administrative consolidation. Organizations share or consolidate administrative functions without combining all programs.
• Dissolution with transfer of charitable assets or programs. The original organization winds down and transfers eligible assets or activities according to an approved dissolution plan.

The appropriate structure depends on the goals of the transition, state law, tax status, finances, assets, liabilities, governance, contracts, funding, employment issues, participant needs, and the degree to which the organizations want to remain separate.

Do not use terms such as merger, subsidiary, acquisition, or takeover interchangeably. They can describe legally and operationally different relationships.

The organization may disappear while the work continues

Sometimes the strongest sustainability outcome is not continued existence of the original organization.

An organization may have:

• Accomplished the purpose for which it was created
• Reached a point where another organization can provide the service more effectively
• Lost the financial or organizational capacity to continue independently
• Created a program intended from the beginning to be incorporated into another institution
• Determined that collaboration, merger, transfer, or dissolution would advance the mission more effectively

The question should be:

What structure best protects and advances the community benefit, mission, participants, staff, charitable assets, and effective practices involved?

Maintaining an organization's name, legal identity, or exact program model is not automatically the same as sustaining its mission.

When should you consider transferring or integrating operations?

When independent continuation is no longer financially sustainable

An organization may face:

• Loss of a major grant or contract
• Repeated operating deficits
• Insufficient cash flow
• Declining contributions
• Increasing operating costs
• An inability to maintain needed staffing or infrastructure
• Expiration of time-limited pilot funding

Financial crisis can make restructuring urgent, but it is also a reason for careful analysis. Strategic alliances and mergers require substantial staff and board time, due diligence, professional expertise, and financial resources.

Do not wait until cash has nearly disappeared if financial trends indicate that a transition may be necessary.

When leadership succession cannot be secured

An organization may depend heavily on a founder, executive director, or small group of leaders whose departure creates substantial risk.

Before assuming that dissolution or transfer is necessary, consider:

• Succession planning
• Leadership recruitment
• Interim leadership
• Shared leadership
• Partnerships or affiliation
• Merger or program transfer

When the organization has accomplished its distinctive purpose

Some organizations are intentionally temporary.

They may exist to:

• Launch a new community service
• Build local leadership
• Create a coalition or independent organization
• Achieve a policy change
• Develop infrastructure that can later be maintained elsewhere

Closing an organization after accomplishing its purpose is not necessarily failure.

When another organization can provide greater community benefit

Another organization may have:

• Stronger financial infrastructure
• More stable staffing
• Greater geographic reach
• Better disability or language access
• More convenient locations or service hours
• Complementary programs
• Greater technology or administrative capacity
• Stronger clinical, educational, or professional expertise

Organizational identity should not take priority over community benefit.

When integration was planned from the beginning

A coalition or pilot project may deliberately create a new intervention with the expectation that an established organization will eventually assume responsibility.

When possible, involve the future host organization early so that funding, staffing, data, evaluation, program standards, and transition responsibilities can be designed with long-term integration in mind.

When a potential partner proposes a merger, affiliation, or program transfer

An unsolicited proposal may create an opportunity, but do not accept simply because the other organization is larger or financially stronger.

Evaluate the proposal according to mission, community benefit, organizational capacity, finances, governance, risk, staff implications, and participant experience.

Explore alternatives before deciding

Transfer or dissolution is not the only response to organizational stress.

Consider alternatives such as:

• Shared administrative services
• Joint programming
• Fiscal sponsorship where appropriate
• Strategic partnerships
• Program reductions
• Changes in staffing
• New institutional funding
• Leadership restructuring
• Affiliation without merger
• Program transfer without dissolution
• Merger
• Planned dissolution

The organization should compare these options based on how well they advance its charitable purpose and protect the people and resources involved.

Who should participate in the decision?

A major organizational transition requires board leadership and appropriate formal approvals.

Board members have fiduciary responsibilities to act in the organization's best interests, protect charitable assets, exercise reasonable care, and oversee legal and financial obligations.

Formal authority, however, should not mean making the decision without the knowledge of people who will experience its consequences.

Depending on the organization and transaction, engage:

• Board members
• Executive leadership
• Program and frontline staff
• Volunteers
• Participants
• Community advisory groups
• Funders
• Partner organizations
• Legal and financial advisors

The level and timing of participation may differ because personnel matters, negotiations, financial information, and legal issues can require confidentiality.

Even when every person cannot participate in every negotiation, leadership should establish a transparent process for gathering perspectives, communicating decisions, and explaining how community and participant needs were considered.

How do you select an appropriate organization?

Mission and values alignment

Look for compatibility in:

• Mission
• Ethical standards
• Program goals
• Participant rights
• Equity and inclusion
• Accessibility
• Community engagement
• Evidence and professional standards

Exact philosophical agreement is not necessary. The more important question is whether the receiving organization can maintain the program's essential purpose and quality while making appropriate improvements and adaptations.

Program and operational competence

Assess whether the organization can actually perform the work.

Consider:

• Staff qualifications
• Management systems
• Program quality
• Financial controls
• Human-resources systems
• Information technology
• Data privacy and security
• Facilities
• Insurance
• Evaluation capacity
• Compliance history

Financial capacity

Review more than whether the organization currently has money.

Examine:

• Financial statements
• Audits or financial reviews where applicable
• Cash flow
• Debt
• Reserves
• Revenue concentration
• Major funding restrictions
• Pension or employee-benefit obligations, where relevant
• Pending liabilities

A larger organization is not automatically a financially stronger or safer organizational home.

Workforce capacity and employment practices

Consider:

• Compensation
• Benefits
• Staffing levels
• Turnover
• Supervision
• Training
• Workplace culture
• Nondiscrimination and accommodation practices

If current staff may move to the receiving organization, determine the proposed hiring process, roles, compensation, benefits, seniority treatment, supervision, work location, and effective date.

Do not promise staff continued employment unless that commitment has actually been authorized and documented.

Community trust and accessibility

The new organization should be able to serve participants effectively.

Examine:

• Community relationships
• Location
• Transportation
• Service hours
• Language access
• Disability access
• Privacy
• Participant experience

Genuine commitment to the work

Determine whether the potential partner wants the program because it advances its mission or simply because the transaction provides funding, assets, visibility, donor relationships, or another institutional advantage.

Mutual benefit is appropriate, but continuation of community benefit should remain central.

Conduct due diligence before committing

Due diligence is a structured review of the organizations, transaction, risks, assets, obligations, and assumptions involved.

For a substantial merger, affiliation, or transfer, review appropriate documents and conditions before final approval.

Governance and legal status

Review:

• Articles of incorporation
• Bylaws
• IRS determination letters
• Board composition and governance policies
• Required state registrations
• Licenses and accreditations
• Conflicts of interest
• Pending or threatened legal matters

Financial condition

Review:

• Financial statements
• Tax filings
• Audits
• Accounts receivable and payable
• Debt
• Restricted funds
• Endowments
• Investments
• Grant obligations
• Outstanding liabilities

Contracts and commitments

Review:

• Grants
• Government contracts
• Leases
• Vendor contracts
• Software licenses
• Insurance
• Debt agreements
• Employment agreements
• Partnership agreements

Determine whether agreements can be assigned or transferred and whether funder, landlord, lender, government, or other approval is required.

Employment and workforce obligations

Review:

• Payroll obligations
• Employee benefits
• Accrued leave
• Retirement plans
• Employment agreements
• Workers' compensation
• Pending employment claims
• Required employee notices

Employment consequences vary according to transaction structure, location, workforce size, contracts, and applicable law. Obtain appropriate employment guidance rather than assuming employees automatically transfer with the program.

Technology, privacy, and cybersecurity

Review:

• Systems and software
• Accounts and credentials
• Cybersecurity practices
• Data backups
• Privacy policies
• Security incidents
• Data-sharing agreements
• Records-retention requirements

Decide what should actually be preserved

Do not assume that every element of the existing organization must continue unchanged.

Identify:

• Essential services
• Evidence-informed practices
• Important participant relationships
• Accessibility requirements
• Community partnerships
• Institutional knowledge
• Program materials
• Evaluation systems
• Intellectual property
• Historical records

Also identify what may appropriately change.

The receiving organization may have better systems, technology, policies, staffing structures, or evidence that supports adapting the original model.

Sustainability does not require freezing the program at the moment of transfer.

Develop transition priorities and negotiate the arrangement

Program continuity and quality

Define expectations for:

• Services to be continued
• Minimum capacity
• Service quality
• Accessibility
• Participant rights
• Evaluation
• Program adaptation

Avoid requiring the receiving organization to preserve every operational detail indefinitely unless a particular feature is essential to safety, evidence, participant access, or the program's purpose.

Staff transition

Determine:

• Which positions are needed
• Whether current employees will be considered for those positions
• Compensation
• Benefits
• Job duties
• Supervision
• Work location
• Start dates
• What happens to staff who do not transfer

Communicate employment information carefully and do not create expectations before decisions are final.

Governance and community voice

If maintaining participant or community involvement is an important feature of the program, consider whether the new structure should include:

• A community advisory group
• Participant representation
• Reserved board seats where legally and strategically appropriate
• Regular community feedback processes

Board composition should follow the receiving organization's governing documents and applicable law rather than being treated casually as part of an exchange.

Brand, name, and intellectual property

Determine whether:

• The program name will continue
• Trademarks or logos will transfer
• Curriculum or program materials may be used or modified
• Website domains and social-media accounts will transfer
• Copyright or licensing restrictions apply

Maintaining a familiar program name can support continuity, but should not be promised without reviewing intellectual-property rights and whether the name remains useful.

Liabilities and outstanding obligations

Do not assume that the receiving organization will automatically pay the original organization's debts.

Identify:

• Accounts payable
• Loans
• Lease obligations
• Employee obligations
• Grant liabilities
• Pending claims
• Contract termination costs

The transaction documents should state clearly which obligations are assumed, retained, paid before closing, or handled in another agreed manner.

Handle charitable assets correctly

Assets should not simply be offered to the receiving organization as bargaining leverage.

First identify and inventory:

• Cash
• Investments
• Endowments
• Restricted funds
• Equipment
• Vehicles
• Real property
• Intellectual property
• Digital assets
• Other tangible and intangible property

For a section 501(c)(3) organization, charitable assets must remain dedicated to exempt purposes.

If the organization dissolves, remaining assets generally must be distributed for an exempt purpose or to an eligible governmental entity for a public purpose, subject to the organization's governing documents, donor restrictions, state law, and other applicable requirements.

Restricted donations, grants, endowments, and other funds may require additional analysis before transfer.

The organization should also determine whether property transfers require:

• Funder approval
• Donor review
• Government approval
• Valuation or appraisal
• Deeds or title transfers
• Intellectual-property assignments
• Other documentation

Treat participant, donor, and employee information separately from other assets

Personal information should not be transferred simply because the receiving organization will continue the program.

Review separately:

• Participant records
• Health or service records
• Intake data
• Employee files
• Donor records
• Email and mailing lists
• Volunteer records
• Research or evaluation data

Determine:

• What information is necessary for continuity
• Whether transfer is permitted
• What people were told when the information was collected
• Whether consent, notice, or another legal basis is required
• Which contractual or funding restrictions apply
• How information will be secured during transfer
• Who will have access
• How retention and destruction will be managed

Where appropriate, use formal data-transfer or data-sharing agreements.

Document the agreement

A substantial program transfer, affiliation, merger, or asset transfer should be documented clearly.

Appropriate documents may include:

• Merger agreements
• Asset-transfer agreements
• Program-transfer agreements
• Memoranda of understanding
• Employment agreements
• Intellectual-property assignments
• Data-transfer agreements
• Grant amendments
• Transition-services agreements

Depending on the transaction, agreements may address:

• Assets being transferred
• Liabilities being assumed
• Employee matters
• Funding
• Restricted assets
• Contracts
• Program obligations
• Intellectual property
• Data and privacy
• Governance
• Participant continuity
• Communications
• Transition services
• Effective date
• Dispute-resolution or enforcement provisions

Qualified legal counsel can help structure and document the transaction. Legal advice does not need to make collaboration adversarial; its purpose is to help the organizations understand and manage obligations and risks.

Obtain required approvals

The required approvals depend on the organizations and the transaction.

They may include:

• Board approval
• Member approval
• Government filings or approvals
• Attorney general or other regulatory review
• Funder approval
• Contract counterparties
• Lenders
• Landlords

Follow the organization's articles, bylaws, policies, contracts, state law, federal tax requirements, and other applicable rules.

Plan the operational transition

Services and participants

Aim to minimize unnecessary service disruption.

Determine:

• Transition dates
• Service locations
• Hours
• Eligibility
• Referral processes
• Transportation
• Accessibility
• Language access
• Contact information
• Procedures for participants who do not want their services transferred

Do not assume that participants will experience the new organization as equivalent to the old one.

Monitor:

• Service interruptions
• Participation changes
• Complaints or concerns
• Accessibility
• Trust
• Differences in outcomes

Staff integration

Staff transitioning into the receiving organization need clear information about:

• Employment status
• Job duties
• Supervisors
• Compensation
• Benefits
• Leave
• Workplace policies
• Facilities
• Technology
• Performance expectations
• Training

Staff who are not continuing may need information concerning final pay, benefits, records, references, and other transition matters.

Systems and technology

Plan the transition of:

• Email and communications
• Websites and domains
• Phone systems
• Software
• Databases
• Accounting systems
• Equipment
• Access credentials
• Cybersecurity controls
• Backups

Institutional knowledge

Document:

• Program procedures
• Partner relationships
• Referral networks
• Grant requirements
• Evaluation methods
• Community history
• Important decisions and why they were made

Avoid making one departing employee the only source of essential institutional knowledge.

Communicate the transition

Develop a communication plan before public announcement.

Depending on the transition, audiences may include:

• Staff
• Participants
• Volunteers
• Board members
• Funders
• Donors
• Community partners
• Government agencies
• Vendors
• Referral partners
• The broader public

Explain:

• What is changing
• Why the change is occurring
• When it takes effect
• What services will continue
• What services will change or end
• What participants need to do
• Where questions can be directed

Communication should be accurate rather than promotional.

Do not promise that "nothing will change" when material changes are expected, and do not agree to conceal legitimate concerns about safety, ethics, program quality, or legal compliance merely to make the transition appear successful.

If the original organization will dissolve, plan the wind-down separately

Transferring programs and dissolving a corporation are related but distinct processes.

Dissolution is governed by state law and generally requires an approved plan for resolving liabilities and distributing remaining assets.

The organization may need to:

• Adopt a formal plan of dissolution
• Pay or provide for liabilities
• Terminate leases and contracts
• Address employment obligations
• Collect receivables
• Dispose of or transfer property
• Address restricted funds and endowments
• Preserve required records
• File state dissolution documents
• File final tax and information returns

For organizations filing Form 990 or 990-EZ, dissolution or a significant disposition of assets may require reporting through Schedule N and disclosure of the assets transferred and the recipient organizations.

Seek qualified state-specific legal and accounting guidance. Requirements vary by jurisdiction and organizational form.

Evaluate the transition after implementation

Do not treat signing the agreement as the end of the process.

During the transition and for an appropriate period afterward, evaluate:

• Service continuity
• Participant experience
• Accessibility
• Program quality
• Outcomes
• Staffing
• Community relationships
• Financial performance
• Data and technology integration
• Compliance

Where appropriate, the agreement may establish a transition committee, community advisory group, funder reporting mechanism, or other process for reviewing implementation.

Acknowledging the end of an organization

Closing, merging, or transferring an organization can carry significant emotional weight for founders, staff, board members, volunteers, participants, and community partners.

The organization's history and contributions can be recognized without allowing nostalgia to interfere with decisions about future community benefit.

Appropriate activities might include:

• Recognizing staff, volunteers, participants, founders, and partners
• Creating an organizational archive
• Recording lessons learned
• Preserving significant photographs or documents with appropriate permission
• Holding a closing or transition event
• Publishing a final report
• Sharing the organization's history with the receiving organization

When preserving stories, photographs, video, or other personal information, consider privacy and consent rather than assuming organizational history overrides individual preferences.

Establish appropriate post-transition boundaries

Former leaders do not need to monitor every decision the receiving organization makes.

At the same time, "walk away and don't look back" is not always appropriate.

The transaction may include continuing responsibilities involving:

• Technical assistance
• Records
• Grant closeout
• Legal filings
• Evaluation
• Advisory roles
• Transition services

Define those responsibilities clearly and establish an appropriate point at which former leaders and staff are no longer involved in operational decisions.

In Summary

Transferring or integrating operations into another organization can be a responsible sustainability strategy when it allows effective and still-needed community work to continue under a stronger or more appropriate organizational structure.

The goal should not be organizational survival for its own sake. Boards and leaders should ask which structure best advances the mission, protects charitable resources, supports participants and staff, and sustains meaningful community benefits.

Consider a range of options before deciding on a merger or dissolution, including collaboration, administrative consolidation, joint programming, affiliation, program transfer, and other strategic partnerships.

Conduct due diligence before committing. Review governance, finances, liabilities, contracts, restricted funds, employment obligations, technology, data, insurance, compliance, community relationships, and the receiving organization's capacity to sustain the work.

Engage people affected by the decision. Formal authority may rest with the board or membership, but staff, participants, volunteers, community members, funders, and partners can provide information essential to making a responsible decision.

Treat assets and personal data carefully. Charitable assets cannot simply be transferred as bargaining tools, and participant, employee, donor, and supporter information should not automatically move with the program. Review restrictions, privacy commitments, legal authority, security, and retention requirements.

Put significant commitments in writing and obtain the approvals required by governing documents, contracts, funders, regulators, and applicable law.

Plan the operational transition in detail, including staffing, services, records, data, facilities, technology, communications, participant continuity, institutional knowledge, and evaluation.

If the original organization will dissolve, complete the legal and financial wind-down separately. Resolve liabilities, distribute remaining charitable assets appropriately, preserve required records, make necessary state filings, and complete final federal reporting.

Finally, recognize the history of the organization while remaining focused on its purpose. A nonprofit does not have to exist forever to succeed. If its mission and effective work continue through another structure - or if the need it was created to address has been met - ending the original organization can be a responsible and mission-centered decision.

Example: Youth-serving agencies merge to better serve children in need

Two longtime Lawrence, Kansas-based organizations that provide housing and other services to children in need decided to become one entity.

Board members of the two agencies mulled over the decision for a year, and decided to merge in order to make both organizations’ efforts stronger and more sustainable over time. “Both organizations are great in and of themselves in terms of what they offer to families. We are excited about making a difference and really being able to do that in a bigger way,” said the current executive director of the O’Connell Youth Ranch. The merged organizations have long had similar missions, and will now be able to better serve youth with use of the joint resources, and will no longer be competing for grants.

“The staff of both agencies will each combine their unique skill sets to provide the services necessary to serve the needs of the young men and women we seek to serve,” said O’Connell Youth Ranch Board President John Rathbun. “The Lawrence community is blessed to have these two agencies join forces to combine their energy and resources.”

Read more.

What does it mean to incorporate your operations into another organization?

___Another organization absorbs yours as a subsidiary.

___Your organization ceases to exist at all, and its services and activities -- or only some of them -- are taken over by the new organization as part of what it does.

How to decide when it's time to incorporate into another entity.

___An internal discussion, involving some combination of board members, staff, participants, and volunteers, says it's time to make the shift.

___When you knew from the beginning that you would incorporate into another organization, and the agreed-upon time has come.

___When another organization with great resources makes an offer to absorb your services and activities and staff.

___When another organization can offer better services to the target population.

___When you've hit the wall on resources.

How to choose the right organization.

___Look for an organization with a mission, philosophy, and values similar to yours.

___Look for an organization you know and trust.

___Look for an organization that's competent.

___Look for an organization with the resources to sustain your work.

___Look for an organization that will benefit from taking on your operation.

___Look for an organization that actively wants to do the work you've been doing, and is committed to maintaining and improving it.

How to negotiate rolling your operations into another organization or initiative.

___Decide on negotiating points.

___Once you've developed a list of negotiating points, decide which of them are absolutely necessary, and which you're willing to give up or compromise on.

___Decide what you can offer.

___Negotiate.

___Once the negotiations are completed, GET IT IN WRITING.

___Once a draft agreement has been prepared, you need to get it approved by all concerned in both organizations.

How to manage the transition to another organization.

___As soon as you have a formal agreement, inform individuals and groups who should know before they read it in the paper.

___If you're transferring the whole operation, staff and all, you need to work with the staffs of both organizations to develop new policies and procedures, and generally make it possible for the staff of your organization to become integrated into that of the other.

___If you're transferring only some or all of the services or activities of your organization, but not the staff , the emphasis in transition should be on participants and the target population.

How to let go.

___Use the signing of the agreement as both a public relations opportunity and a marker in the life of your organization .

___Throw a big party to which you invite anyone who's been involved with the organization from the beginning - - current and former staff, board, volunteers, participants, colleagues, community supporters, members, etc.

___Directly or soon after the party, hold a gathering of the core members of the organization, those few to whom it really mattered, to grieve its passing.

___Finally, walk away and don't look back.

Tool 1: Sample Agreement

The Pearson Young Leaders Initiative (PYLI) and the Pearson Youth Development Corporation (YDC) enter into the following agreement:

YDC will assume responsibility for all activities and services currently provided by PYLI as of the date of the signing of this agreement by both parties. These activities and services include:

Outreach to Pearson youth ages 14-20 for the purpose of enrolling them in leadership development training. For this purpose, YDC agrees to employ one full-time (37.5 hours/week, 52 weeks/year) outreach worker.

Provision of leadership development training for no fewer than 30 youths ages 14-20 per calendar year. This training will include, but not be limited to, courses (using attached curricula) in problem-solving, conflict resolution and mediation, interpersonal communication, and community education. Each course will be limited to ten (10) participants, and will encompass at least 12 hours of instruction, discussion and practical application. In addition, training will include, for each trainee, a minimum fifteen (15) hour supervised practicum in one of the course areas of the trainee's choice after completion of all coursework. For this purpose, YDC agrees to employ two (2) full-time leadership development specialists.

Employment of youth in the practicum area chosen after the successful completion of the practicum. YDC agrees to pay youth for their work as community educators, in-school peer counselors or mediators, or "social entrepreneurs" at the rate of $7.00 per hour to start, with raises (in 50-cent increments) up to $9.00 per hour.

Provision of group and individual support for youth during the training, practicum, and employment phases of the program. Group support will take the form of at least one one-hour group per week for each participant, led initially by a leadership development specialist, and, later, by the youth themselves, with the leadership development specialist becoming a participant. Individual support will take place as needed, and may extend to individual psychotherapy, to be provided by licensed YDC staff. In addition, each youth engaged in employment will have access to at least two hours per month of regular supervision by a youth development specialist or other appropriate YDC staff.

YDC agrees to continue to fulfill the conditions for funding these activities with PYLI's current funders, including the Dept. Of Youth Services, the Miller Foundation, and the Pearson Youth Trust. YDC also agrees to continue to seek funding for PYLI programs from these and other potential funders, and to expand these programs to include more youth as more funding becomes available.

YDC agrees to employ as outreach worker and youth development specialists the current PYLI staff members in those positions. They will receive the same compensation and benefits as YDC employees in, respectively, outreach and education positions with similar seniority.

YDC agrees that four Board members of PYLI's choosing will join the YDC Board of Directors, each to serve indefinitely. They will be added to the current number of YDC Board members (12), but the Board will drop back to 12 through attrition.

PYLI agrees to transfer permanently to YDC the use of its name, logo, and any other identifying symbols, literature, etc. YDC agrees to continue to use the PYLI name as the identifier for the PYLI program.

PYLI agrees to transfer to YDC all monetary and capital assets in its name, including cash in bank accounts, outstanding receivables, endowment and interest income, copiers, computers, furniture, and any other assets in its possession at the time of the signing of this agreement with the exception of one laptop computer, which will revert to its purchaser, PYLI's current director.

PYLI agrees to transfer to YDC all mailing lists, and lists of current and potential donors and community supporters, both on paper and in data base files, as well as any notes and contact information pertaining to them.

PYLI, in the person of its current director, agrees to provide, if necessary, technical assistance to YDC in the operation and maintenance of the PYLI program for a period of up to six months from the signing of this agreement. The same person will also provide, within that same time period, introductions to individuals in the funding organizations named above and to community supporters and key members of the target population.

PYLI agrees to transfer to YDC all participant records, financial records, and any other records or information necessary to the operation of the PYLI program or to fiscal responsibility for it.

With the signing of this agreement, PYLI will cease to exist as an entity, and its functions and assets, as described herein, will be assumed by YDC.

For Pearson Young Leaders Initiative (PYLI)

Printed Name_____________________________

Title____________________________________

Signature_____________________________________

Date_______________________________________

For Pearson Youth Development Corporation (YDC)

Printed Name___________________________________

Title__________________________________________

Signature__________________________________________

Date___________________________________________

Businesses can be important partners in community work. Depending on the company, nonprofit organizations may receive financial contributions, grants, sponsorships, matching gifts, products, professional expertise, employee volunteer support, technology, facilities, or other resources.

Corporate support should not be viewed simply as money available for nonprofits to obtain. The strongest relationships begin with a clear community need, an organization that understands what resources it actually needs, and a company whose giving priorities, values, geographic interests, expertise, or community commitments genuinely align with the work.

Corporate support is also only one part of a broader financial sustainability strategy. Grants, individual giving, public funding, contracts, earned revenue, partnerships, institutional budget support, and other resources may be equally or more appropriate depending on the organization.

What is corporate giving?

Corporate giving or corporate philanthropy refers broadly to financial or nonfinancial support that a business provides for nonprofit organizations, charitable purposes, or community initiatives.

Corporate support can take many forms.

Cash grants and financial contributions

Businesses may make direct charitable contributions or provide grants through a corporate foundation or another giving program.

Funding may be:

• Unrestricted
• Restricted to a specific program or purpose
• One-time
• Multiyear
• Connected to a particular community or geographic area

Review the terms of the contribution carefully so both parties understand the permitted use of the funds, reporting requirements, recognition expectations, and other conditions.

Corporate foundations

Some companies establish legally separate charitable foundations.

In the United States, many company-sponsored foundations are private foundations and are subject to the federal tax and reporting requirements that apply to private foundations, including annual Form 990-PF filing requirements.

A corporate foundation may have priorities closely connected with the interests, communities, workforce, or values of its parent company, but its grantmaking should be researched separately from the company's other business activities.

Direct corporate giving programs

Some companies make charitable contributions directly rather than through a separate foundation.

These programs may be administered through:

• Corporate citizenship or community-investment teams
• Corporate affairs
• Human resources
• Sustainability or social-impact teams
• Local offices or business units
• Other departments

Direct corporate giving is structured differently from private-foundation grantmaking, but it should not be described as entirely unregulated. Tax, charitable-solicitation, contract, advertising, conflict-of-interest, state-law, and other requirements may apply depending on the arrangement.

Corporate sponsorships

A business may provide financial or other support in connection with an event, program, activity, or organization.

Sponsorship agreements should clearly describe:

• The amount or resources being provided
• The activity being supported
• How the sponsor may be acknowledged
• Whether the sponsor receives tickets, access, advertising, exclusivity, or other benefits
• Use of names, trademarks, and logos
• Payment schedule
• Term and termination provisions

For federal tax purposes, acknowledging a sponsor's name or logo can be treated differently from advertising or endorsing its products or services. Organizations should structure sponsorship arrangements carefully and obtain appropriate tax or legal guidance when necessary.

Employee matching-gift programs

Some companies match eligible charitable contributions made by employees and, in some programs, retirees or other eligible participants.

Organizations should follow each company's eligibility, verification, documentation, and submission requirements.

Employee volunteering and skills-based service

Businesses may encourage employees to volunteer with nonprofit organizations.

Support may include:

• Volunteer service days
• Paid volunteer time
• Team volunteer projects
• Board service
• Skills-based volunteering
• Pro bono professional services

Skills-based support might involve accounting, law, technology, human resources, communications, strategic planning, design, data analysis, or another area of professional expertise.

Before accepting professional services, clarify scope, qualifications, supervision, confidentiality, conflicts of interest, ownership of work products, and liability when relevant.

In-kind contributions

Companies may donate products, supplies, equipment, facilities, technology, transportation, food, or other resources.

Accept in-kind contributions because they meet an actual organizational need, not simply because they are free.

Consider:

• Quality
• Compatibility
• Storage
• Installation
• Maintenance
• Licensing
• Insurance
• Disposal costs
• Accessibility
• Cybersecurity and privacy when technology is involved

A gift acceptance policy can help determine which in-kind contributions the organization can responsibly accept.

Cause-related marketing and commercial co-ventures

A business may advertise that it will contribute a portion of sales, a fixed amount per purchase, or another amount connected to commercial activity to a nonprofit organization.

These arrangements are commonly described as cause-related marketing and may also fall within state definitions of a commercial co-venture or charitable sales promotion.

Use a written agreement that clearly explains:

• What purchase or activity triggers the contribution
• The amount or percentage the nonprofit will receive
• Minimum or maximum contributions, if any
• The dates of the promotion
• How sales will be documented
• How the nonprofit's name and logo may be used
• Who approves public communication
• Payment and reporting procedures

Because state requirements vary, organizations should determine what registration, contract, reporting, or charitable-solicitation requirements apply before launching the promotion.

Other partnership arrangements

Businesses and nonprofits may also collaborate through:

• Workforce-development partnerships
• Community investment
• Research
• Technical assistance
• Shared facilities or equipment
• Employee engagement
• Disaster response
• Scholarship or education programs
• Product donation
• Other mission-aligned partnerships

Why do businesses support nonprofit organizations and community initiatives?

Companies have different reasons for community investment, and those reasons can change over time.

Potential motivations may include:

• Commitment to particular community needs or charitable purposes
• Geographic ties to communities where employees live and work
• Employee engagement
• Workforce development
• Community relationships
• Corporate values or purpose
• Reputation and trust
• Customer relationships
• Employee recruitment and retention
• Expertise connected to the company's industry
• Responding to employee interests
• Long-term business and community resilience

Do not assume that every company has the same motivation or that every charitable contribution is primarily an attempt to increase sales.

Research what the particular company says about its own community-investment strategy and examine what it actually funds.

When might pursuing corporate support make sense?

When the company's stated priorities align with your work

Look for genuine alignment between:

• Your organization's mission
• The specific program or need
• The company's published funding priorities
• Geographic eligibility
• The type of support the company provides

Past support for related work can be useful information, but do not assume that previous giving guarantees future support.

When your community is relevant to the company's geographic strategy

Companies may prioritize communities where they have:

• Employees
• Offices
• Facilities
• Customers
• Significant business operations

Local presence can make a proposal relevant, but geographic proximity alone is not a reason to pursue a company whose priorities do not align with the work.

When the type of support matches an actual need

A company may be more useful as a provider of technology, professional expertise, employee volunteers, facilities, or products than as a source of unrestricted cash.

Begin with what your organization needs rather than with what the company appears willing to give.

When the expected value justifies the effort

Corporate fundraising requires staff time.

Consider:

• Potential amount or value
• Probability of success
• Application requirements
• Restrictions
• Reporting requirements
• Relationship-management workload
• Legal or compliance requirements
• Staff capacity

Do not pursue an opportunity simply because the company is large or has substantial financial resources.

When might you decide not to pursue or accept corporate support?

When the partnership conflicts with mission or values

Not every available contribution should be accepted.

A proposed donor or sponsor may present:

• Mission conflict
• Ethical concerns
• Legal risk
• Reputational risk
• Conflicts of interest
• Excessive donor influence
• Conditions inconsistent with program quality or participant interests

A written gift acceptance policy can help board members and staff evaluate difficult situations consistently rather than deciding only after a controversial contribution is offered.

When accepting support could create harmful perceived affiliation

Accepting a contribution does not automatically mean that a nonprofit endorses every product, practice, or position associated with the company.

However, a visible partnership may create a public association between the organizations.

Before accepting substantial support, consider:

• The company's current practices and relevant history
• Whether the partnership could undermine community trust
• Whether the funding relates directly to harms associated with the company
• Whether the company expects influence over program content
• Whether recognition could reasonably be interpreted as endorsement
• Whether appropriate contractual protections are available

When the company requires inappropriate control

Financial support should not give a corporate donor inappropriate authority over:

• Program conclusions
• Research findings
• Participant eligibility
• Professional or clinical decisions
• Hiring or firing
• Advocacy positions
• Evaluation findings

Clearly document donor restrictions and organizational decision-making authority.

When the gift will cost more than it is worth

A donation can create costs.

For example, equipment may require:

• Installation
• Maintenance
• Licensing
• Staff training
• Storage
• Security
• Disposal

Evaluate net value, not merely the stated value of the contribution.

When the opportunity does not fit the organization's strategy

A large company may have substantial resources without being a realistic funding prospect.

Do not reshape the organization's mission or develop unnecessary programs primarily to become eligible for corporate funding.

How do you obtain corporate resources?

1. Identify your needs

Start with the organization's priorities rather than the prospective donor.

Ask:

• What program or organizational need are we trying to address?
• What resources are necessary?
• What is the full cost?
• Do we need cash, technology, services, expertise, facilities, volunteers, products, or another resource?
• Is the need short-term or ongoing?
• What would happen if the support ended?

2. Establish gift-acceptance and partnership standards

Before approaching major corporate prospects, establish criteria for what the organization will and will not accept.

Consider policies addressing:

• Restricted gifts
• In-kind contributions
• Corporate sponsorships
• Naming rights
• Cause-related marketing
• Donor influence
• Conflicts of interest
• Privacy
• Reputational concerns
• Gifts requiring legal or board review

3. Research potential companies and corporate foundations

Use reliable public information.

Sources may include:

• Company websites and corporate-giving pages
• Corporate-foundation websites
• Public annual and impact reports
• Current nonprofit and philanthropy databases
• IRS Form 990-PF filings for private foundations
• IRS Tax Exempt Organization Search
• Publicly available grant histories
• Local community foundations or nonprofit resource centers
• Public business information

The former Foundation Center and GuideStar are now part of Candid, which provides current nonprofit, foundation, and grants research tools.

4. Research the company's giving priorities

Determine:

• What issues the company supports
• Geographic priorities
• Eligibility requirements
• Typical grant sizes
• Whether applications are invited
• Deadlines
• Whether support is cash or noncash
• Whether matching gifts or employee programs exist
• Reporting expectations
• Previous grants or partnerships

Do not research executives' religion, health, family members, bereavements, or other private personal circumstances in order to identify emotional leverage for a request.

Publicly stated professional philanthropic interests may be relevant; private personal circumstances generally are not.

5. Conduct appropriate due diligence

A corporation will often evaluate your organization before providing significant support. Your organization should also evaluate the prospective partner.

Depending on the size and visibility of the relationship, consider:

• Relevant corporate conduct
• Legal or regulatory issues
• Community reputation
• Conflicts of interest
• Compatibility with organizational values
• Conditions attached to the proposed contribution
• Potential donor influence
• Reputational and dependency risks

The depth of review should be proportionate to the size, nature, visibility, and risk of the relationship.

6. Determine the appropriate contact and process

Follow the company's published process whenever one exists.

The appropriate contact may work in:

• A corporate foundation
• Community investment
• Corporate citizenship
• Corporate affairs
• Human resources
• Sustainability or social impact
• A local office

A professional introduction from someone who knows both organizations can be useful, but do not use personal relationships to make it difficult for someone to decline the request.

If no relationship exists, use the company's published inquiry or application process rather than assuming an unsolicited personal approach is required.

7. Prepare the request

Explain clearly:

• The community need
• The organization's role
• What evidence or community experience supports the work
• What resource is being requested
• How it will be used
• Expected outcomes
• The full budget
• Other funding or resources involved
• How the proposal aligns with the company's published priorities
• What reporting or acknowledgment is proposed

The request should explain legitimate benefits of the partnership without turning the nonprofit into an advertising vehicle for the company.

8. Provide organizational due-diligence information

A prospective corporate funder may reasonably ask for information such as:

• Mission and programs
• Leadership
• Board governance
• Tax-exempt status
• Financial statements
• Form 990
• Program results
• Evaluation information
• Budget
• Policies
• References or community partnerships

Keep these materials accurate and current.

9. Follow the application requirements

Follow stated eligibility rules, formats, deadlines, budgets, character limits, and documentation requirements.

Do not submit substantially irrelevant proposals simply because a company has significant resources.

10. Put significant arrangements in writing

Written agreements are especially important for:

• Sponsorships
• Cause-related marketing
• Restricted grants
• Naming arrangements
• Product donations with significant conditions
• Shared staff or professional services
• Multiyear partnerships

Agreements may address:

• Amount or resources contributed
• Permitted use
• Payment schedule
• Reporting
• Recognition
• Trademarks and logos
• Advertising
• Exclusivity
• Data and privacy
• Intellectual property
• Termination

11. Acknowledge support appropriately

Thank corporate supporters promptly and according to the terms of the relationship.

Recognition might include:

• Listing the sponsor or donor by name
• Displaying an approved logo
• Acknowledgment in an annual report
• Recognition at an event
• Other agreed acknowledgment

Do not automatically turn acknowledgment into advertising or endorsement.

If the company expects promotional language, comparative claims, purchase inducements, exclusive-provider rights, or other commercial benefits, review the tax and contractual consequences before agreeing.

12. Steward the relationship and report honestly

Keep supporters informed in the manner and frequency agreed upon.

Report:

• How resources were used
• What was implemented
• Outcomes
• Challenges
• Important changes
• Lessons learned

Do not report only positive information simply because the company may be a future funder.

Stewardship should demonstrate responsible use of resources and maintain an honest professional relationship.

13. Learn from unsuccessful requests

A declined request does not necessarily mean that the proposal was poor.

Reasons may include:

• Limited budget
• Different priorities
• Geographic restrictions
• Timing
• Competition
• Eligibility

When feedback is available, use it to improve future requests. Do not assume that a company will always be able or willing to provide individual feedback.

Researching corporate foundations and funders

Form 990-PF remains a useful source of information about private foundations.

It can provide information about:

• Foundation finances
• Officers, directors, trustees, or foundation managers
• Grants and charitable distributions
• Other reported foundation activity

Current Forms 990-PF and other Form 990-series filings can be researched electronically through IRS resources and nonprofit/philanthropy research platforms.

Fundraising research has changed substantially from the period when organizations relied mainly on printed directories, library collections, mailed IRS copies, or personal contacts. Use current online sources and verify that information remains current before making decisions.

In Summary

Businesses can provide nonprofit organizations with financial contributions, grants, sponsorships, matching gifts, volunteer support, professional expertise, products, technology, facilities, and other resources.

Corporate support should not be approached simply as a large pool of money waiting to be accessed. Begin with your mission and organizational needs, then identify companies whose stated priorities, community relationships, geographic focus, resources, and partnership approach genuinely align with the work.

Companies may have many reasons for community investment, including charitable purpose, employee engagement, workforce development, reputation, community relationships, corporate values, and business strategy. Avoid assuming that every corporate contribution is simply an indirect effort to increase profits.

Research prospective partners carefully. Use reliable public information about their giving priorities, past grants, geographic interests, application processes, and community-investment strategies. Do not use private personal details about executives or their families as fundraising leverage.

Evaluate prospective corporate support from both directions. A company may assess whether your organization is an appropriate partner, and your organization should assess whether accepting the company's resources is consistent with mission, ethics, community trust, and organizational independence.

Establish gift-acceptance and due-diligence policies before difficult offers arise. Some contributions may carry restrictions, reputational risks, legal responsibilities, maintenance costs, or expectations that make declining the contribution the more responsible choice.

Distinguish charitable gifts, sponsorships, advertising, cause-related marketing, and other business arrangements. They may carry different tax, state-law, contractual, reporting, or registration requirements.

Put significant relationships in writing, acknowledge corporate support appropriately, report honestly on results and challenges, and continue evaluating whether the partnership remains beneficial.

Corporate philanthropy can be one useful component of a diversified financial sustainability strategy. The goal is not simply to obtain corporate money; it is to develop responsible, mission-aligned relationships that contribute meaningful resources to community work without compromising the organization's values, independence, or accountability.

Example 1: The importance of developing relationships

Don Murray is founder, president and CEO of a small agency, only 18 months old, which is in the pre-construction phase of building a 20-acre campus for the care and treatment of abused and neglected children. Don is the only full-time paid employee, and is assisted by his wife and a half-time administrative assistant. In the last year, Don has developed relationships with corporate givers very successfully: donations include furniture, copiers, postage and other supplies, as well as several donations in the six-figure range, and is in the final stages of negotiating a gift of 20 acres of land worth nearly a half million dollars. He is clearly well qualified to contribute to our discussion of corporate giving!

The key to getting a piece of the corporate giving pie is in developing relationships. Although many major and some smaller corporations have adopted policies to "give" so many dollars back to their communities, the hard part is to be on the receiving end of this policy. How do we maximize our opportunities to develop relationships which will increase the number of corporate gifts we receive?

Knowing that corporate America maintains vast resources of man-hours, office equipment, supplies, management expertise, and hard cash, it seems logical to come up with a plan to encourage the transfer of this "stuff" to nonprofit organizations... it feels a lot like Robin Hood, but his tactics probably won't work!

Generosity is a funny thing. In addition to a "warm fuzzy", most people feel better about giving when they get something in return. Public TV uses that idea when they give away premiums with pledged contributions, and it works. What kind of "premium" does corporate America want? Well, the obvious answer is... money! Corporate America wants money, and how do they get it? They conduct more business, engage more clients, sell more widgets, etc. So, if our organizations can assist business in their quest for money, we place ourselves in a good position among other nonprofits looking for donations. How do we scratch corporate backs so they're willing to scratch ours?

My organization developed a Professional Business Networking Group. Each month, 125-140 mid- and top-level business owners and executives meet at a local upscale restaurant at a function which we host. (The first one hosted 30 people.) They pay about $15-20 at the door, and spend two hours "networking" and relaxing. This forum permits me to meet those executives and managers who may be able to support us in some way. I attend each function, along with our volunteer "ambassadors" and board members; we work the crowd, finding out about each person's business. New members fill out our applications, which tell me about their business and how to contact them, as well as personal interests (golf, tennis, etc.).

I typically meet from thirty to fifty new execs at each monthly meeting. Regular members get in for free by bringing two guests with them. Incidentally, this function costs our organization NOTHING... the restaurant is thrilled to host this function for us. They provide two free beverages for each guest as well as a heavy munchie buffet. After the two drinks are consumed, guests dip freely into pockets, and it isn't unusual for the restaurant to pick up eight to ten dinner tables after our functions, which are held on Tuesday or Wednesday, traditionally slow nights for restaurants anyway.

It is important to remember that the point of this function is for the guests to conduct their business networking in a relaxed atmosphere; unless pressed, I do not spend much time talking about our organization. I have info to contact these people later, and assuredly will do so. But, I try to find out as much as possible about their businesses, and try to connect them with people there whom they might wish to meet. For example, I may introduce a corporate CEO or CFO who may be bored in their current position to the President of an executive search firm; or introduce a land developer to a general contractor. You get the point.

This is not the time to pitch your charity, but for your guests to see you as a friendly business associate who is interested in their business and their success. This is crucial... if they see this meeting as a time when they're going to be dunned for money for your charity, they won't come. If they come and make some great contacts for their business, they'll return and bring friends next month.

This was used by permission of Fundraiser Software.

___You know what corporate giving is, and what can be considered corporate giving, including:

• Cash
• Executives-on-loan
• Corporate sponsorship
• Employee volunteerism
• Matching programs
• In-kind contributions
• Cause-related marketing

___You know the difference between a company-sponsored foundation and a corporate direct giving program.

___You understand why corporations give money to not-for-profit organizations:

• Enhance their image
• Improve their community
• Support initiatives that will lead to a better work force or new technology

___You know not to try to tap into corporate resources when:

• • Your work is controversial.
  • You don't wish to appear to endorse any particular product or company.
  • Corporations are not used to donating to your type of work.
  • Revenue for the corporation will not be generated.
  • Your organizational goals are unclear.

Preparation:

___You have considered what your organizational needs are.

___You have researched local and national corporations in your community, specifically for:

• CEOs, VPs, and Board Members
• How much money they are willing to give
• What the requirements for the corporation are
• What the local business scene is like

Execution:

___Personal contact with representatives from the corporation has been made.

___Your formal request for assistance has been made.

___If appropriate, you celebrated!

___Follow ups with the organization have been made.

• What does sustainability mean?

• What is a plan for sustainability?

• Why should you plan for sustainability?

• When should you plan for sustainability?

• How do you plan for sustainability?

Your initiative is making progress. Community members are involved, partnerships have developed, and your work appears to be producing meaningful benefits.

Now consider what should happen over the longer term.

Funding may change. Staff or volunteer leaders may leave. Community priorities may evolve. Policies may change. Another organization may become better positioned to carry the work forward. Some activities may become part of routine practice, while others may no longer be needed.

Sustainability planning helps an initiative prepare for those possibilities.

What does sustainability mean?

Sustainability is the capacity to maintain meaningful benefits, effective practices, services, policies, relationships, community capacity, or other valuable results over time.

Sustainability does not necessarily mean keeping every activity, program, staff position, funding source, or organizational structure unchanged indefinitely.

Depending on the initiative, sustainability might mean:

• Continuing an effective program
• Integrating a service into the routine work of an existing organization
• Maintaining a policy or systems change
• Transferring responsibility to a community partner
• Strengthening community leadership and capacity so the work can continue locally
• Maintaining partnerships and referral networks
• Scaling an effective approach
• Adapting a program as needs and evidence change
• Preserving knowledge, tools, data, or infrastructure
• Responsibly concluding activities that are no longer necessary or effective

The central question is not simply, "How do we keep our organization alive?"

A more useful question is:

What benefits of this work should continue, for whom, for how long, and what structures, resources, relationships, or changes are needed to make that possible?

Public-health sustainability frameworks commonly identify several interacting areas that influence whether programs and their benefits can continue, including:

• Organizational capacity
• Funding stability
• Partnerships
• Program evaluation
• Program adaptation
• Communications
• Strategic planning
• Support in the broader organizational, community, policy, and funding environment

Sustainability planning should therefore look beyond fundraising alone.

What is a plan for sustainability?

A sustainability plan is a practical roadmap for maintaining the parts of an initiative that continue to provide value.

It identifies:

• What should be sustained
• Why those elements remain important
• What evidence supports continuing them
• What may need to be adapted
• Who should be responsible for the work
• What partnerships are needed
• What staffing and leadership capacity is required
• What financial and other resources are needed
• What risks or changes may affect the work
• How progress and changing community needs will be evaluated

Sustainability planning is closely connected to strategic planning. It asks organizations to look beyond immediate activities and consider how benefits can continue under different future conditions.

A written sustainability plan can also provide institutional memory. It documents why decisions were made, who is responsible for carrying them out, what resources are needed, and how progress will be assessed.

Questions to consider

A sustainability planning process may begin with questions such as:

1. What benefits, activities, policies, services, relationships, or capacities are worth sustaining?
2. What evidence do we have that the work is useful and equitable?
3. What should continue unchanged, what should be adapted, what should be transferred or institutionalized, and what should end?
4. What community partnerships and forms of community ownership are necessary?
5. What organizational, governance, leadership, and workforce capacity is required?
6. How will we communicate about the work and maintain appropriate community and institutional support?
7. What funding and other resources are needed, and how stable are they?
8. What external changes, risks, and future scenarios should we prepare for?

Example: A community initiative addressing housing instability and access to behavioral health services has achieved promising results, but it depends heavily on one short-term grant and on several staff members and volunteers carrying unsustainable workloads.

Sustainability planning might include documenting effective practices, strengthening partnerships with housing and health organizations, evaluating outcomes, identifying which services could be incorporated into existing systems, developing more stable funding, creating realistic staffing plans, compensating essential work appropriately, cross-training staff, and preparing for leadership transitions.

The goal is not necessarily to preserve the initiative exactly as it exists. The goal is to preserve and strengthen the benefits that matter.

Why should you plan for sustainability?

To maintain benefits that require sustained effort

Some community priorities cannot be addressed through a one-time project.

Preventing child maltreatment, reducing community violence, improving health equity, strengthening educational opportunity, addressing housing instability, improving environmental conditions, and other complex goals may require sustained work across organizations and systems.

Sustainability planning helps identify what must remain in place long enough for meaningful improvements to occur.

To protect valuable investments

Programs require time, funding, relationships, knowledge, trust, training, technology, facilities, and community effort.

If effective work disappears abruptly when one grant ends or one leader leaves, some of those investments may be lost.

Sustainability planning can help preserve useful infrastructure and knowledge even when a particular program changes.

To reduce dependence on one person

Initiatives are vulnerable when leadership, relationships, passwords, procedures, institutional knowledge, or decision-making authority are concentrated in one person.

Sustainability planning can strengthen:

• Succession planning
• Shared leadership
• Documentation
• Cross-training
• Delegation
• Institutional memory

To support a sustainable workforce

Programs are not sustainable when they depend on chronic overwork, unpaid labor, unclear responsibilities, or recurring burnout.

Planning should address:

• Appropriate staffing levels
• Fair compensation
• Workload
• Training
• Supervision
• Staff retention
• Volunteer roles and boundaries
• Leadership development

To prepare for changes in funding and the external environment

Grants end. Government priorities change. Costs increase. Community needs shift. Partners reorganize. Technologies change. New laws or regulations may affect the work.

Planning can help organizations prepare for several possible futures rather than assuming current conditions will continue.

To decide whether continuation is actually appropriate

Sustainability should not become an automatic goal.

Ask whether:

• The need still exists
• The intervention remains effective
• Community members still consider it valuable
• Another organization can provide the service more effectively
• A temporary program should become routine organizational practice
• A policy or systems change has made the original program less necessary
• Resources would now have greater impact elsewhere

Sometimes responsible sustainability planning leads to continuation. Sometimes it leads to adaptation, transition, integration, or planned closure.

When should you plan for sustainability?

Begin sustainability planning early.

Consider sustainability while developing the initiative's mission, objectives, partnerships, funding strategy, staffing model, and evaluation plan rather than waiting until a grant is about to expire.

Early planning can influence decisions about:

• Program design
• Staffing
• Partnerships
• Technology
• Data collection
• Funding
• Governance
• Community participation
• Evaluation

Sustainability planning is not a one-time activity. Review the plan periodically as evidence, community priorities, staffing, funding, policies, and other conditions change.

How do you plan for sustainability?

Step 1. Decide what is actually worth sustaining

Begin by clarifying the purpose of the initiative and what benefits it is producing.

Ask:

• What need or community priority led to this work?
• Does that need still exist?
• What parts of the initiative are producing meaningful benefits?
• Who benefits?
• Are benefits distributed equitably?
• What parts are ineffective, unnecessary, or burdensome?
• What could be continued by another organization or community partner?

Avoid assuming that organizational survival is automatically the goal.

Example: A community initiative supports adolescent sexual and reproductive health through education, access to services, partnerships with schools and health organizations, and outreach.

Sustainability planning does not necessarily mean preserving every workshop or outreach activity permanently. The initiative may determine that some practices should become part of routine school or health-system operations, while others should be adapted as community needs and evidence change.

A short-term initiative may also appropriately conclude once its purpose has been accomplished.

Example: Residents organize a project to restore a neglected section of a river corridor. Once restoration is complete, they might end the project, establish periodic stewardship activities, transfer maintenance to another organization, or develop a broader environmental partnership.

None of those choices is automatically more sustainable than the others. The appropriate decision depends on the continuing need and community priorities.

Step 2. Clarify goals and future direction

Sustainability is easier to plan when the initiative has clear goals.

Review:

• Mission
• Short-term objectives
• Longer-term outcomes
• Equity goals
• Community priorities
• Measures of success

Goals may change as the initiative learns.

Example: Residents initially organize around one dangerous intersection and advocate successfully for safety improvements.

Through that process they discover broader concerns about pedestrian access, transit, traffic speeds, and neighborhood safety. The group can decide whether to conclude after accomplishing its original objective or broaden its mission into an ongoing neighborhood transportation or civic organization.

Expansion should be intentional rather than occurring simply because the initiative has gained attention or members.

Step 3. Evaluate what the initiative has accomplished and learned

Sustainability decisions should be informed by evidence.

Review:

• What was implemented
• Who participated
• Who was not reached
• What outcomes changed
• What participants and community partners experienced
• What worked well
• What did not work
• What unintended consequences occurred
• Whether results were equitable
• What adaptations improved the work

Do not sustain a program simply because staff and supporters have invested substantial time in it. Continue what evidence and community experience suggest is valuable.

Example: A youth violence-prevention coalition develops an after-school recreation and mentoring program.

Participation is strong among some young people but much lower among others. Evaluation shows that transportation, activity choice, disability access, and program scheduling limit participation for several groups. Participants also value the recreation component more than some of the structured lessons.

Sustainability planning would use those findings to redesign the program rather than simply seeking funding to preserve the original model.

Step 4. Build communication, community support, and shared ownership

Communication can support sustainability by helping people understand the initiative, its results, available opportunities, and ways to participate.

The goal is not maximum publicity. Communication should serve specific purposes such as:

• Sharing results and lessons
• Maintaining transparency and accountability
• Recruiting participants or partners
• Building support for policy or systems change
• Helping potential funders understand the work
• Ensuring community members know how to access services

Communication channels might include:

• Community organizations
• Websites and social media
• News and community media
• Email and text communication
• Community meetings
• Public reports or dashboards
• Presentations to partners, boards, funders, and policymakers
• Trusted interpersonal networks

Visibility is not the same as trust. Organizations build lasting support through useful work, accountability, respectful relationships, meaningful community participation, transparent communication, and evidence of impact.

Step 5. Strengthen partnerships and community ownership

Programs that depend on one organization or one leader may be especially vulnerable.

Identify the partners necessary to maintain benefits over time.

These might include:

• Community organizations
• Participants and residents
• Health and human service organizations
• Schools and educational institutions
• Local government
• Businesses
• Faith and spiritual communities
• Funders
• Advocacy organizations
• Universities

Ask whether partners are simply supporting your organization or whether they share meaningful responsibility, decision-making, knowledge, resources, and ownership of the work.

When appropriate, sustainability may involve transferring part or all of a program to a partner that is better positioned to maintain it.

Step 6. Strengthen organizational capacity, governance, and leadership succession

The amount of organizational structure needed depends on the initiative.

A temporary volunteer project may require relatively little formal structure. An organization employing staff, managing grants, providing services, handling confidential information, or making long-term commitments will require more.

Consider whether you have clear procedures for:

• Decision-making
• Financial management
• Roles and responsibilities
• Conflict of interest
• Data and document management
• Privacy and security
• Program quality
• Partnerships
• Leadership transition

Avoid concentrating essential knowledge and authority in one person.

Strengthen continuity through:

• Shared leadership
• Leadership development
• Succession planning
• Cross-training
• Written procedures
• Secure recordkeeping
• Documentation of partner relationships and commitments

Example: A community health initiative has relied heavily on one coordinator for decisions, partner relationships, fundraising, and institutional knowledge.

Sustainability planning might redistribute responsibilities, document procedures, train additional leaders, establish decision-making policies, and create a succession plan before the coordinator leaves.

Step 7. Build sustainable staffing and workforce capacity

Ask whether the initiative has enough people with the right skills, time, support, and compensation to carry out the work.

Review:

• Number of staff
• Workload
• Compensation and benefits
• Volunteer expectations
• Training
• Supervision
• Staff retention
• Cross-training
• Leadership development
• Administrative support

Persistent burnout, unpaid overtime, dependence on a few volunteers, and chronic vacancies are sustainability risks.

Recruiting more volunteers is not always the solution. Some responsibilities require paid staff, professional expertise, consistent availability, or long-term accountability.

When resources cannot support the existing workload, consider reducing or redesigning the scope of work rather than relying on people to absorb unsustainable demands.

Step 8. Develop a sustainable financial and resource strategy

Sustainability requires understanding the full cost of the work.

Estimate:

• Personnel costs
• Employee benefits
• Facilities
• Technology
• Insurance
• Transportation
• Participant supports
• Accessibility and language access
• Evaluation
• Communications
• Administrative and indirect costs
• Equipment replacement
• Training
• Compliance and professional services

Then consider the stability, restrictions, timing, and risks associated with current and potential resources.

Depending on the organization, a resource strategy might involve:

• Grants
• Government contracts
• Individual donations
• Foundation funding
• Membership or participation revenue where appropriate
• Earned revenue consistent with the organization's mission
• Institutional budget allocations
• Partnerships and shared services
• Appropriate in-kind contributions
• Operating reserves

Diversification can reduce dependence on one source, but more funding sources are not automatically better. Each source may carry restrictions, administrative requirements, reporting obligations, or risks.

Avoid expanding solely because new funding becomes available. Expansion should be consistent with mission, evidence, community priorities, staffing capacity, and the organization's ability to support the work after initial funding ends.

Step 9. Anticipate external risks and future scenarios

Sustainability planning should consider changes outside the organization's direct control.

These may include:

• Loss of a major funding source
• Changes in laws or regulations
• Economic downturns
• Leadership changes
• Loss of a major partner
• Technology changes
• Workforce shortages
• Natural disasters or public-health emergencies
• Changes in community demographics or priorities
• Political or institutional opposition

For major risks, consider:

• How likely is this?
• What would the impact be?
• What warning signs could we monitor?
• What could we do now to reduce the risk?
• What would our response be if it occurred?

Scenario planning can help prepare for several plausible futures instead of assuming that current conditions will continue unchanged.

Step 10. Turn the assessment into an action plan

Sustainability planning should lead to specific actions.

For each priority, identify:

• The action to be taken
• The person or group responsible
• Partners who need to be involved
• Resources required
• A realistic timeline
• How progress will be measured

Prioritize rather than trying to strengthen every sustainability area simultaneously.

For example:

Priority	Action	Responsible	Timeline	Measure of progress
Leadership succession	Document key responsibilities and cross-train two additional staff or volunteers	Executive director and board	Next six months	Succession plan adopted and backup responsibilities assigned
Funding stability	Identify funding risks and develop a multiyear resource strategy	Leadership and finance team	Before next budget cycle	Board-approved resource plan completed
Program adaptation	Use participant feedback and evaluation results to revise services	Program staff and community advisory group	Before next program cycle	Revised model implemented and evaluated

Step 11. Review and update the sustainability plan

Sustainability capacity changes over time.

Review the plan periodically and after major changes such as:

• A new strategic plan
• A major grant beginning or ending
• Leadership transition
• Significant program expansion
• Major evaluation findings
• A change in community priorities
• A new partnership or merger
• Significant financial changes
• Changes in law, policy, or technology

Ask whether the same activities still deserve to be sustained and whether the current model remains the best way to provide the intended benefits.

In Summary

Sustainability is not simply keeping an organization or program alive. It is the capacity to maintain meaningful community benefits, effective practices, relationships, services, policies, and other valuable results for as long as they continue to be needed.

Sustainability planning should begin early and continue throughout the life of an initiative. It involves more than fundraising. Strong sustainability capacity may depend on organizational capacity, partnerships, funding stability, evaluation, adaptation, strategic planning, communications, community and institutional support, leadership succession, and a sustainable workforce.

Begin by deciding what is actually worth sustaining. Use evidence and community input to determine what should continue, what should change, what might be transferred or incorporated into other organizations or systems, and what may appropriately end.

Build enough governance and organizational structure to support accountability and continuity without creating unnecessary bureaucracy. Document important knowledge, distribute responsibilities, develop future leaders, and avoid making essential work dependent on one person or on chronic unpaid labor.

Develop a realistic financial strategy based on the full cost of the work and prepare for changes in funding, partnerships, leadership, policy, technology, and community conditions.

Finally, treat sustainability as an ongoing learning process. Evaluate results, listen to community members and partners, adapt when conditions change, and remain willing to change the form of the initiative when another approach can sustain its benefits more effectively or equitably.

Example 1: Sustainability in WASH governance programmes

Taken from the Sustainability in WASH governance programmes, A WaterAid and Freshwater Action Network publication. Written by Hilary Coulby.

 

“For WaterAid and FAN, sustainability means that the benefits and progress achieved during the life of the programme not only survive and continue long after it has ended, but also continue to progress on an upward course. This definition implies that there is no end point for sustainability. Even if a completely ideal state is reached, this too must be continually sustained. If at any time the benefits of the programme begin to disappear and communities slip back into the pre-intervention situation, then the intervention cannot be said to be sustainable.”

This handbook focuses on:

• Sustainability definitions and frameworks.
• Achieving sustainability (at local and national levels).
• Sustainability for non-governmental​ organisations (NGOs) and their networks.
• Limits on the reach of NGOs and international NGOs (INGOs) and implications for their sustainability strategies.

Visit this guide and additional sustainability handbooks online at: www.wateraid.org/gtflearninghandbooks

 

Example 2: Jackie's Internship

Jackie was a graduate student in community psychology at a state university. As part of the rigorous training for her Master's degree, she was required to complete a two-semester internship.

Jackie jumped at the chance to get some hands-on, practical experience in a setting where she could learn about community organizing in a carefully supervised placement. She chose to do her internship in the office of the city's youth activities director.

Jackie arrived for the first day of her internship ready to learn all about organizing activities. Her supervisor, Takisha, informed her that she was to work on the "Annual Women's Basketball Tournament."

Jackie was so excited. She had attended this tournament for the past three years. "Great!" Jackie told her supervisor, "Where's the contact list of sponsors?"

"Oh, I don't know what our last graduate student did with it," her supervisor said.

"That's okay; do we have the mailing lists of girls that participated last year?" Jackie asked determinedly.

"Not that I know of," Takisha answered.

"No problem," Jackie said. "But do you know where the source book explaining how to organize this event is? It would save me a lot of time and trouble. "

"Sorry Jackie, I moved to this position last year after the tournament. The woman who had this job didn't mention anything to me about the tournament. But don't worry ; didn't you say that you wanted a challenge?"

Jackie sat down at her desk and wondered how she was going to recreate the tournament that had taken place so flawlessly for the past five years, starting from scratch. Jackie was looking forward to a challenge, but she did not consider reinventing the wheel a good use of her time. Her time could have been spent organizing the tournament and finding ways of making it bigger and better. Now she was starting from square one.

As Jackie organized the tournament, she clearly documented her every action so that the next person in her position could use what she had done to make the next tournament go more smoothly. Jackie realized that it was necessary to plan to institutionalize the tournament.

Jackie clearly indicated in the "Tournament" source book she created:

• The goals of the tournament
• The accomplishments of the tournament
• The types of publicity she used to promote the tournament, and the extra media coverage it received
• The structure with which the tournament ran
• The budgetary and staffing needs for the tournament
• The obstacles she encountered (and thanks to her predecessors, there were many)

Jackie planned out a way for the tournament to go off smoothly for years to come. The tournament was a success; and thanks to Jackie, the next intern won't get stuck starting from scratch. The tournament will almost be able to run itself.

You don't have to be a graduate student to perform this kind of work. Jackie's documentation, and her tournament source book, did not do the entire job of institutionalizing her program. But it certainly helped!

___You understand that institutionalization is the active process of developing relationships, practices, and procedures that become a lasting part of your community.

___You understand that planning for institutionalization gives you the time you need to solve the problem.

___You understand that it helps you map out how to become an institutionalized initiative with the structure and legitimacy needed for future years of service.

___You understand that it makes your efforts more efficient and effective.

___You understand that it is cost-effective.

___You understand that you want to begin planning for institutionalization once you have a clear idea of your goals and the opinions of your constituency.

You know the answers to the following questions:

___What is the nature of our initiative?

___What are the goals of our initiative?

___What has our initiative done?

___What publicity has our initiative received?

___How is our initiative structured and governed?

___Does our initiative have sufficient staffing?

___Is our budget sufficient to cover expected costs now and in the future?

___What are some obstacles we may encounter? And how do we get around them?

Tool #1: Twelve Tactics for Sustainability

For a downloadable worksheet in Microsoft Word, click here.

 

Tool #2: The Matrix Map: A Powerful Tool for Mission-Focused Nonprofits

The Matrix Map is a visual tool that plots all of the organization’s activities—not just its programs—into a single, compelling image. By illustrating the organization’s business model—through a picture of all activities and the financial and mission impact of each one—it supports genuinely strategic discussions. Read more.

 

A community arts organization has grown substantially, but its administrative systems have not kept pace. Its part-time executive director is carrying an unsustainable workload, and a volunteer board treasurer is handling financial responsibilities that require more consistent organizational capacity.

The organization needs better financial systems, records management, and administrative support.

A nearby university operates a supervised internship program in nonprofit administration. The organization begins a conversation with the university about whether appropriately structured internships could support specific capacity-building projects while providing meaningful educational experience for students.

Before moving forward, the organization examines what work should be performed by paid staff, what could appropriately be part of an internship, how students would be supervised, what access they would have to financial or personal information, whether compensation is appropriate or legally required, and what will happen to the systems they create after the internships end.

This example illustrates a broader question faced by many community organizations: when should an organization use people who are not part of its regular staff to provide expertise, services, leadership, or additional capacity?

What do we mean by external personnel and workforce resources?

External personnel resources are people whose skills, time, professional roles, or community experience can contribute to an organization's work even though they are not part of its regular workforce.

Depending on the arrangement, they may include:

• Staff from partner organizations
• Shared or seconded employees
• Contractors and consultants
• Interns and students
• Volunteers
• Pro bono professionals
• AmeriCorps or other service-program members
• Temporary or staffing-agency workers
• Program participants or community members who voluntarily take leadership or service roles

These arrangements should not be understood simply as ways to obtain free or inexpensive labor.

Instead, ask what type of relationship is appropriate for the work, the person performing it, and the organization.

The answer may be:

• Hire an employee
• Contract with a professional
• Partner with another organization
• Host an educational internship
• Recruit a volunteer
• Arrange shared staffing
• Refer participants to another qualified provider

Why use external personnel resources?

To obtain specialized capacity

An organization may need expertise that it does not require full-time.

Examples include:

• Accounting
• Information technology
• Evaluation
• Interpretation or translation
• Legal services
• Human resources
• Communications
• Clinical consultation
• Grants management

Shared or contracted expertise may be more appropriate than creating a separate full-time position for every specialized need.

To connect participants with existing services

Sometimes the needed service already exists in another organization.

A housing program, for example, may determine that participants need employment assistance. Instead of creating a new employment department, it might establish a referral or co-located service partnership with a qualified workforce organization.

This can reduce duplication and allow each organization to focus on areas in which it has appropriate expertise.

To strengthen collaboration

Shared staffing or service arrangements can lead to deeper collaboration.

Organizations may discover opportunities to:

• Coordinate referrals
• Share training
• Develop joint programs
• Conduct collaborative evaluation
• Share facilities or technology
• Address gaps that no single organization can address alone

To bring additional perspectives into the organization

Interns, volunteers, community advisors, consultants, partner staff, and participants may identify assumptions or problems that regular staff have stopped noticing.

Encourage respectful feedback rather than expecting outside contributors simply to adopt the existing organizational culture.

To build community participation and leadership

Volunteers and community members can contribute knowledge, relationships, expertise, and leadership.

Meaningful community participation can strengthen the work, but participation should be valued for the contribution it makes to the mission - not simply because unpaid people reduce payroll expenses.

To respond to temporary or changing needs

A short-term project, staff vacancy, emergency, technology transition, evaluation project, or temporary increase in demand may require additional capacity for a limited period.

A temporary arrangement can be appropriate if roles, supervision, compensation, confidentiality, and continuity are addressed.

When should you consider using external personnel?

When you need expertise that is unavailable internally

If essential work is being delayed or performed by people without the necessary training, obtain appropriate help.

Examples may include:

• Financial management
• Data systems
• Compliance
• Human resources
• Evaluation
• Legal issues

Do not assume that administrative and infrastructure work can indefinitely be absorbed by program staff, board members, or volunteers.

When another qualified organization already provides the service

If another organization can provide a needed service effectively and accessibly, partnership or referral may be preferable to creating a duplicate service.

Assess:

• Service quality
• Accessibility
• Cost
• Eligibility
• Language access
• Disability access
• Transportation
• Privacy
• Participant experience

When a funder or contract requires expertise that you do not have

Another organization may serve as a partner, subrecipient, or contractor depending on the actual relationship.

Define the role correctly and understand the grant, contract, procurement, monitoring, and reporting requirements that apply.

When you intentionally want to develop a partnership

Joint staffing or professional support can be a practical starting point for a broader organizational partnership when the arrangement serves a genuine need.

When additional short-term capacity is needed

Temporary staffing or volunteers may help with:

• Community events
• Disaster response
• Neighborhood projects
• Nonpartisan civic-engagement activities
• Time-limited outreach
• Other defined projects

Short-term urgency does not eliminate requirements concerning safety, supervision, political or lobbying restrictions, privacy, accessibility, or volunteer classification.

When a useful external opportunity becomes available

A university may offer interns. A professional association may organize pro bono assistance. A business may offer employee volunteer time. A service program may provide eligible members.

Evaluate the opportunity against actual organizational needs rather than creating unnecessary work simply because people are available.

Sources of external personnel resources

Staff from other organizations

Another organization may provide staff through several arrangements.

Seconded or temporarily assigned staff

One organization may temporarily assign an employee to work with another organization while continuing to employ and compensate that person.

Clarify:

• Employer of record
• Supervision
• Work priorities
• Time allocation
• Confidentiality
• Performance management
• Insurance
• Duration

Shared staff

Two or more organizations may share the cost or use of a position.

Shared positions may work well for finance, human resources, technology, evaluation, interpretation, communications, or other functions.

A written arrangement should identify:

• Which organization employs the person
• How compensation and benefits are funded
• How working time is allocated
• Who supervises
• How conflicting priorities are resolved
• How confidential information is separated
• How performance is evaluated

Contracted services

An organization may purchase defined services from another organization or professional.

Employment, contractor, and subrecipient classifications should reflect the actual relationship rather than the label used in the agreement.

Collaborative programs

Staff from several organizations may work together on a shared initiative.

Define governance, supervision, funding, responsibilities, data access, participant communication, and accountability before implementation.

Reciprocal service arrangements

Organizations may exchange appropriate services or resources.

Even when no cash changes hands, clarify what each organization provides, the estimated value or workload involved, professional responsibilities, confidentiality, duration, and procedures for ending the arrangement.

Interns and students

Internships can provide meaningful educational and professional-development opportunities while contributing to organizational work.

Interns should not simply be treated as inexpensive substitutes for employees.

Paid internships

Paying interns can:

• Broaden access to internship opportunities
• Reduce financial barriers for students
• Support clearer employment expectations
• Help organizations recruit from a wider range of applicants

If an intern is an employee, applicable wage, overtime, payroll, tax, workers' compensation, and other employment requirements apply.

Unpaid internships or volunteer internships

Federal and state rules should be reviewed before establishing an unpaid internship.

U.S. Department of Labor guidance recognizes that individuals may volunteer for charitable nonprofit organizations without expectation of compensation in appropriate circumstances. Its internship guidance also emphasizes examining the actual economic relationship rather than relying only on the title "intern."

Educational institutions may impose additional requirements concerning:

• Academic credit
• Learning objectives
• Faculty supervision
• Evaluation
• Hours
• Professional standards

Check applicable federal and state law and obtain human-resources or legal guidance when classification is uncertain.

Every internship requires real supervision

Internships consume organizational capacity as well as provide it.

Plan for:

• Orientation
• Supervision
• Feedback
• Technology and system access
• Confidentiality
• Training
• Evaluation
• Continuity when the internship ends

If the organization cannot provide the supervision necessary for a meaningful and safe internship, an intern may not be the appropriate solution.

Protect continuity for participants

Internships are usually temporary.

Be especially cautious when interns:

• Provide counseling
• Mentor participants
• Conduct case management
• Work with children
• Work with people experiencing trauma
• Develop projects requiring long-term continuity

Plan from the beginning for handoffs, supervision, records, participant communication, and the end of the relationship.

Volunteers

Volunteers can contribute important time, expertise, community relationships, and leadership.

Federal wage-and-hour guidance generally recognizes volunteering for charitable, civic, religious, or humanitarian nonprofit purposes when the individual serves freely and without expectation of compensation.

Volunteers generally should not be used simply to replace employees who would otherwise perform the same regular work.

Paid nonprofit employees also generally should not be asked to "volunteer" the same services they are employed to provide.

Recruit for defined roles

Instead of simply asking for anyone willing to help, identify:

• The work that needs to be done
• Skills required
• Time commitment
• Supervision
• Physical or technical requirements
• Accessibility
• Training

Screen appropriately for the role

Some volunteer positions may require:

• References
• Credentials
• Driving-record review
• Background screening
• Professional licensure
• Safeguarding training

Screening should be proportionate to the responsibilities and risks of the role and consistent with applicable law and organizational policy.

Provide orientation and support

Volunteers should understand:

• Mission
• Role
• Supervision
• Confidentiality
• Safety
• Nondiscrimination
• Participant boundaries
• Reporting concerns
• Technology and data rules

Service programs

National and community service programs can provide structured personnel resources for eligible organizations.

For example, AmeriCorps VISTA continues to place full-time members with nonprofit organizations and public agencies for capacity-building work connected to reducing poverty.

Sponsoring organizations must follow the program's current eligibility, project, supervision, reporting, and member-support requirements.

Do not describe service-program members simply as free staff. Their roles are defined by the program under which they serve.

Business and professional volunteer programs

Businesses, professional associations, universities, and other institutions may support:

• Skills-based volunteering
• Pro bono consulting
• Employee service programs
• Board service
• Professional mentoring

Define scope, confidentiality, conflicts of interest, intellectual property, professional standards, and liability where appropriate.

Program participants and people with lived experience

People who participate in programs may also choose to contribute to the organization.

Their participation can strengthen community leadership, improve services, and bring important lived experience into organizational decisions.

Never imply that receiving services creates an obligation to volunteer.

Access to services, benefits, housing, treatment, education, or other support should not depend on performing unpaid work unless a lawful program specifically requires it and the requirements are clearly disclosed and appropriate.

Peer mentoring and peer support

Participants or former participants may become mentors, peer navigators, educators, or support leaders.

These roles may require:

• Training
• Supervision
• Confidentiality protections
• Boundaries
• Compensation when the role functions as substantial ongoing work

Do not assume that lived experience should always be contributed without pay.

Administrative, event, and facilities roles

Participants may voluntarily help with events, committees, administrative projects, gardening, community improvement, or other activities.

Ask the same questions you would ask for any other volunteer role:

• Is participation genuinely optional?
• Is the role safe?
• Is training provided?
• Are appropriate accommodations available?
• Is this work that should actually be performed by paid staff?

Governance and advisory roles

People with lived experience can make valuable contributions as:

• Board members
• Advisory-group members
• Evaluation partners
• Hiring-panel members
• Program-design partners

Provide all board members with appropriate orientation, governance education, accessible materials, mentoring when useful, and meaningful opportunities to participate.

Avoid creating a single "participant seat" whose main purpose is symbolic representation.

Fundraising and public communication

People may choose to tell their stories publicly or participate in fundraising, advocacy, or community education.

Their participation should be:

• Voluntary
• Informed
• Free from pressure tied to services
• Respectful of privacy and dignity
• Clear about where and how the story, image, or recording will be used

Do not assume that a personal story should be used simply because it may be emotionally persuasive.

Consider compensating people when they contribute substantial time or expertise to organizational communications, training, research, or advisory work.

Temporary workers and consultants

Some work is best handled through paid temporary staff or independent professionals.

Examples may include:

• Accounting
• Technology implementation
• Evaluation
• Facilitation
• Translation
• Legal services
• Organizational development
• Specialized maintenance

Determine whether the individual is appropriately classified as an employee or independent contractor under applicable law rather than relying only on the parties' preferred label.

How do you identify and use external personnel resources?

1. Define the need

Start with the work, not with the available person.

Ask:

• What needs to be done?
• Why does it need to be done?
• What skills or qualifications are required?
• Is the need temporary, recurring, or permanent?
• How much time does it require?
• Does it involve confidential or sensitive information?
• Does it involve children or other populations requiring additional safeguards?
• Should this actually be a paid position?

2. Map possible resources

Potential sources may include:

• Community organizations
• Universities and colleges
• Career and technical education programs
• Volunteer centers
• Professional associations
• Businesses
• Public agencies
• AmeriCorps and other service programs
• Community members
• Participants and former participants

Community asset mapping can help identify organizations, institutions, expertise, and relationships that already exist.

3. Build relationships before a crisis

Organizations are better positioned to collaborate when they already understand one another's work.

Maintain appropriate relationships with:

• Partner organizations
• Educational institutions
• Volunteer programs
• Professional networks
• Public agencies
• Community organizations

Relationships should not be maintained merely so that favors can be requested later. Build them around shared community goals and legitimate opportunities for collaboration.

4. Determine the appropriate relationship

Before recruiting someone, determine whether the appropriate relationship is:

• Employee
• Contractor
• Intern
• Volunteer
• AmeriCorps or another service-program member
• Seconded employee
• Staff member of a partner organization

These categories can involve different legal, financial, supervisory, insurance, and tax responsibilities.

Do not choose a volunteer or internship label simply because the organization cannot afford wages.

5. Assess mission and ethical fit

Outside personnel should be able to work consistently with the organization's:

• Mission
• Participant rights
• Nondiscrimination policies
• Accessibility practices
• Confidentiality requirements
• Professional standards
• Evidence-informed program model

Do not enter a partnership simply because free or inexpensive labor is available when the person's or partner organization's practices conflict with essential ethical or service standards.

6. Calculate the full cost

Outside personnel are rarely cost-free.

Include:

• Recruitment
• Screening
• Orientation
• Supervision
• Training
• Technology
• Workspace
• Background checks where appropriate
• Insurance
• Coordination
• Data-security requirements
• Transition and handoff time

If an arrangement consumes more staff capacity than it provides, redesign it or choose another approach.

7. Protect confidential information

Interns, volunteers, consultants, shared staff, and partner employees may need access to organizational systems or information.

Give people only the access necessary for their role.

Address:

• Confidentiality agreements
• Role-based system access
• Password and account practices
• Secure devices
• Participant and donor privacy
• Records retention
• Return or deletion of information when the role ends

Do not assign someone to build databases of participant or donor information without first determining what information should be collected and who should have access to it.

8. Address safety and safeguarding

Roles involving children, health services, home visits, transportation, money, vulnerable adults, or other higher-risk activities may require additional safeguards.

Depending on the role and jurisdiction, these may include:

• Screening
• Background checks
• Professional credentials
• Mandatory-reporting training
• Boundaries training
• Insurance
• Safety procedures

9. Define expectations

Clarify:

• Role and responsibilities
• Schedule
• Compensation or stipend, if any
• Employer or sponsoring organization
• Supervision
• Training
• Confidentiality
• Professional development
• Communication
• Performance expectations
• Duration
• Evaluation
• Procedures for ending the arrangement

People performing the work should participate in designing the practical details rather than receiving an arrangement that has already been negotiated entirely by organizational leadership.

10. Put significant arrangements in writing

Depending on the situation, use:

• Employment documents
• Contracts
• Memoranda of understanding
• Internship agreements
• Volunteer role agreements
• Data-use or confidentiality agreements
• Service-program agreements

Do not assume that a document involving a volunteer can never have legal significance. The effect of any agreement depends on its content and applicable law.

11. Orient, train, and supervise

People need enough information and support to perform their roles safely and effectively.

Orientation may cover:

• Mission
• Organizational structure
• Program model
• Role expectations
• Confidentiality
• Safety
• Nondiscrimination
• Accessibility
• Participant boundaries
• Technology
• Reporting concerns

12. Evaluate the arrangement

Ask:

• Is the need being met?
• Is the person adequately supported?
• Is supervision manageable?
• Are participants receiving high-quality service?
• Are confidentiality and safety being maintained?
• Is workload appropriate?
• Are there unintended inequities or barriers?
• Is this role actually functioning as work that should be paid?

Adjust or end arrangements that are exploitative, unsafe, ineffective, excessively burdensome, or no longer appropriate.

13. Plan for endings and transitions

Internships, volunteer roles, service terms, contracts, and shared-staff arrangements often end.

Plan for:

• Participant handoffs
• Project documentation
• Return of equipment
• Removal of system access
• Records transfer
• Final evaluation
• Knowledge transfer

Do not allow essential organizational knowledge or participant relationships to disappear every time an intern, volunteer, consultant, or temporary worker leaves.

14. Recognize contributions appropriately

Thank people and organizations for their contributions and provide appropriate feedback about the value of their work.

Recognition should reflect genuine appreciation rather than being used primarily as a strategy to obtain more unpaid work later.

In Summary

External personnel resources can strengthen community organizations by providing expertise, services, leadership, additional capacity, and opportunities for collaboration.

Those resources may include partner staff, shared employees, interns, volunteers, pro bono professionals, AmeriCorps members, temporary workers, consultants, and participants or community members who choose to contribute.

The primary goal should not be to obtain labor without paying for it. Begin by defining the work and then determine the appropriate relationship. Essential ongoing work may require paid employees even when volunteers or interns are available.

Internships should provide legitimate educational and professional-development value and should comply with applicable federal and state wage-and-hour rules. Paying interns can also reduce financial barriers that otherwise limit who can participate.

Volunteers should serve freely and without improper expectations or pressure. They should not simply displace regular employees or be expected to provide unpaid versions of the same work they already perform as paid staff.

Participants may become powerful volunteers, mentors, advisors, board members, employees, educators, and community leaders, but receiving services should never create an implied obligation to perform unpaid labor or disclose personal experiences for fundraising or publicity.

Every arrangement has costs. Recruitment, orientation, supervision, training, technology, insurance, privacy, safeguarding, accessibility, coordination, and continuity all require organizational capacity.

Define roles carefully, involve the people who will perform the work, put significant arrangements in writing, protect confidential information, provide appropriate supervision, evaluate the relationship, and plan for how it will end.

Used well, external personnel resources can strengthen both organizations and communities. Used mainly as a substitute for adequate staffing, they can create exploitation, burnout, compliance problems, poor continuity, and weaker services. Sustainable organizations know the difference.

What do we mean by available personnel resources?

___You know that available personnel resources are people who are already doing, or could do, the job you want done, but who don't work for your organization or initiative.

Why tap into available personnel resources?

You tap into available personnel resources:

___To gain cost-effective necessary services for your organization.

___To extend your reach.

___To improve possibilities for collaboration.

___To gain new ideas and new perspectives.

___To get ideas for more comprehensive programs.

When should you tap available personnel resources?

You tap into available personnel resources:

___When money is tight.

___When you have a specific job that needs to be done, and don't have the capacity to do it within the organization as it exists.

___When you're an initiative that doesn't provide direct service, but it's clear that direct service is needed.

___When funders ask for something you can't deliver alone.

___When you actively want to initiate a collaboration or partnership with another organization.

___When you need more manpower quickly to accomplish an immediate goal.

___When existing resources become available, and fit in with the needs and mission of your organization.

Where do you find available personnel resources?

___As loaned, shared, contracted, or traded staff from other organizations.

___As paid or unpaid interns from education or training facilities.

___As volunteers from the community, business, or organizations.

___As people who work directly for your organization, but are paid by another party.

___As participants in your program.

___As temporary workers or consultants.

A community health and family-support center provides several types of services. Some preventive and behavioral health services are billed to health plans or public insurance programs when they meet applicable coverage and billing requirements. A school district pays for certain educational evaluations under a separate agreement. Other community activities are supported through grants, public programs, charitable contributions, or institutional funding.

Many participants pay little or nothing directly for covered services, but that does not mean every service is "free" or that every activity can be billed to an insurer.

The center uses several financing sources because no single payment method supports all of its work.

Third-party reimbursement can be an important part of that financial strategy, but it brings substantial requirements involving enrollment, credentialing, contracts, eligibility verification, coding, documentation, privacy, billing, prior authorization, claims management, audits, and compliance.

What is third-party payment?

Third-party payment or third-party reimbursement occurs when an entity other than the person receiving the service pays some or all of the allowable cost.

Depending on the service and jurisdiction, third-party payers may include:

• Commercial health insurance plans
• Medicare
• Medicaid
• Children's Health Insurance Program (CHIP)
• Medicare Advantage or Medicaid managed care organizations
• School districts or educational agencies
• State, tribal, territorial, or local agencies
• Employer-sponsored plans
• Workers' compensation or other specialized programs
• Other organizations contractually responsible for eligible services

Third-party reimbursement is not one uniform system.

A payer may reimburse through:

• A fee schedule
• A negotiated contracted rate
• A prospective-payment methodology
• Bundled payment
• Capitation
• Value-based arrangements
• Case rates
• Another payment methodology

The amount ultimately paid may also depend on coverage, eligibility, deductibles, copayments, coinsurance, network status, prior authorization, coding, documentation, medical necessity, contractual adjustments, and other rules.

Before relying on third-party reimbursement, understand both the service-delivery requirements and the revenue-cycle requirements associated with each payer.

What are the potential advantages of third-party reimbursement?

Greater access to services

Insurance, public programs, school funding, and other third-party financing may reduce the amount participants must pay directly.

This can make services more accessible to people who might otherwise face significant financial barriers.

Coverage alone does not eliminate all barriers. Deductibles, copayments, network limitations, transportation, language, disability access, eligibility, documentation requirements, and other factors may still affect access.

A recurring source of earned program revenue

Reimbursement can create revenue tied to actual service delivery rather than depending entirely on grants or fundraising.

That may provide a useful recurring resource when:

• A substantial portion of participants have relevant coverage
• Services are eligible for reimbursement
• Reimbursement rates reasonably support the cost of providing the services
• Claims can be submitted accurately and efficiently

Do not assume reimbursement equals full cost recovery.

Compare payment rates with:

• Staff compensation and benefits
• Clinical supervision
• Facilities
• Technology
• Billing
• Credentialing
• Compliance
• Documentation
• Insurance
• Administrative and indirect costs

Opportunities to strengthen organizational systems

Preparing for third-party billing may lead an organization to strengthen:

• Clinical documentation
• Financial controls
• Data systems
• Quality assurance
• Staff credentialing
• Privacy and security
• Billing and collections
• Accessibility

These improvements can benefit the organization even beyond the payer relationship.

Integration into broader service systems

Participation in health plans, public programs, educational systems, or other reimbursement networks may strengthen referral relationships and coordination with other providers.

Enrollment or network participation should not, however, be described as proof that a program is effective or superior. It demonstrates that specified participation requirements have been met.

What are the potential disadvantages and risks?

Administrative burden

Third-party reimbursement can require substantial work involving:

• Enrollment
• Credentialing
• Contracting
• Eligibility verification
• Prior authorization
• Clinical documentation
• Coding
• Claims submission
• Payment posting
• Denial management
• Appeals
• Reporting
• Audits and reviews

Include these costs when determining whether a reimbursement arrangement is financially worthwhile.

Payment is not guaranteed

Providing a service does not guarantee that a claim will be paid.

Claims may be denied, reduced, delayed, or later recouped because of:

• Eligibility problems
• Coverage exclusions
• Missing authorization
• Incorrect coding
• Insufficient documentation
• Lack of medical necessity under the payer's rules
• Provider-enrollment problems
• Timely-filing limits
• Coordination-of-benefits issues
• Post-payment review

Plan for accounts receivable and claim delays rather than assuming reimbursement will arrive immediately after service delivery.

Cash-flow risk

Third-party billing can create a significant gap between when the organization provides a service and when it receives payment.

Monitor:

• Days in accounts receivable
• Denial rates
• Collection rates
• Aging claims
• Payer-specific payment delays
• Overpayment liabilities

Maintain enough working capital or reserves to manage predictable delays.

Risk of mission drift

Organizations may begin prioritizing services because they are reimbursable rather than because they best address community priorities.

Regularly ask:

• Are we changing services primarily because a payer will reimburse them?
• Are people without coverage receiving meaningfully different access?
• Are payer documentation requirements affecting how staff spend their time?
• Are reimbursement incentives consistent with evidence, ethics, and participant needs?

Access inequities

An organization that depends heavily on reimbursement may have financial incentives to prioritize people whose services can be billed.

Develop an explicit strategy for people who are:

• Uninsured
• Underinsured
• Out of network
• Ineligible for a particular benefit
• Unable to afford required cost sharing

Depending on the organization, approaches may include grants, public funding, sliding-scale policies, financial assistance, charity care, contracts, or partnerships.

Compliance and audit risk

Reimbursement creates obligations to bill accurately and retain documentation supporting the services claimed.

Improper billing may result in:

• Claim denial
• Repayment
• Corrective action
• Payment suspension
• Loss of billing privileges
• Other administrative, civil, or legal consequences

Build compliance into the program before billing begins.

What services can receive third-party reimbursement?

There is no universal list.

Coverage depends on:

• The payer
• The participant's specific plan or program
• The service
• Diagnosis or eligibility criteria where applicable
• Provider type
• Setting
• State law
• Network status
• Authorization requirements
• Applicable coverage policy

Potentially reimbursable categories may include:

• Medical and preventive services
• Behavioral and mental health services
• Substance use disorder treatment
• Physical, occupational, and speech therapy
• Home and community-based services
• Certain adult day services
• Home health services
• Diagnostic and laboratory services
• Psychological and neuropsychological assessment
• Certain educational or developmental evaluations
• Certain reproductive, preventive, nutrition, or chronic-disease services
• Other services specifically covered by the payer

Never assume that a service is reimbursable simply because it is beneficial, clinically appropriate, or covered by another payer.

Testing and assessment

Diagnostic testing and assessment should be described more carefully than as the production of a single score.

Depending on the service, an assessment may include:

• Standardized testing
• Clinical interview
• Medical or educational history
• Behavioral observation
• Information from caregivers, teachers, or other relevant people when appropriate
• Functional assessment
• Integration and interpretation of several information sources

Tests have limitations and should be selected, administered, interpreted, and documented by appropriately qualified professionals.

Results should be interpreted in context rather than treated as perfectly objective measurements independent of health, language, disability, culture, environment, or testing conditions.

Provider and staff requirements

Third-party payers often establish requirements concerning who may provide, supervise, order, refer, certify, or bill for a service.

Requirements may depend on:

• Profession
• Licensure
• Certification
• Education
• Experience
• Scope of practice
• Supervision
• Payer enrollment
• Network credentialing
• Service type

Do not assume that one payer's credentialing rules apply to another.

Behavioral and mental health services

Depending on the payer and service, eligible professionals may include:

• Psychiatrists
• Psychologists
• Clinical social workers
• Marriage and family therapists
• Mental health or professional counselors
• Psychiatric or other qualified advanced-practice clinicians
• Other professionals recognized by the applicable payer and state law

Medicare, for example, now allows qualified marriage and family therapists and mental health counselors to enroll independently and bill for covered mental-health services.

Do not use outdated assumptions that most psychotherapy reimbursement requires doctoral-level clinicians.

Mental health conditions should also not be described as simply "chemical." Diagnosis and treatment may involve biological, psychological, developmental, environmental, behavioral, and social factors, and the appropriate treatment varies by the individual and condition.

Medical services

Medical services may be furnished by physicians and other qualified health professionals within their state scope of practice and the requirements of the applicable payer.

Potential provider types may include:

• Physicians, including MDs and DOs
• Nurse practitioners
• Physician assistants
• Certified nurse-midwives
• Clinical nurse specialists
• Registered nurses
• Physical, occupational, and speech-language professionals
• Other licensed or qualified professionals

Prescribing, diagnosing, ordering, supervising, and billing authority vary by profession, jurisdiction, service, and payer.

Laboratory services

Organizations performing laboratory testing on human specimens may be subject to Clinical Laboratory Improvement Amendments (CLIA) requirements.

The level of certification and personnel qualifications depends in part on the type and complexity of testing.

Do not rely on a generic occupational title such as "licensed medical technician" to determine whether laboratory requirements are met.

Educational and developmental services

Requirements for educational assessment and specialized educational services depend on the school system, jurisdiction, funding source, professional role, and applicable special-education requirements.

Payer eligibility and professional qualification should be verified for the particular service rather than assuming every educational service requires the same credential.

Organizational enrollment and credentialing

Third-party reimbursement often requires more than employing appropriately licensed professionals.

The organization and individual practitioners may need:

• National Provider Identifiers (NPIs)
• Payer enrollment
• Credentialing
• Network contracts
• Practice-location approval
• Ownership and control disclosures
• Licensure or certification
• Accreditation where required
• Periodic revalidation

Medicare

Medicare provider enrollment generally involves:

1. Obtaining the appropriate NPI
2. Completing enrollment through the Medicare Provider Enrollment, Chain, and Ownership System (PECOS) or another permitted application process
3. Paying an enrollment application fee when one applies
4. Working with the appropriate Medicare Administrative Contractor
5. Keeping enrollment information current
6. Revalidating enrollment when required

Enrollment requirements differ according to provider or supplier type.

Medicaid

Medicaid provider enrollment is administered through state programs within federal requirements.

Participating providers are subject to screening and enrollment requirements, and state procedures may differ considerably.

Medicaid managed care plans may also have contracting or credentialing processes in addition to state enrollment requirements.

Commercial payers

Private plans may require separate:

• Credentialing
• Contracting
• Network participation
• Provider-directory information
• Recredentialing

Enrollment with one payer does not automatically make an organization eligible to bill another.

Does an organization need 501(c)(3) status?

Not necessarily.

Federal tax-exempt status and provider reimbursement eligibility are separate concepts.

Some particular grants, contracts, programs, or public funding arrangements may require nonprofit or tax-exempt status, but many health care providers receiving third-party reimbursement operate under other organizational structures.

Nonprofit incorporation also does not automatically create federal income-tax exemption.

Organizations seeking recognition under section 501(c)(3) generally must meet federal requirements and, in most circumstances, apply to the Internal Revenue Service for recognition of exemption.

Federal tax exemption also does not automatically provide exemption from every state or local sales, property, or other tax. Those requirements vary by jurisdiction.

Facility, accessibility, technology, and privacy requirements

Requirements may apply to both physical and virtual service settings.

Accessibility

Health and human service organizations should provide access for people with disabilities consistent with the laws and requirements applicable to them.

Depending on the setting, considerations may include:

• Accessible routes and entrances
• Accessible restrooms
• Accessible examination rooms and equipment
• Appropriate communication access for Deaf and hard-of-hearing people
• Materials accessible to people with visual, cognitive, or other disabilities
• Reasonable modifications to policies and procedures where required

Accessibility should not be treated merely as a credentialing task. It is part of providing equitable access to services.

Privacy and confidentiality

Third-party billing may require collecting and transmitting sensitive health and financial information.

Organizations should determine whether they are covered entities or business associates under HIPAA and what other federal and state privacy rules apply.

Appropriate safeguards may include:

• Role-based access
• Secure electronic systems
• Privacy policies
• Workforce training
• Secure communication
• Business associate agreements where required
• Risk assessment
• Breach-response procedures

Protect privacy in physical spaces as well as electronic systems.

Telehealth and remote services

Some services may be delivered through telehealth or other remote methods when permitted.

Before billing, verify:

• Payer coverage
• Provider licensure
• Participant location requirements
• Approved technology
• Coding
• Documentation
• Privacy
• Consent requirements

Telehealth requirements can change, so organizations should monitor current payer and regulatory guidance.

Billing and documentation requirements

Becoming enrolled or credentialed does not by itself create a successful reimbursement system.

The organization needs a reliable revenue-cycle process.

Verify coverage and eligibility

Before providing a billable service when practical, determine:

• Whether coverage is active
• Whether the provider is in network or otherwise eligible
• Whether the service is covered
• Whether authorization or referral is required
• What participant cost sharing may apply

Obtain prior authorization when required

Some payers require approval before specified services, procedures, medications, or levels of care are provided.

Authorization does not always guarantee payment, but failing to obtain a required authorization can result in denial.

Track:

• Authorization numbers
• Approved services
• Units or visits
• Effective dates
• Expiration dates
• Renewal requirements

Document services accurately

Records should support the services billed and meet applicable clinical, professional, payer, and legal requirements.

Documentation may need to support:

• Service date
• Provider
• Service performed
• Diagnosis or other eligibility information when applicable
• Medical necessity or program criteria
• Duration or units
• Treatment or service plan
• Outcomes or response when required

Document the service because it is clinically and administratively necessary, not simply to maximize reimbursement.

Code accurately

Health care claims may require CPT, HCPCS, ICD-10-CM, revenue, place-of-service, modifier, or other coding depending on the payer and service.

Coding should accurately reflect the service documented.

Do not bill a higher-level or different service merely because it produces a higher payment.

Submit claims and manage remittances

Establish systems for:

• Electronic claim submission
• Claim-status tracking
• Payment posting
• Contractual adjustments
• Participant balances
• Denials
• Corrected claims
• Appeals
• Refunds and overpayments

Monitor denials

Denials are not just individual billing problems. Patterns can reveal weaknesses in:

• Eligibility verification
• Authorization
• Documentation
• Coding
• Credentialing
• Contract setup
• Staff training

Track denial reasons and address recurring causes.

How do you prepare to pursue third-party reimbursement?

1. Define which services you want to finance

Begin with mission and community need rather than with the payer.

Identify:

• The services to be provided
• Who needs them
• Current costs
• Current funding sources
• Why reimbursement may be appropriate

2. Identify relevant payers

Determine which health plans, public programs, agencies, schools, or other entities cover the services used by the people your organization serves.

3. Research each payer's requirements

Obtain current information directly from the payer or authoritative program guidance.

Review:

• Covered services
• Provider eligibility
• Credentialing
• Enrollment
• Network requirements
• Rates
• Prior authorization
• Coding
• Billing
• Documentation
• Appeals
• Audit provisions
• Termination provisions

4. Assess the organization's readiness

Review:

• Staff credentials
• Clinical or service capacity
• Facilities
• Accessibility
• Technology
• Privacy and security
• Financial systems
• Billing systems
• Compliance
• Cash reserves

5. Model the financial impact

Estimate:

• Expected payer mix
• Contracted or allowed rates
• Expected volume
• Denials
• Participant cost sharing
• Billing costs
• Credentialing costs
• Technology costs
• Additional staffing
• Payment delays

Compare expected net reimbursement with the full cost of providing and administering the service.

6. Plan for workforce changes

If additional credentials or expertise are needed, determine whether to:

• Hire staff
• Increase supervision
• Contract appropriately with qualified professionals
• Partner with another organization

Compensation, workload, professional development, supervision, and working conditions should support recruitment and retention.

7. Build the required infrastructure

This may include:

• Electronic health or service records
• Billing software
• Clearinghouse relationships
• Compliance policies
• Privacy and security safeguards
• Credentialing systems
• Financial controls
• Quality-improvement systems

8. Complete enrollment, credentialing, and contracting

Complete all required steps before assuming the organization may submit payable claims.

Verify:

• Effective date
• Billing privileges
• Network status
• Authorized locations
• Individual provider enrollment or reassignment where required

9. Train staff before billing begins

Staff should understand:

• Covered services
• Documentation
• Coding
• Prior authorization
• Privacy
• Billing compliance
• Participant financial communication

10. Communicate with participants

Explain clearly:

• Which coverage the organization accepts
• Network status when known
• What services may be covered
• Potential deductibles, copayments, or other costs
• Financial-assistance options
• What happens if coverage changes

Avoid promising that insurance will pay simply because a service has been scheduled or authorized.

11. Start carefully and monitor performance

Organizations may benefit from implementing reimbursement in stages rather than immediately depending on it for a large share of operating revenue.

Monitor:

• Claims submitted
• Payments
• Denials
• Accounts receivable
• Administrative costs
• Staff workload
• Participant access
• Service quality
• Mission impact

Maintaining payer relationships and compliance

Communication with payers matters, but payer relationships should be professional, documented, and compliant.

Do not rely on personal relationships to obtain faster payment, avoid requirements, or have rules "bent."

Designate appropriate responsibility

Depending on organizational size and billing volume, responsibilities may include:

• Provider enrollment
• Credentialing
• Contract management
• Revenue-cycle management
• Claims
• Denials and appeals
• Compliance

Smaller organizations may combine these responsibilities or use qualified external support.

Use formal payer channels

Maintain current contacts for:

• Provider relations
• Credentialing
• Contracting
• Claims
• Prior authorization
• Appeals

Document important payer communications and contract interpretations.

Monitor policy changes

Third-party reimbursement changes continually.

Monitor changes involving:

• Coverage
• Fee schedules and contracted rates
• Coding
• Prior authorization
• Provider enrollment
• Revalidation
• Telehealth
• Documentation
• Electronic transactions
• Interoperability
• Privacy and cybersecurity

Maintain enrollment information

Report changes within required timeframes and complete recredentialing or revalidation when required.

Failure to maintain current enrollment may interrupt billing privileges or payment.

Maintain a compliance program

Organizations should establish processes for identifying and correcting billing or documentation problems.

This may include:

• Policies and procedures
• Staff training
• Internal auditing
• Coding review
• Denial analysis
• Overpayment identification and response
• Processes for reporting concerns

Continue evaluating whether third-party reimbursement supports the mission

Third-party billing is a financing tool, not an organizational purpose.

Periodically evaluate:

• Net revenue
• Administrative burden
• Payment delays
• Denial rates
• Staff workload
• Service quality
• Participant access
• Equity
• Mission alignment

An organization may decide to add a payer, leave a network, renegotiate a contract, limit certain reimbursable services, increase alternative funding for people without coverage, or stop billing a payer when the arrangement no longer supports sustainable and effective service delivery.

In Summary

Third-party reimbursement can provide an important recurring source of revenue for community organizations that deliver eligible health, behavioral health, educational, rehabilitation, or other covered services.

It can improve access by reducing what participants must pay directly and can help integrate an organization into broader service systems. It can also require substantial investment in staff credentials, enrollment, billing, technology, accessibility, privacy, documentation, compliance, and financial management.

Payment is not guaranteed simply because a covered service was provided. Eligibility, authorization, network status, documentation, coding, medical necessity, timely filing, audits, and other requirements may affect whether and when payment occurs.

Determine reimbursement eligibility separately for each payer, service, provider type, setting, and participant. Do not rely on broad lists of services or professional credentials that may be outdated or inapplicable to a particular program.

Before billing begins, understand the full cost of participation, complete required enrollment and credentialing, establish appropriate clinical and administrative systems, protect participant information, train staff, and plan for denials and payment delays.

Third-party billing should also be evaluated for equity. Organizations should consider how services will remain accessible to people who are uninsured, underinsured, out of network, or otherwise unable to obtain reimbursement.

Finally, continue evaluating whether reimbursement supports the organization's mission. Sustainable financing should help the organization provide effective and accessible services; the organization should not redesign its purpose simply around what a payer is willing to reimburse.

You understand:

___ Third party payment

___ Advantages of pursuing third party payment

___ Who is eligible for third party payments?

___ How do you prepare your organization to become an approved provider?

___Communicating and maintaining relationships with third party payers

Community organizations often rely on a mix of grants, contracts, donations, public funding, and other resources. In some situations, an organization may also be able to generate revenue by charging individuals, businesses, public agencies, schools, nonprofit organizations, or other purchasers for useful services.

This approach is commonly described as fee-for-service and is one form of earned revenue.

Fee-for-service can strengthen financial sustainability when the services advance the organization's mission, sufficient demand exists, pricing covers the true cost of delivery, and the organization has the capacity to administer the work.

It is not automatically unrestricted, dependable, or profitable, however. Organizations should evaluate tax, legal, contractual, financial, accessibility, staffing, and mission implications before relying on earned revenue as a major funding source.

What is fee-for-service?

Fee-for-service means receiving payment in exchange for providing a defined service.

Services might include:

• Education or training
• Consultation
• Facilitation
• Evaluation
• Technical assistance
• Community or human services
• Workforce-development services
• Health or behavioral-health services
• Childcare
• Transportation
• Other services consistent with the organization's mission and capacity

Fee structures may take several forms.

An organization might:

• Charge a participant for a class or service
• Charge an employer for workforce training
• Contract with another nonprofit to provide specialized services
• Contract with a school system or public agency
• Charge for professional consulting or technical assistance
• License appropriate organizational materials or intellectual property

Third-party insurance or public-program reimbursement is another form of service-based revenue, but it has additional enrollment, credentialing, coding, billing, documentation, and compliance requirements and is addressed separately in the Community Tool Box.

Fee-for-service does not make a nonprofit simply another small business

Nonprofit organizations can engage in revenue-generating activities, but they remain responsible for their charitable or other exempt purposes, governance obligations, funding restrictions, tax requirements, and accountability to the communities they work with.

The purpose of earned revenue should be to strengthen sustainable mission delivery - not to make revenue generation the organization's primary purpose.

Tax considerations for tax-exempt organizations

Charging a fee does not automatically make income taxable.

For a tax-exempt organization, an income-producing activity may be substantially related to the organization's exempt purpose.

For example, an organization created to advance adult education may charge reasonable fees for educational programs that contribute importantly to that educational purpose.

For most tax-exempt organizations, an activity generally may produce unrelated business income when all three of the following apply:

1. It is a trade or business.
2. It is regularly carried on.
3. It is not substantially related to furthering the organization's exempt purpose.

The fact that profits from an unrelated activity are later used to support charitable programs does not by itself make the revenue-generating activity related to the exempt purpose.

A section 501(c)(3) organization also should not allow unrelated commercial activities to become substantial compared with its exempt-purpose activities.

Before launching a significant new earned-income activity, obtain appropriate tax or legal guidance when the relationship to the organization's exempt purpose is uncertain.

A taxable subsidiary is not a routine solution

In some circumstances, an organization may consider conducting a commercial activity through a separate taxable entity.

This can involve significant questions concerning:

• Governance
• Tax
• Capitalization
• Contracts
• Liability
• Intellectual property
• Transactions between the nonprofit and taxable entity

Do not create a for-profit subsidiary simply because an activity may generate substantial revenue. Compare the costs, risks, and alternatives with qualified legal and tax advisors.

What are the potential advantages of fee-for-service?

Revenue diversification

Earned revenue can reduce dependence on a single grant, donor, contract, or public funding source.

Diversification can improve financial resilience when revenue sources have different risks and funding cycles.

Greater flexibility in some circumstances

Revenue earned directly from mission-related services may be less restricted than many grants.

It may therefore help support:

• Staff
• Administration
• Technology
• Evaluation
• Facilities
• Reserves
• Other mission-related organizational needs

Greater flexibility does not mean that the organization may spend revenue without limits. Contracts, representations to purchasers, tax-exempt purpose, organizational policies, board oversight, licensing rules, and other obligations still apply.

Better understanding of program costs

Developing a responsible fee structure requires organizations to understand what services actually cost.

This can improve budgeting for both earned-income activities and grant-funded programs.

Opportunities to share expertise

An organization may develop specialized knowledge that other organizations, schools, agencies, or businesses value.

Training, consultation, evaluation, facilitation, and technical assistance can extend the organization's expertise beyond its direct programs while generating revenue.

Potential for recurring demand

A well-designed service may generate repeat business or longer-term contracts.

Recurring revenue can improve predictability, but demand can change and should never be treated as guaranteed.

What are the potential disadvantages and risks?

The activity may not cover its full cost

Revenue alone does not establish financial success.

Include the full cost of:

• Salaries and benefits
• Supervision
• Preparation time
• Travel
• Facilities
• Technology
• Materials
• Marketing and business development
• Billing
• Collection
• Insurance
• Administration
• Indirect costs

A service generating $40,000 in revenue may still be financially unsuccessful if it requires $45,000 in direct and indirect organizational resources.

Administrative complexity

A fee-based activity may require additional systems for:

• Contracts
• Invoicing
• Accounts receivable
• Payment processing
• Cash handling
• Financial reporting
• Sales or other applicable taxes
• Customer support
• Refunds
• Collections

Mission drift

A service may become financially attractive even though it contributes little to the organization's mission.

Regularly ask:

• Does the activity still advance our mission?
• Are we creating programs mainly because purchasers will pay for them?
• Is earned-income work consuming staff capacity needed for higher-priority community work?

Financial barriers for participants

Charging individuals directly can reduce access, especially when the people most likely to benefit from a service have limited financial resources.

Do not assume that willingness or ability to pay reflects how much someone values a program.

Consider whether:

• Fees should be waived for some participants
• A sliding-fee or discount policy is appropriate
• Scholarships or subsidies are available
• Another payer could cover some services
• Grants or donations should subsidize access

Collection and cash-flow risk

Providing a service does not guarantee immediate payment.

Organizations may experience:

• Late invoices
• Contract disputes
• Participant balances
• Uncollectible accounts
• Long payment cycles

Establish respectful billing and collection procedures and monitor accounts receivable.

Conflict with other funding

Grants and contracts may restrict:

• Charging participants
• Charging another payer for the same service
• Use of grant-funded staff or equipment for commercial activities
• How program income must be treated

Review funding agreements before launching fee-based services and establish systems that prevent double charging or inappropriate cost allocation.

Who might purchase your services?

Employers

Employers may purchase services that support employees or organizational operations.

Examples may include:

• Employee assistance or behavioral-health services
• Workplace health and safety training
• English-language learning
• Digital-skills or workplace education
• Leadership development
• Conflict-management training
• Organizational development
• Childcare or family-support services

Nonprofit organizations, agencies, and community institutions

Other organizations may purchase:

• Staff training
• Evaluation
• Facilitation
• Community engagement
• Career preparation
• Translation or interpretation
• Transportation
• Health or human services
• Technical assistance

Public agencies and criminal legal systems

Courts, probation departments, corrections agencies, or other public entities may contract for appropriately qualified services.

Depending on the organization and contract, services might include:

• Substance use disorder treatment
• Behavioral-health services
• Adult education
• Workforce development
• Family support
• Mediation
• Court-ordered intervention programs

Services involving mandatory participation require particular attention to informed communication, confidentiality, professional ethics, safety, participant rights, and contract requirements.

Schools and educational institutions

Schools may contract for:

• Professional development
• Student-support services
• Tutoring
• Arts programming
• Conflict-resolution or restorative-practice training
• Health or prevention education
• Family education
• Evaluation

Public-school contracts may involve procurement, background screening, data privacy, accessibility, insurance, and other requirements.

Individuals receiving services

An organization may charge participants directly when doing so is consistent with its mission and does not create unacceptable barriers.

Before introducing direct fees, examine:

• Participants' financial circumstances
• Current alternatives
• Likely effect on access
• Administrative cost
• Collection risk
• Whether subsidies are available

Consulting and training purchasers

Organizations with specialized expertise may provide paid consultation or training in areas such as:

• Community engagement
• Public health
• Education
• Organizational development
• Equity, inclusion, and accessibility
• Program evaluation
• Strategic planning
• Workplace health and safety
• Specialized staff development

Consulting can generate useful revenue, but pricing must cover preparation, staff expertise, travel, administration, follow-up, and other costs rather than focusing only on the hours spent in a meeting or training session.

How do you determine whether fee-for-service is viable?

1. Start with mission and community need

Identify the service you are considering and how it advances the organization's purpose.

Ask:

• Why should our organization provide this service?
• Who benefits?
• What community need or organizational need does it address?
• What would happen if we did not provide it?

2. Distinguish need from paying demand

A community may strongly need a service while having limited ability to pay for it.

That does not make the service unimportant. It may mean that direct fee-for-service is the wrong financing mechanism.

Ask separately:

• Is the service needed?
• Who is able and willing to purchase it?
• Could another payer subsidize it?
• Should grants, public funding, philanthropy, or cross-subsidy support access?

3. Research demand and alternatives

Speak with prospective purchasers, participants, partners, employers, agencies, and community members as appropriate.

Research:

• What services they need
• How they currently meet those needs
• Existing providers
• Typical purchasing processes
• Pricing
• Contract requirements
• Accessibility
• Barriers to purchasing or participation

Use the results honestly. Do not launch a service simply because organizational leadership already prefers the idea.

4. Analyze competitors and potential partners

Determine whether other organizations already provide the service effectively.

Consider whether collaboration, referral, or subcontracting would provide greater community benefit than creating a competing service.

5. Assess organizational capacity

Determine whether you have:

• Qualified staff
• Supervisory capacity
• Facilities
• Technology
• Insurance
• Financial systems
• Contract-management capacity
• Marketing or business-development capacity
• Working capital

How do you price services?

Do not begin only by asking what competitors charge.

Develop a full-cost estimate for the service.

Consider:

• Staff wages or salaries
• Benefits
• Preparation
• Supervision
• Travel
• Materials
• Facilities
• Technology
• Insurance
• Administrative support
• Billing
• Marketing
• Evaluation
• Indirect organizational costs

Then consider:

• Market conditions
• Comparable prices
• Purchaser budgets
• Mission and accessibility
• Contract requirements
• Desired operating margin or reserve contribution

Charging below full cost may be appropriate when the organization intentionally subsidizes a service with another funding source. Make the subsidy visible in the budget rather than assuming the service is financially self-supporting.

Direct participant fees and sliding-fee policies

When charging individuals, affordability should be addressed through a written policy rather than informal negotiation or assumptions about what people "should" be able to pay.

A policy may consider:

• Household income
• Household or family size
• Current Federal Poverty Guidelines or another appropriate benchmark
• Service cost
• Available subsidies
• Program-specific requirements

Do not require a symbolic minimum payment simply to make someone demonstrate commitment or dignity.

Depending on mission and program requirements, a full discount or waived fee may be appropriate.

Example from federally supported health centers

Certain federally supported health centers operate under specific sliding-fee requirements.

Current Health Resources and Services Administration requirements generally provide a full discount or only a nominal charge for eligible individuals and families at or below 100 percent of the current Federal Poverty Guidelines and partial discounts for those above 100 percent and at or below 200 percent.

Eligibility is based on income and family size under that program.

These particular requirements do not automatically apply to every nonprofit fee-for-service activity, but they illustrate the importance of using current, objective affordability criteria rather than outdated fixed-dollar tables.

Communicate fees before services are provided

Explain:

• Standard fees
• Available discounts
• Eligibility requirements
• Payment options
• Refund or cancellation policies
• What happens when someone cannot pay

Fee discussions should be respectful and private.

Avoid language suggesting that inability to pay reflects irresponsibility, lack of commitment, or lack of appreciation for the service.

Develop contracts and terms for organizational purchasers

When a business, school, nonprofit, or public agency is purchasing services, use a written agreement appropriate to the arrangement.

Clarify:

• Scope of work
• Deliverables
• Timeline
• Price
• Payment schedule
• Expenses
• Cancellation
• Intellectual property
• Confidentiality
• Data and privacy
• Insurance
• Performance expectations
• Termination

Public entities may also require procurement, vendor registration, competitive bidding, background checks, insurance, or other compliance.

Develop a communication and business-development strategy

Potential purchasers need to understand what the organization offers and how to obtain the service.

Depending on the audience, communication may include:

• An accessible website
• Professional email outreach
• Presentations
• Referrals
• Professional networks
• Community partnerships
• Procurement and contracting portals
• Search and online directories
• Social media
• Conferences
• Print materials when appropriate

Use targeted outreach rather than trying to reach as many people as possible through every available channel.

Communication should accurately explain:

• Services
• Qualifications
• Intended purchasers or participants
• Evidence or experience supporting the work
• Pricing or how to obtain a quote
• Accessibility
• Contact information

Communicating directly with prospective participants

Use plain, accessible language and communication channels that people actually use.

Depending on the community, these may include:

• Websites
• Phone
• Text
• Email
• Community organizations
• Social media
• Local media
• Printed materials
• Trusted community messengers

Provide information in preferred languages and accessible formats when appropriate.

Build the administrative structure

The complexity of the administrative system should match the scale and risk of the fee-based activity.

Systems may need to address:

• Revenue and expense tracking
• Cost allocation
• Contracts
• Billing and invoicing
• Accounts receivable
• Payment processing
• Cash handling
• Refunds
• Financial assistance
• Data and privacy
• Customer or participant records
• Reporting
• Tax and regulatory compliance

Separate costs appropriately

If staff, facilities, or technology support both grant-funded and fee-based work, use reasonable cost-allocation methods.

Do not charge the same cost to two different funding sources.

Review grant and contract rules concerning program income, shared resources, and staff time.

Establish payment controls

Use secure systems and appropriate separation of duties for:

• Receiving payments
• Recording payments
• Deposits
• Reconciliation
• Refunds

Provide receipts and maintain accurate payment records regardless of how much a participant pays or which payment method is used.

Pilot before depending on the revenue

When practical, begin on a manageable scale.

A pilot can reveal:

• Actual demand
• Actual service cost
• Administrative workload
• Collection rates
• Participant response
• Staffing requirements
• Contract problems

Do not build an ongoing staffing structure around projected revenue before testing whether that revenue is realistic.

How do you sustain a fee-for-service activity?

Monitor financial performance

Track:

• Revenue
• Direct costs
• Indirect costs
• Net margin
• Accounts receivable
• Uncollectible balances
• Contract concentration
• Staff utilization

A growing service is not automatically financially successful.

Monitor quality and outcomes

Evaluate:

• Service quality
• Participant experience
• Outcomes
• Complaints
• Accessibility
• Equity

Use evaluation to improve the work. When communicating results to prospective purchasers, accurately represent what the evidence supports.

Monitor access and equity

Ask whether fee-based services are changing who receives services.

Examine:

• Who participates
• Who stops participating
• Who cannot afford fees
• Who receives subsidies
• Whether fee-paying purchasers are receiving priority over people with greater need

Adjust the financing model if earned-income incentives are undermining equitable access or mission priorities.

Monitor the purchaser mix

Dependence on one major contract can create the same concentration risk as dependence on one grant.

Review:

• Revenue by purchaser
• Contract renewal dates
• Payment performance
• Market changes
• Competing providers

Maintain organizational rather than purely personal relationships

Relationships with purchasers matter, but no contract should depend entirely on one personal contact.

Maintain:

• Clear agreements
• Multiple appropriate contacts
• Accurate records
• Regular performance communication
• Renewal calendars

Revisit pricing

Staff compensation, insurance, facilities, technology, inflation, market conditions, and indirect costs change.

Review pricing regularly rather than leaving rates unchanged simply because purchasers have become accustomed to them.

Continue evaluating mission alignment

Ask periodically:

• Is the activity still advancing our mission?
• Is it financially sustainable?
• Is it improving or reducing access?
• Is it consuming disproportionate staff capacity?
• Are we maintaining quality?
• Would another financing model work better?

Reduce, redesign, subsidize, or end a fee-for-service activity when evidence shows that it no longer provides sufficient mission or financial value.

In Summary

Fee-for-service can provide a useful source of earned revenue for community organizations by allowing individuals, employers, schools, agencies, nonprofit organizations, businesses, and other purchasers to pay for valuable services.

Earned revenue can diversify an organization's finances and may provide greater flexibility than some restricted grants. It is not automatically unrestricted, profitable, or permanent.

Begin with mission and community need. Then assess paying demand, competition, organizational capacity, tax implications, full cost, accessibility, and financial risk before launching a service.

For tax-exempt organizations, determine whether an earned-income activity is substantially related to the exempt purpose. A regularly carried-on business that is not substantially related may produce unrelated business taxable income, and substantial unrelated activity can create risks for section 501(c)(3) status.

Price services using full-cost information rather than simply copying competitors' rates. If the organization intentionally charges less than full cost to protect access, identify how that subsidy will be financed.

When charging participants directly, use clear, respectful affordability policies. Do not require everyone to pay a symbolic amount, and do not assume that ability or willingness to pay reflects commitment to the program. Sliding-fee policies should use current, objective criteria appropriate to the program.

Establish written contracts for substantial organizational purchases, build adequate billing and accounting systems, protect participant and purchaser information, prevent double charging, and understand how fee revenue interacts with grants and other funding.

Finally, evaluate the activity continuously. Monitor net revenue, full cost, accounts receivable, demand, service quality, participant access, equity, staff workload, purchaser concentration, and mission alignment.

Fee-for-service is most useful when it is treated as one financing tool within a broader sustainability strategy - not as a guarantee of unrestricted income or as a reason for a nonprofit organization to operate primarily like a commercial business.

___You've considered the advantages and disadvantages and decided that a fee-for -service operation is right for your organization.

___You've decided on the services you're ready to offer.

___You've done market research to find out whether your services are needed, and by whom.

To develop the program:

___You've developed and implemented a marketing plan.

___You've determined and set a fair price for services.

___You've created an administrative structure to handle the fee-for-service operation .

To sustain the program:

___You continue to update and implement your marketing plan.

___You maintain personal contacts at businesses and organizations.

___You continually reevaluate what you're doing.

Long-term community work requires more than a strong program. Organizations also need capable staff, effective governance, appropriate facilities and technology, community relationships, sound financial systems, and adequate resources.

Government funding can be one important part of that resource base.

Federal, state, tribal, territorial, regional, county, municipal, and other public entities may support community work through grants, cooperative agreements, contracts, formula or pass-through funding, reimbursement programs, appropriations, and other mechanisms.

Public funding can provide substantial resources, but it should not be treated as permanently stable or as the only path to sustainability.

Appropriations, policies, leadership, economic conditions, program performance, eligibility rules, and community priorities can change. Public awards may also create significant administrative, reporting, financial, data, procurement, and compliance responsibilities.

Organizations should therefore evaluate public funding according to both the resources it provides and the obligations it creates.

What is public funding?

Public funding refers broadly to resources provided through government revenues or government-administered programs for authorized public purposes.

Public funding may originate at one level of government and be administered at another.

For example, federal funds may be awarded directly to an organization or may flow through:

• States
• Tribal or territorial governments
• Counties or municipalities
• Universities
• Health systems
• School systems
• Other pass-through entities

Federal funding

Federal funding may include:

• Discretionary grants
• Formula grants
• Cooperative agreements
• Contracts
• Reimbursement programs
• Other forms of federal assistance

Some federal opportunities are available directly to nonprofit and community organizations. Others are limited to states, tribal governments, local governments, educational institutions, health entities, or other specified applicants.

Eligibility must be determined from the particular funding opportunity.

State, tribal, territorial, and regional funding

These governments and public entities may distribute resources derived from:

• Federal awards
• State or territorial revenues
• Fees
• Dedicated taxes
• Legislative appropriations
• Other authorized public revenues

Some federal money becomes a subaward or other pass-through funding rather than a direct federal award. The organization should know whether it is a recipient, subrecipient, contractor, or another type of funded entity because different requirements may apply.

Local funding

Counties, municipalities, school districts, public-health departments, housing authorities, libraries, and other local public bodies may provide funding or purchase services.

Opportunities may take the form of:

• Community grants
• Human-service contracts
• Public-health agreements
• Arts or cultural funding
• Housing and community-development funding
• Youth or education programs
• Other locally authorized initiatives

Grants, cooperative agreements, contracts, and subawards are not the same

Organizations should understand what type of relationship they are entering.

Grants

Grants generally provide financial assistance to carry out an authorized public purpose.

The recipient remains responsible for carrying out the approved project and complying with the terms and conditions of the award.

Cooperative agreements

Cooperative agreements are also forms of financial assistance, but they generally anticipate substantial involvement by the federal awarding agency in carrying out the funded activity.

Contracts

Government contracts are procurement arrangements through which a public entity acquires goods or services for its use or to fulfill governmental responsibilities.

Procurement opportunities can involve different solicitation processes, performance standards, pricing structures, and legal requirements from financial-assistance awards.

Subawards

An organization may also receive federal funds indirectly from a state, local government, university, nonprofit organization, or another pass-through entity.

Determine whether the relationship is a subaward or a procurement contract according to the substance of the arrangement rather than simply the terminology used by the parties.

What are the potential advantages of public funding?

Substantial resources

Government programs can provide resources at a scale that may be difficult to obtain through individual donations or small private grants.

Some awards can support:

• Personnel
• Benefits
• Facilities
• Equipment
• Technology
• Evaluation
• Training
• Administration
• Other allowable costs

Potential for multiyear or recurring support

Some public programs provide multiple years of funding, continuation awards, recurring contracts, formula allocations, or other comparatively predictable support.

Recurring does not mean guaranteed.

Funding can change because of:

• Appropriations
• Revenue changes
• Program performance
• Policy changes
• Eligibility changes
• Legislative action
• Contract competition
• Award termination or nonrenewal

Funding aligned with established public priorities

Government funding programs may already be authorized for services related to:

• Public health
• Behavioral health
• Substance use disorder prevention and treatment
• Education
• Housing
• Workforce development
• Transportation
• Youth development
• Environmental protection
• Community development

This can create a strong fit when an organization's existing mission and program model align with the authorized public purpose.

Opportunities to strengthen organizational systems

Preparing for government funding may encourage stronger:

• Financial controls
• Budgeting
• Procurement
• Program evaluation
• Records management
• Accessibility
• Data security
• Grant management

Receiving an award does not by itself prove that an organization is effective, but successful administration can demonstrate organizational capacity and responsible stewardship.

What are the potential disadvantages and risks?

Significant application workload

Government applications may require substantial preparation.

Requirements may include:

• Program narratives
• Detailed budgets
• Budget narratives
• Logic models
• Evaluation plans
• Staffing information
• Organizational documents
• Certifications
• Data
• Partnership commitments

Estimate the probability of success and the organizational effort required before committing significant staff time.

Administrative and compliance requirements

An award may require:

• Detailed financial tracking
• Performance reporting
• Procurement procedures
• Subrecipient monitoring
• Records retention
• Civil-rights compliance
• Accessibility
• Data protection
• Audit or monitoring
• Prior approval for specified changes

Include these administrative costs when determining whether an award adequately supports the proposed work.

Cash-flow risk

Public awards may use:

• Advance payments
• Reimbursement
• Milestone payments
• Fixed amounts
• Other payment arrangements

Understand the payment structure before accepting an award.

If payment follows expenditure, an organization may need sufficient working capital to pay salaries and other costs before reimbursement arrives.

Mission drift

A large funding opportunity can encourage an organization to expand into work that is only loosely related to its purpose.

Before applying, ask:

• Does this work advance our mission?
• Does the community need it?
• Do we have appropriate expertise?
• Can we perform it at the required quality?
• What happens when the award ends?

Do not create a program solely because funding is available.

Funding concentration risk

A large government award can create dependence on one program, agency, or contract.

Consider what would happen if the award:

• Ended
• Was reduced
• Was recompeted
• Changed eligibility rules
• Was temporarily delayed

How do you find public funding opportunities?

Federal grants and cooperative agreements

Grants.gov is the primary federal portal for searching and applying for many federal grant and cooperative-agreement opportunities.

Federal funding notices may be called:

• Notices of Funding Opportunity (NOFOs)
• Funding Opportunity Announcements
• Requests for Applications
• Program announcements
• Other agency-specific names

Do not assume that every funding opportunity is an RFP.

Federal assistance programs

SAM.gov's Assistance Listings provide descriptions of federal assistance programs.

Assistance Listings can help organizations identify federal programs that may relate to their mission, while Grants.gov identifies current grant opportunities for which applications may be submitted.

Federal contracts

Federal procurement opportunities are available through SAM.gov.

Contracts differ from grants and cooperative agreements, so organizations pursuing federal procurement should understand applicable acquisition requirements and the solicitation process.

State and local opportunities

States and local governments use different systems.

Monitor:

• Official grant portals
• Procurement systems
• Agency websites
• Public notices
• Funding newsletters or alerts
• Relevant public meetings

Do not rely on a single annual funding season

Opportunities can be announced throughout the year.

The federal fiscal year runs from October 1 through September 30, but individual federal programs have different competition schedules.

State and local fiscal years vary.

Maintain an ongoing opportunity-tracking system rather than assuming that most funding will appear in a particular month.

The Federal Register

The Federal Register remains an important source of federal rules, notices, proposed rules, and other official information and is published each federal working day.

For organizations primarily searching for federal grant opportunities, Grants.gov is generally a more direct starting point.

Prepare your organization before an opportunity appears

Maintain required federal registrations

Organizations applying for federal grants through Grants.gov generally must first register as an entity in SAM.gov.

SAM.gov provides the organization with a Unique Entity ID (UEI).

SAM registration must be maintained and renewed annually.

Registration can take time, so do not wait until an application deadline.

Maintain organizational records

Keep current:

• Legal name
• UEI
• Employer Identification Number where applicable
• Governing documents
• Board information
• Financial statements
• Audit reports where applicable
• Insurance
• Policies
• Staff résumés or qualifications
• Program data

Build financial-management capacity

Organizations receiving government funds need systems capable of:

• Tracking award revenue and expenses
• Allocating shared costs appropriately
• Documenting payroll and personnel costs
• Managing procurement
• Monitoring subawards where applicable
• Managing cash
• Producing financial reports
• Retaining required documentation

Understand current federal audit requirements

The former A-133 threshold described in older guidance is obsolete.

Under the current federal Uniform Guidance, a nonfederal entity that expends $1,000,000 or more in federal awards during its fiscal year generally must obtain a Single Audit or an allowable program-specific audit for that year.

Organizations below that threshold are still responsible for maintaining records and making them available for appropriate review.

State, local, contractual, or other audit requirements may impose additional obligations.

Plan for indirect costs

Publicly funded programs consume administrative and organizational resources in addition to direct program expenses.

Federal recipients and subrecipients that do not have a current federally negotiated indirect cost rate may generally elect a de minimis indirect cost rate of up to 15 percent of modified total direct costs under current Uniform Guidance, subject to applicable award requirements.

Do not automatically exclude legitimate indirect costs in an effort to make an application appear less expensive.

Strengthen accessibility and civil-rights compliance

Government-funded programs may be subject to requirements involving:

• Disability access
• Nondiscrimination
• Language access
• Equal opportunity
• Other program-specific civil-rights requirements

Strengthen data and cybersecurity practices

Before accepting an award that involves participant, student, patient, employee, research, financial, or other sensitive information, determine:

• What data must be collected
• What information must be reported
• Who owns or controls the information
• Who may access it
• How it must be secured
• How long it must be retained
• What incident-reporting requirements apply

Build appropriate relationships with public agencies and policymakers

Professional relationships can help organizations understand public priorities and funding systems.

Appropriate activities may include:

• Attending public meetings
• Participating in coalitions
• Joining relevant professional networks
• Attending agency webinars or technical-assistance sessions
• Meeting with policymakers to educate them about community conditions
• Participating in lawful public-policy advocacy

These relationships should not be used to obtain preferential treatment in a competitive application.

Agency employees should not be expected to overlook requirements, privately improve an application, or treat a known organization more favorably than other applicants.

Understand lobbying rules

Nonprofit organizations can participate in public-policy discussions, but organizations should distinguish education from lobbying and understand the rules that apply to their tax status and funding.

For section 501(c)(3) organizations, some attempts to influence legislation constitute lobbying and are subject to applicable limits.

Action by Congress, state legislatures, local councils, and similar legislative bodies can fall within the definition of legislation for this purpose.

Government award funds may also carry restrictions on lobbying expenditures.

Track and fund advocacy appropriately rather than assuming public-award funds can be used for all advocacy activities.

How do you decide whether to apply?

Read the entire funding notice first

Determine:

• Purpose
• Eligibility
• Available funding
• Period of performance
• Cost-sharing requirements
• Allowable and unallowable costs
• Evaluation criteria
• Reporting requirements
• Data requirements
• Submission method
• Deadline

Conduct a go/no-go review

Ask:

• Are we eligible?
• Does this advance our mission?
• Does the proposed service respond to a demonstrated community need?
• Can we meet the required outcomes?
• Can we recruit or retain the necessary staff?
• Does the budget cover the true cost?
• Can we meet reporting and compliance requirements?
• Can we manage the cash flow?
• Is the probability of success worth the application effort?

Do not apply solely because a large amount of money is available.

Evaluate sustainability before promising expansion

A three-year award may create positions, leases, technology systems, or participant expectations that continue beyond the funding period.

Decide before applying what is likely to happen when the award ends.

How do you apply?

1. Follow the funding notice exactly

Use:

• Required forms
• Required headings
• Character or page limits
• Budget formats
• Attachment requirements
• File formats
• Naming conventions

An otherwise strong proposal can become nonresponsive if it fails mandatory requirements.

2. Use official questions-and-answers channels

If instructions are unclear, use the process identified in the funding notice.

Depending on the opportunity, this may include:

• An agency point of contact
• A pre-application webinar
• A formal question period
• Published FAQs
• An amendment to the notice

Significant clarifications may apply to every applicant, so monitor the official opportunity for updates.

3. Design the program before writing persuasive language

Define:

• Need
• Goals
• Activities
• Staffing
• Timeline
• Participants
• Partnerships
• Outputs
• Outcomes
• Evaluation
• Budget

Program, finance, evaluation, leadership, and compliance staff should be involved when their responsibilities are affected.

4. Build the budget from the program design

Include the resources actually required to perform the work.

Consider:

• Salaries
• Benefits
• Travel
• Equipment
• Supplies
• Contractual services
• Subawards
• Participant support when allowable
• Evaluation
• Data systems
• Indirect costs

Do not commit to a scope of work that cannot be performed with the available funding.

5. Write to the evaluation criteria

Explain directly:

• What problem or opportunity is being addressed
• What the organization will do
• Why the approach is appropriate
• Who will perform the work
• How implementation will be monitored
• How outcomes will be evaluated
• Why the budget is reasonable

A grant application is not simply a sales pitch. It is a proposal for carrying out funded work under specified requirements and evaluation criteria.

6. Support claims with appropriate evidence

Use:

• Current community data
• Program results
• Relevant research
• Participant and community input
• Organizational experience

Do not exaggerate need, effectiveness, reach, or outcomes to strengthen an application.

7. Coordinate partner commitments early

If partners will provide services, data, staff, referrals, facilities, or cost sharing, define those commitments before submission.

Do not request letters of support that imply responsibilities the partner has not actually agreed to perform.

8. Review numbers carefully

Confirm:

• Budget totals
• Staffing calculations
• Cost-sharing amounts
• Participant counts
• Cost per participant
• Timelines
• Narrative-budget consistency

9. Use secure document and version control

Complex applications may involve several contributors.

Establish:

• File naming
• Version control
• Editing responsibility
• Secure shared storage
• Backup procedures
• Final approval authority

10. Submit early enough to address technical problems

Federal applications are commonly submitted electronically through Grants.gov or another authorized system identified by the agency.

Do not plan to upload for the first time immediately before the deadline.

Verify:

• Active registration
• Authorized submitter
• File format
• Successful validation
• Submission timestamp
• Confirmation or tracking number

Retain the complete submitted application and submission confirmation.

What should you do if you receive an award?

Review the award before accepting it

Compare the final award with the application.

Review:

• Award amount
• Scope of work
• Performance period
• Payment method
• Reporting
• Cost sharing
• Special conditions
• Data requirements
• Intellectual property
• Termination provisions

Do not assume the final award contains everything requested in the application.

Assess cash flow

Understand:

• When funds may be drawn or invoiced
• Whether payment is advanced or reimbursed
• Required documentation
• Anticipated payment timing
• Working-capital needs

An award can create a financial problem if the organization lacks enough cash to operate while awaiting reimbursement.

Establish award-specific financial tracking

Financial records should allow the organization to demonstrate how award funds were used.

Establish appropriate:

• Account codes
• Cost centers
• Timekeeping or personnel documentation
• Cost-allocation methods
• Procurement records
• Supporting documentation

Spend according to the award, not simply to exhaust the budget

Do not make unnecessary purchases merely because an award period is ending.

Costs should comply with the award and applicable requirements and should be properly supported.

Determine what happens to unspent or unobligated balances according to the specific award rather than assuming they can or must be spent.

Manage budget and program changes correctly

Some changes may be made within the recipient's authority. Others require prior written approval.

Under federal Uniform Guidance, specified program and budget changes require prior approval from the federal agency or pass-through entity.

Do not rely on a generic rule such as "10 percent can always be moved between budget categories."

Monitor performance and reporting

Establish responsibility and deadlines for:

• Financial reports
• Performance reports
• Outcome data
• Subaward reporting
• Programmatic deliverables
• Other required certifications or reports

Collect only information necessary for legitimate program, evaluation, compliance, and reporting purposes and protect sensitive information appropriately.

Manage subrecipients and contractors appropriately

If another organization will carry out part of the funded program, determine whether the relationship is a subaward or a procurement contract.

Pass-through entities may have substantial responsibilities for:

• Subaward terms
• Risk assessment
• Monitoring
• Financial and performance review
• Corrective action
• Closeout

Use appropriate procurement procedures

When purchasing goods or services with award funds, follow the procurement requirements applicable to the award and organization.

Maintain safeguards against conflicts of interest and document procurement decisions as required.

Prepare for monitoring and audit

Government funders or pass-through entities may review:

• Financial records
• Program performance
• Procurement
• Personnel costs
• Subawards
• Participant records
• Compliance with award conditions

Treat documentation as part of program administration rather than something assembled only when an auditor arrives.

Close out the award properly

The end of program activity is not necessarily the end of award responsibilities.

Closeout may require:

• Final performance reports
• Final financial reports
• Liquidation of obligations
• Equipment or property disposition
• Final subaward actions
• Records retention
• Refund of amounts owed

Under current federal Uniform Guidance, a recipient generally has 120 calendar days after the end of the period of performance to liquidate financial obligations, while subrecipients generally have 90 days unless an earlier date is established by the pass-through entity.

Follow the specific award and agency instructions.

Maintain professional relationships with funding agencies

Good communication remains important after an award is made.

Maintain clear contacts for:

• Program questions
• Financial questions
• Reporting
• Prior approvals
• Amendments
• Technical assistance

Document significant guidance and approvals in writing.

Professional relationships should make communication clearer, not create exceptions from applicable requirements.

Continue evaluating the award

During implementation, monitor:

• Program quality
• Outcomes
• Equity
• Participant experience
• Staff workload
• Administrative cost
• Cash flow
• Financial performance
• Compliance
• Mission alignment

An award that creates chronic deficits, unsustainable workload, serious access barriers, or substantial mission conflict may need to be renegotiated where possible or not pursued again.

Diversify funding

Public funding can be a major component of an organization's finances, but dependence on one agency, appropriation, contract, or government program creates risk.

Depending on the organization, a diversified resource strategy may include:

• Federal awards
• State or local funding
• Foundation grants
• Individual contributions
• Corporate support
• Fee-for-service revenue
• Third-party reimbursement
• Institutional partnerships
• Other appropriate revenue

Diversification should be evaluated by risk, flexibility, timing, restrictions, concentration, and sustainability rather than simply by counting the number of funding sources.

In Summary

Public funding can provide substantial resources for community organizations and can support programs that advance important public purposes.

Government funding may take the form of grants, cooperative agreements, contracts, formula or pass-through funding, reimbursements, appropriations, or other arrangements. Each has its own eligibility, administrative, financial, and compliance requirements.

Public funding should not be treated as permanently secure. Appropriations, policies, eligibility, economic conditions, competition, performance, and community priorities can change.

Use current official systems to find opportunities. Federal grant opportunities are commonly available through Grants.gov, federal assistance programs can be researched through SAM.gov Assistance Listings, and federal procurement opportunities are available through SAM.gov.

Prepare before an application appears. Maintain required registrations, financial systems, organizational records, staff capacity, data protections, accessibility, and grant-management processes.

For federal grant applications submitted through Grants.gov, organizational applicants generally need an active SAM.gov registration and a Unique Entity ID. Keep the registration current and begin renewal early enough to prevent application or award problems.

Evaluate every opportunity for mission fit and full financial cost before applying. An award that does not adequately support required staffing, administration, evaluation, reporting, and compliance can weaken rather than strengthen an organization.

Follow the funding notice exactly, use official clarification channels, build the program and budget together, support claims with evidence, and submit through the required system with enough time to resolve technical problems.

Once funded, treat award management as an organizational responsibility. Maintain effective financial controls, meet reporting and performance requirements, manage procurement and subawards appropriately, protect sensitive information, obtain prior approvals when required, and prepare for monitoring, audit, and closeout.

Finally, continue evaluating whether public funding advances the mission. Sustainable financing is not simply the ability to obtain government money. It is the ability to use resources responsibly to provide effective, equitable, and enduring community benefit without allowing funding requirements to replace the purpose the organization exists to serve.

What is public funding?

You know that public funding is:

___Funding from the public treasury, i.e. taxes and other government revenues.

___Federal funding

___State funding

___Local funding

Why should your organization apply - or not apply - for public funding?

You know that among the advantages of public funding are:

___Public funding often represents the largest amount of money available to fund organizations and initiatives.

___Public funding is often more reliable and more long-term than private funding.

___Public funding is often appropriated specifically for what your organization does.

___Public funding gives your organization more credibility in the community.

___Public funding may make it easier for your organization to gain funding from other sources.

___Public funding is subject to advocacy, and therefore you may have some influence on how much of it is available.

You know that among the disadvantages of public funding are:

___Public funding proposals may be extremely time-consuming and difficult to write.

___Public funding may come with lots of conditions attached.

___Public funding requires strict accounting and audit procedures.

___Public funding, because of its restrictions, may not allow you to do what you want to do, or may conflict with your mission and philosophy.

___Public funding may be administered by a bureaucracy that is unresponsive, ignorant of the important issues for your organization, rule-bound, and/or difficult to deal with.

___Public funding payments may be slow in coming, either because funding agencies are inefficient or unresponsive, or because the government isn't getting money to them.

___Public funding can get cut or run out if the economy is bad, or if fashions in funding change.

How do you find out about the availability of public funding?

You know that:

___Federal, state, and local agencies usually send notices of funding possibilities to everyone on their mailing lists.

___The Federal Register, a weekly publication, publishes all federal grant notices , with appropriate information and deadlines.

___Check federal, state, and local government websites.

___The newsletters and journals (print and electronic) of professional associations , community coalitions, and other groups often publish funding information.

___Establishing and maintaining contact with individuals at potential funding agencies and town and county offices will ensure that you get information.

___Becoming part of a larger network of community-based, non-profit, and other organizations and agencies will gain you funding information.

How do you position your organization to acquire public funding?

___You know how to become eligible:

• 501(c)(3) tax status
• Appropriate administrative and organizational structure
• Staff with appropriate credentials and training
• Proper financial management, bookkeeping/accounting, and audit procedures
• Compliance with ADA (Americans with Disabilities Act) regulations
• A good track record

___You understand the need to establish relationships

• Establish relationships with federal and state legislators and/or their aides, and local officials
• Establish relationships with individuals at agencies that might fund you
• Attend meetings, conferences, etc. where you'll meet others doing the same work you do
• Join coalitions and collaborate whenever you can
• Volunteer for committees and task forces you're interested in, and take (and carry out) responsibility.

How do you apply for public funding?

___You pay attention to the information in the Request for Proposals (RFP).

• Services or programs desired
• The amount of money available
• Who is eligible to apply
• What the deadlines are
• What information the applicant needs to submit
• What the proposal should look like

___You conceptualize the proposal

• Study the RFP
• Get creative with what you propose
• Be true to your mission and philosophy
• Assemble a reasonable budget for what you're proposing

___You write the proposal

• Find a good proposal writer
• Respond to the RFP precisely as it asks you to
• Answer questions as directly and clearly as possible
• Follow format rules
• Be as brief as you can and still get your message across accurately
• Be explicit about what you want to do and how you'll use the money.
• If possible, allow plenty of lead time to complete the proposal
• Check any numbers several times for errors
• If a checklist is provided, use it; if it's not, make your own

___You assemble the proposal

• Start planning when you first read the RFP
• Assign tasks as you conceptualize
• Do everything you can beforehand
• Make sure you have enough time, space, hands, and equipment to assemble and check the proposal, and deliver it on time

___You celebrate after the proposal has been delivered

If you're successful

___You understand the mechanics of the grant or contract, and be sure you can make it work financially

___You understand any legal agreement fully, and negotiate any questionable points before you sign it

___You make sure you understand and can live with the funder's required financial and reporting procedures

___You negotiate the scope of work if necessary, to be sure you can deliver what 's promised

___You diversify your funding

Imagine that your community organization receives an unexpected call from an attorney, financial advisor, or prospective donor who is considering a gift much larger than the organization normally receives.

Before deciding how to use or structure the gift, the organization should ask several questions.

• What is the donor hoping to accomplish?
• Does the proposed gift support the organization's mission?
• Is the donor requesting restrictions?
• Can the organization honor those restrictions over the long term?
• Is the gift appropriate for current use, capital investment, reserves, an endowment, or another purpose?
• Does accepting the gift create legal, tax, investment, administrative, environmental, reputational, or other obligations?

Major and planned gifts can help community organizations strengthen long-term financial resilience, but they require thoughtful governance and stewardship.

This section provides general information about endowments and planned giving. Tax, trust, estate, investment, charitable-solicitation, insurance, and nonprofit laws can be complex and can vary by jurisdiction and type of gift.

Organizations considering significant endowment or planned-giving activity should work with qualified legal, accounting, tax, investment, development, and other professionals as appropriate.

Donors should also be encouraged to consult their own independent legal, tax, and financial advisors. The organization's advisors represent the organization and should not be treated as substitutes for the donor's personal advisors.

What are endowments and planned gifts?

Endowments

An endowment is a fund intended to support a charitable organization or purpose over an extended period.

Endowed assets are generally invested, and the organization makes distributions according to the applicable gift terms, spending policy, investment policy, and state law.

An endowment should not be understood simply as a bank account in which the original principal can never be touched while all interest may automatically be spent.

Modern endowment management often considers the total investment return of the fund rather than distinguishing rigidly between interest, dividends, and appreciation.

Applicable state law - often a version of the Uniform Prudent Management of Institutional Funds Act, or UPMIFA - may establish standards for prudent investment and expenditure of charitable institutional funds.

Donor-restricted endowments

A donor may make a gift with instructions that it be maintained as an endowment for a particular charitable purpose.

Examples might include:

• Support for a community health program
• Scholarships
• Maintenance of a facility
• Staff development
• General organizational operations

Donor restrictions can remain important for many years.

Before accepting a restricted endowment gift, determine whether the organization can realistically administer the restriction if programs, community needs, technology, terminology, or organizational structures change.

Gift agreements can sometimes include carefully drafted provisions addressing what should happen when the original purpose becomes impracticable, impossible, unlawful, or inconsistent with future community needs.

Modification or release of donor restrictions may require donor consent or compliance with applicable state-law procedures. Do not assume the board may simply redirect a restricted endowment when priorities change.

Board-designated funds

A board may also designate unrestricted organizational assets for long-term investment.

These funds are sometimes called board-designated endowments or quasi-endowments.

Because the restriction was created by the board rather than a donor, the board may generally have greater authority to change the designation, subject to governing documents, organizational policy, fiduciary duties, and applicable law.

Clearly distinguish donor-restricted endowment funds from board-designated reserves or quasi-endowments in organizational records and communications.

Planned giving

Planned giving is a broad term for charitable gifts that are coordinated with a donor's financial, tax, retirement, or estate planning.

A planned gift does not necessarily provide payments back to the donor.

Common planned-giving approaches can include:

• Bequests through a will or trust
• Beneficiary designations
• Retirement-plan assets
• Life-insurance gifts or beneficiary designations
• Charitable gift annuities
• Charitable remainder trusts
• Charitable lead trusts
• Other appropriately structured charitable gifts

Some planned gifts are completed during the donor's lifetime. Others become effective only after death.

Some provide payments to the donor or another beneficiary. Others do not.

Bequests and beneficiary designations

For many community organizations, the simplest planned-giving program begins with bequests and beneficiary designations rather than complex life-income arrangements.

Bequests

A donor may include an organization in a will or revocable trust.

The gift may be:

• A specific dollar amount
• Specific property
• A percentage of the estate
• All or part of the remaining estate after other distributions

Organizations may provide sample descriptive language identifying the organization's legal name and tax identification information, but should not draft a donor's estate-planning documents unless appropriately qualified and authorized to do so.

Beneficiary designations

Depending on the account or asset, a donor may be able to name a charitable organization as a beneficiary of:

• Retirement accounts
• Life-insurance policies
• Certain bank or investment accounts
• Other assets that permit beneficiary designations

The tax consequences vary according to the asset and structure.

Simply naming a charity as a beneficiary is not the same as transferring ownership of an asset to the charity during life and does not automatically create a current income-tax deduction.

Charitable gift annuities

A charitable gift annuity, or CGA, is generally a contract between a donor and a charitable organization.

The donor irrevocably transfers cash or other acceptable property to the organization. In return, the organization promises to make fixed payments to one or two annuitants for life.

Part of the value transferred is considered a charitable gift, with the amount determined under applicable federal tax and actuarial rules.

The organization assumes a continuing payment obligation. A CGA therefore should not be offered merely because a donor requests one.

State regulation matters

Charitable gift annuities are regulated differently across states.

Depending on the jurisdiction, requirements may address:

• How long the organization must have operated
• Minimum unrestricted assets
• Registration or notice
• Reserve funds
• Investment requirements
• Contract language
• Disclosure requirements
• Annual reporting

An organization with donors in several states should determine which jurisdictions' requirements apply rather than assuming compliance in one state satisfies every other state.

Payout rates and actuarial calculations

Do not create payout rates from general life-expectancy assumptions or from characteristics such as race, ethnicity, place of birth, or a fundraiser's estimate of a donor's health.

Calculations should use applicable federal actuarial rules and current professional guidance.

Organizations often consider suggested maximum charitable-gift-annuity rates published by the American Council on Gift Annuities, but must also consider applicable law and their own financial capacity.

Do not promise that a particular rate or tax result will apply until a properly prepared illustration has been completed using current information.

Charitable gift annuities require organizational capacity

Before establishing a CGA program, consider whether the organization can:

• Meet applicable state requirements
• Maintain appropriate reserves
• Administer contracts over potentially long periods
• Make payments reliably
• Produce required tax reporting
• Manage investments prudently
• Track beneficiaries and addresses
• Maintain records after staff turnover

Smaller organizations may find it more practical to work with a community foundation or another qualified partner rather than creating an internal CGA program.

Charitable remainder trusts

A charitable remainder trust, or CRT, is an irrevocable trust in which property is transferred to the trust, distributions are made to one or more noncharitable beneficiaries for a qualifying period, and the remaining assets eventually pass to one or more qualified charitable organizations.

Federal law establishes specific requirements for these trusts.

Charitable remainder annuity trust

A charitable remainder annuity trust, or CRAT, generally pays a fixed amount each year.

Charitable remainder unitrust

A charitable remainder unitrust, or CRUT, generally pays a specified percentage of the trust's value as recalculated under the governing rules.

Federal rules govern payout ranges, charitable-remainder requirements, allowable terms, taxation, reporting, and administration.

CRTs should be created and administered with qualified legal and tax counsel and appropriate trustees.

Do not market a CRT as a method to eliminate tax. Tax consequences depend on the trust, assets, distributions, beneficiaries, and applicable law.

Charitable lead trusts

A charitable lead trust generally makes payments to one or more charitable organizations for a specified period, after which the remaining property passes to noncharitable beneficiaries or otherwise as provided in the trust.

Charitable lead trusts can involve complex estate, gift, income-tax, investment, and trust issues and are generally donor-advised arrangements rather than programs that a small nonprofit should attempt to design independently.

Pooled income funds and other specialized arrangements

A pooled income fund is a specialized charitable trust governed by federal tax requirements.

It should not simply be described as a mutual fund operated by a nonprofit, and donors should not be told that their entire contribution automatically qualifies for a charitable deduction.

Many community organizations do not need to create or administer such arrangements themselves.

When a donor proposes a specialized split-interest gift, involve qualified legal, tax, and financial professionals.

Life-insurance gifts

Life insurance may be incorporated into charitable planning in several ways.

For example, a donor may:

• Name the organization as a beneficiary
• Transfer ownership of an existing policy
• Structure another permissible charitable arrangement involving insurance

These approaches can have very different tax consequences.

Do not tell a donor that naming the organization as beneficiary automatically creates a current deduction or that every future premium payment will automatically be deductible.

Review proposed insurance gifts under the organization's gift-acceptance policy and encourage the donor to obtain independent tax and legal advice.

Gifts of securities and other investments

Publicly traded securities can be useful charitable gifts because they are generally easier to value and liquidate than many other noncash assets.

Donating appreciated securities may provide tax advantages in some circumstances, but the result depends on factors such as:

• How long the donor has held the property
• The type of security
• The type of charitable organization
• Applicable deduction limitations
• The donor's individual tax circumstances

Do not promise a donor a particular deduction or capital-gains result.

Establish procedures for receiving securities, identifying the donor, acknowledging the gift, liquidating assets when appropriate, and recording the gift correctly.

Gifts of real estate and other complex property

Real estate, closely held business interests, artwork, collectibles, cryptocurrency, intellectual property, and other complex assets can produce significant charitable value, but can also create substantial risk.

Adopt a written gift-acceptance policy identifying which gifts require additional review.

Real estate review

Before accepting real estate, consider:

• Title
• Mortgages or other debt
• Liens
• Environmental conditions
• Zoning
• Property taxes
• Insurance
• Maintenance
• Marketability
• Carrying costs
• Whether the organization intends to use or sell the property

Obtain appropriate legal, environmental, financial, and property expertise before acceptance.

Valuation belongs to the donor

A nonprofit should not assign the tax value of a donor's noncash contribution.

The donor is responsible for substantiating the claimed deduction and, when required, obtaining a qualified appraisal.

The organization's acknowledgment generally describes the property received without stating its fair market value for the donor's tax deduction.

Certain noncash gifts may also require IRS forms or additional reporting by the donor or organization.

Tax considerations

Charitable tax rules change and depend heavily on the donor and the gift.

Avoid using planned-giving materials that promise:

• A specific tax deduction
• Elimination of capital-gains tax
• Guaranteed estate-tax savings
• A particular after-tax return

Instead, explain the structure of the charitable gift and encourage donors to determine the consequences with their own advisors.

Organizations should provide accurate acknowledgments and complete required tax and information reporting.

Why establish an endowment?

To provide long-term support

An appropriately sized endowment can provide recurring distributions that support programs, facilities, staffing, innovation, or general operations.

Endowment distributions should be incorporated into a realistic financial plan rather than treated as guaranteed income.

To diversify financial resources

An endowment can reduce dependence on annual fundraising, a single government contract, or a limited number of grants.

It does not eliminate financial risk.

Investment markets fluctuate, donor restrictions may limit spending, management costs reduce returns, and an endowment may lose purchasing power if spending and investment performance are not balanced over time.

To support long-range planning

A mature endowment may provide a degree of financial predictability that helps an organization plan beyond a single grant cycle.

To preserve a donor's long-term charitable purpose

Some donors want their contribution to support a mission or program for many years.

An endowment can provide a structure for accomplishing that purpose when the restrictions are appropriate and administratively sustainable.

When might an endowment not be the best choice?

An organization should not create or expand an endowment simply because endowments sound financially sophisticated.

Consider whether the organization first needs:

• Adequate operating cash
• Emergency reserves
• Debt reduction
• Essential facilities
• Technology
• Competitive staff compensation
• Other immediate organizational capacity

Locking scarce resources into long-term investment while the organization cannot meet current obligations may weaken rather than strengthen sustainability.

Boards should compare an endowment with other strategies such as operating reserves, board-designated long-term funds, capital investments, or community-foundation funds.

When should you consider establishing a planned-giving program?

Planned giving can be appropriate when the organization has:

• A stable mission
• Sound governance
• Consistent financial management
• A history of donor relationships
• Appropriate gift-acceptance procedures
• Capacity for long-term recordkeeping and stewardship

A small organization does not need to begin with charitable gift annuities or trusts.

A basic planned-giving program might simply:

• Explain how to include the organization in a will or trust
• Provide the organization's correct legal name and identifying information
• Explain beneficiary-designation options
• Establish a process for documenting known legacy intentions
• Build relationships with local estate-planning professionals

Consider partnering rather than administering everything internally

Smaller organizations may be able to establish an endowed fund or obtain planned-giving support through:

• A community foundation
• Another qualified public charity
• A financial institution with nonprofit expertise
• A professional planned-giving administrator

Outsourcing administration does not eliminate board responsibility.

Review fees, services, investment options, donor restrictions, access to distributions, reporting, termination provisions, and responsibility for legal and tax compliance.

Adopt a gift-acceptance policy

A written gift-acceptance policy can protect both the organization and prospective donors.

The policy should identify:

• Gifts staff may accept routinely
• Gifts requiring executive or board review
• Gifts requiring legal or tax review
• Unacceptable restrictions
• Procedures for real estate
• Closely held business interests
• Life insurance
• Cryptocurrency or other complex assets
• Tangible personal property
• Charitable gift annuities or trusts
• Naming opportunities
• Conflicts of interest

The policy should also make clear that the organization does not provide individualized legal, tax, or investment advice to donors.

Use written gift agreements for significant or restricted gifts

A written gift agreement can help both the donor and organization understand:

• The amount or property being given
• The charitable purpose
• Whether the gift is expendable or endowed
• Investment and spending expectations
• Recognition or naming
• Reporting
• What happens if the original purpose can no longer be carried out

Avoid restrictions so narrow that future leaders cannot responsibly use the funds.

Establish investment governance

The board retains responsibility for prudent stewardship even when investment management is delegated to professionals.

Adopt an investment policy

A written policy may address:

• Investment objectives
• Time horizon
• Risk tolerance
• Liquidity
• Asset allocation
• Diversification
• Investment-manager authority
• Performance benchmarks
• Fees
• Conflicts of interest
• Mission-aligned or responsible-investment considerations

Adopt an endowment spending policy

The organization should also determine how much may prudently be distributed from an endowment.

Consider:

• Donor restrictions
• Applicable state law
• Duration and preservation of the fund
• Purpose of the fund
• Inflation
• Expected total return
• Investment policy
• Organizational resources

Do not use a universal rule that a particular portion of annual interest or investment gains should always be spent.

Select and monitor investment professionals

When outside investment professionals are used, evaluate:

• Qualifications
• Fiduciary role
• Investment approach
• Fees
• Conflicts of interest
• Custody arrangements
• Reporting
• Performance against appropriate benchmarks

Do not judge investment performance solely by whether the fund gained or lost money in a single year.

Review performance over appropriate periods and in relation to the organization's objectives, risk tolerance, spending policy, fees, and relevant benchmarks.

Responsible and mission-aligned investment

Some organizations incorporate environmental, social, governance, community-investment, or other mission-related considerations into investment policy.

Decisions should reflect:

• Fiduciary responsibilities
• Applicable state law
• Donor restrictions
• Risk and return
• Liquidity
• Organizational mission and values

Avoid reducing the question to whether particular investments are simply "good" or "bad." Establish transparent criteria and a process the board can apply consistently.

Build the administrative systems

Endowments and planned gifts may require long-term administrative systems that survive leadership and staff turnover.

Systems should address:

• Gift agreements
• Donor restrictions
• Investment records
• Beneficiary information
• Annuity or trust payments where applicable
• Tax reporting
• State registration and reporting
• Donor acknowledgments
• Privacy
• Information security
• Records retention

Assign clear responsibility for each function and create calendars or automated systems for recurring deadlines.

Educate prospective donors ethically

Planned-giving conversations should be voluntary, accurate, and professional.

Explain:

• The organization's mission
• How gifts are used
• Available gift structures
• Restrictions the organization can or cannot accept
• Whether recognition is available
• Which parts of the arrangement require the donor's independent advisors

Do not present a charitable gift as though it were an ordinary commercial investment product.

For life-income gifts, distinguish clearly between the charitable purpose of the transfer and the payments the arrangement may provide.

Protect donor independence

Avoid pressure based on:

• Age
• Health
• Bereavement
• Family relationships
• Financial vulnerability
• Fear of tax consequences

Encourage donors to involve independent advisors and, where appropriate, family or other trusted people chosen by the donor.

Do not draft estate-planning instruments or give individualized tax advice unless the person providing that advice is appropriately licensed and acting in that professional capacity.

Respect donor privacy

Planned giving can involve especially sensitive personal information.

Collect and retain only information needed for legitimate fundraising, stewardship, administration, and compliance purposes.

Protect:

• Contact information
• Gift information
• Financial information
• Family information
• Estate intentions
• Beneficiary information

Do not assume that staff, board members, participants, alumni, or current donors may freely provide friends' and relatives' information for unrestricted fundraising use.

Communicate planned-giving opportunities

Appropriate communication channels may include:

• The organization's website
• Email
• Print publications
• Donor meetings
• Educational seminars
• Estate-planning professional networks
• Legacy-society communications

Communications should be educational rather than coercive.

Donor testimonials may be used with permission, but should not imply that another donor will receive identical income, investment performance, tax treatment, or other financial results.

Recognition and naming

Recognition can be appropriate for significant gifts, but it should be governed by policy.

Options may include:

• Recognition in publications
• Donor walls
• Legacy societies
• Naming of appropriate programs or facilities
• Invitations to organizational events

Respect donors who prefer anonymity.

Significant naming commitments should address duration, organizational changes, reputational concerns, and circumstances under which a name may be changed or removed.

Do not give donors operational authority, privileged access to participants, or governance power merely because of the size of a contribution.

Steward current donors

Long-term stewardship is particularly important for endowment and legacy donors because the relationship may extend for decades.

Provide:

• Prompt acknowledgment
• Accurate reporting
• Appropriate recognition
• Updates about the organization's work
• Information about significant changes affecting restricted gifts

Stewardship should not be treated primarily as a strategy for extracting additional gifts or referrals.

A donor's contribution does not create an obligation to give again or to identify other prospective donors.

Review the program regularly

Boards should periodically evaluate:

• Endowment investment performance
• Spending policy
• Fees
• Liquidity
• Purchasing power
• Donor restrictions
• Planned-giving liabilities
• State registrations
• Tax reporting
• Gift-acceptance policy
• Donor privacy and stewardship

Update policies when laws, organizational circumstances, donor expectations, technology, or professional standards change.

In Summary

Endowments and planned gifts can help community organizations build long-term financial resilience, but they are not simple sources of guaranteed income.

An endowment is a long-term charitable fund managed according to its governing gift terms, organizational policies, fiduciary responsibilities, and applicable state law. Organizations should distinguish donor-restricted endowments from board-designated long-term funds and should use prudent investment and spending policies rather than fixed assumptions about annual returns or investment income.

Planned giving is broader than life-income arrangements. It can include bequests, beneficiary designations, retirement assets, life-insurance gifts, charitable gift annuities, charitable remainder trusts, charitable lead trusts, and other appropriately structured gifts.

Complex planned gifts require current legal, tax, actuarial, investment, and administrative expertise. A nonprofit should provide accurate general information while encouraging donors to obtain advice from their own independent professionals.

Before accepting a large or unusual gift, use a written gift-acceptance policy and evaluate mission fit, restrictions, administrative capacity, tax and legal obligations, liquidity, risk, and long-term cost.

Noncash gifts also require careful handling. The donor is responsible for determining and substantiating the value claimed for tax purposes; the organization should not act as the donor's appraiser.

Smaller organizations do not need to create sophisticated planned-giving operations themselves. Bequests and beneficiary designations can provide a practical starting point, and community foundations or other qualified partners may offer endowment and planned-giving administration.

Finally, treat planned giving as stewardship rather than financial sales. Respect donor choice, privacy, independent advice, and restrictions; maintain strong board oversight; and make decisions according to the organization's mission and long-term responsibility to the community.