|Learn about the nature of public funding, its advantages and disadvantages, what you need to do to obtain it, and what you need to consider once you have it.|
What is public funding?
Why should your organization apply - or not apply - for public funding?
How do you find out about the availability of public funding?
How do you position your organization to acquire public funding?
How do you apply for public funding?
What do you do if you're successful?
Chapter 46 is about making sure your organization can continue for the long term. In order for that to happen, you obviously need a number of things: a competent and committed staff, an organizational structure that works, appropriate space, community support... and money. Stable, adequate funding is the holy grail for just about every organization that sees itself as more than temporary. There are many possible sources of stable funding, but one of the most readily available -- and probably the largest -- is public money. A share of it may provide the foundation you need if you want to institutionalize your organization.
This section discusses the nature of public funding, its advantages and disadvantages, what you need to do to obtain it, and what you need to consider once you have it. It may be the answer to your prayers, or your worst nightmare... or both. You have to examine all the angles to decide whether public funding is a good option for your organization. This section should give you much of the information on which to base that decision.
What is public funding?
Public funding, in its simplest terms, is funding that comes from the public treasury. It's the taxpayers' money, and the funding of health, human service, environmental, community development, and other public service programs is one of the ways it's spent for the common good. Public funding may come through federal, state, or local government channels, and those channels are usually different at each level.
- Federal funding comes from federal taxes -- the money that individuals and for-profit businesses pay to the IRS, in other words. The federal government usually doesn't fund small organizations directly, but rather parcels out money to states for funding various activities. On occasion, however, the government -- often for pilot programs or the like -- will offer research or program money to community -based or grass roots organizations. In this case, it is generally an agency of a government department that oversees the process.
For example, OERI, the Office of Educational Research and Improvement, an agency of the U.S. Department of Education, offers grants for research on specific educational topics. Although most of its grants go to state agencies or universities, it occasionally funds community-based organizations.
- State funding, as mentioned above, may come from federal money, or it may come from the state's revenues. These vary by state laws, but may include state income taxes, sales taxes, taxes on other commodities (cigarettes, gasoline, restaurant meals), fees for state government transactions (car registrations, professional certification, various permits), and even lottery sales. As with the federal government, it is generally an agency or office of a state government department or division (Department of Public Health, Department of Employment Training, Department of Environmental Management, Division of Youth Services, etc.) that makes the decisions and administers funding. Most of this funding goes to local organizations, which may be community -based or other nonprofits, local government entities, school systems, etc. In the case of contracts, money may also go to for-profit and/or out-of-state concerns that submit successful bids.
- Local funding may come from federal or state sources, or from local - county and municipality - fees and taxes, particularly property taxes. Although local governments may also work through agencies, many, especially smaller, counties or municipalities may administer funds through an individual -- an Administrative Assistant, Town Planner, Human Service Coordinator, etc. These funds are limited to the county or municipality which offers them, but an outside organization that serves a sizeable number of residents may still be eligible for them.
An organization that served the homeless located in one western Massachusetts county nonetheless regularly received money from another, because it maintained shelters in that county as well.
Why should your organization apply -- or not apply -- for public funding?
Public funding has its advantages and disadvantages, but there are a number of good reasons why you should consider tapping into it.
Advantages of public funding:
- Public funding often represents the largest amount of money available to fund organizations or initiatives. A fairly populous state has a budget of tens of billions of dollars. The federal government budget is in the trillions. Thus, even a very small portion of the budget can represent a large amount of money for programs -- in the tens, or even hundreds of millions of dollars. That can very nicely cover the few -- or even more than a few -- thousands your program needs.
- Public funding is often more reliable and more long-term than private funding. Once public funding for a particular issue becomes a recognized item in the budget, it is often refunded without much question, year after year.
- Public funding is often appropriated specifically for what your organization does. The federal government, most states, and many local governments offer money for such services as substance abuse treatment, youth services, community health education, adult literacy, mental health services, etc. It is often easier to ask for money already designated for what you want to do than it is to convince a funder that what you're doing is worthwhile.
- Public funding gives your organization more credibility in the community. It establishes you as a "legitimate" entity, and makes it easier to gain community moral and financial support.
- Public funding may make it easier for your organization to gain funding from other sources. Both the fact that a public funding source saw you as fundable, and the fact that you've already done the work of becoming eligible for public funding, could make another funding source -- public or private -- more willing to work with you.
An adult literacy program, already funded by two state sources (the Department of Education and the Department of Employment Training) was able, as a result, to get funds from a third, the Department of Public Health, to add health education to its services. The facts that it already had fulfilled the requirements for state funding, and that it had a good reputation with its other state funders contributed greatly to its successful application.
- Public funding is subject to advocacy, and therefore you may have some influence on how much of it is available. Through an advocacy or professional organization or a grass roots coalition, or simply through educating the public, you may be able to convince legislators about the need for funding for your particular issue.
Public funding may be just the answer you've been looking for... or it may not. Along with its considerable pluses, it can carry some distinct negatives as well.
Disadvantages of public funding:
- Public funding proposals (see "How do you apply for public funding?" below) may be extremely time-consuming and difficult to write. Government agencies and offices at all levels often have their own sets of regulations, which may conflict with those of other funding agencies. In addition, they may require an enormous amount of documentation and information, all requested in bureaucratic language that's hard to follow and often self-contradictory.
- Public funding may come with lots of conditions attached. Reporting requirements, particular ways of operating or administering programs, prescribed money management arrangements -- all might be part of a grant, and might present difficulties, especially for small organizations.
- Public funding requires strict accounting and audit procedures. You have to be able to track the money in your grant accurately, and may have to return it if it's not spent as agreed upon. If your grant is greater than a certain, relatively small, amount, you are required to undergo an annual audit that can be both costly and time-consuming.
- 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. Some granting agencies may have their own ideas about how services should be delivered, for instance, and may have little tolerance for an unorthodox, or just a different, approach.
As in all such situations, it's extremely important to assess the effect of accepting a grant on your organization. If it's going to require you to violate your guiding principles or to change your mission, you might be better off turning the grant down. Taking it might transform your organization in ways that wouldn't serve its original purpose. If you're considering applying for public funding, you might want to have an organizational discussion about this issue beforehand.
- 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.
One way to address this issue -- one that crops up frequently -- is to establish personal relationships with people within the funding agency (see "How do you position your organization to acquire public funding?" below). Most people are helpful and flexible if you can approach them as human beings: it's only when they -- and you -- are trapped by their positions that their bureaucratic nature wins out.
- Public funding payments may be slow in coming, either because the funding agencies are inefficient or unresponsive, or because the government isn't getting money to them.
State governments in particular often have great difficulty in passing budgets on time. In 1999, both Massachusetts and New York, for instance, failed to pass state budgets until several months after the beginning of the fiscal year. That meant that agencies had no money to pass on to programs, which in turn had to operate on their other sources of income or borrow money in order to keep going. Even after the budget was passed, it took several weeks for the bureaucratic wheels to turn, and for money to arrive at its destination. Some services had to close down for weeks or months, and some organizations went out of business because they didn't have enough cash flow or credit to cover their operations.
- Public funding can get cut or run out if the economy is bad, or if fashions in funding change.
At all levels, the availability of public funding depends, to a large extent, upon trends and public awareness. AIDS and cancer research, adult literacy, violence prevention, air and water clean-up, teen pregnancy prevention, education -- all have received increased public funding at various times over the past three decades because of public and legislative attention.
Often, a particular issue is highlighted by the publication of a book or newspaper or magazine article ("Illiterate America," by Jonathan Kozol, brought adult literacy to the fore in the mid-'80's; "The Silent Spring," by Rachel Carson, started the environmental movement in the '60's; a 1981 article in the New York Times Magazine first informed most of the country about the spread of AIDS). Sometimes, an issue may be raised by a national figure or policy maker (Senator Bob Kerrey's focus on health care in his unsuccessful campaign for the Democratic presidential nomination helped lead to President Clinton's later emphasis on it). But whatever the initial push, public and political enthusiasm for various kinds of public funding is often fickle.
Unfortunately, legislative support for public funding for an issue is seldom based on careful consideration of the needs of the country or the community, but rather on what seems to be attracting votes or attention. Advocacy and lobbying have a lot more to do with public policy than logic or compassion do. Thus, funding for a "trendy " issue can be unstable at best.
Some issues, however -- AIDS research and outreach, for instance -- seem to have reached deeply enough into the national consciousness that their funding is reasonably safe. You need to consider whether your organization's focus falls into such a category or not. If it does, public funding will probably be a long-term benefit to your organization; if it doesn't, you might want to take a long, hard look at your funding plans.
It's obvious that applying for public funding isn't necessarily a simple issue. It's important to understand clearly the pros and cons for your organization, and to decide whether public funding will be a plus for you. That's in the best of all possible worlds: the reality is that, for some organizations, it may be impossible to survive, and particularly to survive for the long term, without public funding. Given that, the rest of this section is devoted to how public funding works, how you can get yourself in a position to get it, and how you can deal with it if you 're successful.
How do you find out about the availability of public funding?
If you've decided to apply for public funding, how do you find out when and where it's available? There are a number of ways in which government agencies and municipalities spread the word when they have money to give out. They're often concerned that as many organizations as possible have the chance to apply, so that they can pick and choose to get the best service.
But not always... they may want to limit applicants to certain categories or to certain organizations, or they may have very strict requirements that only a small number of organizations can meet. Politics can play a role here as well.
They also have a legal obligation to make sure that the news is widely spread, so that there's no favoritism or discrimination involved in the application process. The following are some of the ways that public funding sources advertise grant or contract possibilities.
- Federal, state, and local agencies usually send notices of funding possibilities to everyone on their mailing lists. This includes, among others, all currently and formerly funded organizations, organizations which have applied for funding in the past, and other agencies. If you know which agencies you're likely to be funded by, you can ask to be placed on their postal and/or electronic mailing lists.
- The Federal Register, a weekly publication, publishes all federal grant notices, with application information and deadlines. It's available on the Web and at most public libraries.
- Virtually all federal and state government agencies, and many local government agencies and offices as well, have websites, which often post funding notices with information on how to apply. Professional associations, advocacy groups, and other related organizations may also post funding information on their websites, newsgroups, or e-mail lists.
A Web search can often turn up information on funding possibilities from these sites. Be careful to check dates, however, since web information can be months, or even years old.
- The newsletters and journals (print and electronic) of professional associations, community coalitions, and other groups often publish funding information as a matter of course. If you don't receive any of these publications, many are available at libraries or on the Web; in your local area, you can, once again, probably ask to be placed on the list to receive community and municipal newsletters and funding notices.
- Establishing and maintaining contact with individuals at potential funding agencies or town or county offices will ensure that you get information when you need it. These folks can also be helpful if you decide to apply.
- Becoming part of a larger network of community-based, non-profit, and other organizations and agencies in your area will greatly benefit your organization and gain you funding information as well. It will give you access to word-of-mouth news that you might not get otherwise.
Most public funding is offered on a regular (usually annual) basis. While some is essentially earmarked to refund already-funded organizations and programs, some is often competitive or otherwise available. The funding cycle generally follows the fiscal year. Since the federal fiscal year starts September 1, and most state and local fiscal years start July 1, state and local funding notices are most likely to go out in February or March, or even earlier, with application deadlines in April or early May. The federal timeline often lags behind by a month or two. Thus, late winter and early spring are when you're most likely to find public funding up for grabs.
In addition, agencies and government departments, like publicly funded organizations, are prey to the need to spend all their money if they hope to be refunded at the same level for the following year. If they have any left over, they'll do their best to use it before the fiscal year ends. This sometimes creates opportunities to apply for unspent public money toward the end of the fiscal year.
How do you position your organization to acquire public funding?
First, as mentioned above, you have to be eligible to receive public funding. Eligibility requirements often vary somewhat from one agency to another, but the following are usually necessary.
- 501(c)(3) tax-exempt status. Most organizations directly funded with public money need to have this non-profit standing. You'll almost undoubtedly need state tax-exempt status as well, which requires a separate procedure.
- Appropriate administrative and organizational structure. Most publicly funded organizations are required to have an administrative structure that can properly manage the grant and the proposed program or activity. In addition, most public funders require a Board of Directors, and many require a community advisory board as well. (In some cases, this advisory board may be the Board of Directors, in other cases, it specifically may not.)
An appropriate structure may also mean that you have to be a certain type of organization to be eligible for the funding in question. In some states, only certain types of organizations can apply for funding for particular services: community health centers in some states can only be run by hospitals, for instance.
- Staff with appropriate credentials and training. Many, if not most, Requests For Proposals (RFPs) ask for staff resumes, to assure that services will be delivered and supervised by competent people. Depending upon the program, that may mean that your staff needs to include at least one MD, Ph.D. psychologist, or LICSW; or that your staff members need long experience in street outreach, alcohol education, family therapy, or some other field.
- Proper money management, bookkeeping/accounting, and audit procedures. Government agencies are very concerned that taxpayer money be spent properly, and that organizations be held accountable for their spending. That means you must have the capacity to budget appropriately, spend according to the budget, and keep track of every penny you take in and spend. You must also have records which are kept in a standard manner and which can be formally audited every year. If you receive over $25,000 in public funds, you are subject to a particularly rigorous A-133 audit, and you have to be able to produce all the financial and other information that audit requires.
- Compliance with ADA (Americans with Disabilities Act) regulations. Handicapped accessible space and/or the ability to include and serve individuals with disabilities are required by public funders.
- A good track record. If your organization has been around for a while, you'll probably have to prove that you've been successful at what you do before you can gain access to public money.
If you don't meet all of these eligibility requirements, you still might be able to apply for public funding. You might, for instance, be able to partner or subcontract with another organization that does meet the requirements, or share staff members with specific credentials. You might also receive provisional funding if you can show that you are in the process of becoming eligible, and agree to complete the process by a specified date.
There's more to getting your organization in a position to acquire public funding than simply meeting eligibility requirements, however. Public money for a given service or activity may be available each year, but it may also generally go to those organizations which have been funded before. In other words, it may be hard to break in. Especially if you're a new organization, you'll have to make yourself known to policy makers, funders, and others in your field. The name of the game is networking:
- Establish relationships with your federal and state legislators and/or their aides, and with local officials. Make appointments to talk to them about what you do, and show how your work meets their and their constituents' needs. Invite them to visit your organization and watch it in action. You can help to educate them about your issue. In turn, they can inform you about funding availability, get you through the 501(c)(3) and state tax-exempt processes, and help you make your case with funders.
- Establish relationships with individuals at agencies that might fund you. Ask for their help in getting eligible, let them know about your work and why it's praiseworthy, and get to know them as human beings. It's much easier to deal with a bureaucracy in the form of the real people who staff it, and they're more likely to take your application seriously if they know and respect you.
- Attend meetings, conferences, etc. where you'll meet others doing the same work you do. The more people you know in the field, the more legitimate you'll seem in their and funders' eyes.
- Join coalitions and collaborate whenever you can. It will improve your organization, make you friends and contacts, and establish you as someone people want to work with.
- Volunteer for committees and task forces you're interested in, and take (and carry out) responsibility.
All of this will not only bring you friendships with a lot of interesting and like -minded people, but will put a face on your organization, give you personal connections when you need them, and ultimately help you get a foot in the public funding door.
How do you apply for public funding?
The RFP process
Public funding of all sorts is almost always offered in a Request For Proposals (RFP) process. A government agency or office either decides or is mandated by law to spend a portion of its money for certain services or programs. The agency drafts an RFP, and sends it out to reach as large a number of potential applicants as possible.
The character of an RFP depends largely upon how well the agency understands what it wants, and upon the person who writes it. The better and more clearly it's written, the easier it will be to respond to... but it won't be clearly written unless both the agency and the writer know exactly what they're asking for. Unfortunately, in some cases, the writer may have no background or expertise in the area in question, and the RFP may be confusing, repetitive, or downright incomprehensible. In that circumstance, it is often helpful to call the agency and ask questions about points you don't understand or which seem contradictory. You'll probably find that you're not the only caller; if there are enough questions, the agency may set up a hotline or issue a clarification.
Your organization needs to respond to the RFP: i.e. to write a proposal telling the agency what you want to do, how much it will cost, and exactly how you plan to spend the money. The RFP explains what services or programs the agency wants; how much money is available; who is eligible to apply; what the deadlines are; what information applicants need to submit; and, often, what their proposals should look like. Each of these pieces implies a decision or action for your organization.
- The services or programs desired. If your organization is already doing exactly what the RFP is asking for, there's no problem here. But if the RFP would require you to change what you do or start something new, it will take some serious thought.
You'll have to create something that will both meet the criteria of the RFP and mesh with what you're already doing. Is that possible? Can your organization sustain such activities administratively? Do they conform to your mission and philosophy? Are they as effective as, or more effective than, what you've been doing? If the answer to any of these questions is no, you need to consider carefully whether you want to apply for this money. If the answer to more than one is no, you either need to get extremely creative, or not apply.
- The amount of money available. Is there enough money to fully fund what you are asking to do? If not, you need either to adjust your proposal, or to reconsider your application.
Regardless of the money available, you may not get all you ask for if you do get funded. Can you live with that? Could you scale down your proposed activities to fit a smaller budget, and still be effective?
- Who is eligible to apply. Can you meet the eligibility requirements? Will you have to jump through some hoops in order to do so, and are you willing to do that? (See "How do you position your organization to acquire public funding?" above.)
- What the deadlines are. Do you have enough time to put the proposal together? Can you start up at the beginning of the funding cycle if you're successful?
- What information the applicants need to submit. Is all the relevant information available to you? Is someone in the organization capable of putting it all together, writing the various pieces, etc.? Is your organization in fact capable of doing what this RFP is looking for?
- What the proposal should look like. You need to be careful to put together a proposal that is exactly what the RFP asks for. If it instructs you that Appendix A should be the budget, then Appendix A should be the budget, and should be in the form that the RFP specifies. Some agencies are so serious about their specifications that they won't consider a proposal that deviates in any way from the form they require. Others are more flexible, but they include specifications for a reason. The more closely you adhere to the funder's guidelines, the better off you'll be.
Conceptualizing, writing, and assembling a proposal for public funding
There are really three stages to responding to an RFP. The first is conceptualizing what you want to do, how it will work, and how the available funding will pay for it. The second is actually writing the text of the proposal -- the part that describes what you'll do and how you'll do it -- and putting together a budget that describes exactly how much money you're requesting, and how you propose to spend it. And the third is assembling the full package, including appendices (some of which may be specified in the RFP, and some of which may be supplementary material that you're including for information or to strengthen your case), budgets, supporting documents (letters from other organizations endorsing your proposal, for instance), etc.
This is in some ways the most important step in the process, because it will both determine the worth and effectiveness of what you propose, and also help you understand whether you should respond to this RFP at all. As stated above, if you're already doing exactly what the RFP asks for, then this step is easy. If, as is far more likely, you're doing something that relates to the goals of the RFP but needs to be adjusted to meet them, the process becomes more complex.
If you're doing outreach with homeless youth, for instance, do you have the capacity to take on a program of substance abuse education and treatment with that population? It will mean changing the focus of at least some of what you do, hiring staff with particular expertise, and possibly changing - and jeopardizing - the relationships you have with the teens you're already serving. You have to decide both whether such a program is feasible for your organization, and whether its benefits would outweigh its costs.
The first step in the conceptualization process is to study the RFP carefully. What exactly are the agency's expectations, assumptions, biases, etc.? Are they close enough to your own so that there should be no serious problem in working with them? And can you come up with something that fits for both your organization and the funder?
If you have questions about whether some of your ideas will fit within the guidelines of the RFP, this is a good time to call the funder and ask. Funders may not be able to answer your question directly - there are rules they have to adhere to in order to avoid the appearance of discrimination or favoritism - but you can usually garner enough information to figure out whether what you want to do is allowable. In addition, it won't hurt to establish a contact at the funding agency, if you don't have one already.
The crucial trait here is creativity. Can you design something that either improves, continues, or dovetails with what you're already doing, and also meets the goals of the RFP? Don't be afraid to try something new -- this may be a tremendous opportunity for your organization to move to a higher level. The planning in this phase should be a group process -- the more heads, the better. Just don't forget to be true to your philosophy and mission as well. The bottom line is never to apply for funding just for the money: if the money doesn't fund something you're already doing or want to do, it could just as easily be harmful.
A key question to focus on here is whether you're trying to get more or more stable funding for something that's already happening, or whether you're planning an entirely new program or service that furthers your mission and contributes to the continuation of your organization. Both take careful planning, but the former can actually be harder, because of the necessity of matching up with the requirements of the RFP.
Write the proposal
You've come up with a program that both works for you and fulfills the conditions of the RFP; now you have to describe it convincingly to the funder. The first step, an absolutely essential one, is to find a proposal writer who can write well and clearly. If no one in the organization is a capable writer, it may be worth it, if the grant is large enough, to hire someone knowledgeable in the field to write, or at least edit, the proposal. Your application will have a much better chance if it 's in easy-to-read, graceful prose that says exactly what you want to say and responds accurately to the RFP. A well-written proposal is usually worth its weight in gold.
It is possible to have more than one person do the writing, but they all have to be able writers, and they have to work together closely so that all sections of the proposal are as well-coordinated as if they were written by one person. It has to flow smoothly from section to section.
Some general rules for writing a proposal:
- Study the RFP, and respond to it precisely as it asks you to. Use the RFP's format for the proposal (i.e. number and/or head the sections of your proposal to correspond to numbering and headings in the RFP). For instance, if the first question it asks is "What is the mission of your organization?" then that's the first question you answer. Use the question as your header for that section of the proposal.
- Answer questions directly and as clearly as possible. If you have questions about what information is needed, as might be the case if the RFP is badly written, ask your contact at the funding agency. (And make sure you have a contact at the funding agency.)
- If there are rules for page limits, type size, margins, spacing, page formats, etc., keep to them strictly.
- If there are no page limits, try to be as brief as you can and still get your message across accurately. Staff members at the funding agency may have 20 or 30 -- or more -- proposals to read and evaluate. It's unlikely that they'll give you extra points for sending them 40 pages of explanation.
- Be absolutely explicit about what you want to do and how you'll use the money. Don't just describe your organization or program; describe the exact services or activities you're going to provide.
If you're running a Certified Nurse's Aide training program, for instance, don't just describe it as "48 weeks of CNA classes for a total of 72 students." Instead, be as specific as possible:
"Job training for Certified Nurse's Aide: 6 classes, 3 to take place July-December, 3 to take place January-June; each class 12 hours (three 4-hour classes) per week for 24 weeks (total 288 hours per class), 12 students per class. Each class includes a 6-week, 10-hour per week practicum for each student."
- If the deadline allows it, leave yourself at least twice as much time to complete the proposal as you think you need. If you have to rely on another individual or organization for information, or for completing parts of the proposal, double the lead time again.
- Check any numbers (budgets, cost per person, number of hours of service, etc.) at least three or four times. You can't afford a mistake, and there are plenty of opportunities to make one.
- Many RFPs provide a checklist to help you make sure you've finished and included everything required. If there's no such checklist, make one for yourself and use it. It could be invaluable, especially at the last minute.
Ultimately, a proposal is a sales pitch. The better it's presented, the more clearly you can put forth your ideas and your program or activity, the easier it is to read and digest, the more likely the funder is to buy.
Assemble the whole package
In addition to the proposal narrative and the budget -- the parts discussed above -- funders may require a large amount of other information, documentation, forms, and support (one proposal the author recently wrote asked specifically for several forms and 14 appendices). Including all these, in the order requested, can be as important as writing the proposal.
Putting the final version of the proposal together can be a nightmare if you have to do it at the last minute, hours before the proposal is due. If you take some time early in the process to think about this step, you can anticipate and avoid problems, and get it done well before the deadline.
When you first read the RFP, take careful note of:
- The actual deadline. It may not be simply April 12, for instance, but noon on April 12. The difference between a proposal due at noon and one due at 5:00 p.m. on the same day may be crucial as you put everything together. There may also be a distinction between the mailing deadline and that for receiving the proposal (e.g. mailed proposals must be postmarked no later than April 10), which alters the equation in yet another way if you're not hand-delivering it.
- How many copies are required. Many RFPs ask for a large number of copies in addition to the original -- as many as 10 or 15 is not uncommon. Although you won't want to make your copies until you're absolutely sure your original is complete and totally correct, you will need to make sure -- especially if you don't have one of your own -- that a reliable source of copying is available for the time you'll need it. If you're going to use a commercial copier, you can probably make arrangements beforehand to ensure that a machine will be there for you at the right time.
It's a good idea to make sure you have backups for everything you'll need. If your organization has only one computer and printer, for instance, make arrangements to use someone else's if yours fails, or have someone bring one in from home. The level of panic that can set in when the printer fails halfway through the final copy of a proposal isn't pretty, and is not something you need to experience.
Backups extend to written material also. If, as is likely, you're writing the proposal on a computer, save regularly -- every 10 or 15 minutes -- to a floppy disk, and keep the floppy somewhere other than with the computer when you're not working with it. If you're not using a computer, make copies of everything you do -- everything, even notes. You won't be sorry.
- The required form of the proposal. RFPs often specify the material on the cover page, whether or not copies need to be bound, how sections of the proposal need to be separated, etc. If there are things you need to make arrangements for -- binding, for instance -- take care of that now. If there are things you can do beforehand, such as printing the cover page, separation pages for appendices, etc. you can do that now, too.
If you're really well organized, you can actually be creating a system that you can use for submitting future RFPs as well. It's always easier the second time around, and it's easier still if you have a record of what went well and what didn't.
- What information or other material you'll need to get from outside the organization. Many RFPs ask for letters of support or participation from the community or from other organizations, guarantees of particular services (child care, for instance) from other sources, or commitments to serve on an advisory board. It makes sense to try to get these as early in the process as possible, so that neither you nor the provider of the material will have to rush around at the last minute.
If you're part of a larger organization, you may need signatures, permission, review of your budget, etc. from within your organization before the proposal goes out. You need to figure in the time this will take, and move your writing deadline closer so that you can submit a complete proposal for internal processing in time to meet the funder's deadline.
- What, if any, forms have to be filled out and included. Make sure that you have them all (RFPs may be incomplete, it may be assumed that you already have the forms, you may have to download them from a website, etc.), and request from the funder any that aren't included or otherwise available. This is also the time to ask any questions you may have about the forms and how to fill them out.
- Whether the RFP requires budget pages, or even the whole text, on disk. Make sure you have the capacity to capture what you need on floppies, or to send the proposal electronically if that's required.
- A checklist, telling you what you need and the order in which to put it. If the RFP doesn't have one, make one now, triple-check it for accuracy, and make sure everyone involved in the process has a copy and knows which items he's responsible for.
- To whom the package needs to go. If you're mailing it, there's probably a specific address, and a specific contact person, in the RFP. In some cases, copies may have to go to more than one place, or may go somewhere other than to the funding agency. Be completely certain that you're sending or delivering everything to the right places.
As you conceptualize:
- If it's appropriate, assign the assembly or collection of various appendices and other supplementary material to particular individuals, with deadlines well in advance of the final deadline.
- Decide if there are any non-required appendices or other supplementary material that you want to include to strengthen your proposal (letters of support, a Board list, awards your organization has won, endorsements from legislators, etc.). Then, if it makes sense, assign these to people in the same way as the required supplementary material.
Find out from funders, if you can, whether submissions like these will do you more good than harm. Some funders find them helpful and pay attention to them; others are adamant that they want only what they request in the RFP.
- A Table of Contents (without page numbers) may be another piece that can be assembled now. It can help the writer(s) think about the flow of the proposal, and, if there is a length restriction, how much room they have for each section.
As you assemble the proposal package:
- Especially if the proposal is long, make sure you have enough people to collate, but not so many that they get in one another's way.
- Well beforehand, find a space where you can spread out -- it may be a corridor, someone's apartment, your office, whatever -- and easily assemble the pieces.
- One person -- usually the proposal writer, but it could be someone else -- needs to be in charge of the assembly process. That person should confirm all the parts of the proposal against the checklist, make sure all the collators know what they have to do, see that pages are numbered correctly (often a last-minute job because things keep changing as the deadline approaches), and make sure there's extra toner for the copier, fresh ribbons or toner for the printer, enough paper for all the copies, etc.
- Be certain to make enough copies to keep several for the organization. If you don't get funded, you can still probably use the text in other proposals and presentations. If you do get funded, you'll need to refer back to the proposal continually.
- Know how you're going to get the proposal to the funder. Will it be hand-delivered? Go overnight or regular mail? Can it be sent electronically? Whatever the method, you should be ready to get it there on time.
If you mail your proposal, always send it Certified Mail, Return Receipt Requested, so that you can confirm, if the funder loses it (and this happens more often than you might think), that you sent it, and that it was received on time. By the same token, if you hand-deliver it, be sure to get a receipt with the date and time on it.
- Once the proposal has been sent or delivered, celebrate! Proposal writing is stressful and difficult -- you owe the organization a party, a day off, or some other indication of a job well done.
What do you do if you're successful?
Applying for funding is only the beginning of your relationship with a public funder. If your proposal is accepted, there's still a lot of thinking and work to do before you start your program and once it's running.
Grants, contracts, and financial survival.
Public money may come as a grant or a contract. The difference is that grant money is usually allotted either at the start of a program, at regular intervals throughout the year, or as you need it. You get the money from the funder, and then you spend it.
In the case of a contract, you're generally expected to spend the money first, and then bill the funding agency for reimbursement for what you've spent. If the funding agency is local, this may be a matter of writing a payroll check on Friday and getting a check back from the funder the following Wednesday. If the funder is the state or the federal government, you may wait weeks or months for your reimbursement. Unless you have enough cash flow -- money that you can actually get your hands on, as opposed to what you're owed -- to cover running the program until you get paid, you could find yourself in a deep hole.
Make sure you understand what the payment method is, how long you'll wait for a check once you've applied for a payment on either a grant or a contract, and what your and the funder's obligations are as far as money is concerned. Make sure also that you can survive financially under the arrangement. If it's going to cause more problems than it solves, you might reconsider whether to accept the money.
Whether you receive a grant or a contract, you'll almost undoubtedly be asked to sign a standard legal agreement or contract which lays out, among other things, the circumstances under which the grant or contract can be discontinued by either party, what you'll be obligated to pay back if you fail to complete the work or spend in other than the agreed-upon ways, how long you have to keep records, etc. These documents are usually long, printed in 8-point type, and written in legalese, so they're incredibly hard to read.
Do not sign such an agreement without reading it. If you have trouble understanding it, find help, either from the funding agency or from a lawyer (you may have one on your Board of Directors: situations like this are exactly why you should.) If you have questions about or objections to any of the provisions in the agreement, you should talk them out with the funder before you accept the money.
Most public funders have particular procedures for handling money and other issues. You need to be sure you understand and can both live with them and carry them out.
- Accounting. Your books must be in a form that the funder considers acceptable, and that will capture the information the funder requires. This generally means that you can keep track of this particular grant or contract separately, and report and document exactly how you've spent the money for it. The funder will also want a copy of your last audit report.
- Spending deadlines. Virtually all public funding agencies require that the money be spent in the period for which it's allotted, usually the fiscal year. Any money unspent at the end of the funding period has to be sent back. (This is why so many organizations "dump" money on supplies, materials, and equipment on June 29.) There may be earlier spending deadlines for some specific funding categories as well (no equipment purchases after May 1 without permission, e.g.).
- Restrictions on spending. You will have to submit a line item budget -- a budget detailing exactly how much you intend to spend on each expense category (salaries, telephone, materials, etc.). There may be specific categories you can't spend this grant on. Once you and the funder have agreed on a budget, you'll be held to it, and you'll usually need the funder's permission to change it significantly. It's your responsibility to know your overall organizational budget well enough to negotiate a feasible budget for this grant or contract.
- Budget changes. Most agencies understand that things can change over a year, and allow some flexibility in budgets. They may allow you to make some changes without permission (changing a line item by up to 10%, for instance), and will probably let you negotiate larger changes over the course of the year. These changes often have time limits, however (e.g., no changes after April 30), and shouldn't be left to the last minute.
- Reporting. The bottom line is whether you deliver whatever you've promised, and funders usually have some procedure for finding that out. They may want either numbers (participants served, average length of stay, hours per successful intervention, etc.) or some other information, or both. You may be required to report electronically, to fill out forms by hand, to undergo site visits, to write progress reports, to submit documentation (of participant attendance, for instance), or some combination. Reporting may be monthly, quarterly, or annually. In any case, you need to provide for it, and to understand what it will cost in staff time, equipment, and program disruption (It's best if you can plan for this before the proposal is even written). You also need to consider whether the funder is asking for confidential information, and how that affects your organizational policy on confidentiality.
Scope of work issues.
The term "scope of work" is often used by funders to refer to what the funded organization actually will do. You and the funder obviously need to agree on what this means for your particular grant. Exactly what services do you intend to deliver, and to whom? You covered that in your proposal, of course, but that may not be the final word. The funder may accept your proposal, but ask you to change some things about it. Your organization's circumstances might have changed since you wrote it, and you might want to try a somewhat different approach. Or the funder might offer you a smaller amount of money than you asked for.
Scope of work issues can include a number of things. Some of the most common are:
- The amount of service you're asked to deliver for the money. In your budget for the proposal, you've figured out what it costs you to provide service. If you're being offered less than you think it's going to cost you for the service requested, that's a serious problem. To convince a funder that you either need more money or you can only offer reduced service, you'll need to be able to back up your assertions with numbers and a convincing argument. But if you can't convince the funder, you may be stuck in a situation that will cost your organization money, unless you turn down the grant or contract.
Although it's been said elsewhere in this section, it's worth repeating here that you need to make sure you can afford the grant or contract that's offered. Sometimes organizations take grants that they know they will have to supplement themselves, just to be able to provide the service, or to establish a relationship with the funding agency. If they're doing it intentionally, and they have the extra money to cover what they're doing, that's not a problem. But accepting funding that places you at financial risk is a problem, and won't help your organization in either the short or the long run.
You have to examine carefully what the funder wants. Something as seemingly simple as reporting requirements can be the financial straw that breaks the organization 's budget, if it means you have to hire someone to do data entry. Extra administrative burdens are another, often hidden, source of costs. Don't let yourself be trapped in a situation that costs you money rather than helping to stabilize your funding.
- The amount of leeway between what your proposal promises and what you have to deliver. If, for instance, you're running a job training and placement program, how many trainees will you have to place in jobs? No agency will expect you to place 100%... but they won't expect you to place only 10%, either. What is an acceptable percentage? It's important to work this out with the funder beforehand.
- The amount of time it might take for a participant to complete a program. If the program is simply a course that lasts for a specified amount of time and is then over, the answer is obvious. But if the program is one of community immunization, or of teaching immigrants English, the time needed depends on a lot of other factors: the receptiveness of the community, the educational backgrounds of the immigrants, what participants experience in the rest of their lives, etc. If the funder's time expectations are unrealistic -- wanting immigrants who can barely read in their own language to become literate in English in six months, for instance -- you need to make that clear, and set up realistic expectations that both you and the funder can agree on. Otherwise you're setting yourself up for failure.
Don't be afraid to negotiate with a funder about these and other issues. They may involve the integrity of your organization, or the difference between doing a mediocre job and doing an outstanding one. You're the expert, after all -- that's why the funder asked you to do this work.
Diversification of funding.
As we discussed earlier in this section, public funding can be very stable, or not stable at all. It also may come with restrictions and regulations that make it difficult to do some of the things you want to do. The wise course is to try not to depend too greatly upon it. In the words of an old pun, "Don't put all your begs in one ask-it."
Your organization will probably be best off if it has many sources of funding. The most desirable is money that comes with no strings at all -- from community fundraising or memberships, for instance -- but it's unlikely, unless you're quite small and willing to stay so, that you can raise enough no-strings money to run your organization. The optimal situation will most likely be one in which pieces of your funding come from several different layers of government, from private foundation grants and community organizations, from community events and fundraising (including membership), and from business and industry partners (perhaps as fee-for-service). If your funding is diverse enough, then losing one piece of it won't be a disaster. It can be replaced with something else, and the organization can continue doing what it was founded to do.
Public funding -- money that comes from public revenues at the federal, state, and local levels -- can be a secure source of funding for your organization. In order to take advantage of it, however, it's important to understand its drawbacks as well as its positive side. On the one hand, it's probably the largest potential funding source available, can be a much longer-term prospect than other funding sources, and may be earmarked for exactly what you do. On the other hand, it can come with restrictions, procedures, and bureaucratic hassles that challenge your mission and make your life complicated and difficult. You have to weigh the positives and negatives, and decide whether public funding is right for your organization.
Once you've decided to apply, your first hurdles are learning about the availability of appropriate funding for your organization, and making the organization eligible to receive it. Networking can also be important in positioning yourself to acquire public funding. Then there's the small matter of actually going through the Request For Proposal (RFP) process, and writing a proposal that gets funded. Each of the three steps in this process -- conceptualization, writing, and assembling the final product -- has its own tasks and pitfalls, and needs to be approached in a way that addresses them.
Finally, if your proposal is accepted, you still have to negotiate a contract or grant agreement that actually allows you to provide the services the community needs, both programmatically and financially.
If you can successfully make it through this process, then you might end up with a major piece of stable funding that will help you further the mission and philosophy of your organization for years to come.
Library of Congress links to state and local government websites.
NIH RFP Directory Home Page. Request for Proposals directory of the National Institutes of Health.
State and Local Government on the Net. Links to websites for all 50 states.
Catalog of Federal Domestic Assistance (CFDA). U.S. Government Printing Office. Published annually, updated at mid-year.