Continuing support/continuation: Grants additional funds to your organization after you’ve already received an initial grant award from that same grantor. These monies are intended to continue the program or project initially funded.
Endowments: Grants to develop long-term, permanent investment income to ensure the continuing presence and financial stability of your nonprofit organization. If your organization is always operating in crisis-management mode, one of your goals should be to develop an endowment fund for long-term viability.
Fellowships: Grants to support graduate and postgraduate students in specific fields. These funds are typically awarded to institutions and not directly to individuals, with the exception of some international fellowship funders.
General/operating expenses: Grants for general line-item budget expenses. You may use these funds for salaries, fringe benefits, travel, consultants, utilities, equipment, and other expenses necessary to support agency operations.
Matching funds: Grants awarded with the requirement that you must match the grant award with your own monies or with in-kind contributions.
Program development: Grants to pay for expenses related to the expansion of existing programs or the development of new programs.
Research: Grants to support medical and educational research. Monies are usually awarded to the institutions that employ the individuals conducting the research.
Scholarship funds: Grants to eligible organizations seeking to award scholarships to eligible individuals. Remember that when funds are awarded directly to an individual, they’re considered taxable income (that is, the recipient owes taxes on them).
Seed money: Grants awarded for a pilot program not yet in full-scale operation. Seed money gets a program underway, but other monies are necessary to continue the program in its expansion phase.
Technical (consulting) assistance: Grants to improve your internal program operations as a whole (versus consulting on one specific program). Often, this type of grant is awarded to hire an individual or firm that can provide the needed technical assistance.
Understanding your eligibility for grants
The types of organizations or entities eligible to apply for a grant vary from grantor to grantor. Each type of grantor — government (public) or foundation (private) — always includes clear, published grantmaking guidelines that indicate who or what type of entity is eligible to apply for those specific grant funds. To access these grantmaking guidelines, simply visit the grantor’s website.
Funders typically include one or more of the following types of grant applicants in their eligible applicant language:
State government
County government
City or township government
Federally recognized Native American tribal governments
Independent school districts
Nonprofits with and without Internal Revenue Service (IRS) 501(c)(3) (nonprofit) status
Private, public, and state-controlled institutions of higher education
Public and Native American housing authorities
For-profit businesses
For-profit organizations other than businesses
International nonprofits (called nongovernmental organizations or NGOs)
Individuals
Grants are awarded to organizations that have applied to the IRS for nonprofit status and have received the 501(c)(3) designation as well as to units of government (state agencies, counties, cities, towns, and villages) and government agencies, including state colleges and universities. Foundation and corporate grantors focus predominantly on nonprofit organizations and aren’t inclined to fund for-profits. However, a few grants are given to individuals (see Chapter 7 for details).
In some instances, government agencies have set up separate 501(c)(3) nonprofit structures in order to scoop up more private-sector (foundation and corporate) grant awards.
Recognizing the Purpose of a Funding Development Plan
Without key stakeholder input on what your target population needs and the plan for closing the gap on these needs, you’re jumping off the cliff without a parachute. You must have an organized funding development plan to guide your organization in adopting priority programs and services and then identifying all potential grantors you plan to approach with grant requests. A funding development plan answers questions such as the following:
What programs are strong and already have regular funding to keep them going? Are they likely to be refunded?
What community needs aren’t being addressed by your organization or other organizations providing similar services?
What new programs need funding and is there evidence of the needs?
What opportunities exist to find new funding partners and who will be responsible for making the initial contact with each funder?
What existing grants expire soon and can you reapply or do you have to find new funding?
When the stakeholders answer these questions, you can begin to look at the plethora of areas where grants are awarded and start prioritizing the type of funding you need. (For more information on funding development plans, see Chapter 2.)
Connecting to Public-Sector Grantmaking Agencies
I receive dozens of emails and social media inquiries every week asking about grants. Everyone wants grants; aka, everyone wants money! If you’re feeling clueless as to how to find potential funding for your organization, you simply need to use your favorite search engine. You can search for potential sources that are interested in what your organization needs in the way of goods and services. Get your fingers moving on the keyboard and start searching for the monies that may be waiting for your organization. While you’re at it, why not start with the nation’s wealthiest relative, Uncle Sam?