Most not-for-profits count on donors to keep their organization humming on all cylinders. But if donations start to slow down due to factors beyond your control, such as high inflation or economic weakness, how will you fill budget gaps? If you haven’t done so already, consider becoming more aggressive in pursuing government grants.
4 Benefits
Government grants may be more bountiful and available than you think. In fact, you don’t necessarily even have to be a 501(c)(3) organization to qualify for one. Another type of entity or even an individual or business may be eligible for certain grants. Obviously, the advantage of a government grant is that it provides your organization with funds to help further your mission. But these grants offer additional benefits:
1. Not a loan. Grants are especially advantageous because they don’t have to be repaid. Your organization can simply put the money to use, whether it’s for a special program or project or for routine expenses such as staff wages.
2. Instant credibility. Donors often embrace organizations that have been rewarded with government funding because it confers a sense of trust and integrity. Make sure stakeholders can view grant acceptances on your website.
3. Wide availability. You can search for government grants from a variety of local, state and federal sources and pick and choose to apply based on your nonprofit’s needs.
4. Unlimited number. There’s no specific limit on the number of government grants an organization can apply for and receive. Although it’s generally not recommended, nonprofits can survive — and even thrive — on grant funding alone.
Finding Funding
Here’s what you should know about applying for government grants at each level:
Federal. Spend time learning what you’ll need to apply, so you’ll have the data and materials ready. Grants.gov is the main source for information on federal grants and can help you track your applications. The website also provides a list of federal grants you can find with keywords or other identifying information. Other sites that may include news about government grants are sam.gov and federalregister.gov.
Note: Congress allocates new federal grants to nonprofits by Oct. 1 of each year (the start of the federal government’s fiscal year). Grant recipients are usually expected to use funding by the following Sept. 30.
State. Finding these grants will vary from state to state. Some states offer search abilities on their websites. With others, the process is more complicated. You can find out more about state grants and how to apply for them by using your search engine or contacting state officials.
Local. Because there’s typically less competition for local grants, it may actually be easier to secure them. However, local grants can be harder to find. Contact your county or municipality, or search for them at grants.gov. You might also make an in-person trip to City Hall to find the appropriate office and speak directly to a potential grant decision-maker.
How to Improve the Odds
Although there’s no absolute foolproof method for winning a grant, you can improve your chances of success by using some common-sense techniques. For example, when searching online for potential grants, use keywords. So if your mission is to provide shelter for people who are unhoused, the keywords “shelter,” “homeless” and “grants” should help you find relevant information.
You might want to consider hiring an experienced professional to help you find and apply for grants. An independent contractor can take the pressure off your busy staff and is likely to know certain tricks of the trade, including how to effectively convey financial data. Professional grant writers also usually avoid making common errors and can provide measurable results to show stakeholders.
Even if you engage an outside grant writer, assign a staff member to oversee specific projects. If several different people are searching for grants, it’s easy for details to fall between the cracks. This employee should be responsible for monitoring the progress of applications and reaching out to government authorities, if necessary.
Competition Can Be Fierce
Government grants offered at the three levels can range in value from a few hundred dollars to several million dollars (depending, of course, on the size of the nonprofit’s need). Competition for funding can be fierce, so it’s important to put your best foot forward from the outset. For help navigating the grant landscape (including nongovernment grants) contact a financial advisor who specializes in tax-exempt organizations.
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