Wednesday, May 31, 2006

LOI vs. Full Proposal

In our acronym crazy world even seasoned grants professionals sometimes need a secret decoder ring to figure out the grant jargon. One of the more confusing acronyms is “LOI”. This three letter tyrant can stand for several different types of grant requirements.

A Letter Of Inquiry is a brief, usually two pages, letter requested in lieu of a full proposal by grant-making institutions as a screening device to determine if the funder might be interested in learning more about your program or project. Sometimes if the program officer or the Board of Trustees like the way you presented your program in your LOI, they will ask you to submit a full proposal with a budget, financial statements and all the other bells and whistles.

Letters Of Interest are typically the same thing as a letter of inquiry. Both terms are used interchangeably.

On a side note, did you know that Duilio Loi {born April 19, 1929) is a retired Italian boxer who held the Italian and European lightweight and welterweight titles, as well as the world junior welterweight championship. Loi fought from 1948 to 1962, and retired with a record of 115 wins (26 KOs), 3 losses and 8 draws.(Interesting fact found at Wikpedia.com ) Alas, I digress; back to grant LOI’s.

A Letter Of Intent is often utilized by federal and state agencies and is a required element of a grant application. Typically the letter of intent is due well before the actual application and lets the particular agency know that you plan on applying for funding under a particular RFP (Here is yet another acronym-this one means Request for Proposals). The primary reason that agencies may require the letter of intent is to try to determine just how many proposals they will receive, therefore ensuring they have enough proposal reviewers to judge your application.

The important thing to remember no matter if you are answering an LOI, or RFP-follow each individual funders specific guidelines and know your grant acronyms.

Tuesday, May 09, 2006

More On Following Those Rules

One of the more important yet simple procedures to follow when writing a grant proposal is to follow the funders guidelines explicitly. The majority of grant making organizations have set guidelines that they publish regarding the required contents for each proposal. Find out what those requirements are, get a copy and comb through line by line to make sure you understand what is expected. Many proposals are prematurely tossed out because the author used a 10 point instead of 12 point font.

The instructions for Federal and State proposals can sometimes be almost as long as the proposal itself. Before starting on a complicated proposal- read through the instructions first, then go back and begin to pick each section apart. At this point you will want to determine who on your grant team will be responsible for each required element. You can utilize a software program such as Microsoft Project, keep a running written document with each person’s assignments and deadlines or use a simpler method such as marking up with color coded highlighters.

Many times even small family foundations will have written instructions such as, “As a first step, please submit a two page letter of inquiry explaining the projects goals, objectives and attach a program budget.” You want to follow those instructions to the “T” as well. Do not send a three page summary with your full organizational budget, and your latest glossy annual report. If they need more information they will ask for it.

If the guidelines are non-existent, not clear about what to send and you are unable to contact a person directly at the foundation, then it is best to send less. If you can’t contact someone chances are the organization does not have the resources to read a lengthy proposal. You can send a short letter asking for their written guidelines, or submit a brief one to two page letter outlining your project, making the ask for a certain dollar amount and politely let the organization know you can provide further information should it be required.

Wednesday, April 12, 2006

Incredible Shrinking Awards

I have noticed an interesting situation over the past 6-8 months: With the exception of two grant awards, ALL of the grants that have been awarded to my clients recently have been lower than the original requested amount. Of course this does happen frequently and over the past eight years I have experienced the rush of receiving an award and at the same time the disappointment of realizing the awarded amount is lower than the original ask amount. However, the reduction in award amounts seems to be happening more frequently with foundations and corporate giving programs.

In my quest to find out why, I discovered that there is not currently a good answer. At first, I thought that I could blame it on the economy since it is a catch all blame basket for whatever is ailing the country. Then I thought that it was because more giving was diverted from the usual funding areas to help with hurricane relief efforts.

However, the latest statistics show that in 2004 giving increased by 5%. A report released last month by the Foundation Center noted that grants made only by foundation grantmakers increased in 2005. "Giving by the nation's close to 68,000 grantmaking foundations reached a new milestone in 2005. Estimated giving totaled $33.6 billion, up from the previous high of $31.8 billion recorded in 2004" (Foundation Growth and Giving Estimates Current Outlook, p.1).

So if giving is increasing then why are the grant amounts typically smaller? Several factors come to mind. Funding for the natural disasters over the past two years have only slightly diverted funds from other more traditional areas such as education, arts, and research. In addition the number of nonprofit organizations that need grant funding to operate has grown dramatically over the past ten years to over 1 million organizations in the United States alone.

Lastly, corporate and foundation assets have remained relatively flat or only slightly increased over the past three years. Foundations in particular calculate their grant budgets for the next year based on their assets from the past three to five years. When budgeting for 2006 many foundations utilized figures that may have reflected their 2001 assets. If you recall, 2001 was a tough year financially for many including foundations that lost millions with their investments.

More focused giving, higher competition for grant dollars and lack of perceived assets are part of the reasons why many organizations are giving smaller than the requested amount of grant dollars.

Next time, I will explain what to do when you receive a smaller check than expected.

Thursday, March 09, 2006

More on Federal Grants

I am one of the few people, I believe, that actually enjoy writing Federal grant proposals. Now before you write me off for good, let me explain why. All Federal proposals that I have worked on have clearly defined instructions that explain in detail exactly what is needed for each section. Most Federal proposals are scored on a point system and typically the higher scored proposals are the ones that are funded. Usually the issuing agency is even kind enough to give you a rubric, which explains how each section in the proposal will be scored. For example under the target population section the rubric may show that 10 points are awarded for services provided to multiple ethnic groups, 5 points for services to one or two ethnic groups and 2 points for services serving only one ethnic group.

Perhaps it is because I thrive when I am organized, but I much prefer this knowing exactly what is expected of you method than to writing only two pages that describe the organization in detail and explain precisely what the organization will accomplish over the next three years with such limited word space. I guess I am a person of many words, as is the case with most writers!

Back to grants. Each Federal agency has its own criteria and instructions, which can sometimes be larger than the proposal itself, for their grant programs. The step after properly planning the program is to get a hold of the RFP or application and sit down with a nice cup of tea or java or whatever you prefer and comb through every word on every page while taking notes about action steps. After you are done with that, go back through your notes and prioritize each action item and create a timeline which assigns responsibility for completion of each action item for each team member. Remember that most organizations applying for Federal funding are collaborationg with other organizations. Keep in mind that you may need to obtain information from other agencies that have different ways of disseminating information than you are used to. Allow extra time when collaborating with others.

Now to the attachments. The Feds are particular about non profit organizations performing lobbying activites, discriminating against people groups, employing criminals and many other such pesky matters. Forms are provided by the government for the agency that is applying for the grant to sign and include as attachments to the proposal. These are pretty straightforward forms, just don't forget to include them.

The EPA in connection with Purdue Univesity has a nice grant tutorial that offers practical grant proposal writing information and a writing activity.

Yes, the Federal proposals are very time comsuming, can be emotionally draining if the program is not properly planned out, and can be donwright frightening for the first time Federal proposal writer, but the payoff can be huge in terms of dollar amounts awarded and people served through the program.

Wednesday, February 22, 2006

The Maze of the Federal Grant Process

Getting that large federal grant sounds like the answer to all of your agencies problems doesn't it? That evaluation is not always accurate. Government funding, especially at the federal level, can be difficult to obtain, and just as difficult to keep due to arduous reporting requirements, program restrictions, and non-allowable expenditures.

First and foremost your program has to be properly planned for several reasons:

1. Typically Government Request For Proposals (RFP's) are issued and the deadline to submit the proposal is typically within 1-2 months after the RFP is made public.

2. The proposal itself is very detailed and time consuming. An agency can expect to work an average of 100 hours on each proposal, and that is if it is well planned out prior to the RFP release.

3. Generally Federal programs require that you work with one or more other agency to help serve a larger number of people. Cooperative agreements will need to be drawn up declaring which agency will be responsible for each part of the program.

Usually RFP's are issued at the same time each year depending on the agency. For example if HUD issues its SUPERNOFA in the spring of each year, you can usually count on it being released each spring. Of course you don't want to miss an RFP because of the short turn around time, so you can subscribe to the Federal Register, which is published each weekday and contains all rules, executive orders and grant information by agency. Another must see site is the Grants.gov website that allows you to review federal grant opportunities, and in many cases submit your proposal online. Online submissions are now required for many proposals, so if you plan on submitting a federal proposal, familiarizing yourself with this site will be essential. The Grants.gov site is much more user friendly than the Federal Register site.

Check out those sites and next time I will discuss the actual application process included the dreaded attachments in more detail.

Monday, January 16, 2006

So you got the grant, great! Now what?

You have done your due diligence and submitted the proposal and have been awarded the grant. Great news. Now you can relax right? Wrong! Your work has just begun.

Now you have to actually do what you said you were going to do in the proposal. Hopefully you set realistic goals, objectives and activities. You need to be able to track those as well as the financial expenditures. The most effective way to do this is to utilize some type of software. For the financial component you may be able to use your organization's current financial software such as QuickBooks, or Quicken. Whatever you have be sure to track each and every penny of the granting agencies funds. Creating a simple excel spreadsheet might be all you need to use to track activities. Use software that will give you the best ability to track your progress. You will need the information at a later date and it can be tedious trying to remember what you did seven months ago.

With the check you will probably receive an award letter that outlines when reports are due, how the funds can be expended and other important information. Review this letter immediately and store in a prominent place in case you need to refer back to it.

There should be an internal process in place to book and track the funds. This process needs to have the capability to differentiate grant funds from individual gifts or endowments. Often times funders will require you to place the check in its own separate account so that interest can be calculated and expenses made specifically for the program or project that they funded. Make sure your bank can do this for you.

After six months or a year, funders normally require an accounting of how you spent their gift in the form of a progress or final report. Since budgets are projections and necessitate educated guesses, sometimes the funds need to be expended in a different way than originally proposed. Some organizations will allow for a certain percentage of the total amount to be moved between line items. For example, lets say the funder gave $40,000 for salary, $2,500 for equipment, $2,500 for consulting and $5,000 for supplies for program X. The director of the program leaves the organization after six months. After two months without replacing the program director you have additional funds available in the salary line, while you have depleted the funds in the consultant line because you have had to rely more heavily on the consultant to meet the constituent needs. Let's say the funder allows you to move 10% of the total grant ($50,000), you may be able to move $5,000 from the salary line to the consultants line to defray the additional cost. Remember that unless the project or program completely stopped when the program director left, someone was doing the work. If another staff member took on the responsibilities of the program, he or she should be compensated with a portion of the grant funds. When in doubt contact the funder to find out what they will allow as far as line item changes.

This brings up a very important point-contact the funder throughout the course of the grant on a regular basis, especially when challenges arise. Invite the program officer to the event they are sponsoring. Send that press release to the funder even if it is not directly tied to the program they are funding. Send your quarterly newsletter, and annual report. You want to use every opportunity to market your entire organization, not just the program they are funding. Making them aware of other programs or projects that your organization is involved in may boost potential interest in those programs from the funder in the future. They may not have time to read the press release or decline your invitation, but contact has been made and that is important. It shows them that you care about their support. Of course, don't harass the funder by sending weekly updates, but don't wait until the final report is due to let them know about the progress that has been made.

A colleague recently wrote an excellent article called Stewardship: What Happens after the Grant is Won that nicely details the relational aspects between granting and recipient organizations.

Wednesday, January 04, 2006

Grant checklist for the new year

I hope that everyone had a wonderful holiday season. Mine was refreshing and relaxing, but now it is time to get back in to the world of grants.

I enjoy setting goals for myself, family and business at the beginning of the year. It helps me to stay focused and I am able to gain a sense of accomplishment when I am able to complete the activities and objectives that correspond with each goal. Grantwriters and other organizational planners can and should create a plan during the year to keep their organization's mission at the center of what they do. The steps to this planning process could include:

1. Work with your organization's key stakeholders to determine organizational priorities for the year. Identify the needs of the people being served by the organization. This will vary from year to year depending on both internal and external circumstances.

2. If a new program is being introduced, the key stakeholders develop a plan and formalize it in the form of a concept paper. If this is an ongoing program, the plan needs to be updated to reflect changes over the past year and anticipated changes over the next year. The concept paper could include the following details:

A. An overview of how the project serves the needs of the constituents
B. Goals, objectives, activities and tasks
C. Staff and equipment needed
D. A three-year preliminary budget (For new programs)
E. Outline of evaluation methods and/or assessment tools to measure outcomes
F. Post grant sustainability plan.

3. With the plan in hand, thoroughly research and identify potential funders. How do you know if granting agencies will fund the program? Know your funders. Start with the city or region that your organization is headquartered. Look at the areas major corporations, nearest community foundation, philanthropic families, and foundations. Many tools are available to research prospects on the internet. A good place to start is the Foundation Center. Check your nearest University, they may have the Foundation Center collection available for your use. There are many other resources available. Do a Google search to find one that meets your specific needs. Research as much as possible to determine if your program fits into their focused area of giving. If the funder is a foundation (Not a corporate giving program) look for their IRS Form 990 on Guidestar, which will give a wealth of information such as their total assets, previous grant amounts and sometimes provide guidelines to submitting a grant.

4. Don't try to fully fund a program with only grant funding. This is dangerous. Diversify your revenue streams with other types of funding such as an annual appeal, special events, individual donations, in kind gifts, and endowments. Generally speaking, only one in three grant proposals are funded. Be prepared to approach more than one potential funder.

5. Begin building relationships with the funder(s) whenever possible. Some granting agencies appreciate face to face visits, others prefer telephone calls or email. A colleague recently mentioned that more and more foundation staff prefer to correspond via email or letter as it gives them the ability to respond to inquiries as their schedule allows. Some organizations do not want to be contacted prior to submitting a Letter of Inquiry or full grant proposal. Follow their guidelines to the T! No use getting off to a bad start with someone you want to help meet your organizational goals.

6. Your program plan can be used to create a grant proposal based on the funder's specific guidelines. Some funders want a two page letter of inquiry, others want a ten page detailed full proposal. Again follow their specific guidelines. Having the program plan pre-written will be extremely helpful when submitting government grant applications. Typically Federal Government agencies only allow a one to two month turnaround time between when their Request for Proposals(RFP') are released and the grant application is due. These government applications can be extremely arduous and time consuming. Without a well though out plan the chances of being awarded a large government grant is very unlikely.

7. Work through the editing process and when possible include the organization's key stakeholders. Again follow those grant guidelines, don't forget the attachments such as your IRS tax-exempt letter and drop it in the mail (or email it if they prefer).

Next time I will discuss what you should do when you get the grant!