Operating Support? How Much?

 

One of our alumni recently asked about submitting a grant proposal to a specific funder. She wanted to know what percentage of the organization’s annual budget she should request in her proposal for general operating funds. And if the organization decided to seek program funds instead, she wondered what percentage of the program budget she should request. Here's what I told her:

 

When seeking operating support or program support from a funder, you’ve got to understand how the targeted funder operates. Only when you can answer the following questions will you be ready to decide what and how much to ask for.

• What types of grants does the funder award?  Program? Operating? Challenge?

• What types of organizations does the funder support? The same ones year after year? Large? Small? All sizes?

• What award amounts does the funder typically make for various types of support?                             

• What amounts has the funder awarded to organizations such as yours? For what purposes?

 

Your homework will include studying both the funder’s website and several years of the funder’s Form 990-PF tax returns. (You can access the 990-PFs by signing up for a free account at Guidestar.org).

 

After completing the research, ideally you would contact a program officer at the foundation, discuss what you’d like to request, and ask for guidance. Is your request one the foundation might consider? Having a conversation with someone on the foundation staff can be extremely helpful. But if that’s not possible, you’ll have to base your decision on your research.

 

Funders are generally hesitant to award a grant in an amount that represents a significant part of a grantee organization’s budget. The issue is sustainability. Funders want to support strong organizations that will keep providing services after the grant ends—they want to make “investments.” They don’t want to fill a hole that will just open up again once the grant money is spent.

 

Some funders will provide general operating support. Many, however, will do so only for organizations with which they have an existing relationship. But even if a foundation is open to providing general operating support more broadly, the issue of sustainability will still be huge. You’ll have to make the case that the grant is an investment—helping to move your organization toward greater strength, stability, and independence. The funder will want to know about your board of directors. Who are they? Are they donating to the organization? What types of fundraising does your organization do? What evidence can you show of increasing stability?

 

There are no hard and fast rules about what or how much to ask for.  As you learn how to make such decisions, you’ll become more effective in seeking grants—and any other type of funding.

 

—Barbara Floersch, Chief of Training & Curriculum

 

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