Blog

Viewing posts from the Blog category

Gifts Versus Grants

Many in the nonprofit world use the terms “gifts” and “grants” interchangeably, so if you’re second-guessing yourself or are confused about the terminology many nonprofits and funders alike are using, you’re not alone. In fact, larger nonprofits have developed and published guidelines to help their staff distinguish between gifts and grants. JCCI has witnessed a growing number of private and corporate funders that previously offered “gifts” to nonprofits that are now moving to a grant model for their philanthropic support. We’ve also worked with clients who were making unsuccessful attempts to reshape their priorities to fit a grant’s stated goals and objectives. Gifts and grants are two distinct philosophies of giving, and—accounting principles aside—understanding the philosophical differences between the two can help you effectively research prospective donors and respond to funding opportunities. Here’s how JCCI distinguishes between gifts and grants.

Gifts

Nonprofits benefit greatly from gifts that help them sustain general operations or special programming. A gift philosophy is one without strings attached—at least not in the way that grants have strings attached to the funds. Instead, donors who give gifts are supporting an organization without a preconceived expectation of specific outcomes. Gifts may be restricted to certain purposes, but within those constraints, gifts support organizational needs and priorities. Gifts don’t support a funder’s goals and priorities, though the funder’s goals and the nonprofit’s goals are usually closely aligned. While you may submit a stewardship report and let your donor know how your organization used the gifted funds, the organization isn’t held accountable for achieving funder-identified goals. You may also provide donors with a budget and breakdown of expenditures, but donors who provide gifts are typically more interested in overall impact rather than with detailed accounting and outcomes. Gifts are often smaller amounts than grants, but, collectively, gifts can be the mainstay of nonprofit operations.

Grants

A grant philosophy, on the other hand, is very much tied to a funder’s goals and objectives. Government grant programs, for instance, typically provide funding as a means of accomplishing specific identified goals that the government entity cannot accomplish independently. A grantor seeks an organization with the expertise and capacity to carry out work—work that the grantor is unable to carry out itself—that achieves the grantor’s goals rather than the grantee’s goals. As such, RFPs and other grant announcements include the rationale for offering grant funding and provide a detailed scope of work expected and identified goals and objectives that grantees should achieve. Ideally, applicants for grant funds share the funder’s goals and are already conducting work that aligns with those goals. Ultimately, though, grant funders expect grantees to make a pre-determined impact that accomplishes the funder’s agenda.

Grants are often large amounts, and grantors may provide funding for grantees to conduct projects over several years. Grant agreements stipulate reporting requirements that include a detailed accounting of all expenditures and demonstrate the impact of grant-funded activities. If grantees wish to use funds in a manner that is different from information in their initial proposal, grantors reserve the right to approve this type of change, and grantors may ask that grantees return funds if agreed-upon conditions are not met or if funds are unspent.

Mixed Messages

No wonder many in the nonprofit world are confused over terminology. Funders themselves are sending mixed messages. In the current climate, more and more funders have their own agendas. Many corporate and private foundations are developing giving programs that look and act much more like grants than gifts, though their donations are still, technically, gifts. While providing gifts to nonprofits, these funders are also adopting grant strategies such as pre-defined goals and objectives that they expect nonprofits to achieve. Additionally, many funders are now requesting components of proposals that typically appear in grant applications. For instance, more funders expect gift requests to include logic models, work plans and timelines, and evaluation plans. These items, when thoughtfully constructed, should strengthen a nonprofit’s development of specific projects and lead to improved outcomes, so having your team consider these application elements—whether requested or not—can often help you craft a better case for support whether through grants or gifts.

Finding the Right Fit

Since more funders are taking a mixed philosophical approach to funding and have more pre-defined agendas, nonprofits must take even more care to research the best prospects for funding. In an ideal world, nonprofits can identify projects and work already underway that aligns with philanthropic goals of both private and corporate foundations as well as government entities. Adhering to your organization’s mission rather than trying to develop projects that fit a funder’s priorities, though, will always be the best recipe for funding success.

Federal Grant Eligibility for Title III and Title V Programs

Knowing your organization’s federal grant eligibility is key to monitoring and applying for grants that help sustain and grow institutional programs and priorities, but questions of federal grant eligibility can often be confusing. That’s especially true regarding eligibility for the multiple programs offered under the Title III and Title V umbrellas. The U.S. Department of Education (DOE) has taken steps to simplify the eligibility determination process by using data that’s readily available; however, higher education institutions still need to understand the process and take steps to ensure their information is accurate and, if appropriate, apply for a waiver of eligibility. Competition for these grants is rigorous, and even if your organization doesn’t receive grant funding through the Title III and Title V programs, there are many benefits to having this federal grant eligibility designation.

A Little History

The Title III grant program was part of the Higher Education Act (HEA) that Congress passed in 1965. The grant program was designed to bolster postsecondary institutions whose student populations included a high percentage of low-income and minority students and was aimed primarily at supporting what are now Historically Black Colleges and Universities (HBCU). DOE awarded Title III funding to help these institutions improve the quality of academic programs, strengthen institutional management, and ensure fiscal stability, and that’s still the purpose of the grant program even after a long history of Congressional renewal of the HEA and changes over the grant’s 50+-year history. In 1998, Congress added Title V as a separate grant category under HEA. Title V grants support postsecondary institutions that serve a large percentage of Hispanic and low-income students.

Who’s Eligible?

DOE determines eligibility for these two grant programs based on two factors: 1) core expenses per FTE and 2) percentage of needy students served. DOE considers an institution’s core expenses in proportion to the number of students enrolled in undergraduate programs during the academic year and compares data across similar institutions to determine an average value. To obtain federal grant eligibility under Title III and Title V, an institution’s core expenses per FTE must be lower than the average for similar institutions. The second factor affecting eligibility is student need. To be eligible, an institution must show that half of its degree-seeking student enrollment receives aid through programs such as Pell Grants and the Federal Work Study Program. Alternatively, an institution can demonstrate student need if the percentage of students enrolled at least half-time who receive aid through federal programs such as Pell Grants and Federal Work Study is greater than the percentage of these students enrolled at similar institutions.

What’s the Process?

Early in the calendar year, a notice will appear in the Federal Register announcing the availability of the Application for Designation as an Eligible Institution from the OPE Institutional Service (IS) office. (Federal Student Aid will also publish an announcement so financial aid staff are aware that the application process is open.) Institutions can check eligibility for Title III and Title V funding by entering their OPE identification numbers. Institutions will fall in one of two categories at this point:

  • Pre-Determined as Eligible: Each year, the Office of Postsecondary Education (OPE) automatically pulls data from the Integrated Postsecondary Education Data System (IPEDS) and uses this data to determine an institution’s eligibility for Title III or Title V programs. Once the automated process is complete, institutions can check their eligibility by simply entering the college’s OPE ID number to see if the organization is pre-determined as Title III- and Title V-eligible. If OPE’s process pre-determines your institution is eligible for Title III and/or Title V programs, great! No further action is needed, and your institution can immediately print its letter of eligibility.   

But if your organization does not appear on the list of pre-determined eligible colleges, you can submit an application for eligibility/waiver request.

  • Not Pre-Determined as Eligible—Can Submit an Application/Waiver for Eligibility: The application process gives institutions who weren’t pre-determined as eligible a chance to correct or submit critical information to demonstrate eligibility. Organizations must submit this application prior to the annual deadline, which is typically in March.

Historically, 99% of institutions that submit waivers become eligible (in 2017, only six colleges that applied were not deemed eligible, and those failed to submit all data requested). If you feel your institution meets the criteria, you should definitely complete the application for eligibility.

The Department of Education has created a helpful document outlining the steps for checking eligibility and for completing a waiver application. JCCI Resource Development Services has also successfully worked with clients to prepare waiver requests that were approved, thereby making the institution Title III- and Title-V eligible.

What are the Benefits?

Obviously, federal grant eligibility for these two grant programs benefits institutions because they can apply for grant funding, but there are other benefits to being eligible and to understanding the federal grant eligibility rules.

  • Institutions that are eligible for Title III and Title V funding are also eligible for a waiver of their cost-sharing requirements under some categories of the Federal Work Study (FWS) and the Federal Supplemental Education Opportunity Grant (FSEOG) programs. Without a waiver, institutions are generally responsible for supplying 25% of any earnings through these federally-sponsored student work opportunities.
  • Eligibility opens the door to multiple grant programs within Title III and Title V.
  • Eligible institutions can use their eligibility designation to substantiate service demographics when seeking funding from private and corporate funders interested in supporting education initiatives for under-served students.

How Often Should You Check Eligibility?

Already receiving Title III or Title V funding? Fantastic! You should still check your federal grant eligibility under these programs each year to ensure your institution’s information is still accurate and to take advantage of additional benefits of eligibility. If your college isn’t receiving Title III or Title V funding, but you want to apply, you’ll definitely want to review your eligibility status annually as you monitor grant announcements and plan for grant submission.

The Importance of Grant Planning

If you wait until you see the latest funding announcement or RFP from a private or federal funder before beginning the grant planning process, you’re already behind. Funding announcements typically have tight turnaround deadlines for applications and don’t allow time for gathering data and formulating a competitive project and proposal. Theoretically, the reasoning behind those tight deadlines is that funders want to provide support for organizations that already have clearly identified needs and concerns and that have already developed strategies and solutions they want to implement.

 

Planning to apply for a grant well before a notice of funding availability or RFP is released can help your organization in two ways: 1) your organization can pursue the best funding match for your needs instead of chasing funding dollars that may not entirely align with your mission or primary goals and 2) your organization has more time to fully develop projects or programs, obtain data, and involve collaborative internal and external partners during the program development phase. The grant planning tips below will get you started with the grant planning process and increase your organization’s odds of submitting a competitive proposal.

 

Begin with Strategic Planning and Continuous Quality Improvement (CQI) Processes

All planning, including grant planning, should begin with a strategic plan because a strategic plan gives your organization a solid basis upon which to make decisions about organizational priorities and needs. With a strategic plan in place, an organization is better able to prioritize specific needs related to maintaining or expanding services and meeting the needs of consumers.

 

While continuous quality improvement (CQI) is a term more commonly used in the business sector, nonprofits and higher education institutions can benefit in many ways from supplementing strategic planning with CQI techniques. In other words, solutions to problems and organizational priorities should always reflect the purpose of the organization and be aligned with what the organization hopes to accomplish. If proposed solutions and needs don’t align with the organization’s basic mission and purpose, you may experience “mission creep” which hinders the organization’s overall success.

 

CQI involves an ongoing and systematic process to pinpoint, analyze, and define what works well and what doesn’t and usually involves processes rather than people. CQI also involves positing appropriate solutions and process improvements, trying those solutions out, and revising them if needed. For instance, if your college has identified student advising as an area that needs improvement, putting together a team to conduct CQI around that issue will help you formulate improvements to the process of student advising and test your theories.

 

Since the CQI process helps organizations identify problems and propose solutions, it can be fundamental to any grant planning. Once you know what problems your organization wants to address and once you’ve developed an appropriate response to those problems, your organization will need funding to implement your solutions. At that point, your organization can begin to research the types of funding available for your specific needs. This pro-active approach is more effective in meeting organizational priorities since you are focused on finding funding opportunities that match your needs rather than trying to create programs and organizational priorities in response to funding announcements that you otherwise might not pursue.

 

Be Aware of the Grant Cycle

Grants, especially established federal grant programs, are often announced on a rolling basis. For instance, some grant programs are announced annually or bi-annually at approximately the same time of year. These cyclical grant announcements and criteria usually don’t vary much from year to year, so once you know what types of funding will best benefit your organization, you can review past grant announcements that match your funding needs. One way to search the availability and prior RFPs for federal grants is to conduct a keyword search on Grants.gov. Many times you can also review information about the specific projects that were successfully funded in the past and, therefore, explore the similarities to your proposed projects.

 

Having access to previous RFPs or NOFAs is invaluable in the grant planning process because you have all the information needed to begin planning an application well in advance of the formal grant announcement. Because federal grants are extremely competitive, JCCI Resource Development Services recommends planning at least a year ahead of an anticipated grant announcement. This time frame allows your organization to gather data, seek input from a variety of stakeholders, develop a comprehensive plan, and craft a competitive proposal. During this planning phase, working with an external grant consulting team such as JCCI Resource Development Services can improve your organization’s focus on identified problems and solutions and will bring an objective perspective to the table.

 

Check All Applicable Registrations

Often, organizations believe they are ready to apply for a grant, only to discover that the user name and passwords for federal portals such as Grants.gov and SAM.gov are no longer accessible. Personnel changes and upgrades to these services make checking accounts well ahead of any grant submission a best practice. Online tools such as Grants.gov and SAM.gov also must be able to “talk” to one another and must be linked organizationally. If you need to update any information or account settings, the process could take several weeks. SAM.gov offers online tips for setting up accounts.  Similarly, Grants.gov will walk you through the applicant registration process and also provides an overview of tools such as the Workspace feature.

 

From Planning to Submission

Taking time to prepare adequately for a grant submission will improve the competitiveness of your organization’s proposal. Once a funding deadline is announced, you will still have adequate time to craft a compelling case and discuss a strategy for meeting identified needs that is based on data, feedback and input, and evidence that you’ve had time to gather. You will also have time to have an external reviewer read your draft and make helpful comments prior to submission. The grant process is typically extremely competitive, and taking advantage of the grant planning strategies recommended here can make a difference in earning a winning application score.

Why Title III SIP is Unique

Among all the U.S. Department of Educations grant opportunities, the Title III Strengthening Institutions Program (SIP) is most unique. The JCCI Resource Development Services team monitored the federal budget proposals presented in 2017 and was shocked to learn that the initial budget from the president’s office removed the entire line item for Title III SIP. The Trump administration stated that funding was removed from the budget because they felt Title III SIP duplicates other grant funding opportunities. Every educational institution that has ever received an SIP grant award understands how this program is different from most other DOE grants. Fortunately, Congress’s final budget returned that line item funding to cover grantees at least during the 2018 year. With much debate about government spending and the national debt and an uncertain future for Title III SIP, it seems appropriate to consider what makes SIP different and why continuing this type of funding will, indeed, strengthen our higher educational institutions.

Problem Solving

Though there are many federal grants that target under-resourced institutions serving low-income students, only Title III SIP compels an institution to examine a significant problem that is unique to their operations and their student body. Successful applicants will not only identify this problem, but will also propose a research- and evidence-based solution to that problem. Project evaluations must demonstrate successful problem solving and achievement of outcomes within the 5-year grant time frame. The grantee is responsible for showing that the problem has been resolved with no future need for additional DOE funding. This grant enables institutions to solve problems that impact the long-term future of the organization and the students they serve and requires grantees to resolve the issues “on time and within budget.” In fact, awardees cannot re-apply for the same problem, and they must wait a minimum of two years before applying for a Title III SIP grant to assist in resolving a different issue. If a grantee applies in another grant cycle, the institution receives no benefits for being a prior SIP recipient.

By Comparison

For those who are unfamiliar with the way other federal grant programs work, the problem-solving and time-frame benchmarks for Title III SIP grants may not seem that unique; however, by comparison to other DOE grants, the unique nature of SIP becomes clear. Consider SIP in comparison to DOE TRIO grant programs. Like Title III, there are several specific grants under the TRIO umbrella. For example, Talent Search and Upward Bound are under the TRIO umbrella of grant funds. Like Title III, TRIO grants are intended to help higher educational institutions provide educational services to students from disadvantaged backgrounds who may have to overcome challenges to completing a degree program. Challenges might include low income, disabilities, or being a first-generation college student. TRIO grants provide important funding to address a variety of socio-economic challenges to student success and higher education.

 

Unlike Title III SIP grants, though, TRIO grantees can literally receive continual funding for decades without a waiting period between grant applications, and, for most programs, previous grantees are awarded an additional 15 points for prior experience in the competitive grant cycle. The additional points which previous grantees receive make it even more challenging for new and innovative programs to obtain enough points to be funded.

 

The TRIO programs’ goal of helping institutions serve segments of the population that may need additional support to accomplish educational goals is, of course, a worthy goal. Title III SIP grant competition is fierce, but equitable, as no organization automatically receives points for prior award status. SIP awardees are held accountable for resolving identified issues with a specified time frame in a manner that is sustainable without continual federal funding. No other DOE grant program is designed specifically to support under-resourced institutions (defined by the institution’s educational and general expenditures compared to a national mean for its sector) serving low-income students while ensuring institutional efficiency and sustainability within a 5-year period. Title III SIP remains a unique and transformational investment in our educational system.

Beyond Getting the Grant: The Project Evaluation Process

Receiving grant funding comes with a serious responsibility to manage funds appropriately and demonstrate how the funded project is meeting defined goals and objectives. A comprehensive and carefully crafted project evaluation plan allows grantees to fulfill this responsibility more efficiently and to make any adjustments to the project that may be needed to achieve desired outcomes. Increasingly, grant applicants are incorporating external evaluation into their project design as a means of fulfilling this serious project monitoring and evaluation responsibility. Whether an institution is utilizing the services of an external evaluator or managing evaluation reporting internally, JCCI Resource Development Services recommends following these guidelines when designing a project evaluation plan.

 

Evaluation starts with the grant application. Formulating a basic plan for evaluating project success and achievement of project milestones and objectives when developing the grant project and writing the grant application ensures that stakeholders are aware of evaluation responsibilities before any work on the project ever begins. Each project and each grantee is unique and will require different evaluation methods; however, there are three standard evaluation tactics that are especially helpful in defining and outlining evaluation needs:

 

  • Michael Quinn Patton developed the Utilization-Focused Evaluation (UFE) approach that emphasizes engaging real and specific end users of the evaluation results and ensuring that evaluation reports are drafted with these users in mind. Patton advises continuously collecting, analyzing, and reporting quantitative and qualitative information to facilitate data-driven decision making. Using the UFE approach entails examining the evaluation process itself to make sure the process contributes valid and reliable information to end users and stakeholders in a timely manner. The evaluation must be meaningful.

 

  • Logic models are simplified visual representations of an identified need, a vision for fulfilling the need, and the strategy to accomplish the vision. Logic models use a linear format of inputs, activities, outputs, and outcomes to ensure all aspects of a program are measured against established benchmarks. Logic models can also serve as a map to show where participants and processes should be to ensure long-term project success. Several organizations such as The W. K. Kellogg Foundation, REL Pacific, and ERIC provide helpful information about developing logic models as well as sample logic models.

 

  • A participatory evaluation approach requires that those with “boots on the ground” rather than those in the “ivory tower” guide evaluation efforts. A participatory evaluation approach has the distinct advantage of gaining especially useful insights based on firsthand experience; project staff participation in the evaluation process is a key component of any successful evaluation effort. This approach can be time consuming, though, and requires a great deal of coordination. MEERA, a group formed to help environmental educators with evaluations, provides a good overview of the participatory evaluation approach’s pros and cons as well as examples of when this methodology would be appropriate.

 

In addition to determining the best evaluation practice or combination of approaches that suit a particular project and institutional goals, a good plan will also outline the type of evaluation the institution will use. The two main types of evaluation are formative and summative, and subcategories within those two types of evaluation include process, impact, and outcome evaluations.

 

Formative evaluations are common in many business operations and are commonly referred to as continuous quality improvement (CQI) efforts because they are ongoing rather than a one-time review. Summative evaluations, on the other hand, are reviews of project or program successes and outcomes typically performed at the end of specific time frames or at the end of the entire . Robert Stake, highly regarded for his influential development of program evaluation theory and practice, distinguished these two types of evaluation with his now-famous metaphor: When the cook tastes the soup, that’s formative; when the guests taste the soup, that’s summative.

 

Process evaluation is a subset of formative evaluations while impact and outcome focuses are subsets of summative evaluations. Recommended best practice is to use both formative and summative evaluations for a comprehensive assessment of the grant project. With selected methods and types of evaluations, the next step in the evaluation design involves identifying specific components at the outset:

  • The organization or person responsible for the evaluation plan and reports.
  • Agreed-upon benchmarks and measurements.
  • Types of data to be collected and an agreed-upon schedule and time-frame for data collection.
  • Agreed-upon methods for analyzing, reporting, and using collected data.
  • Reporting schedule.

Ultimately, the evaluation process should inform stakeholders about progress of the funded project as well as project successes or the need for adjustments to the project plan to achieve desired outcomes. Though funders might not require an evaluation report until the end of the grant period or at the mid-point of multi-year projects, preparing draft evaluations throughout the duration of the grant project will better position the grantee to give a meaningful evaluation report. Good project evaluation reports not only fulfill the responsibility of providing a detailed accounting to funders; they can also help grantees learn from a project and use that knowledge to be more competitive in future project planning and grant applications. Evaluation reports might also guide other institutions in implementing similar projects based on the grantee’s experiences.

How Competitive is Federal Grant Funding?

It’s the question on everyone’s mind when considering applying for federal grants: what are the odds of being approved for funding? Just how competitive is federal grant funding? The question is legitimate since applying for a grant can consume both human capital and financial resources when organizations and institutions often have little of either to spare. At the same time, receiving competitive federal grant funding can be the catalyst for moving programs and even entire organizations to the next level of service. Grant funding allows nonprofit institutions to do more than they could ever do without significant capital investment, so pursuing federal grants is definitely worthwhile.

 

During a 2017 conference for community college grant writers, a representative from the U.S. Department of Education answered questions from conference participants about the recent Title III Strengthening Institutions (SIP) grant cycle. The questions and the answers provided during this session shed some light on the competitive nature of that particular grant, and the statistics are likely similar for many other federal grant competitions.

 

U.S. DOE received more than 125 applications for the 2017 Title III SIP Part A grant funding cycle. Only 10 applicants received funding. The cutoff grant application score for the Title III SIP competitive grant funding was 103 which included a perfect score on the criteria (100 points) plus utilization of a tie-breaking method to determine grantees. It often happens that the Title III SIP selection process ends in a tie and funds are not sufficient to fund all institutions. In this case, the U.S. DOE awards up to three additional points based on 1) total market value of endowment fund during a base year, 2) total expenditures for library materials during a base year, and 3) activities that the applicant proposes to carry out in the application. In the 2017 cycle, no applicant with a score below 103 received funding, and many applicants with scores of 103 did not receive funding.

 

The good news from this extremely competitive federal grant funding cycle is that DOE may decide to “fund down” in the following year rather than announcing a new cycle of funding for grant applicants (as they often do). To “fund down” means that the DOE will review high-scoring applicants from one year’s competition to make additional funding awards rather than asking all applicants to submit grant requests again. For the institutions with high-scoring submissions, that news is especially welcome as it means the resources put into that above-perfect scoring application might still result in federal grant funding.

Planning Ahead

Considering the competitive nature of these types of federal grants and JCCI Resource Development Services’ experience with funded proposals, we know there are some steps to take in making a grant application as competitive as possible. Planning ahead is the most effective means of writing a winning grant, and that means planning as far out as a year ahead. Many institutions who received funding in the latest DOE Title III SIP funding cycle had been outlining their needs and planning their strategies a year ahead of beginning the grant submission process. These institutions were able to gather compelling data during this time frame and were able to generate the best solutions to their problems. Waiting until the U.S. DOE announced the grant funding cycle before thinking about the best ways to serve students and gathering supporting data simply would not allow enough time to lay the groundwork for a successful proposal.

 

After competitive federal grant funding opportunities are announced, applicants must still research specific grant opportunities to ensure they can meet all grant criteria and that the institution’s project and needs align with specific desired grant outcomes. RFPs and FOAs will include details about the amount of funds available, the cap on award amounts, total number of awards planned, grant project timelines, evaluation and reporting requirements, restrictions on use of grant funding, and a host of other helpful details to help organizations decide whether to apply. Because federal grants are highly competitive, ensuring that organizational goals match grant funding goals is crucial to success. Planning well in advance of a grant announcement and appropriate research of grant criteria are vital for developing a grant proposal that will be competitive.