Board members can be invaluable in helping to obtain grants from foundation, corporate and even government funders. Jeannette Archer-Simons ("Board Members as Grants Advocates," CharityChannel, March 4, 2009) suggests giving them some of the responsibility for research, such as identifying foundations that are likely to support your organization or gathering statistics and demographic data to use in the proposal. Ask them to talk to their business associates, friends, and colleagues about possible grant sources, such as corporations, bank trust departments, financial managers, and government agencies. As ambassadors for your organization, board members can open doors for you. Just make sure they’ve been provided with talking points to use when they’re out in the community, or attending meetings, or accompanying your CEO on visits to grantmakers.

Organizations short on development staff can look also to volunteers for help securing grants. Perhaps you can’t afford to hire a paid development staff. Or the staff person who identifies grant opportunities and writes proposals may be swamped with other responsibilities. In "Building Your Grants Team with Inside and Outside Volunteers" (CharityChannnel, April 15, 2009), Lynne T. Dean recommends asking volunteers who are self-motivated to search the Internet for grant sources. For proposal writing, tap volunteers who are experienced writers, love to write, can adopt different styles, and can work under deadline pressure. Dean adds these tips for working with volunteers:

• Develop written roles and responsibilities.
• Keep in touch with the volunteers.
• Have a staff liaison.
• Celebrate success.
• Recognize the effort of the volunteers.

(The complete articles can be accessed only by CharityChannel subscribers.)

[Editor’s note: If you use volunteers for proposal writing, don’t expect them to reinvent the wheel. See "Get proposals off the ground fast" in the July 2008 issue of {Centered} for ways to make their work—and yours—easier.]

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With the passage of the American Recovery and Reinvestment Act, the surge of interest in federal funding can snarl traffic on Grants.gov. But there are other ways to access grant applications and information. In "Recovery Applications May Overwhelm Grants.gov, OMB Warns" (Local/State Funding Report, April 6, 2009), you’ll find suggestions for alternate routes. Some agencies, including the Department of Energy, the Department of the Interior, and the Office of Community Oriented Policing Services at the Department of Justice, have set up systems on their own web sites to accept applications. The Office of Management and Budget (OMB), in the White House, is developing other alternatives to Grants.gov. Information should soon be available on the OMB web site.

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The Sloan Foundation’s decision to eliminate their online-education grant program leaves institutions of higher education with fewer sources of direct grant support. This means colleges and universities will have to incorporate requests for support of online-education programs into other types of grant applications, says Marc Parry, in "Sloan Foundation Clicks ‘End Program’ for Its Online-Education Grants" (The Chronicle of Higher Education, April 17, 2009). Parry recommends looking for National Science Foundation and National Institutes of Health grant programs that require education promotion. If you’re applying to the Bill and Melinda Gates Foundation for money to increase the number of people receiving higher education credentials, he suggests folding a request for support of your online-education program into that proposal.

[Editor’s Note: The Chronicle of Higher Education has granted {Centered} readers access to Parry’s full article for a limited time. The link above will expire on June 16, 2009.]

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If you read the newspaper, watch the news, or surf the Internet, you may feel that grants—and grantseekers—are everywhere. In the United States, much of the federal stimulus package is being distributed in the form of grants, either directly from the national government or as pass-through money to be distributed by state and local governments. Announcements of foundation grants to worthy projects and organizations frequently appear in the news. Many documentaries celebrate programs, started with grant money, that are doing enormous good. Our neighborhood schools, local hospitals, and county libraries are all looking for grants.

But what, exactly, is a grant and who (or what) is eligible to get one? Even those of us who could actually make excellent use of funding are sometimes mystified by this question. The answer can sometimes be complex, but it’s based on a few straightforward principles.

What we call a "grant" today, in the United States, comes from what was once properly a verb, "to grant," which means "to give what is requested" or "to confer formally or by legal procedures" (Webster’s Ninth New Collegiate Dictionary).

Today we use the term as a noun to mean the act by which something is formally given—be it land, other property or money. It differs from a "gift," which is something given to show friendship or affection. While a gift requires only a "thank you," more is required when one accepts a grant. In return for being "granted" something, the grantee accepts certain obligations.

At least three broad criteria determine whether or not one is eligible to apply for a grant:

1. To be eligible for grants, you must be an organization. (There are rare exceptions, but these anomalies are beyond the scope of this article.)
2. To be eligible (in most cases) for grants from governmental, foundation, or corporate sources, either you must be designated by the Internal Revenue Service (IRS) as a nonprofit organization or you must be a governmental agency.
3. To receive a grant, you must meet other eligibility requirements.

I. To receive a grant, you must (with rare exceptions) be an organization.

The term "grant" is often loosely used to apply to money given to individuals—as in Pell grants, which the U.S. federal government makes to students for their education; similar state grants, what we usually call scholarships or fellowships but what are often referred to as grants; and small contributions (called "bonuses" if they are significantly large) made by business and industry to reward outstanding service.

That definition, however, is too broad for our purposes. The kinds of grants we’re speaking of here are grants made to organizations. To be eligible for such a grant, the applicant must (with rare exceptions) be an organization, not an individual. The term "organization" denotes a group of people that is just that—organized. It has some history, a certain degree of permanency, a structure (which may be loose or formal), various roles for various members, and a purpose. A grassroots neighborhood group or a small faith-based one is such an organization. So are the American Red Cross, the Boy Scouts of America, your local public school district, and, for that matter, General Motors.

Grants are made to organizations by governments (federal, state, and local), corporations, and foundations. A foundation—or at least a grantmaking foundation—is an organization (that word again) established to receive pre-tax dollars from its contributors and to pass those dollars on to other organizations that work for causes in which the donors and board members are interested. There are tax advantages; many foundations were established so that big business and wealthy individuals could direct their tax dollars to causes in which they were interested. However, today U.S. foundations are highly regulated by the IRS, and almost all foundations have specific missions to benefit society in some specific way. Many corporations also take advantage of tax deductions through charitable-giving programs with well-defined missions, but these are usually somehow related to the business of the corporation.

II. To receive a grant from a corporation, from a foundation or from a government agency, a nongovernmental organization must (in most cases) be designated by the IRS as a nonprofit organization.

In most cases, corporate, foundation, and government grantmakers can make grants only to groups which have been designated as 501(c)(3) nonprofit organizations by the IRS or are agencies of national, state, and local government. (There are a number of federal grants for which nonprofit organizations that are not 501(c)(3)s may apply, and there are also a small number of federal grant programs for which for-profits, small businesses, and, in a few cases, even individuals are eligible. We won’t address these here, but you can learn more about them on the "Search Grant Opportunities" page at Grants.gov. Scroll down that page to the "Search by Eligibility" feature.)

III. To receive a grant, you must meet other eligibility requirements.

By now, you’ve probably figured out whether or not you are eligible to seek grant funding at all. So, if you’ve read this far, we’ll assume that:

• you’re seeking a grant for your organization, not for yourself or for another individual, and
• your organization is a governmental agency, or a 501(c)(3), or a small grassroots or faith-based organization.

Now the process becomes more complicated.

Every funding organization has its own criteria about which organizations are eligible to apply for and receive its grants. Sometimes, with government and private funders, these are broad and general: For example, some federal grant programs indicate that any local or state unit of government, any nonprofit organization, and any grassroots or faith-based organization may apply. Some foundations indicate that only nonprofit organizations may apply. Other grant programs are much more specific. For example, one Request For Proposals (RFP) from the U.S. Department of Labor says that (with a very narrow exception) only community colleges may apply and then only in partnership with a number of other specific kinds of organizations. Recently one foundation limited its grants only to nonprofit organizations that provide for the basic needs of the region’s neediest people. Furthermore, in order to be eligible, an applicant organization must have a written strategic plan. These kinds of criteria are usually stated clearly in the grant application materials, but since there may also be unwritten agendas, it is always appropriate to ask.

Certain criteria may appear to be insurmountable barriers, but that’s not necessarily the case. For example, the Department of Labor program referred to above limits eligibility to community colleges working in partnership with specific kinds of community agencies. Although your organization may not be a community college, perhaps it could be one of the partners. Another RFP requires the applicants to be IRS-designated nonprofit organizations; however, a university or government partner might supply essential services as a subcontractor. Finally, it’s not uncommon for grantmakers to limit eligibility to a consortium of organizations (although one agency is always designated as the fiscal agent). However, with good planning, new consortia can always be formed to address new (or newly identified) needs.

There are three governing principles to remember:

1. Government agencies (federal, state, and local) are absolutely bound by their rules. By finding a way to fall within those rules (such as becoming a member of a consortium), you may become eligible. However, grantmaking government agencies cannot disregard their own rules.
2. Private foundations (those that get money from one or a few donors and who are not raising money from the public) are not always required to follow the rules they may have laid down for themselves. They may, for example, have guidelines stating that they do not fund government agencies. But if they are persuaded that a particular project is very important, that government cannot fund it, and that the outcomes will be extremely beneficial, they may be eager to fund that project.
3. Some foundations and corporations indicate that they do not accept unsolicited proposals. Many grantseekers rule these out as prospective donors. However, since private foundations are required by the IRS to spend a certain amount of their assets each year on grant-related activities, they will be making grants and often very significant ones. Once they know that an organization or a project related to their mission is of high value, they may ask the organization to submit a grant proposal. When this happens, if your proposal is good, so are your chances of getting the grant!

To summarize: Individuals are unlikely to be eligible for the kinds of grants we’re talking about here. Organizations should ascertain whether or not they are eligible for grants generally, and, if so, whether or not they meet the eligibility criteria for specific funding opportunities. Remember that, as part of a consortium, your organization may be eligible for a grant for which it would not otherwise be considered. Finally, many foundations and corporations that do not accept unsolicited proposals are looking for solid organizations that operate excellent projects and, once aware of such organizations, may invite them to submit proposals.

Mary Ruth Clowdsley is a consultant trainer for The Grantsmanship Center. She has had over 40 years of experience working with nonprofit organizations and as director of grants for an institution of higher education.

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