Fundraising: Government Grants

Updated: 6.1.06

Federal, state and local governments distribute more than $200 billion annually to support nonprofit organizations that provide programs and services to the nation's citizens. The government is motivated to fund these nonprofit organizations because it needs their expertise, their ties to the community and their resources. Available funding and funding priorities, however, fluctuate with the national and local climates. Variables such as the economy, the political party in office, the popularity of the cause and the strength of competing demands determine the funds available and the types of programs that receive funding.

Currently, states are under exceptional budget pressure. According to the Center on Budget and Policy Priorities, in fiscal year 2002, states' total budget deficits exceeded $36 billion, and that number is only expected to increase.

The advantages to receiving government grants are:

Ongoing support: Government funding tends to have more continuity than other sources, particularly when the funds are secured through legislated mandates. Other "seed grant" programs are more short-lived. In either case, securing initial funding from the government puts you in a good position for obtaining further government funding down the road, especially when your program shows measurable results.

Substantial support: In many cases, government grants provide substantially more funding than other sources. However, keep in mind that some government agencies are interested in knowing that your project has multiple sources of funding, regardless of the size of the grant.

Credibility: Once you have secured funding from one grantor agency, it will be significantly easier to approach other agencies in the future. Knowledge of the systems and processes within the government, and proof that you can meet the fiscal and programmatic expectations, bodes well when applying for other government grants. Additionally, the credibility will help when attempting to solicit funding from private ventures as well.

Access to decision-makers and the decision-making process: Relationships with agency personnel and elected officials are invaluable. Once you have your foot in the door, gaining and keeping support for your program among decision-makers and key personnel will be that much easier (assuming you've successfully attained project goals, etc.). The longer the program is around, the more likely it is to build public support.

For a full report on going to state and local governments for your fundraising efforts, download the full Developing a Fundraising Plan: Government Grants section of the Guide to Fundraising.