by Mandy Pearce

As I work with coaching or consulting clients, it never ceases to amaze me when I conduct historical reviews of their budgets and see ‘grant writing’ as a line item that actually has dollars associated with it.  
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Do you work on your personal budget, family budget or home budget and have the following thought?

we are about $10,000 over on expenses compared to our income for next year, so I think we’ll just put that $10,000 under yard sales.  We can hold a few during the year and hopefully they will generate the $10,000 we need to make budget

This is the same concept as nonprofits who have a shortfall in their budget and decide to put the remainder needed in the ‘grant’ line item and hope for the best.

I think there should be a line item for grants in a nonprofit budget in 3 distinct situations.

  1. When an organization has a renewing grant that they know will generate income in the budgeted year.
  2. When an organization is conducting a capital campaign or specific project and they have a set dollar amount, goal or objective from specific grants, foundations, RFPs, etc.
  3. When an organization knows they want to write grants and hopes to secure some, but do not have a set goal, assurances of receipt or capital project… in this case, the line item should exist, but the dollar amount associated with it should be $0.

When organizations write dollars into budgets for a grant line item to help balance a budget, they are setting themselves up to fail. There is no guarantee that a grant is going to be awarded simply because you submit an application.  Regardless of the need, there is simply no way to guarantee being awarded a grant.  By writing in a specific dollar amount, you set up unrealistic expectations of staff, from board and for your organization. 

As we begin the 4th quarter of 2015 many organizations are working on budgets and mapping out their development plans for a successful year-end and intro to 2016.
I encourage you to:

  • Have diversified fundraising streams in your development plan
  • Be realistic about your goals and their attainability
  • Work with board, staff and accountant to create a workable and realistic budget
  • Start reviewing historical data NOW to create a successful plan for 2016

Planning is one of the main keys to success in fundraising.  Start planning now!

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