Grant Seeking During the COVID-19 Crisis
The COVID-19 crisis threatens to stop us in our tracks. But nonprofit organizations must not stop striving to fulfill their missions, and so they must not stop growing their relationships with funders and seeking grants. The Grants Plus team is committed to monitoring how the crisis impacts the grant seeking sector and supporting nonprofits to remain strong and stable during this uncertain time.
Grant Seeking During Crisis Content:
Emergency Small Business Loans for Nonprofit Organizations
The CARES Act passed as part of the $2 trillion coronavirus relief bill provides emergency support for nonprofit organizations and small businesses.
As of April 21, Congress has finalized a $450 billion package that will inject an additional $310 billion into the Paycheck Protection Program. Of this, $60 billion is intended for small businesses/organizations or businesses without an existing banking relationship by directing the funds to small banks, credit unions, and community financial institutions. The program continues on a first-come, first-served basis, so organizations are encouraged to act quickly.
- Paycheck Protection Program: Organizations with 500 or fewer employees may qualify for loan amounts up to $10 million for payroll and associated costs, including benefits and facilities costs. The maximum loan amount is calculated at 2.5 times your organization’s average monthly payroll costs for the past year. Organizations that maintain employees on their payroll from February 15 through June 30 may have their loans forgiven, essentially turning the loan into a grant. For advice on preparing for forgiveness, see this advice.
- Economic Injury Disaster Loans: This program enabled organizations to apply for a $10,000 advance on an Economic Injury Disaster Loan and receive checks within three days. According to the SBA, new applications are not being accepted at this time based on available appropriations funding. Applicants who already submitted their applications will continue to be processed on a first-come, first-served basis.
- Fully refundable tax credits: If an organization is subject to a shut-down order and has lost 50% of revenue compared to last year, they may receive up to a $5,000 per employee tax credit. Tax credits could be applied against payroll taxes, so this is an immediate benefit. Organizations cannot take both the tax credits and the SBA loans. A helpful explanation of the tax credits is here.
See loan and grant resources for small businesses:
Webinar Recording: Grant Seeking During the COVID-19 Crisis and Why Your Nonprofit Shouldn’t Press Pause
What’s most important is not to stop your grant seeking efforts during this time. Do not stop communicating with funders, cultivating opportunities, and taking proactive steps to secure grant funding. To stop is to put your grant revenues and relationships at risk not just now but in the longer-term.
Please view the full webinar recording for more substantial detail about the current context and what it means for grant seekers, including specific steps we advise taking now and also in the short-term.
Following are highlights:
What to do now:
- Develop a plan and proactively communicate your needs to your funders. Prioritize talking to funders about:
- Changes you need to request to existing grant terms.
- Flexibility to use grant funds for a different purpose or program.
- The possibility of emergency funding to replace lost income or fund direct response to the crisis.
- Seek out special opportunities for emergency funds. Grantors are specifically releasing funds for health services to treat and contain COVID-19, expand services to vulnerable populations, and provide income assistance for people losing wages. The Grants Plus team is collating emergency grant funding opportunities from around the country. Click here for the list.
What to do next:
- Assess and address the anticipated impact of the crisis on your organization’s mission, programs, and services. You will need to understand and be able to communicate these impacts to funders.
- Continue to communicate with and steward existing funders. Specifically:
- Discuss how the crisis has affected the organization and its work.
- Convey the importance of your work now and in the future.
- Discuss potential changes to funder priorities that may affect future grants.
- Continue identifying and cultivating new funders.
- There will be increased need and so increased competition for grant funding. The organizations that stand to secure the most grant funding are those that will proactive to build new relationships and request funds.
- In the event you may lose funding from existing grant makers who shift their priorities as a result of the crisis, you must keep building a pipeline of new funders to replace them.
- Adapt your communication tactics to meet grant funders where they are.
- The best overall method continues to be picking up the phone to have a conversation. Use email to follow-up if you don’t immediately make contact.
- Since site visits are not currently an option, use video and pictures to show your mission in action.
- Expand your use of additional technologies, including video conference to create virtual rapport.
Answers to Commonly Asked Questions About Grant Seeking During the COVID-19 Crisis
Q: What if we can’t complete a current grant according to the terms?
A: Talk to your funders. Funders recognize that many organizations are unable to meet the terms of current grants because of the crisis, and many are asking their grantees to get in touch to discuss how to best use the funds. Some funders have even proactively converted existing restricted grants to instead be used for general operations. Nearly 300 grant makers across the US have signed on to A Call to Action, Philanthropy's Commitment During Covid-19, a pledge to flex current funding and deadlines and make more unrestricted funds available.
Q: How do you communicate with funders before you know how your programs will change?
A: If you know that your programs will have to change but are not sure exactly how, don't wait until every detail is perfectly worked out before communicating with your funders. Right now it’s more important that your funders have a timely update than an elegant multi-year plan. Share where things stand now and what you anticipate. Then follow-up again once you have a better understanding of the change.
Q: Do I proceed with deadlines that haven't changed?
A: Yes. Many funders are working diligently to continue their work uninterrupted and remain committed to their ongoing mission even during the crisis. If a funder has not explicitly changed a submission deadline, proceed with your submission. If your work is impacted by the crisis, be sure to explain how. If your work isn't immediately changed, still acknowledge the crisis and make the case for why your work remains important in this context. For example, a proposal to support a neighborhood garden that may have talked about the health benefits of fresh food could now instead focus on the importance of producing food in the neighborhood as the COVID-19 crisis strains supply lines.
Q: How can organizations make the most of emergency sources of funding?
A: One of the best ways to find opportunities is to regularly check the Grants Plus COVID-19 funding resources page. In addition, regularly check the websites and social media accounts of your top funders and the largest funders in your area. Some of these emergency funds are being proactively directed to pre-selected organizations; other emergency funds are more competitive. If the emergency fund in your community is competitive and matches your organization's mission and focus, proceed with the application steps ASAP. If there is no application process, identify if you have an existing contact with one of the funders supporting the crisis fund. Seek a conversation right away to discuss how you are addressing the crisis and your additional funding needs.
Q: Do we expect funders will abandon their traditional priorities to fund the crisis?
A: It's not something we are seeing happen and we think it may be unlikely. Funders are aware that the priorities and needs of a few weeks ago are still urgent today. Many have explicitly stated that they will continue their regular grant making during the crisis. We do expect to see some funders provide additional funding to organizations that are directly addressing the COVID crisis and its societal impacts, but we doubt funders will completely abandon their core mission.
Q: Do we anticipate differences in how corporate vs. private funders will respond?
A: Yes and no. Corporate giving programs that are funded by the ongoing operations of the company are likely to dramatically curtail giving immediately due to the economic impact of the crisis on their business. Corporate foundations that are funded annually by a percentage of the company’s profits will likely be forced to cut back on funding in the near future. Corporate foundations that have a separate endowment and are not reliant on annual profits will likely behave more like private foundations, although some may shift giving to focus on the crisis.
Q: What tips do you have for organizations that do not provide direct services?
A: Keep going. Funders realize that all organizations are being hit hard by the crisis, not only those that provide direct services. The most important thing to do is to talk to your funders and be sure they are aware of your needs and how you plan to continue working to advance your mission during the crisis. Based on past economic downturns, you may be more successful seeking funding to support your core, ongoing mission rather than seeking funding to support program expansions or new programs.
Q: How is the crisis impacting federal funding?
A: On March 19th, the Office of Management and Budget sent a memorandum to all federal departments authorizing them to be flexible in grant making. This includes allowing agencies to extend submission deadlines, to provide automatic extensions to current grant periods, to accept shortened requests for non-competitive continuation grants, to extend reporting deadlines, to loosen restrictions on allowable expenses, and several other changes to provide relief to applicants and grantees. Not every agency is taking advantage of this flexibility, but some have already delayed application deadlines.
Q: What about donor-advised funds?
A: Donor-advised funds (DAFs) are a powerful potential source of revenue, especially since history shows giving through DAFs remains strong through economic crises. If you already receive grants from donors who give through DAFs, offer them a personalized report on how the crisis is impacting your organization and how much your organization would be helped by an emergency gift now. Donors with DAFs already donated that money prior to the pandemic, so those funds are available to be allocated in the form of grants. If you aren't already receiving grants through donor-advised funds, there are steps you can take now to invite those gifts in the future.
Other resources from Grants Plus's friends and partners to move your organization through this crisis:
- Candid has released a resource page that summarizes the philanthropic response to the coronavirus crisis and lists grant opportunities from national and international grant makers to fund medical care and research.
- Cramer & Associates has developed a useful "Top Ten Checklist" of action steps nonprofit organizations should take.
- CCS presented a webinar, Principles of Fundraising: Navigating the Challenges Presented by Coronavirus, that is available for download.
- Foundant Technologies has built a resource library for grant makers and grant seekers.
- Bloomerang has compiled a library of crisis fundraising advice, articles, opinions, webinars, videos, and other resources about the impact of coronavirus on the nonprofit sector.
- Ashire has produced a 30-minute recorded webinar about crisis communications during the coronavirus pandemic.
- More than 100 entities, including major national funders, have signed on to a pledge to support grantees through the crisis, loosen funding restrictions, and make unrestricted grants available. See more information from the Council on Foundations.
- Qgiv has accumulated numerous articles on ways to pivot if you must cancel a fundraising event because of COVID-19.
- Benefactor Group provides this guidance to colleges and universities navigating the COVID crisis.
- Sangfroid Strategy recommends five areas to build nonprofit resilience during this time.
- The Greater Cincinnati Nonprofit News continues to be committed to publishing each week - sharing news and connecting nonprofits in the region during the COVID-19 pandemic. Send your news here and/or subscribe for free.
- Mission Minded offers advice for messaging and communications during crisis via articles and upcoming webinars.
- Blackbaud has curated a collection of resources organized by industry type to help social good organizations respond to the crisis.
- Amy Eisenstein recommends these tips and strategies for continuing to fundraise for capital campaigns during crisis.
- Council on Foundations provides a hub of information on COVID grant resources.