Fundraising Part 6 of 6 - Terms Important to all types of Fundraising and Development - There Are Only 4 Basic Sources of Contributed Income

So there it is!  Remember the terms!  Apply them to what you learned about the 4 Basic Sources of contributed revenue.  And remember, there are only 4 Basic Sources!  Not too complicated!

Fundraising Part 5 of 6 - Individuals - There Are Only 4 Basic Sources of Contributed Income

Individuals - WHERE THE MONEY IS AT

Here's a reminder from our July 17, 2013 Blog.

Let's think of it like this:

No waiting.  No decision process like through a government source,  through a foundation, through a corporation.  Take out a check book, write a check, hand it to you.

Most often we ask Individuals for gifts for the Annual Fund (yearly giving and gifts we hope for every year).  The goal is to make these gifts progressive in size of time.

As fundraisers, we like major gifts.  What each organization thinks of as a large or major gift is typically based on the non profits budget size.  Smaller organizations may be highly excited about $1,000, $500, or even $250.  Larger organizations might need $10,000, $100,000 or $1,000,000 to be as excited.  Again, it depends on who you are and what you are used to receiving.  But in general, if someone has never giving to you, it is hard to just suddenly go big unless you think you have a connection that helps or a reason to think they want to help you a lot.  Think of it as planting a flower.  You plant, you remember to water regularly, it takes time, the flower grows, something beautiful blooms.  Or you have a great interaction with an individual, you ask for a first gift, you remember to be nice and say thank you, you wait a bit, you ask again and ask for a little more if possible, the gift grows, water, repeat, ask again, repeat, repeat, repeat, you have a big flower garden.

Another type of Individual giving is Planned Giving.

Like the slogans and images above, often associated with Planned Giving is the idea on leaving a legacy and having something grow.  Planned Giving is when someone leaves you a gift in their will and the gift comes at the time of death.  Often these gifts are much, much larger than annual gifts.

In our next Blog in this series on fundraising we will finish up with some important terms and concepts that all fundraisers should remember and keep at the front of their minds.

Fundraising Part 4 of 6 - Foundations - There Are Only 4 Basic Sources of Contributed Income

There are only 5 basic types of Foundations.  Foundations, like non profits, are 501(c)3 organizations or a similar non profit status.

A Family Trust is what it sounds like.  It is when instead of giving from their check book or stock options, a family forms a more formalized structure and gives from their trust.  This is often managed by a family who has living individuals that make decisions on who gets their donations.

A Community Foundation is a non profit that has been set up and that collects donations from a community then sets up a system to give out those donations.  A Community Foundation is governed by a Board just like other non profits.  The Board tends to set policy on what they feel are the greatest needs of their communities than establish procedures for how funds can be applied for.  See our Blog post from May 19, 2013 for an example of how to apply to one specific Community Foundation.  NOTE:  All Community Foundations are different!  So make sure to research the one in your community!

A Private Foundation is another example.  Sometimes they are similar to Family Trusts, when it is named for a family it is often set up in a way that if all members of a family passed away gifts would still be made to the causes they find most important.  Sometimes it is a group of people not related or a group of businesses with common interests that come together to form a foundation.  Just like Community Foundations, they most often have specific application procedures.

Corporate Foundations, as briefly touch upon in the 8/14/13 Blog, are a corporation's more philanthropic was of giving over sponsorship dollars.  As a review, sponsorship means a corporation expects to receive value back for it's gift.  A Corporate Grant tends to mean logo not required and is given for more philanthropic reasons.  For example, PNC Bank has a corporate foundation that focuses on education and early childhood development.  Often large corporations - Bank of America, Target, Walmart, etc. - establish foundations to help with their tax burdens.  Just like Community Foundations and Private Foundations there are processes and procedures to which you must apply through.  Research needed.

The fifth type of foundation is an Operating Foundation.  This is typically not a good foundation to apply for money for.  Operating Foundations are non-profits that are allowed to make all their donation to themselves.  Yes, sounds odd but it is correct.  They are 501(c)3's that work to do public good, can collect donations, than fund their operating needs to continue the public good.

What is the same for all of these foundations is:

The IRS requires that independent / private and corporate foundations pay out at least 5% of the year-end fair market value of their assets.

So again, please do your research so you know which or how many of these are appropriate for you to be applying to!  And next month we promise to provide grant writing tips!

Next up... Individuals... WHERE THE MONEY IS AT...

How to convince reviewers of project sustainability

By Jim Abernathy, The Grantsmanship Center -

{Centered}: April 2013 (Vol. 6, No. 5) 

How to convince reviewers of project sustainability

Federal grantmaking agencies increasingly want applicants to show their ability to continue proposed projects beyond the life of the grant. Using the Department of Education Innovation Fund Start-Up grants program, by way of example, the article "Demonstrating Ongoing Impact of a Project Can Boost Proposal," (Local/State Funding Report, March 28, 2013) suggests ways to satisfy such requests. The agency wants to see a multi-year financial plan, demonstrated commitment of partners, and evidence of the broad support from stakeholders that projects need to succeed, and its reviewers look kindly on proposals that show past experience with models for sustaining funding. Those are just some of the nonfinancial factors that can demonstrate your sustainability to many types of grantmakers - foundations, as well as federal agencies. Others include: Strong, long-term relationships with other significant institutions working in the same field. Networks with businesses within your community. The infrastructure of personnel, leadership, and training you've built for your project. The knowledge you've gained through outreach efforts. Plans for continued use of materials and resources beyond the grant period.

Fundraising Part 3 of 6 - Corporations - There Are Only 4 Basic Sources of Contributed Income

Let's start simple -

Yup, just two options.

So what is the difference between Corporate Sponsorships and Corporate Grants?

Let's start with Sponsorships.

So really, that simple.  It is a gift with an expectation of receiving value back.  Show them you have value!

And the difference between a Corporate Sponsorship and Corporate Grant...

So some corporations from foundations and give for a mixture of purely philanthropic reasons and for tax breaks.  Like foundations they have application procedures and follow up requests.

This is a good transition into the next Blog in the series.  Part 4 to be posted on 8/21/13 will explain the various types of Foundations.

Fundraising Part 2 of 6 - Government Funding - There Are Only 4 Basic Sources of Contributed Income

Stated simply, Government donations are NOT private funding.

Typically Government funding that can be applied for comes from taxation of some sort or lawsuits the government has won and is now responsible for distributing.

There are also four basic sources of Government funding.

1. International

2. Federal

3. State

4. County

Let's start with #1 - International.  As American's, and speaking from my experience of only working from within the US so far, one source of International funding is the United Nations.  The United Nations has some funds available for projects that help to show collaboration between nations for artistic projects.  NOTE: please, you will need to do you own research and inquiries for possible funding.  The purpose of this Blog series is to better educate on various types of funding, not give specific directions on how to apply.

Going from large scale and moving closer to home, #2 is Federal funding.  The most common type of Federal funding for the arts comes from the National Endowment of the Arts (NEA).  The NEA ONLY funds certified non profits / 501(c)3 organizations.  The NEA has a variety of funding options.  One of the most common that arts organizations applies for are Fast Track Grants, formerly know as Our Town.  Fast Track Grants are for $10,000 and typically help to fund the creation of new art or community engagement and education of art.  New art could be art itself, compositions, or a collaboration of new and in existence.

Here are some useful Federal links.  

All government grant seekers must register through Grants.gov -   http://grants.gov/

For researching NEA possibilities -  http://www.nea.gov/grants/

For researching National Endowment for the Humanities - http://www.neh.gov/grants

Next comes #3, State funding.  

All 50 states and the six U.S. jurisdictions (American Samoa, District of Columbia, Guam, Northern Marianas, Puerto Rico, and the U.S. Virgin Islands) have state arts agencies. Visit National Assembly of State Arts Agencies's (NASAA) state arts agency directory to learn more about your own state arts agency. - http://www.nasaa-arts.org/About/State-Arts-Agency-Directory.php

What do state arts agencies do?

State arts agencies increase public access to the arts and work to ensure that every community in America enjoys the cultural, civic, economic and educational benefits of a thriving arts sector. To do this, state arts agencies:

• provide grant funding for artists, arts institutions, schools and community groups;
• offer training and information that strengthens the management and entrepreneurial skills of artists and arts organizations;
• support in- and out-of-school arts activities for young people;
• lead special initiatives to foster economic and civic development through the arts;
• advance arts education through teacher training, curriculum development and assessment projects;
• conduct research that documents the impact of the arts;
• educate the public about the essential role of the arts in American life;
• preserve and celebrate the unique cultural traditions of each state;
• recognize and promote artistic achievement.

How can I apply for state arts agency funding?

Every state arts agency offers a unique combination of grants and services for artists, arts organizations, schools and community groups. Get started by learning about the programs your state arts agency offers and considering how your goals and your agency's goals are a good match. NASAA's state arts agency directory has contact and website information to help you begin. Taking the time to talk with your state arts agency's knowledgeable staff will start you on the path for applying for funding.

And finally, #4 County.  This is where it gets hard to be specific for all areas.  Some have it, some don't.  For example, some city's have arts funds, some don't.  Googling and research will be needed in this area.  County funding is an area where county lawsuits can sometimes help arts non profits.  One great example is in Erie, PA.  Due to a lawsuit between the County of Erie and a casino within the county who had tables that were weighted unfairly, the county has large sums of money to donate to large arts non profits.  In the last several years the Erie County Gaming Revenue Authority has been able to give millions to local arts non profits.

Stay tuned.  In a few days we'll help to explain corporate giving!

Fundraising Part 1 of 6 - There Are Only 4 Basic Sources of Contributed Income

When I guest lecture or teach about fundraising, the overview always starts with one basic concept - THERE ARE ONLY 4 SOURCES OF CONTRIBUTIONS TO COME FROM.

Yup, it is that simple.  Over the next couple of weeks I will role out a series of Blogs that talk more about each of these 4 Basic Sources.  Hopefully they will help to make fundraising and understanding some of the basics seem more simple and easy to grasp.   Remember, most things are less complicated than they seem.

Show the need, but emphasize the opportunity

By Jim Abernathy, The Grantsmanship Center -

{Centered}: April 2013 (Vol. 6, No. 5) 

Show the need, but emphasize the opportunity

A strong needs section is essential for any proposal, but you should follow it with a convincing argument that your program represents an opportunity to address that need. In "Keeping it Positive and Keeping it Local" (CharityChannel, April 11, 2013), Cheryl Kester says that, while being clear about the severity of the need, you should keep a positive tone about your program's ability to make a difference. She offers these four guidelines: Demonstrate that your organization is well positioned to meet the need. Include stories that show how success is possible. Present a clear and convincing plan to address the need. Instead of begging for help, invite participation in your program.  It's also important to show that your organization's plan for addressing the need is realistic. Illustrating how your program will work in a small community or neighborhood is a good way to make the case that the need can be met. To do this, says Kester, you should use local statistics and tell real-life stories from those communities. If the people you've helped have sent notes or letters of thanks, try to quote these in your proposal.

Major NEA Cut Frozen Until Fall‏ - From the Americans for the Arts

Wednesday the U.S. House Appropriations Committee began consideration of legislation that would devastate the National Endowment for the Arts (NEA) with a 49% cut to its budget. An amendment to restore the funding to the NEA was defeated along a party-line vote of 19-27. With rising tempers over this cut and many others, the committee has now suspended its consideration until mid-September.

This legislation began its journey as a subcommittee proposal last week and the full committee is the middle step before it goes to the House floor for final consideration. Arts advocates are outraged and have sent more than 22,000 messages to Capitol Hill this past week calling for a rejection of these cuts.

If you have two minutes, please contact your member of Congress, or you can use our powerful media alert tool to send a Letter to the Editor to your local newspapers calling for Congress to reject this cut.

As stated in yesterday’s committee meeting by members of Congress from both parties, the cuts to our cultural resources are misguided and disproportionate. Not only will they impact the NEA, but the millions of Americans working in the creative industries that are boosted by the strategic grants made by the NEA.

• Senior Democratic appropriator Rep. Nita Lowey (D-NY) described the bill as the "worst bill considered during this appropriations cycle."
  
• Rep. Betty McCollum (D-MN) said, "We'd be better off passing a blank piece of paper."
  
• Rep. Chellie Pingree (D-ME) noted how many communities in her state have been revitalized because of NEA support and how critical it is.
  

The Road Ahead:
As members of Congress head back to their home districts shortly for a five week recess period, the appropriations process will be put on hold until their return on September 9. Americans for the Arts will continue to build our advocacy efforts, looking ahead to later in the fall when the committee will try again to complete its work and move consideration of the bill to the House floor, where amendments to restore funding, and unfortunately reduce funding even further, could be offered.

The steps beyond that are unclear as the appropriations process this year appears to be heading toward a dysfunctional ending. As the Senate and the House have vastly different appropriations levels on a variety of bills, it is unlikely that they will find a compromise position. The most likely outcome would be a “continuing resolution” that would maintain the current NEA funding level into the next fiscal year.

If you have two minutes, please contact your member of Congress, or send a Letter to the Editor to your local newspapers calling for Congress to reject this cut. Americans for the Arts has further details and will be providing updates on our ARTSblog here.

Please help us continue this important work by becoming an official member of the Arts Action Fund. If you are not already a member, you can play your part by joining the Arts Action Fund today -- it's free and easy to join.