“Leveraging a Budget to Build a Foundation-Grantee Partnership” by Steven Green

Reference: Jim Joseph Foundation

May 23, 2013

In many ways, a grantmaking relationship begins with a shared understanding of a budget. This is not to say that grant financials supersede programmatic goals; rather, they are essentially complementary: A comprehensive financial report accompanied by a detailed budget narrative informs an organization’s programmatic priorities.

When a funder and grantee come together for budget reviews, it is an opportunity for them to explore how grantee management of the grant award can support efficient implementation of the grant. They can think smarter about how to achieve their shared goals. Conversations about timing of grant payments and reporting on grant implementation, for the Jim Joseph Foundation, are part of a relational funder-grantee dynamic[1]. Four key factors, all related to financial practices, can provide the framework for a substantive Foundation-grantee partnership.

1. Pay prospectively. By the time we award a grant, the Foundation has undertaken an extensive review of an organization’s mission alignment, fiscal health, leadership, strategy and prior accomplishments.  Additionally, the grantee has already invested significant resources in getting beyond the application process.

Admittedly – and as grantees would attest – we request thorough documentation. From this information, we gain an understanding of the stages of a grantee’s initiative and can anticipate when payments will be needed. Often times, we agree to a payment schedule that provides some funding in advance of when expenditures will occur. This helps an initiative’s growth and progression, and it provides a sense of security for the grantee. And making selected grant payments prior to the use of funding also allows both parties to focus more on the actual initiative and less on the dollars. (Incidentally, we have a similar relationship with researchers, consultants, and independent evaluators. While we reserve a small payment for the end of each contract, a majority of the contract awarded is paid prospectively. Reconciliation based on wages and expenses occurs at the end of the contract when a final payment is calculated)

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