General-operating support grew dramatically during the pandemic as grant makers recognized nonprofits’ need for greater flexibility during the crisis.
Now, many nonprofit leaders, fundraisers, and advocates are wondering if the trend will continue once the pandemic wanes. The Chronicle assembled a panel of experts to explore that question, and the connection between general operating grants and advancing equity.
Stacy Palmer, editor of the Chronicle, moderated the session, entitled General Operating Grants Can Advance Equity. The panel included:
- Tanya Coke, Director, Gender, Racial, and Ethnic Justice, at the Ford Foundation
- Glenn Harris, President of Race Forward, a nonprofit that supports social-justice movements
- Crystal Hayling, Executive Director of the Libra Foundation
- Nicholas Turner, President, Vera Institute of Justice, which works to end mass incarceration.
The foundation and nonprofit leaders made the case for the need to reduce red tape and place more trust in nonprofits. Read on for highlights of the discussion, or watch the video to get all the insights.
Greater Trust Is Needed, Especially for Groups Led by People of Color
Turner says his nonprofit now gets about half its grants in the form of general operating support, up from a very small percentage before the pandemic. At Vera, Turner says he hasn’t seen any backtracking from this new level of support, but he hasn’t seen continued growth either.
Hayling acknowledges the ongoing challenge program officers face: They must convince leaders to extend this form of support. She explains that this is often because of a lack of trust, and the lack of trust is particularly acute when it involves organizations led by Black people, Indigenous people, and other people of color (BIPOC).
“It’s not hard for large donors, let’s say for example, in climate, to make a $100 million gift to a by-and-large white-led organization,” Hayling says. “Those same institutions will really gnash their teeth and nibble on their knuckles about a $25,000 grant to a BIPOC organization. That’s really about the question of whether or not they feel they can trust” those BIPOC groups.
Coke notes that much of the new general operations grants aren’t multiyear, reflecting a likelihood that they will not be renewed. She explains that, historically, grant makers hesitate to make a lasting commitment to nonprofits, especially those led by people of color, and women of color in particular.
Restricted Grants Can Tie the Hands of Leaders
When he arrived as president of the Vera Institute of Justice eight years ago, Turner says, it was “a storied, credible, well-established organization” with about 200 staff members and a $51 million budget. However, its impact was limited because nearly all of its grant funding was restricted.
“This was an organization that wasn’t focused on a core strategy,” says Turner. “It was an organization that was doing a lot of good work, but it was a collection of work, like a mosaic.”
He adds, “We had very little resources in the way of unrestricted money to deploy. There was no ability to execute a vision.”
The growth of unrestricted funds in recent years has allowed Vera Institute to pursue broader, multiyear strategies, such as working with prosecutors around the country to reduce racial disparities in sentencing, Turner says. Unrestricted funding also enabled him to build and train the staff to execute those longer term strategies.
Coke notes that budgetary flexibility is especially important for racial-equity work “because racism is a shape-shifter. One minute, the crisis at hand is about police violence, and the next minute, it’s a manufactured backlash campaign about critical race theory in elementary schools.”
We had very little resources in the way of unrestricted money to deploy. There was no ability to execute a vision.
Plus, grants that can be used at a leader’s discretion are invaluable for internal equity work, which is a high priority for most nonprofits, Coke says. “I cannot think of a single grantee whose proposals or reports I’ve read in the last two years has not referenced all of the internal equity and DEI work that they are doing,” she says.
Doing effective DEI work requires money and flexibility for things like staff surveys and consultants, hiring a DEI director, or making salaries equitable, Coke says. “All of that costs money, and you can’t fund that with project grants; you just can’t.”
Unrestricted funds are vital to meeting a current challenge, the Great Resignation, Harris says, because they help nonprofits retain high-quality staff members and support them through during difficult times.
General Operating Grants Should Redefine Program Officers’ Roles
A move toward unrestricted grants requires a radical rethinking of the role of program officers, Hayling says. The traditional role of a program officer has been to serve as a gatekeeper, reviewing proposals, doing detailed analysis of overhead expenses and other factors, and making grant decisions, she explains.
When making general operating grants, that role changes dramatically. “Your job is to actually build a relationship to enable those nonprofits to achieve their goals,” says Hayling. “It’s a very different job, and it’s a different job day to day, hour to hour. It means you’re doing a whole different set of things.”
That shift in role and thinking can have an energizing effect on program officers, says Hayling.
Coke, noting that 88 percent of the Ford Foundation’s grants to U.S. nonprofits are now general operating support, added that those kinds of changes to a program officer’s role help to build trust. Nonprofits no longer fear sharing bad news as they seek help to correct problems. “It’s been palpable, the difference, because they know that we trust them,” says Coke. “One conversation isn’t going to jeopardize their funding next year.”
Nonprofit Leaders Should Be Honest With Grant Makers, Open to Lived Experience
The panelists encourage grantees to be open and blunt with their donors about the benefits of general operating support and not to shy away from talking about experimentation and innovation. “Funders like to hear from organizations that want to try new things because we’re all working on intractable problems,” says Coke.
Nonprofit leaders should be proud to tout a willingness to hire people with “lived experience” in the areas the nonprofit is trying to address, such as criminal-justice reform. “Those folks bring in a different kind of expertise to this work,” says Hayling. “It created an entirely different kind of fuel.”
The panelists urged grant makers who are still on the sidelines trying to decide whether to move to more general operating support to get moving, because the benefits are clear. “Let’s stop having a bias to study and create a bias to action,” says Hayling.
