Increasing the Capacity of Individuals, Families and Communities

Capacity Benchmarking Tool
For Faith- and Community-Based Organizations

Table of Contents | Part IV: Community Linkages and Partnerships | Part VI: Technology

Part V: Fundraising

What is Fundraising?
Organizations need financial resources to fulfill their missions. Community- and faith-based organizations seek financial support from a range of sources such as: a sponsor organization or religious institution; congregational or organizational members; other churches or church groups; board members; foundations; corporations; government grants or contracts; the United Way and/or other federations and community-based funds; special events; income from services and sales; and individual donations.

Why is Fundraising important?
Fundraising that establishes a diversified funding base (meaning that the organization has multiple funding sources) helps increase financial stability by:

• Reducing the hardship of losing a primary funding source (e.g., government priorities and grant programs may change with different administrations; individual, foundation, and corporate giving may fluctuate depending on the economic climate and other competing concerns); and

• Supporting infrastructure and administrative systems that generally cannot depend on restricted funding (restricted funding can only be used for specific programs or activities).

What topics are covered in the Fundraising section?

Fundraising Plans

Individual Donors

Grant Writing

Board Strength in Fundraising

Fundraising Plans

Fundraising Plans	Needs a lot of work (1)	Needs some work (2)	Needs a little work (3)	Meets Current Needs (4)
Best Practice: Fundraising plans are designed to increase the number and types of funding sources.
Basic Benchmarks
1. At least one staff member or volunteer coordinates fundraising efforts.
2. Staff and board members actively seek potential donors.
3. Board and staff help develop fundraising goals.
4. The organization has two or more funding sources.
Enhancement Benchmarks
5. The organization is not dependent on only a few funders and has a mix of funding sources, such as: individual donations; sponsor/parent organization; foundation, government, and corporate grants; local religious congregations; special events; and earned income.
6. Staff research possible public and private funding sources on an ongoing basis.
7. Written long-term (3-5 years) and one-year fund development plans are aligned with long-term and annual work plans and budget projections.
8. The organization has a computerized tracking system that monitors contributions and progress toward fundraising goals.

Tips and strategies for fundraising plans:
	Annual fundraising plans should include: The budget goal for the year; The amount the organization plans to raise from each funding source; Strategies to close the gap between the expected funding and the budget size; Specific staff and board responsibilities needed to secure funding; and Materials, equipment, and software required.
	Long-term fundraising plans should include: Strategies for addressing fundraising obstacles and goals; Roles and expectations for executive director, staff, and fundraising staff; and Specific assistance needed from the board.
	Long-term fundraising plans should also identify broad development goals, such as those for: Overall budget size and the percentage of the budget to be obtained from each type of funding source; Number of months of reserve revenue; and Percentage of unrestricted funds (funds that can be used for general operating expenses that cover needs such as staff training, new financial management systems, proposal writing , and technology upgrades) versus restricted (project/program specific) funding.

Individual Donors

Individual Donors	Needs a lot of work (1)	Needs some work (2)	Needs a little work (3)	Meets Current Needs (4)
Best Practice: Funds are solicited on a regular basis, not only during crises
Basic Benchmarks
1. Board members give staff the names of their own contacts and other people who can be asked to become donors.
2. Board and staff members make presentations to individuals, community organizations, churches and other religious congregations. These presentations describe the organization, its services, and donation request.
3. Donors are thanked promptly with a written letter/receipt acknowledging the date and amount of the donation.
4. Donor information is kept on file. This information includes: donor's name and address; amount and date of the donation. This information is not shared without permission.
Enhancement Benchmarks
5. The organization has a written "Case for Support." This document articulates the need, strategies for addressing the need, the total dollar amount required, and the level of support (e.g., specific dollar amount) being requested from the potential donor.
6. Donor information is recorded in a database.
7. Donors are acknowledged in communications material (such as newsletters).

Tips and strategies for getting more individual donors:
	Head out organizational brochures when making presentations or meeting new contacts.
	Solicit funds from all prior donors and new contacts on an annual basis (an annual appeal).
	Invite current or past clients to presentations and have them talk about the importance of the services they received.

Grant Writing

Grant Writing	Needs a lot of work (1)	Needs some work (2)	Needs a little work (3)	Meets Current Needs (4)
Best Practice: Grant funding contributes to a diversified funding base.
Basic Benchmarks
1. The organization knows how to research government, foundation and corporate grant opportunities
2. The organization sets up meetings with potential funders to explore possible funding opportunities.
3. The organization pursues grants that fit with the organization's mission and strategies.
4. The grant amount is sufficient to fund a program (or the organization has other resources to fund the shortfall).
5. Grants are written according to an organized outline that clearly addresses the topics and information requested by the potential funder.
6. Grant applications are carefully reviewed and edited before being sent.
7. Staff and board members can articulate how the organization's role and strategies are clearly distinct from other programs potentially competing for funds.
8. The organization has an effective system to monitor grant income and grant expenditures. Required reports are accurate and generated on time.
Enhancement Benchmarks
9. Research about potential foundation, government, and corporate funding is kept current.
10. Past accomplishment can be described in terms of outcomes. "Success" is clearly defined, measured, and described.

Tips and strategies for grant writing:
	Check for institutions that provide information about government and foundation grant opportunities, such as state or local associations of nonprofits, grantmaker associations, and intermediaries (organizations that may be funded by the government or foundations to grant funds to local organizations).
	Find out which web sites and newspapers publish RFP (Request for Proposals) notices and search those sources on a regular basis.
	Solicit valued opinions about how to describe success.
	Ask others to review proposal drafts and provide feedback.
	Check to see if the foundations in your area use a "common grant application" that allows you to prepare one grant request for review by more than one foundation.

Board Strength in Fundraising

Board Strength in Fundraising	Needs a lot of work (1)	Needs some work (2)	Needs a little work (3)	Meets Current Needs (4)
Best Practice: The board raises funds for the organization.
Basic Benchmarks
1. The board helps formulate fundraising strategies.
2. The board participates in fundraising campaigns and events.
3. Board member recruitment takes fundraising needs into account.
4. Board members donate funds to the organization. While striving for donations from 100% of board members, respect is given to members' own sense of giving ability.
5. The board members fundraising results and, when necessary, evaluates and authorizes fundraising policy changes. For example, if the fundraising plan and process are not working as effectively as expected or new opportunities arise, the board may want to shift the focus among types of funding sources.
Enhancement Benchmarks
6. The board fundraising committee works closely with appropriate staff to create short- and long-term development (fundraising) plans for full board review.
7. The board fundraising committee works closely with appropriate staff to implement board fundraising responsibilities.
8. At least one board member has fundraising expertise.
9. A few board members have connections to funding sources, such as philanthropic people and institutions.

Tips and strategies for improving the board's fundraising effectiveness:
	Explain fundraising expectations to board members who might not be clear about how to participate.
	Solicit strategy ideas from individuals and schedule group strategy sessions.
	Arrange confidential conversations with each board member about his/her preferred giving level.

Congratulations! You have completed your assessment of the Fundraising capacity area. Use your responses to determine the most important capacity building priorities. Please review the "How to Use This Tool" section on page 4.

Table of Contents | Part IV: Community Linkages and Partnerships | Part VI: Technology