Monthly Archives: May 2014

Partnerships to Improve Community Health (PICH)—Riding the CDC Grant Gravy Train

Even after a hundred years as a grant writer, the feds never cease to amaze me. Last week, it was the CDC issuing a Funding Opportunity Announcement (“FOA,” which is CDC-speak for RFP) for an entirely new program: Partnerships to Improve Community Health (PICH). The program is funded through the Affordable Care Act (ACA)—or ObamaCare as it is sometimes known to its many friends.

PICH is great news: as Pink Floyd put it in Have a Cigar: “And did we tell you the name of the game, boy? We call it riding the gravy train.” This post explains the game.

The game is walkin’ around money, as we explain at the link. In this case, there’s $150,000,000 up for grabs, with max grants ranging from $1,000,000 to $4,000,000, depending on the population of the service area.

What makes PICH nearly pitch-perfect walkin’ around money is that the program funds community collaboratives that meet to essentially talk about improving health, but not actually do anything, like deliver healthcare. It’s all process and no services. This means that the grantee only has to form the collaborative, hold meetings, conduct needs assessments and develop the ever popular action plans. Since there are no services, there’s nothing to evaluate, except process objectives like the “composition” of the collaborative, number of meetings held, plans drafted, long tons of donuts consumed during meetings, and the like.

This should make most public health officers and nonprofit executive directors swoon. Get a PICH grant and you’ll definitely be riding the gravy train. And, since you’ll be the one with the gravy ladle, other organizations in your service area will be sitting on their hind legs begging for the sub-grants that are required under PICH.

For example, say you’re Executive Director or Chairwoman of the Healthy Owatonna Collaborative. To make your pitch for a PICH grant, you’ll need to gather input from, and meet the needs of, all segments of the “community.” An easy way to accomplish this is to propose involvement of population-specific or advocacy groups in the planning and implementation process.

If cyclopes are an important population in Owatonna, propose a subcontract in your proposal with the Owatonna Cyclops Improvement Association, which has its eye, so to speak, on health issues confronting cyclopses in Owatonna. The ability to pass out big subcontracts to local advocacy organizations is going to make you very popular, as lots of organizations will try to get their snouts into the PICH trough. The applicant and lead agency is the Gatekeeper to this largesse.*

An interesting aspect of PICH is applicant eligibility:

  • Government Organizations: Local public health offices, American Indian tribes or Alaskan Native villages, local housing authorities, school districts, or local transportation authorities.
  • Non-government Organizations: Nonprofits with 501(c)3 IRS status (other than institution of higher education), or nonprofits without 501(c)3 IRS status (other than institution of higher education.

Two aspects of the listed eligible organizations are curious. First, essentially every kind of non-business entity is eligible to apply for PICH, except colleges and universities, for some arcane reason. Universities are unlikely to want to improve local health, but transportation authorities are? Welcome to the odd world of federal grantmaking.

Second, nonprofits with or without 501(c)3 status are eligible. Most people’s reaction to the eligibility of nonprofit, but not tax-exempt, organizations is probably “WTF?

Let me explain.

Many community collaboratives for various purposes (e.g., health improvement, substance abuse prevention, services to homeless cyclopses, etc.) are actually unincorporated associations composed of representatives of nonprofit and public agencies, who get together once a month or so to eat donuts, drink beer (if they’re lucky), and opine on the subject of interest. In most states, however, it’s very easy to get a charter for the collaborative as a nonprofit corporation. As we’ve written about before, the hard part is not incorporating—it’s getting a 501(c3) letter of determination out of the IRS. So the CDC is encouraging informal collaboratives, which are willing to incorporate, or incorporated nonprofits, to apply. Very sweet.

Now, don’t let the fact that your agency may not actually be part of an existing health collaborative prevent you from applying. Remember, this is the proposal world, not the real world. A good grant writer should be able to create a plausible collaborative out of polka dots and moonbeams. I know we can, as we’ve written many funded proposals like PICH over the years, including an $800,000 HRSA Community Access Program (CAP) grant for a rural public health department in Illinois, a $900,000 OCS CCF-CEY capacity building grant for a youth services collaborative in Wisconsin, a $2,000,000 CDC Capacity Building grant for a national HIV/AIDs coalition serving African Americans, and a $2,000,000 CDC REACH-US grant for a collaborative in Virginia to reduce the incidence of diabetes.


* Sigouney Weaver, as Dana, was possessed by the Gatekeeper demon, while Rick Moranis as the hapless Louis was possessed by the Keymaster demon in the 1984 classic Ghostbusters, which was Jake’s favorite movie as a kid.

The Challenges of Seeking Grants for a New Facility

Facility grants are among the most difficult grants for a nonprofit to secure and almost impossible for a new organization with no track record.

Last week, a guy in Atlanta called about grants for a transitional living facility for pregnant teens. I immediately asked the caller if his organization had received its IRS Letter of Determination of tax exempt status under Section 501(c)3 of the IRS Code, and the organization’s track record. At first he said he had the letter, but after some questioning he finally admitted that he had just applied to the IRS.*

I know from decades of incorporating nonprofits that the organization was unlikely to get the all-important IRS letter for at least six months to a year. Ordinarily, I would have brought up the potential of the caller finding a fiscal agent to serve as the applicant, but he also eventually revealed that the new organization hadn’t actually done anything yet—and he was seeking capital grants to buy a facility for the proposed transitional living facility.

The conversation declined and he eventually hung up on me. Why? Because I told him, as I always do with such callers, what I told you in the first paragraph of this post: that “facility grants are among the most difficult grants for a nonprofit to secure and almost impossible for a new organization with no track record.” I suggested he consider seeking start-up grants to lease a facility, hire staff and so on. Nonprofits, like most businesses, should test their idea first and worry about long-term real estate second, or really eighth—behind a host of other factors.

It’s also challenging to get grants of any kind for transitional living facilities, which are sometimes called group homes, board & care homes, or sober living housing, depending on the population being served. Most such facilities serve a small number of residents—often only six, because of zoning restrictions, and rarely more than 25 or so.

Let me do the math: the organization seeks $500,000 to buy, renovate and equip a building for use as a transitional living facility to house ten pregnant teens. That’s $50,000/teen, without providing staff, supportive services and so on. If the funder simply gave $50,000 to the teen, she could rent her own apartment, provide child care, hire a personal case manager and have her nails done weekly. There’s really no need for the nonprofit.

Additionally, funders all know that most transitional housing operators charge rent to residents, which is usually provided at least in part by a third-party payer (e.g., SSI, foster care system, child protective services, insurance, family, etc.). Thus, a facility grant request requires a cash flow analysis and sources & uses statement to demonstrate a funding gap. Every real estate developer trying to get investors or a bank loan knows that a positive cash flow must be demonstrated, but in the nonprofit world of facility grants, the reverse is true: a gap must be demonstrated.

This is called a “but-for” analysis; but for the grant in question, the facility can not be purchased or built. In any other condition, the nonprofit faces supplantation problems. Back to my example: a sources & uses analysis might demonstrate that a $100,000 grant is enough to support a $500,000 facility acquisition, taking into account projected revenue, mortgages costs, and the like. Nonprofit executive directors, and especially founders of new organizations, never want to hear this reality; they want money for nothing and chicks for free.

Funders generally will not even fund the gap for new organizations with no track record, for perhaps obvious reasons. Most new organizations that require purchase of a facility are actually funded by a combination of a direct loan from the founder and/or a bank line of credit, secured by the personal guarantee of the founder or an “angel” who loves the project. This, of course, eliminates most would-be facility acquisition proponents, as they either don’t have much money, lack credit, and/or have yet to meet an angel.

The better, more realistic approach is to gather enough capital and/or grants to lease a facility, operate on a shoe-string and collect third-party payments. After a few years of successful operations, the organization can then plausibly seek capital grants, based on demonstrated expenses and documented projected revenues.


* For reasons that elude me, callers often lie to me about their nonprofit and operational status. Since I’ve been fielding such calls for 21 years, I recognize pointless obfuscation immediately. As Long John Baldry put it, “Don’t Try to Lay No Boogie Woogie on the King of Rock & Roll.”

Moreover, there’s little point in lying to your doctor or grant writers: what we don’t know can hurt you.

Collaboration is Often Inefficient: The Camille Paglia, Mark Zuckerberg, and Chris Christie examples

Almost all RFPs include requirements for “collaboration” with local entities. Yet I recently read this from Camille Paglia:

After endless quarrels with authority, prankish disruptiveness, and impatience with management and procedure, I now see that hierarchical as both beautiful and necessary. Efficiency liberates; egalitarianism tangles, delays, blocks, deadens.

(Emphasis added.)

Furthermore, in the fascinating article “Schooled: Cory Booker, Chris Christie, and Mark Zuckerberg had a plan to reform Newark’s schools. They got an education,” Dale Russakoff writes:*

Early in the summer of 2010, Booker presented Christie with a proposal, stamped “Confidential Draft,” titled “Newark Public Schools—A Reform Plan.” It called for imposing reform from the top down; a more open political process could be taken captive by unions and machine politicians. “Real change has casualties and those who prospered under the pre-existing order will fight loudly and viciously,” the proposal said. Seeking consensus would undercut real reform.

(Emphasis added.)

Neither hierarchical nor egalitarian decision processes are automatically better. They’re different. Highly open, transparent processes work in some situations and don’t work in others. You’d never know that from reading contemporary RFPs, however, which make endless consensus building sound like an eternal truth akin the Second Law of Thermodynamics.

Many if not most successful companies aren’t run on a primarily consensus basis. At Apple, if Steve Jobs said the bezel should be one millimeter, then the bezel was one millimeter regardless of what anyone else thought. He got the right answers, at least in terms of revenue. The bosses at Google appear to get a lot of answers right. As we’ve said before, nonprofits are more like businesses than is commonly realized. They compete with each other, and within the organization the Executive Director can (usually) fire people at will. That’s particularly true when an Executive Director says, “This is the way it’s going to be,” and a subordinate staff member refuses, or wants to keep litigating after a decision has been made.

Sometimes fast, “wrong” decisions are better than slow, “right” decisions—and open, transparent, consensus-driven projects can be subject to self-interest. In Seattle, for example, it has taken literally decades to build even very simple light rail lines, in part because every constituent along the way first had to be consulted and then had to file a lawsuit, which had to be fought, and only then could the effort proceed. We’ve got so much process involved that in building that we’re too often unable to build anything.

In the real world, organizations collaborate to the extent they need to and don’t collaborate to the extent they don’t. Smart executive directors ask knowledgable parties for information and input, then they make the best decisions they can based on the information they have.

That can mean telling someone they don’t get what they want. That’s how life works, as Paglia understands. Subordinates who are sufficiently disruptive might eventually be fired. Those who think current management is dumb can decide that “You Don’t Have to be in a Shithole Nonprofit.” For most nonprofits in most fields, quitting and starting a new nonprofit is a viable option. There are some situations in which the local powers-that-be can block new entrants to market—as anyone who wants to provide homeless services and gets crosswise with their local Continuum of Care can attest—but in most situations grants, whatever their other flaws, are a market-based system.

Someone who thinks they can do it better than the competition can make a go. We’ve worked for lots of upstart nonprofits that want to take grants or contracts away from the local heavies. We’ve also worked for lots of incumbent nonprofits worried about local upstarts (threatening the local power structure is one way to ensure that better proposals get written). Neither upstarts nor incumbents are inherently “better.” The situation is always situational. Too bad RFP writers don’t realize it.


* We’ve worked for clients in Camden, albeit smaller but very similar to Newark, and parts of the article read like our needs assessments.

Links: Classrooms, Sex Economics, Hackers, Bill Gates, Drugs, and Keep It Short

* Good news if true (and long overdue, whether this report turns out to be a true trend or a false growth): “Shaking Up the Classroom: Under an increasingly popular system called competency-based learning, students are promoted after they master material—not just because they have spent a year in a class.”

* “In-Depth Report Details Economics of the Sex Trade;” the funniest thing is the way pimps fill a niche created by prohibition. Take away the laws and the pimps likely go too.

* Have liberal arts degree, will code.

* The Bill Gates Rolling Stone interview; pay special attention to the sections about anti-poverty programs.

* Ham Sandwich Nation: Due Process When Everything Is a Crime. In other words, virtually anyone can be arrested for something in the contemporary United States.

* Keep it short.

* “Made in the U.S.A. (Again): The new industrial revolution won’t be in India or China. It will be right here in America.” But it likely won’t include a lot of jobs.

* Someone found Grant Writing Confidential by searching for “best grant writing certification.” There is no such thing because they’re all bad and pointless.

* “The Value Of An Engineering Degree,” which complements “Have liberal arts degree, will code.”

* Crowd funding is market research.

* “It’s Time to End ‘Rape Culture’ Hysteria.”

* “One big reason we lack Internet competition: Starting an ISP is really hard.” If I had Zuckerbergian money I’d fund ISPs.

* “Judge says prosecutors should follow the law. Prosecutors revolt.”

* Deeply chilling sentences.

* “Is HUD threatened by a Christian group’s plans to expand?” Unlikely; although Todd Starnes, the reporter, has probably never heard of this, it’s more probable that the group doesn’t want to join the local Continuum of Care.

* “Why RFPs Waste Time – Choose a Better Approach to Finding a Great Consultant;” almost all the other nonprofit-world blogs we’ve found are bogus, but this one isn’t. See also our post Why Seliger + Associates Never Responds to RFPs/RFQs for Grant Writing Services.

* Phages versus drug-resistant bacteria—really?

* It’s been at least 800,000 years since carbon-dioxide levels were this high.

* Addict. Informant. Mother. If rural towns in Eastern Pennsylvania have a heroin epidemic what hope do the rest of us have? So much for 40 years of the War on Drugs. Clearly, drugs have won this war.

David L. Kirp argues that Head Start should work like Section 8. He should consider how successful school bussing was.

Someone in the Federal Government REALLY Wants School Kids Counseled, as the “School Climate Transformation Grant Program” Shows

This week’s e-mail grant newsletter included this long-winded program title: “Office of Elementary and Secondary Education (OESE): School Climate Transformation Grant Program: Local Educational Agency Grants.” The program’s purpose is to offer yet more school counseling, although the RFP uses 50 words where five will due; it says the purpose is to “develop, enhance, or expand systems of support for, and technical assistance to, schools implementing an evidence-based multi-tiered behavioral framework for improving behavioral outcomes and learning conditions for all students.” I became exhausted reading this sentence several times—it’s a nice example of bureaucratic word salad.

Sound familiar? It should. We’ve seen a spate of nearly identical program RFPs recently, including:

All five programs have subtly different project descriptions but are all intended to engage in the same basic set of activities: getting “trained” adults to do something—on a one-on-one or small group basis—with students who have been reported by teachers or other “trained” adults in the kids’ lives. You could submit a proposal for any one of these programs, change the name on the header of the next proposal, and do more or less the same thing. The only exception is the last one, YEP II, which is less a Columbine-Newtown-response-style program and more of a traditional urban youth program of the sort that have been around for forty years.

In 2012 Isaac wroteSandy Hook School Shootings Tragedy Likely to Lead to New Grant Opportunities for School Security, After School and Mental Health Project Concepts.” The programs we’re seeing the Federal government issue are the ones Isaac predicted.

At their most basic level,* these programs are really mental health early warning systems: they’re trying to figure out which ninth grader is likely to bring a gun or knife to school this week. They’re like Foucault’s famous panopticon, or the Stasi, though better intentioned. We’re not convinced the effort will be successful, but it’s happening right now, and no one in the Federal government asked for our opinion. Smart LEAs and nonprofits are going to ride this grant wave.


* Free proposal phrase.

Speech Codes, Microagression and Grant Writing: Words that Shouldn’t (and Should) be Used in Proposals

One of the most unfortunate changes in the academic world since I left the warm bosom of the University of Minnesota in the Great Frozen North over 40 years ago is the rise of so-called “hate speech codes.” These Orwellean codes purport to regulate speech to prevent “hate speech,” as defined by the local campus Thought Police, and thus avoid dreaded microagressions. This is pretty rich for someone who started at the U of M in 1968 during the height of campus free speech demonstrations regarding an essay, the title of which—”The Student as ________“— I can no longer put in print because of changing speech mores.*

George Orwell presaged the decline of real meaning in his 1948 essay “Politics and the English Language,” which is a must read for any grant writer.

In grant writing, there’s a strict, albeit unwritten, speech code that budding grant writers would be wise to learn. Here are some words and concepts to avoid—or use—in grant writing and why:

  • Bureaucracy: The bureaucrats who read typically read and score proposals might be offended if they’re reminded that they actually are bureaucrats and not saintly givers of OPM (other people’s money). Jake likes the word “bureaucrat,” which I find very annoying when I have to edit it out. By the way: don’t use the term “OPM,” either!
  • Victim: Never characterize the recipient of whatever human service you’re writing about as a “victim,” which is now seen as pejorative. For example, a homeless person is “experiencing” homelessness and a drug addled teen is “living with the scourge of addiction.” They are not victims of their situation.
  • Ex-offenders: Never refer to a formerly incarcerated person as an ex-offender. The term now in use is “returning citizen.” To me it sounds like they got back from a cruise, but who am I to blow against the wind?
  • Win: If someone is characterized as “winning,” this implies a loser—and we can’t have losers in grant writing. Like grade school soccer in some precincts, all players are winners and get a trophy (dodge ball is out). You can, however, use the hoary, but acceptable “win-win”, or even better “win-win-win” phraseology to summarize the wonderful world that will exist in the afterglow of project funding and implementation.
  • Guardian: “Guardian” is a legal term and should be avoided. Instead, when writing about at-risk children and youth, it’s best to always refer to “parents/caregivers” rather than just “parents,” since many of them live in the ever popular termed “single-parent household.” Parents/caregivers implies an extended “family constellation” (another great grant phrase that should be used) that is somehow looking after the interests of the young person, even though dad’s disappeared, mom’s incarcerated, but will soon be a returning citizen, and grandma’s “living with a disability.”
  • Disabled, and So On: No one is disabled. Instead, as above, they’re “living with a disability” or even better, “living with a condition of disability”. Why use four words when six will do? They can also be “differently abled.” Similarly, no one is blind, they “live with a visual impairment,” no one is deaf, they “live with a hearing impairment.”
  • Infected: People are not infected with HIV, but are rather “HIV positive,” or in shorthand, “HIV+”. This puts a positive spin on things, don’t you think? Or, I suppose you could try, “person of HIVness.” Phrases like “living on the down low” are acceptable, however. So is MSM (“men who have sex with men.”)
  • Of Color: Shorthand for minority residents is “residents of color.” Obviously, don’t say it the other way around!
  • Ethnic Capitalization: In a laundry list of ethnic groups living in a target area, do this: African American, Hispanic or Latino (Latino generally preferred in CA and the southwest), Asian and white.
  • Partnership/Collaboration: Every project is going to be implemented by a partnership or collaborative, even if it isn’t. Usually it isn’t.
  • She/he: It’s always “she/he” and “her/his,” not the other way around. Draw your own conclusion.
  • LBGTQ: The is for “Q” for “questioning” or “queer,” depending on your point of view, and has recently been added to the catchall, LBGT, for sexual orientation/gender identity. The whole gender identity issue may throw my “she/he” convention into a cocked hat. Maybe, I should start using “she/he/not sure” instead.
  • Poor: No one is never poor; a person or family might “economically disadvantaged” or “low income.” Describing the world in terms of “advantage” and “disadvantage” is a good; contrasting “economically disadvantaged residents” with their “affluent, privileged” neighbors is particularly good.
  • Career Ladder: Any job training or education effort should lead to a “career-ladder job” with “living-wage potential.”

I could go on, as there are lots more examples, but, I of course, have to finish the proposal draft I’m working on. This list may be updated as we think of more examples.


* Camille Paglia and I are the last people alive who remember the real ’60s left, which bears only a passing resemblance to and shared name with the current left:

My essays often address the impasse in contemporary politics between ‘liberal’ and ‘conservative,’ a polarity I contend lost its meaning after the Sixties. There should be an examination of the way Sixties innovators were openly hostile to the establishment liberals of the time. In today’s impoverished dialogue, critiques of liberalism are often naively labeled ‘conservative,’ as if twenty-five hundred years of Western intellectual history presented no other alternatives.

Seliger’s Quick Guide to Setting Up a Nonprofit Corporation and Getting a 501(c)(3) letter (I Hope You’re Not in a Hurry)

We get a couple of calls a week from folks saying, “I’m in the process of setting up a nonprofit to help _______.” We always say the same thing: “Do you have your IRS 501(c)(3) letter of determination of tax-exempt status, and, if not, have you applied to the IRS?” Too often the response is “No” and “No,” or even-more troubling, “Huh?”, which means the caller doesn’t even understand what she’s doing.

We’ve never had anywhere useful to send these callers, but we’d like to—so here’s Seliger’s Quick Guide to setting up a nonprofit:*

  • Spend some time learning about nonprofits, including the IRS tax-exemption rules, as well as the rules in your state. Presumably one goal of a new nonprofit is to secure grant funds. Most funders expect your nonprofit to be incorporated in the state in which most services will be provided. So, if you want to help cyclopses being emancipated from the foster care system in Owatonna, Minnesota, don’t randomly incorporate in Florida. This step usually takes a few weeks.
  • Apply for a nonprofit corporate charter in your state, following the state rules, as well as the national IRS rules, with respect to board membership, composition, interested parties and so on. To do this, you’ll need appropriate articles of incorporation, but you might as well draft bylaws at the same time, as these will be needed shortly anyway for your state (probably) and your federal tax-exemption applications. This step will likely take a few weeks to a month.
  • If your state has a corporate income tax, apply for state tax-exempt status. This step can take a few weeks to several months—think “several months” in a state like California, which has a very complex application process; Pennsylvania, by contrast, has a simple, quick process.
    At the end of the above steps, you’ll have a conformed copy of your formation documents. “Conformed” is just a fancy way of saying a signed, state-approval stamped copy. You’re going nowhere with the IRS without conformed documents. This is a key point.
  • Apply for a federal Employee Identification Number (EIN). This is the only part of the process that is almost instantaneous.
  • If you haven’t given up or died of old age, you’re finally read to complete your Form 1023, which is the actual IRS application for determination of 501(c)(3) status. You need the letter of determination, because without it, your new organization is not exempt from paying taxes and, even more importantly, donations to it are not deductible by the donor.

Most foundations won’t consider a proposal from nonprofits that lack a letter of determination. You can always try to find a fiscal agent while you’re waiting for the IRS to respond to your application, but that carries its own problems, as we discuss at the link.

Wait you will: it can take the IRS anywhere from three months to several years to approve your 1023. Along the way, you’re likely to get a series of interrogatories from the IRS that are designed to make you crazy, discourage you from continuing, or are genuinely aimed at ferreting out phony applicants, depending on your point of view.

If you do the math, you’ll see the completing the nonprofit formation process typically takes about nine months to two years. This news usually comes as a shock to the hopeful but frequently hapless callers I mentioned at the top of the post. We generally advise such callers to contact an attorney or accountant in their area that works with nonprofits and can help them with the paperwork.

I incorporated my first nonprofit over 40 years ago, when I was a young and starry-eyed intern, but the process is much more complex now. Trying to to this yourself or using one of the $99 Internet incorporation outfits is penny wise and pound foolish. You have been warned; as Robbie the Robot said, “Danger Will Robinson!

There is one way of forming a nonprofit more quickly (and it is not the “expedited review” offered by the IRS for an additional fee, which I don’t think actually speeds anything up). Instead, you wait for a giant disaster and try drafting behind it like cyclists behind a big rig.

After events like 9/11 or Hurricane Katrina, state tax officials and the IRS will often quickly approve new nonprofits because of obvious need, even if the proposed nonprofits have no apparent connection to the disaster. Most of the time the IRS and state tax officials are as motivated as any kind of government bureaucrat. Only the possibility of widespread political heat and anger motivate them to act with the kind of haste one otherwise associates with Amazon.com.

If you have a plausible charitable purpose, don’t be discouraged by the process. Thousands of nonprofits get incorporated and receive their 501(c)(3) status every year. Even the NFL is nominally a “nonprofit,” albeit a 501(c)(6) and it made almost $10 billion last year. Stay the course. Don’t lose heart. And while you’re waiting around for a disaster, you might as well start down the IRS Yellow Brick Road.


* The various state and federal fees are going to run around $800. They’re not refundable.