Author: Isaac Seliger

NYT: Nonprofits should focus on grant writing, not donations, during the COVID-19 crisis

We’ve written two recent posts on the impact of COVID-19 on nonprofits, “COVID-19, donations, and foundation and government grant proposals” and “Less obvious things that impact human services during the coronavirus pandemic.” During an economic crisis like this one, most nonprofits will probably be gob-smacked with cash flow problems, while demand for services, particularly among human services provides, skyrockets.* Since thousands of businesses are suddenly closed, millions are unemployed, and the stock market is gyrating downward, seeking donations is mostly a waste of time and it’s not possible to hold galas and fundraisers. To avoid organizational disaster, the only option for most nonprofits is to immediately conduct grant source research and start submitting foundation and government grant proposals. If the nonprofit lacks internal capacity to do this, hire a consultant like Seliger + Associates.

A recent New York Times David Streitfeld article confirms this, “A New Mission for Nonprofits During the Outbreak: Survival.” Although Streitfeld incorrectly conflates donations and grants, the articles reaffirms what we said in our posts—foundations react to economic crises, at least in the short term, by vastly increasing their grant making:

Foundations, traditionally not among the spryest of organizations, learned from 9/11 and severe hurricanes that they could move fast. They are quickly retooling to disburse emergency money and relax reporting requirements that are suddenly impossible to meet. Bloomberg Philanthropies, Carnegie Corporation of New York, the Doris Duke Charitable Foundation and 23 other foundations as well as individual donors have created a $78 million Covid-19 rescue fund for New York City nonprofits. Grants will start going out to small and midsize social services and arts and cultural organizations on Monday. Interest-free loans will follow.

In hard-hit Seattle, the Seattle Foundation is administering a $14.3 million emergency program funded by local businesses, foundations and government. It released more than $10 million to 120 organizations this week.

These are probably not “donations,” and the nonprofits will likely have to submit proposals of some sort and, unless nonprofits are actively searching for such foundation support, most will miss out entirely. Foundation largess, however, will not last. Within a few months, the spectacular decline of their endowments will sink in and the the fire hose will be reduced to a normal flow—or even a trickle.

While the NYT piece doesn’t cover it, the same phenomenon is happening with government grants, but at a much higher level. In addition the normal billions of federal grant dollars up for grabs, billions more are included in the three COVID-19 Stimulus Bills passed so far, with Congress likely to past several more bills.

So, the time to seek foundation and government grants is now.


* Since grant writing in the time of COVID-19 is a strange experience, this is good time to read or re-read Gabriel Garcia Marquez’s wonderful magical realism novel, Love in the Time of Cholera.

COVID-19, donations, and foundation and government grant proposals

We’ve been in business since 1994 and have written proposals during several economic shocks; in the Great Recession in 2009, donations to nonprofits began drying up as soon as the stock market began diving (we wrote as much at the time). A decade later, COVID-19 is sending the economy into what could be a second Great Depression. While hopefully the crash will be v-shaped, there’s no way to know when a rebound will start, since much depends on the public’s response and on the success or failure of the drugs in clinical trials.

Nonprofits, and especially human services providers, are being torn between higher service demands and evaporating revenue. Particularly hard hit are Federally Qualified Health Centers (FQHCs); about 1,400 FQHCs deliver front line healthcare to Medicaid and other low-income patients. Total patient population estimates differ, but FQHCs may serve as many as 30 million people. FQHC CEOs have been telling us they have very limited capacity for treating infectious disease patients (no separate waiting rooms, scarce protective gear, etc.) and face staffing shortages, because clinicians staying home to watch their now out-of-school children. Some clinicians are pregnant and some are sick themselves. Inadequate testing infrastructure has been well-covered in the media by now.

Some nonprofits, like Head Start and other early childhood education providers or behavioral health service providers, face the same grim reality, as their centers are closed and third-party payments become delayed or non-existent. For other nonprofits that depend on donations, fundraisers, and/or membership dues (e.g., Boys and Girls Clubs, YMCAs, museums, performing arts, etc.) are likely even worse off. John Macintosh just wrote in the NYT that COVID-19 could mean extinction for many nonprofits. But this extinction can be averted—and will be by nimble nonprofits.

For the short term, nonprofits should stop or reduce screaming empty bowl-in-hand emails and mailers for donations. With the stock market in free-fall and unemployment probably already 10% and on a path to 20% *barring a sudden drug trial that works), seeking donations is delusional. When businesses, small and large, suddenly have zero revenue, millions are being laid off, and 401Ks being decimated, donations will quickly decline, no matter how good the cause or the relationship with the donor. Also, there’ll be no galas, art auctions, and other fundraisers for who knows how long.

The only real option for most nonprofits is to quickly ramp-up grant seeking and grant writing. As has been the case in previous economic crises, the federal response will likely be to dump money into grant programs and issue RFPs. In addition to already authorized FY ’20 federal funding for grant programs, by this week Congress will have passed three huge COVID-19 stimulus bills totally close to $2 trillion—dwarfing the 2009 Stimulus Bill. These bills will have a lot extra money for existing programs, as well as for a flock of new grant programs.* We saw this in 2009, when we wrote proposals for all kinds of oddball programs and projects, and this will unfold again with astonishing speed. Federal agencies will approve grant proposals much faster than usual—like most Americans, the federal bureaucracy rises from its normal stupor to meet extreme challenges. But RFPs are likely to have very short deadlines. Nonprofits that start preparing for intense grant writing will be more likely to succeed.

Most foundations, meanwhile, respond to crises like this by quickly increasing the amount of funds available from their endowments and speeding up their normal approval processes, both to address issues related to the crisis, as well as to keep essential nonprofits operating. In addition to emergency operating support, foundations will be very interested in project concepts relating to primary care access, public health education and outreach, telehealth, and behavioral health. But this foundation response won’t last more than about six months. At some point, they’ll turn off the spigot, either because their endowments will have been depleted too much or the crisis will have passed.

Even nonprofit royalty, which usually don’t sully their hands will grant writing, unless the grants are wired, know that reality has changed.** You may have read, “Met Museum Prepares for $100 Million Loss and Closure Till July.” The author reports that the Met will be “fundraising from foundations and pursuing government grants.” If the Met is turning to grant writing, so should your nonprofit and the sooner the better.

Want to talk about how Seliger + Associates can help? Give us a call at 800.540.8906 ext.1. By the time you read this, your organization’s leadership will probably already be convening meetings about what to do next.


* Extraneous program authorizations in federal spending bills are common and referred to as “ornaments.”

** As Bob Dylan put it in Things Have Changed, “People are crazy and times have changed.”

Do “child-care deserts” highlighted in the Washington Post really exist?

The Washington Post says, “A Minnesota community wants to fix its child-care crisis. It’s harder than it imagined.” Duluth City Councilperson Arik Forsman wants to solve the “region’s child-care crisis” and the reporter, Robert Samuels, vaguely cites “studies [that] have shown… more than half of the country lives in a child-care desert — places where there is a yawning gap between the number of slots needed for children and the number of existing spaces at child-care centers.” The link in his story leads to the highly partisan Center for American Progress website, which defines a child-care desert crisis using cherry-picked data to fit this definition: “any census tract with more than 50 children under age 5 that contains either no child care providers or so few options that there are more than three times as many children as licensed child care slots.”

Numerous rural census tracks are likely not to have any child-care providers, due to vast travel distances and low population density, but could still meet the low bar of 50 young children. The second part of the definition presupposes that most parents want to place their child in child-care, ignoring the reality that there still lots of people who don’t want their child in institutionalized child-care—they have one parent who stays home or who works at home (like I did when my kids, and S + A, were young). Some parents prefer to use family and friend networks. The cost of providing child-cage to infants and toddlers is very high—imagine trying to care for 30 kids, who are not potty-trained, and go on from there.

The “crisis” is based on specious data collected to make a political point, not address the actual issues. I know because we write lots of Head Start, Pre-K For All, and similar proposals under the umbrella of “early childhood education,” which is the theme for almost all child-care grant programs. Head Start is by far the largest publicly-funded early childhood education program and emphasizes “education.” Government funders always insist that child-care providers, including Early Head Start (birth – 3), focus on “education” rather than the custodial care model that largely disappeared 30 years ago. It officially disappeared; in reality, most children under age five are mentally equipped for play far more than they are for educational activities. Still, when we write a child-care/early childhood education proposal, we always state that the program will use the ever-popular “TeachingStratgies Creative Curriculum.” In this curriculum, even very young children are supposedly taught things like “pre-reading” (whatever that is) and other quasi-academic subjects. The typical “class schedule” for child-care programs, however, includes maybe two out of eight hours in alleged academic activities, with the rest of the day devoted to things like welcome and closing circles, snacks and lunch, hand-washing, nap time, outdoor/indoor play, etc.

Many contributing factors that come together to limit child-care options: just like with the affordable housing/homelessness crisis, much of the shortage of child-care slots is due to basic zoning rules (a topic we have covered extensively), as well as strict licensing requirements. In the abstract, most people support the idea of convenient child-care—until an actual facility is proposed down the street, and then existing residents think about 60 frisky kids whooping it up on their block, with fleets of parents dropping-off and picking-up kids. This type of proposal brings out the NIMBYs in force. They will use zoning to fight this “blighting” influence—and will usually win.

Also, ever since the hysteria over the fake McMartin Preschool abuse scandal in 1983, child-care facility regulations, even for home-based child-care, have become very stringent. While likely a good thing overall, this drives up the cost of operating child-care facilities. Even Head Start programs, which are fully federally-funded, have a hard time opening new facilities and keeping them open. All child-care programs, whether for-profit or non-profit, operate on thin margins and can be sunk by regulatory problems.

Then, there’s the challenge of finding and keeping “teachers.” Since Head Start was created in 1965, the open secret has been that it’s as much of a jobs program as an early childhood eduction program. The teachers, who might have a certificate of some sort but are rarely licensed teachers, are often the same moms who put their kids in the program, creating a sort of closed-loop system.

This worked fairly well until a perfect storm recently hit. As we wrote about in early 2019 “The movement towards a $15 minimum hourly wage and the Pre-K For All program in NYC,” this effort spells trouble for all child-care programs—the Minnesota minimum wage rises to $10/hour on January 1, 2020 and is set to rise to $15/hour by 2022. Staff costs make up the vast majority of child-care program budgets and rapidly rising minimum wages mean higher fees for parents, and they require larger public subsidies (which are not available in most municipalities). Ergo, it’s much harder to open a child-care facility and keep it open, even if qualified staff can be found. With an unemployment rate of less than 4% in the Duluth area, good staff are hard to find.

In related news, “Government Standards Are Making 5-Year-Olds and Kindergarten Teachers Miserable.” It seems that the bureaucrats who make these decisions have never interacted with actual human five-year-olds.

Nonetheless, we’re delighted to add the concept of child-care deserts to the equally ephemeral “food deserts” concept we often use in proposals. In grant writing, it’s not possible to have too many Potemkin deserts to add color to otherwise drab needs assessments. And many funders are more excited about solving marginal problems than real ones, like regulatory overreach and zoning.

Funders sometimes force grantees to provide services they don’t want to: FQHCs and Medication Assisted Treatment (MAT)

We often remind clients that those with the gold make the rules. Accepting a government grant means the applicant must sign a grant agreement, in which the applicant agrees not only to provide wherever services were specified in the proposal, but also abide by a myriad of regulations and laws. While many applicants will tussle with a funder over the budget, there’s rarely any point in trying to modify the boiler plate agreement—just like one can’t modify Apple or Facebook’s Terms of Service.

In addition to the specific terms of the grant agreement, grantees quickly become subject to other influences from the funder—when the Godfather makes you an offer you can’t refuse, you know that eventually you’ll be told to do something you’d otherwise not much want to do. While a federal agency is unlikely to place a horse’s head in a nonprofit Executive Director’s bed, the grantee might end up having to provide an unpalatable service.

A case in point is HRSA’s relatively recent (and divisive) endorsement of Medication Assisted Treatment (MAT) for treating opioid use disorder (OUD). Since HRSA is the primary FQHC funder, it is essentially their Godfather and has great influence over FQHCs. In the past few years, HRSA has strongly encouraged FQHCs to provide MAT. The CEOs of our FQHC clients have told us about HRSA pressure to start offering MAT. It seems that, even after several years of cajoling, only about half of our FQHC clients provide MAT, and, for many of these, MAT is only nominally offered. Other clients see offering MAT as a moral imperative, and we’ll sometimes get off the phone with one client who hates MAT and then on the phone with another client who sees not providing MAT as cruel.

“MAT” generically refers to the use of medications, usually in combination with counseling and behavioral therapies, for the treatment of substance use disorders (SUD). For OUD, this usually means prescribing and monitoring a medication like Suboxone, in which the active ingredients are buprenorphine and naloxone. While Suboxone typically reduces the cravings of people with OUD for prescribed and street opioids (e.g., oxycontin, heroin, etc.), it is itself a synthetic opioid. While MAT replaces a “bad opioid” with a “good opioid,” the patient remains addicted. Many FQHC managers and clinicians object to offering MAT for OUD, for a variety of medical, ethical, and practical reasons:

  • Like its older cousin methadone, as an opioid, Suboxone can produce euphoria and induce dependency, although its effects are milder. Still, it’s possible to overdose on Suboxone, particularly when combined with alcohol and street drugs. So it can still be deadly.
  • While MAT is supposed to be combined with some form of talking or other therapy, few FQHCs have the resources to actually provide extensive individual or group therapy, so the reality is that FQHC MAT patients will likely need Suboxone prescribed over the long term, leaving them effectively addicted. We’re aware that there’s often a wide gap here between the real world and the proposal world.
  • Unless it’s combined with some kind talking therapy that proves effective, MAT is not a short-term approach, meaning that, once an FQHC physician starts a patient on Suboxone, the patient is likely to need the prescription over a very long time—perhaps for the rest of their life. This makes the patient not only dependent on Suboxone, but also dependent on the prescriber and the FQHC, since few other local providers are likely to accept the patient and have clinicians who have obtained the necessary waiver to prescribe it. Suboxone users must be regularly monitored and seen by their prescriber, making for frequent health center visits.
  • As noted above, prescribed Suboxone can, and is often, re-sold by patients on the street.
  • Lastly, but perhaps most importantly, most FQHC health centers prefer to look like a standard group practice facility with a single waiting room/reception area. Unlike a specialized methadone or other addiction clinic, FQHC patients of all kinds are jumbled together. That means a mom bringing her five-year old in for a school physical could end up sitting between a couple of MAT users, who may look a little wild-eyed and ragged, making her and her kid uncomfortable. Since FQHCs usually lack the resources for anything beyond minor paint-up/fix up repairs, there is simply no way around this potential conflict.

Given the above, many FQHC CEOs remain resistant to adding the challenges of MAT to the many struggles they already face. Still, the ongoing pressure from HRSA means that most FQHCs will eventually be forced to provide at least a nominal MAT program to keep their HRSA Program Officer at bay. The tension between a typical mom and her five-year old against a full-fledged behavioral and mental health program is likely to remain, however. Before you leave scorching comments, however, remember that we’re trying to describe some of the real-world trade-offs here, not prescribe a course of action. What people really want in the physical space they occupy and what they say they want in the abstract are often quite different. You can see this in the relentless noise around issues like homeless service centers; everyone is in favor of them in someone else’s neighborhood and against them in their own neighborhood. Always pay attention to what a person actually does over a person’s rhetoric.

Don’t split target areas, but some programs, like HRSA’s Rural Health Network Development (RHND) Program, encourage cherry picking

In developing a grant proposal, one of the first issues is choosing the target area (or area of focus); the needs assessment is a key component of most grant proposals—but you can’t write the needs assessment without defining the target area. Without a target area, it’s not possible to craft data into the logic argument at is at the center of all needs assessments.

To make the needs assessment as tight and compelling as possible, we recommend that the target area be contiguous, if at all possible. Still, there are times when it is a good idea to split target areas—or it’s even required by the RFP.

Some federal programs, like YouthBuild, have highly structured, specific data requirements for such items as poverty level, high school graduation rate, youth unemployment rates, etc., with minimum thresholds for getting a certain number of points. Programs like YouthBuild mean that cherry picking zip codes or Census tracts can lead to a higher threshold score.

Many federal grant programs are aimed at “rural” target areas, although different federal agencies may use different definitions of what constitutes “rural”—or they provide little guidance as to what “rural” means. For example, HRSA just issued the FY ’20 NOFOs (Notice of Funding Opportunities—HRSA-speak for RFP) for the Rural Health Network Development Planning Program and the Rural Health Network Development Program.

Applicants for RHNDP and RHND must be a “Rural Health Network Development Program.” But, “If the applicant organization’s headquarters are located in a metropolitan or urban county, that also serves or has branches in a non-metropolitan or rural county, the applicant organization is not eligible solely because of the rural areas they serve, and must meet all other eligibility requirements.” Say what? And, applicants must also use the HRSA Tool to determine rural eligibility, based on “county or street address.” This being a HRSA tool, what HRSA thinks is rural may not match what anybody living there thinks. Residents of what has historically been a farm-trade small town might be surprised to learn that HRSA thinks they’re city folks, because the county seat population is slightly above a certain threshold, or expanding ex-urban development has been close enough to skew datasets from rural to nominally suburban or even urban.

Thus, while a contiguous target area is preferred, for NHNDP and RHND, you may find yourself in the data orchard picking cherries.

In most other cases, always try to avoid describing a target composed of the Towering Oaks neighborhood on the west side of Owatonna and the Scrubby Pines neighborhood on the east side, separated by the newly gentrified downtown in between. If you have a split target area, the needs assessment is going to be unnecessarily complex and may confuse the grant reviewers. You’ll find yourself writing something like, “the 2017 flood devastated the west side, which is very low-income community of color, while the Twinkie factory has brought new jobs to the east side, which is a white, working class neighborhood.” The data tables will be hard to structure and even harder to summarize in a way that makes it seem like the end of the world (always the goal in writing needs assessments).

Try to choose target area boundaries that conform to Census designations (e.g., Census tracts, Zip Codes, cities, etc.). Avoid target area boundaries like a school district enrollment area or a health district, which generally don’t conform to Census and other common data sets.

Why we like writing SAMHSA proposals: the RFP structure is clear and never changes

We wrote our first funded Substance Abuse and Mental Health Administration (SAMHSA) grant about 25 years ago, and there’s something notable about SAMHSA: unlike virtually all of their federal agency sisters, SAMHSA RFPs are well structured. Even better, the RFP structure seemingly never changes—or at least not for the past quarter century. This makes drafting a SAMHSA proposal refreshingly straightforward and enables us, and other competent writers, to (relatively) easily and coherently spin our grant writing “Tales of Brave Ulysses.” The word “coherently” in the preceding sentence is important: RFPs that destroy narrative flow by asking dozens of unrelated sub-questions also destroy the coherence of the story the writer is trying to tell and the program the writer is trying to describe. SAMHSA RFPs typically allow the applicant to answer the 5Ws and H.

A SAMHSA RFP almost always uses a variation on a basic, five element structure:

  • Section A: Population of Focus and Statement of Need
  • Section B: Proposed Implementation Approach
  • Section C: Proposed Evidence-Based Service/Practice
  • Section D: Staff and Organizational Experience
  • Section E: Data Collection and Performance Measurement

While SAMHSA RFPs, of course, include many required sub-headers that demand corresponding details, this structure lends itself to the standard outline format that we prefer (e.g., I.A.1.a). We like using outlines, because it makes it easy for us to organize our presentation and for reviewers to find responses to specific items requested in the RFP—as long as the outlines make sense and, as noted above, don’t interrupt narrative flow. In this respect, SAMHSA RFPs are easy for us to work with.

In recent years, SAMSHA has also reduced the maximum proposal length (exclusive of many required attachments) from 25 single-spaced pages to, in many cases, 10 single-spaced pages. Although it’s generally harder to write about complex subjects with a severe page limit than a much longer page limit, we’re good at packing a lot into a small space.* A novice grant writer, however, is likely to be intimidated by a SAMHSA RFP, due to the forbidding nature of the typical project concept and the brief page limit. In our experience, very long proposals are rarely better and are often worse than shorter ones.

We haven’t talked in this post about what SAMHSA does, because the nature of the organization’s mission doesn’t necessarily affect the kinds of RFPs the organization produces. Still, and not surprisingly, given its name, SAMSHA is the primary direct federal funder of grants for substance abuse and persistent mental illness prevention and treatment. With the recent and continuing tsunami of the twin co-related scourges of opioid use disorder (OUD) and homelessness, Congress has appropriated greater funding for SAMHSA and the agency is going through one of its cyclical rises in prominence in the grant firmament. Until we as a society get a handle on the opioid crisis, SAMHSA is going to get a lot of funding and attention.


* When writing a short proposal in response to a complex RFP, keep Rufo’s small luggage in Robert Heinlein’s Glory Road in mind: “Rufo’s baggage turned out to be a little black box about the size and shape of a portable typewriter. He opened it. And opened it again. And kept on opening it–And kept right on unfolding its sides and letting them down until the durn thing was the size of a small moving van and even more packed.” The bag was bigger on the inside than the outside, like a well-written SAMHSA proposal.

Washington Post’s story on rural health care ignores Federally Qualified Health Centers (FQHCs) — huh?

Eli Saslow recently wrote a 3,500-word Washington Post story about rural healthcare in “Urgent needs from head to toe’: This clinic had two days to fix a lifetime of needs.” Although it reads like a dispatch from Doctors Without Borders in Botswana, Saslow is describing rural Meigs County TN. Rural America certainly faces significant unmet healthcare needs, but this piece has a strange omission: it doesn’t mention Federally Qualified Health Centers (FQHCs).

The Tennessee Primary Care Association reports over 30 Federally Qualified Health Centers (FQHCs) operating over 200 health clinics in the state, most in rural areas—including at least four in or near Meigs County! FQHCs are nonprofits that receive HRSA Section 330 grants to provide integrated primary care, dental care, and behavioral health services to low-income and uninsured patients. FQHCs also accept Medicaid and, in rural areas, are usually the main primary care providers, along with ERs.

Federal law requires FQHCs to provide services under a sliding-fee scale, with a nominal charge for very-low-income patients—in theory, at least, FQHCs never turn patients away due to lack of ability to pay. Similarly, federal law requires ERs to treat everyone, regardless of income and/or insurance status. Unlike ERs, however, FQHCs provide a “medical home” for patients. There are over 1,400 FQHCs, with thousands of sites, both fixed and mobile, to better reach isolated rural areas like Meigs County. We should know—we’ve written dozens of funded HRSA grants for FQHCs, including many serving rural areas like Meigs County.

The story’s hero is Rural Area Medical (RAM), a nonprofit that appears to set up temporary clinics under the free clinic model. Free clinics emerged from the runaway youth health crisis of the late 60s, starting in the Summer of Love in San Francisco—I was on the board of a free clinic over 40 years ago and understand the model well. While there are still over 1,400 official free clinic sites, free clinics largely depend on volunteer medical staff, may not accept Medicaid, and have insecure funding because they rely on donations (often from their volunteers) to keep the lights on. To operate, a free clinic must necessarily devote much of its resources away from direct services to maintaining volunteers and fundraising, like any nonprofit that depends on volunteer labor (think Habitat for Humanity).

Unlike FQHCs, free clinics patients don’t have a designated primary care provider (PCP), since a given doc or NP might be volunteering or not on a given day—like an ER, free clinic patients lack a true medical home. Free clinics aren’t generally eligible to participate in the federally subsidized 340B Discount Pharmacy Program, so patients don’t have access to long-term, low-cost medications. Free clinics, while once the only source of healthcare for many uninsured, have now mostly been overtaken by FQHCs, much as the days of the independent tutor ended with the coming of public schools. We’ve worked for a few free clinics over the years, and most were struggling to stay open and provided erratic services. Their executive directors could feel which way the wind is blowing and consequently many were trying trying to become FQHCs.

I wonder: has RAM applied to become an FQHC and open a permanent site in Meigs County? I don’t know anything about Meigs County, and it’s possible that the local FQHCs are incompetent or poorly run and could use some new competitors. HRSA just had a New Access Points (NAP) competition, with over $200 million to found and fund new sites. If the the healthcare situation is dire in Meigs County, applying for NAP grant makes much more sense than setting up shop for a weekend. Does RAM refer patients to local FQHCs? That may be a more efficacious long-term solution than the superman approach of flying in, saving the day, and flying out (imagine if education worked the same way, with itinerant teachers stopping by to give a lecture on geometry one day, Shakespeare’s sonnets the next, and the gall bladder the day after).

The original story is great as human interest, but it doesn’t go into root causes. Some consulting organization created the “Five Whys” strategy or methodology, which holds that, for any given problem, it’s often not useful to look at a single moment or cause of failure or inadequacy. Rather, systems enable failure, and for any given failure, it’s necessary to look deeper than the immediate event. Some of the other underlying problems in this story include the American Medical Association (AMA), which controls med school slots, and the individual medical specialty associations, which control residency slots. The U.S. has been training too few doctors and doing an inadequate job getting those doctors into residency for decades. Detail on this subject is too specific for this piece, but Ezekiel Emanuel has a good article on the subject; med school needs to be integrated with undergrad and needs a year lopped off it. The way medical training works right now is too expensive and too long, creating physician shortages—especially in the places that need physicians most. The supply-demand mismatch raises the costs of physician services and mean that physicians charge more for services than they otherwise would.

Rural areas have also faced decades of economic headwinds, with young adults moving to job centers, leaving an aging-in-place population that needs many support services; declining tax base from manufacturing leaving for emerging countries; the opioid epidemic; and so on. While I wouldn’t expect Saslow to fully cover such factors, context is missing and at least a passing reference to FQHCs would make sense.

The movement towards a $15 minimum hourly wage and the Pre-K For All program in NYC


Over the last few years, the highly marketed $15/hour minimum wage has had remarkable success: it, along with the recent economic boom and historically low unemployment rates, have increased wages for some unskilled/low skill workers in some areas. Last week, though, I was developing a budget for a federal grant proposal on behalf of a large nonprofit in NYC. The federal program requires the use of “Parent Mentors”, which is another way of saying “Peer Outreach Worker.” So two full-time equivalent (FTE) Parent Mentors went into the budget.

“Peer” staff are not professionals—college degrees or formal work experience aren’t typically required. Instead, the peer is supposed to have life experience similar to the target population (e.g., African American persons in recovery for a substance abuse disorder treatment project in an African American neighborhood) or street credentials (“street cred”) to relate to the target population (e.g., ex-gang-bangers to engage current gang-bangers). In most human services programs, the peer staff are supervised by a professional staff person with a BA, MSW, LCSW, or similar degree. While the peer staff are at the bottom of the org chart, in many cases, they’re much more important to getting funded and operating a successful program than the 24-year-old recent Columbia grad with a degree in urban studies or psychology, as the “supervisor” is often afraid to go out into the community without a peer staff person riding shotgun. The situation is analogous to a first-year military officer who is technically superior to a 15-year enlisted veteran sergeant.

There are 2,080 person hours in a person year, so, at $15/hour, one FTE peer worker is budgeted at $31,200/year. If a nonprofit operates in an area with a $15/hour minimum wage, that’s the lowest salary that can be legally proposed. For many nonprofits, actual salaries for entry-level professional staff are about $30,000 to $35,000 per year. One might say, “No problem, just raise the professional salaries to $40,000.” This is, however, not easily done, as the maximum grants for most federal and state programs have not been adjusted to reflect minimum wages in places like New York or Seattle. If the nonprofit has been running a grant-funded program for five years, they’ve probably been paying the peer workers around $10/hour, and the new RFP very likely has the same maximum grant—say, $200,000—as the one from five years ago. That means one-third fewer peer workers.

If a Dairy Queen (I’m quite fond of DQ, like Warren Buffet) is suddenly confronted by the much higher minimum wage, they can try making the Blizzards one ounce smaller, skipping the pickles on the DQ Burgers, or buying a Flippy Burger Robot, and laying off a couple of 17-year olds. Nonprofits can’t generally deploy any of these strategies, as the service targets in the RPF are the the same as they ever were. For “capitated programs” like foster care, the nonprofit has to absorb rising costs, because they have a fixed reimbursement from the funder (e.g., $1,000/month/foster kid to cover all program expenses); we’re also unlikely to see robot outreach workers any time soon.

Most nonprofits also depend to some extent on fundraisers and donations. It’s hard enough to extract coin from your board and volunteers, so having a “New Minimum Wage Gala” is not likely to be a winning approach. Some higher-end restaurants in LA have added surcharges for higher minimum wages and employee health insurance, a practice I find annoying (just raise the damn pasta price from $20 to $22 and stop trying to virtue signal—or make me feel guilty). That avenue is typically closed to nonprofits, because the whole point is to provide no-cost services, or, in cases like Boys and Girls Clubs, very low-cost fees ($20 to play in the basketball league). Some organizations charge nominal membership fees, which are often waived anyway.

The nonprofit and grant worlds move much slower than the business world, and I guess we’ll just have to wait for the funders to catch up with rising minimum wages. In the meantime, some nonprofits are going to go under, just like this US News and World Report article that reports, “76.5 percent of full-service restaurant respondents said they had to reduce employee hours and 36 percent said they eliminated jobs in 2018 in response to the mandated wage increase” in New York City. More grants will also likely end up going to lower-cost cities and states, where it’s possible to hire three outreach workers instead of two outreach workers.

We write lots of Universal Pre-K (UPK) and Pre-K For All proposals in NYC and few, if any, of our early childhood education clients over the years have paid their “teachers” or “assistant teachers”—who are mostly peer workers with at most a 12-week certificate—$15/hour. There’s a new NYC Pre-K For All RFP on the street, and, if we’re hired to write any this year, the budgeting process will be interesting, as the City has minimum staffing levels for these classrooms, so staff cannot be cut.

Some organizations will get around the rules. Many religious communities are already “familiar,” you might say, with ways of getting around conventional taxation and regulatory rules. Their unusual social bonds enable them to do things other organizations can’t do. Many religious communities also vote as blocks and consequently get special dispensation in local and state grants and contracts. We’ll also likely end up seeing strategies like offering “stipends” to “parent volunteers” to get around the “wage” problem. For most nonprofits in high-minimum-wage areas, however, the simple reality is that fewer services will be provided per dollar spent.

More on developing federal grant budgets: Stay in the proposal world, not the operations world

This is an update to our popular post “Seliger’s Quick Guide to Developing Federal Grant Budgets.” While that post provides a step-by-step description of how to develop a federal grant proposal budget, it assumes that the budget preparer understands the difference between the real world and the proposal world. Experts in real-world budgets are often too sophisticated for the proposal world.

When we’re hired to complete a federal proposal, we send our client an Excel template that models the SF-424 budget form found in all grants.gov WorkSpace applications. Recently, we’ve been working for a series of large nonprofits and public agencies that have skilled Chief Financial Officers (CFOs). Most of these CFOs, however, have little or no understanding of proposal budgeting, as they’re accustomed to detailed operational budgets. Yet they’re often charged with filling out a proposal budget.

Even if we discuss the proposal world with the CFO first, the completed template we receive back is usually way too detailed, because it reflects actual program operations, not the idealized proposal world. This not only makes preparing the associated budget narrative/justification far too complex, but also means the budget presentation won’t display well when saved as the required .pdf for attachment to the kit file. The budget will also confuse proposal reviewers (which is never a good idea while being very easy to do), as most of them are not accountants, CFOs, etc.

So how do you keep your budget anchored in the proposal world?

  • Keep the number the number of line items short—around, say, 20. If you use 40 line items, the spreadsheet bloat will be very difficult to format in a way that is readable and meets RFP formatting requirements (unless you’re a wiz at Excel, which almost no one—including us and the CFOs we encounter—is).
  • Only include staff and line items that will be charged to the grant (and match, if required).
  • Personnel line items must match the staffing plan in the narrative. Resist the urge to load up the budget with small FTEs (2% to 20%) of lots of existing administrators/managers, as this will make your agency look bureaucratic (not a good idea, even if it is) and clog the budget narrative. Large numbers of small FTEs are what a federally approved Indirect Cost Rate is for. If your agency has at least one existing federal grant, get an approved Indirect Cost Rate, which is not that difficult, and many of your proposal budgeting woes will be solved.
  • Unless the RFP requires it, don’t line-item fringe benefits. These can usually be lumped together as a the percent of salaries your fringe benefit package equates to. For most nonprofits, this will be in the 18% to 30% range. Anything above 30% will probably generate unwanted attention from grant reviewers, even if that is what you pay. If the fringe benefit rate is relatively high, this should be explained in the budget narrative (e.g. lower salaries, high local costs, need to retain staff, etc.).
  • For multi-year budgets, don’t include expected yearly salary increases or annual inflators; this is too detailed and will, again, result in a very complicated budget justification. Inflation in the current environment is low. In a high-inflation environment like the ’70s, this advice would be different.
  • Regarding the “Other” Object Cost Category on the SF-424A, it’s unnecessary to break down line items too far. For example, lump together facility costs (e.g., rent, utilities, security, janitorial, maintenance, etc.), or communications (e.g., landline and cell phones, mailings, etc.) into single line items. Try to consolidate.
  • If feasible, try to make the total annual budget level for each project year. This can be a bit challenging, if, for example, the project involves start-up costs (e.g., buying staff furniture, hiring a web designer/social media consultant, etc.) in year one. The way to do this is to increase some other line item(s) in the out years to keep the budget level. Level annual budgets will make the budget easier to write and understand.
  • Make one line item your plug number to enable reconciliation to the maximum allowed grant and/or level annual amounts in multi-year grants. The plug number should be in the Other Object Cost Category and could be advertising, communications, or similar line items that look OK with an odd number in different years. Reviewers are aware of plug numbers and won’t hold reasonable plug numbers against you.

The proposal budget is just a financial plan that supports the proposed project activities, not a detailed expression of an operational situation. Following the notice of grant award, your agency will have to negotiate the actual budget in the contract anyway.

In most cases, the grantee can move 10% of the total grant among line items by notifying the federal program officer or requesting larger budget changes to reflect operations in the real world as the project is implemented. Unless you ask to swap an Outreach Worker for a lease on a Tesla for the Executive Director, the program officer will likely go along with your plan, as most simply don’t care what you do so long as the grant doesn’t end up in BuzzFeed, Politico, or the New York Times. Program officers want to make sure you are reasonable implementing a proposed project, but they don’t care about relatively small changes in operations-level detail. Fighting over small details in a proposal budget is a foolish thing to do, as is including small line items. Get the big picture right and the details will shake out during implementation.

Grant writing and cooking: Too many details or ingredients is never a good idea

As a grant writer who also likes to cook, I understand the importance of simplicity and clarity in both my vocation and avocation: too much detail can ruin the proposal, just as too many ingredients can produce a dull dish. Ten years ago, I wrote a post on the importance of using the KISS method (keep it simple, stupid—or Sally, if you don’t like the word “stupid”) in grant writing. We recently wrote an exceedingly complex state health care proposal for a large nonprofit in a Southern state, but even complex proposals should be as simple as possible—but no simpler.

As is often the case with state programs, the RFP was convoluted and required a complex needs assessment. Still, the project concept and target area were fairly straightforward. We wrote the first draft of the needs assessment in narrative form, rather than using a bunch of tables. There’s nothing intrinsically better or worse about narrative vs. tables; when the RFP is complex, we tend toward narrative form, and when the project concept and/or target area are complex, we often use more tables. For example, if the target population includes both African American and Latino substance abusers in an otherwise largely white community, we might use tables, labeling columns by ethnicity, then compare to the state. That’s hard to do in narrative form. Similarly, if the target area includes lots of counties, some of which are much more affluent than others, we might use tables to contrast the socioeconomic characteristics of the counties to the state.

Many grant reviewers also have trouble reading tables, because they don’t really understand statistics. Tables should also be followed by a narrative paragraph explaining the table anyway.

So: our client didn’t like the first draft and berated me for not using tables in the needs assessment. The customer is not always right, but, as ghostwriters, we accommodate our clients’s feedback, and I added some tables in the second draft. Our client requested more tables and lots of relatively unimportant details about their current programming, much of which wasn’t germane to the RFP questions. Including exhaustive details about current programming takes the proposal focus away from the project you’re trying to get funded, which is seldom a good idea. It’s best to provide sufficient detail to answer the 5 Ws and the H), while telling a compelling story that is responsive to the RFP.

Then, stop.

The client’s second draft edit requested yet more tables and a blizzard of additional, disconnected details. Our client disliked it the third draft. We ended up writing five drafts, instead of the usual three, and the proposal got steadily worse, not better. As chef-to-the-stars Wolfgang Puck* is said to have said, “Cooking is like painting or writing a song. Just as there are only so many notes or colors, there are only so many flavors – it’s how you combine them that sets you apart.” Attempting to use all the flavors at once usually results in a kitchen disaster.

A given section of a proposal should be as short as possible without being underdeveloped. Changes from draft to draft should also be as minimal and specific as possible.


* Jake sort-of-met Wolfgang, albeit before he was born. His mom was eight months pregnant with him when we went to Spago for dinner. Wolfgang was there in his Pillsbury Doughboy getup, and, despite not being celebrities, he couldn’t have been nicer and made a big deal out of a very pregnant woman dining at his place. I think he wanted his food to induce labor, but that didn’t happen for a couple of weeks; instead, Nate ‘n’ Al’s Deli (another celebrity hangout in Beverly Hills), was the culprit. A story for another day.