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Inflation poses potentially major challenges for nonprofits and their budgets

The United States is currently experiencing the highest measured inflation rate since the early ’80s, although it may have moderated a bit recently. We see this in our business—all of our many software-as-a-service (“SaaS” in tech nomenclature) subscriptions have gone up by at least 10% in the past six months, our costs for consumable supplies and equipment have also risen, and anyone who’s been to the used car lot, supermarket, etc., sees it in their daily lives. Still, while there are many articles on inflation in the media, I’ve yet to read one that discusses the significant and deleterious impact of inflation on nonprofits. I was the Executive Director of the Hollywood-Wilshire Fair Housing Council in the late ’70s, and then a full-time grant writer, so I experienced first-hand hyper inflation. Back then, we learned quickly that budgets had to account for inflation, and inflation expectations affected everything we did.

As we’ve written many times, most nonprofits depend on only four revenue streams, no matter how big or small the nonprofit: grants, fee-for-service contracts / third-party reimbursements, fund raising / donations, and, for a few, membership dues. A tiny number of nonprofits have endowments, but, if you’re Princeton or the Met, you don’t really have the problems and challenges normal nonprofits do. Inflation will negatively all of these streams:

  • Grants: Inflation will have the biggest impact on grants. When a nonprofit gets a grant award, the award is based on the proposed budget, and the proposed budget may be modified somewhat during the contract negotiation process. Still, the grant will be a fixed amount, either annually or for the budget period, and grant contracts rarely, if ever, include a Cost of Living Adjustment (COLA) provision. If the grant is, for example, $500,000 annually for five years, and inflation runs at 5% per year, the last year of the grant is going to be much harder to implement than the first.* While it’s usually possible to get approval to move money among budget line items, you can’t go to your program officer and say, “Hey, we now have to pay our Outreach Workers $20/hour because they can make $18/hour at McDonalds” or “our rent went up by $500/month” to get relief. You’re stuck (or a similar, six-letter word that starts with “f” and ends with “ed”). Because inflation has been low, most nonprofit Executive Directors and Boards have never experienced rapid inflation. Not much can be done with existing grants, but in writing future grants, it’ll be critical to propose budgets and services taking into account anticipated inflation. Since an estimated 10% of the American economy is conducted by nonprofits, multiply the impact of inflationary thinking by thousands of nonprofits. The Federal Reserve had to raise interest rates to 20% in the early ’80s to break the inflationary cycle, and that could happen again.
  • Fee-for-Service Contracts and Third-Party Reimbursements: Unlike grants, fee-for-service contracts for things like foster care, home healthcare, some substance abuse treatment, etc., typically reimburse nonprofits at a specific rate for services rendered, which are often capitated (“per head”) or a fixed price for a unit of service rendered. Like grants, such contracts will not usually have built-in COLA provisions. If the contract is based a capitated rate or unit of service provided, inflation will quickly screw this up. A nonprofit may be able to renegotiate contract rates, since in cases where specialized services are provided (e.g., foster care), the contracting agency may need the nonprofit more than the nonprofit needs the contract. Third-party reimbursements, like Medicaid for FQHCs, are even more problematic, as these cannot not be renegotiated and there will be a lag before rates catch up with inflation, if they ever do.
  • Fund Raising / Donations: Let’s say tickets for your nonprofit’s annual “Gala” have been $100 for the last five years. Due to inflation (e.g. venue rent, food, celebrity honorariums/goody bags, etc., cost increases), you may need to charge $150 to net enough money to make the exercise worthwhile. Some number of your supporters will be priced out, if their own wages or investment income aren’t keeping up. Back in my Fair Housing days, most of our fund raising involved overpriced tickets to plays and concerts, Christmas card sales, etc., and, as inflation went up, we netted less and less money. The same is true for donations; as folks’ real incomes are depressed due to inflation, they’re likely to donate less and the amount they donate will be worth less to the nonprofit. Essentially, this becomes a downward spiral, which caused me to start writing more grants to keep the Fair Housing staff on board and the lights on.
  • Membership Dues: A few nonprofits like environmental organizations or Boys and Girls Clubs, are able to charge membership dues. Like with fund raising and donations, however, inflation will make these agencies need to raise their dues to preserve their “buying power,” but dues increases will likely run into resistance from their members. Many members also likely cancelled during the pandemic; Jake had a YMCA gym membership that he cancelled in April 2020 and never restarted. Inflation erodes real incomes as people’s salaries buy less stuff and wage increases typically lag inflation increases. So, membership dues are easier to cut from a family’s budget that say new school clothes for the kids.

Nimble nonprofits will plan for inflation now, just as smart countries planned for pandemics before the pandemic hit. A good strategy is to seek grants that offer “walking around money.” These are grants for nebulous, rather than specific, services and in effect can be used to support other staff and indirect costs. It’s also important to get a Federally Approved Indirect Cost Rate or include a de minimus indirect rate (10%) in your grant budget, if the RFP allows this. Nonprofits will want and need grant revenue that isn’t tied to providing specific services.

Nonprofits that don’t realize the world is quickly changing due to inflation will be in for a rude awakening. As Bette Davis says in the wonderful 1950 comedy All About Eve, “Fasten your seatbelts, it’s going to be a bumpy night.”


* While one can include COLA increases in grant budgets (e.g., 3% annual salary increases), this doesn’t help, because the maximum grant amount is usually fixed. Furthermore, complex budgets violate Seliger + Associates’ basic advice to use the KISS (Keep it Simple Stupid—or “Sally” if you want to be nice) method in grant writing when possible.

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The 3-point revolution in basketball: a lesson for grant seekers and grant writers

I’m old enough to remember the time (not that long ago) when the most important player on most basketball teams was the low-post man, often a back-to-basket center, like George Mikan (the original), Kareem, Wilt, Shaq, etc. That was upended a few years ago with the 3-point shot revolution pioneered by the Golden State Warriors (think Seth Curry, Klay Thompson, etc.). The 3-point shot was added in 1979, but it took basketball experts almost 40 years to figure out that it’s more efficient for players to take more 3-point shots than 2-point shots, even if the shooting percentage for 3-pointers is lower. Maybe humans are less rational than the classical model suggests, if it took so long for teams to optimize for a change, even in a relatively small, controlled environment like pro basketball.

Greater efficiency is achieved by 3-point shooting even if fewer balls technically go through the hoop: we can apply a similar idea or set of ideas to grant writing. It’s more efficient for a nonprofit to submit more proposals rather than spending too much time and resources polishing a smaller number of proposals. We’ve been through many client-induced “polishing” and extensive “editing” exercises with proposals, and they typically generate diminishing returns. Imagine the Lakers rebounding at the Jazz basket and having to take a shot at their end within the 24 second shot clock: the point guard could spend 22 seconds working the ball into a low-post player, who (hopefully) takes a high percentage shot, or the point guard could quickly dribble to the 3-point line, hand off to the shooting guard who takes a 3-point shot at the 6 second mark. While the completion percentage is much lower, this results in many more possessions and opportunities to shoot and score.

In grant seeking, a nonprofit could have its grant writer work tirelessly to polish one grant proposal or have the grant writer do a credible, but maybe not perfect, job on three proposals during the same “grant writing shot clock.” The second approach is likely to produce more funded grants than the first approach, largely because you’re taking more shots on goal. As hockey GOAT Wayne Gretzky famously put it, “I missed 100% of the shots I didn’t take.” Moreover, there’s a lot of noise in the grant evaluation process, just as there is in dating, jobs, and many other human endeavors. The people who succeed most in dating or jobs typically try a lot of different things, knowing that many possible romantic prospects will not like them, for whatever internal reason, and the same is true of employers.

In grant writing terms, and as we periodically blog about, “many shots” means avoiding the perils of perfectionism. It doesn’t matter how perfect the proposal is if you miss the deadline. Also, it’s best to understand that grant reviewers will not study your proposal like the Talmud. At most, the reviewers, who are likely reading dozens of proposals, might spend a half hour reviewing your 40-page opus. As long as the proposal is technically correct and tells a compelling story, it’s probably good enough, since funding decisions go well beyond the proposal itself, including such unknowable considerations as location (urban vs. rural), target population, ethnicity, number of similar applicants, and, the old standby, politics.* There’s likely a pin map in the Under Assistant Secretary’s office to figure out which high scoring proposals will actually be funded (too many in red state Texas, then let’s move a couple to purple state Arizona in anticipation of the 2022 midterms).

Like NBA players who practice long hours to improve their 3-point shooting, your grant writer should be able to get better and faster at writing proposals. Writing proposals, though, is a job that’s hard and drives many grant writers or prospective grant writers mad, or encourages them to leave the business—which is why we have the business we do.


  • At least with federal programs, and large state programs, this is almost never any RFPs of the “let me give you $10,000 in unmarked bills, or bitcoin” variety, but rather of the “Texas is getting five grants, and California zero? That needs to be better balanced” variety.
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The latest Service Area Competitions (SAC) from HRSA are here, and the FQHC Shuffle

2020 was a peculiar year for many reasons great and small, one of the small reasons germane to grant writers and Federally Qualified Health Centers (FQHCs) being that HRSA deferred Service Area Competitions (SAC), allowing FQHCs to skip the typical application, or re-application, process. For those of you unfamiliar with FQHCs, they’re the nonprofit healthcare providers that are designed to accept any patient, regardless of ability to pay, and that specialize in Medicaid patients, or helping the uninsured sign up for Medicaid. FQHCs and their counterparts, FQHC Look-Alikes, have significant advantages over typical nonprofit or for-profit primary healthcare providers in that they get higher reimbursement rates from Medicaid, protection from medical malpractice lawsuits, access to the 340B low-cost medication program, and a few other advantages—including eligibility for Section 330 grants via the SAC process, which offer between hundreds of thousands and millions of dollars per year in funding. Every (or almost every) geographical area in the country is supposed to be covered by a SAC and most FQHCs must submit a competitive SAC proposal every three years to keep their Section 330 grants.

Delaying SACs seemed like a reasonable idea during the pandemic, and their return is likely to herald some changes. We talk to lots of FQHCs, and it seems that some of the incumbents are weaker than they were, or discombobulated by the pandemic. Others, however, seem to have been strengthened, particularly those that moved expeditiously to telemedicine, which let them keep up their patient loads, while others have struggled with telemedicine. It’s often not apparent from the outside what’s happening on the inside of FQHCs. Some that may seem weak are likely strong, and vice-versa. That’ll make this SAC season unusual and interesting, and I’d not be surprised to see larger-than-average turnover in SAC grants. Because each SAC covers a specific geography, any new applicant is by definition trying to take over the designation from an existing grantee. We’ve heard the SAC process called “the FQHC shuffle.” Most FQHCs succeed in getting their SAC proposals approved and Section 330 grants renewed, but a significant portion don’t; most of us wouldn’t want to play a game we don’t think we’ll win.

We’ve worked with FQHCs on both sides of the SAC shuffle: incumbents worried about upstarts, and upstarts interested in taking over the incumbents’s service area and Section 330 grants. Losing a Section 330 grant can be an FQHC’s death knell: while SACs typically compose less than 20% of an FQHC’s budget, and often less than 10%, they often function as the glue holding the organization above the water level. Lose the SAC, and the overall revenue decline may be small, but that revenue may also be the revenue that keeps the organization in the black. During uncertain times like the present, an alert organization may be able to make progress that would be more difficult in other times.

Three of the eight planned FY ’22 SAC NOFOs have been issued so far: you can see whether your organization’s service area is up for renewal in HRSA’s massive SAC lookup table. The rest will be issued in the coming weeks or months. Is your FQHC or would-be FQHC ready to act?

Although the pandemic is receding, we’re still living in a strange time: the nonprofit winners have a lot of cash; some nonprofits, however, are gone. The next generation of nonprofit startups haven’t wholly started up yet. This is a propitious time to pursue change. We’ve been talking to a lot of callers about what’s happening in the present and what the future might hold.

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New combo COVID-19 stimulus bill and budget bill have tons of grant “ornaments”

The latest COVID-19 Stimulus Bill was signed into law Dec. 27, which, combined with the FY ’21 budget authorization bill, represents a burst of new grant activity. Congress loves to cobble together fantastically complex budget legislation, as this practice, called adding special interest “ornaments,” gives members lots of room for plausible deniability about voting for them; some of the new discretionary provisions include:

    • $82B for “education,” including $54B for K-12 schools and $23B for colleges/universities. Some of these funds will be distributed on a formula basis, likely via pass-throughs to state education agencies, but the rest should be awarded through competitive RFPs, either direct federal applications or RFPs run by the states.
    • $7B for expanding access to “high-speed internet connections,” including subsidies for low-income families. This provision also include $300M for building out broadband infrastructure in rural areas and $1B for tribal broadband programs. We wrote many broadband infrastructure grants following the 2009 Stimulus Bill during the Great Recession.
    • $70B for a slew of “public health measures,” including $20B for “test and trace” programs and “billions for combating the disparities facing communities of color.” This is another way of saying “walking around money” for nonprofits and local public agencies.
    • $10B for child care providers. We write many early childhood education proposals, including Head Start, Early Head Start, Universal Pre-K, etc., and this set of funding provisions will likely be similar. Furthermore, it’s probable that both non-profit and for-profit entities will be eligible, since much of the non-Head Start child care industry is operated by for-profits.
    • $35B for “wind, solar, and other clean energy projects.” These funds will likely be distributed through the Department of Energy, ARPA-E and similar funding agencies.
    • $400M for food banks and $175M for nutrition programs under the Older Americans Act, which will probably be distributed via programs like Meals on Wheels.
    • $5B for the “entertainment industry,” including cultural institutions like theater groups, museums, etc.
    • $14B for public transit.

Some of the other features, listed here more for amusement than anything else, include: a statement of policy regarding the succession or reincarnation of the Dalai Lama; the establishment of two new Smithsonian museums; giving West Virginia a national park; banning the USPS from mailing electronic vaping products; the decriminalization of various minor violations, including the transportation of water hyacinths, alligator grass, or water chestnut plants across state lines and the unauthorized use of the Swiss coat of arms, the 4-H Club emblem, the “Smokey Bear” character or name, the “Woodsy Owl” character, name or slogan, or “The Golden Eagle Insignia; the establishment of an anti-doping program for horse racing; a bunch of foreign aid programs for things like gender studies in Pakistan; and, my personal favorite, a 180-day countdown underway for the Pentagon and spy agencies to reveal what they all know about UFOs.

In other words, the Mulder and Scully Act of 2020” is hidden in this bill. During a conversation with Tyler Cowen, former CIA director John Brennan recently commented on UFOs, saying that he’s “seen some of those videos from Navy pilots, and I must tell you that they are quite eyebrow-raising” and that, after sifting the evidence, “I think some of the phenomena we’re going to be seeing continues to be unexplained and might, in fact, be some type of phenomenon that is the result of something that we don’t yet understand and that could involve some type of activity that some might say constitutes a different form of life.”

We’ll write another follow-up post or two on this topic, as the 6,000 page bill is fully digested.

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Deciding on the grant proposal structure: ACF’s recent Early Head Start (EHS) application illustrates the challenge

Many RFPs don’t simply and directly state, “Use the following header pattern in your response to the narrative questions.” Why don’t funders tell applicants which header pattern to use? Bureaucracy, legal requirements, funder indifference, signaling: whatever the reason(s), we’ve run into a bunch of program RFPs recently that don’t explicitly state what headers should be used (like the Small Business Innovation and Research grants (SBIRs) we wrote about last week). In structuring responses to confusing RFPs, there are two main schools of thought: one is to use the general headers found in the RFP, and then reply to all the sub-questions in paragraph form. The other school of thought is to use the general headers and every sub-header found either the narrative instructions (if there are any) or the review instructions (if there are any of those). Neither approach is necessarily “right.”

The recent ACF Early Head Start (EHS) RFP, for which we just wrote a proposal, offers a good example of this challenge. Like SBIRs, the EHS RFP has, bafflingly, two sets of narrative instructions: on Adobe page 35, under “Approach” and the other on Adobe page 57, under “Application Review Criteria.” Neither is quite canonical—in other words, the instructions don’t say, in big bold type, “USE THIS HEADER SET.” Instead, ACF offers maddening ambiguity. Perhaps this maddening ambiguity is deliberate, but is more likely due to this fact: the folks who write the RFPs never write the proposals in response and, as bureaucrats, likely they simply don’t care.

Regardless, one has to decide whether it’s better to use just top-level outlines, like “1. Community Need and Objectives, 2. Program Design and Approach,” or sub-header outlines, like “1. Community Need and Objectives, a. the proposed service area and location(s) where services will be delivered.” We chose to mostly follow page 57, while still referencing material on page 35. As with SBIRs, though, there is no 100% right answer, because neither the NIH or ACF give applicants one—but both could reject applications that don’t follow the weakly specified instructions.

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Confusing NIH and other Small Business Innovation and Research (SBIR) application guidance

In theory, an “application guide” for a Small Business Innovation and Research (SBIR) grant from a federal agency is meant to make the application process easier: the applicant should presumably be able to read the application guide and follow it, right? Wrong, as it turns out. The difficulties start with finding the application guide and associated RFP (or “FOA,” Funding Opportunity Announcement in NIH-land) . If you go to grants.gov today, Sept. 9, dear reader, and search for “SBIR,” you’ll get 74 matching results—most for National Institutes of Health (NIH) programs, which we’ll use as an example for the sake of this exercise, and because I worked on one recently. I’m going to use “PA-18-705 SBIR Technology Transfer (R43/R44 Clinical Trial Not Allowed)” program, which has download instructions at Grants.gov. When you download and review the “instructions,” however, you’ll find this complication:

It is critical that applicants follow the SBIR/STTR (B) Instructions in the SF424 (R&R) SBIR/STTR Application Guide (//grants.nih.gov/grants/guide/url_redirect.htm?id=32000)except where instructed to do otherwise (in this FOA or in a Notice from the NIH Guide for Grants and Contracts (//grants.nih.gov/grants/guide/)). Conformance to all requirements (both in the Application Guide and the FOA) is required and strictly enforced.

Notice that the URLs in the quoted section are incomplete: it’s up the applicant to track down the true SBIR application guide and correct FOA. I did that, but the tricky phrase is “follow the SBIR/STTR (B) Instructions […] except where instructed to do otherwise.” For the particular NIH application we were working on, the FOA and the Application Guide disagreed with each other concerning how the narrative should be structured and what an applicant needed to include in their proposal. So what’s an applicant, or, in this case, a hired-gun grant writer, to do? With some SBIRs, there is no canonical set of questions and responses: there’s the “general” set of questions and the FOA-specific set, with no instructions about how reconcile them.

To solve this conundrum, I decided to develop a hybridized version for the proposal structure: I used the general narrative structuring questions from the application guide, and I tacked on any extra questions that I could discern in the program-specific FOA. The only plausible alternative to this hybridized approach would have been to contact the NIH program officer listed in the FOA. As an experienced grant writer, however, I didn’t reach out, because I know that program officers confronted with issues like this will respond with a version of “That’s an interesting question. Read the FOA.”

The challenge of multiple, conflicting SBIR guidance documents isn’t exclusive to the NIH: we’ve worked on Dept. of Energy (DOE) SBIRs that feature contradictory guides, FOAs/RFPs, and related documents. It takes a lot of double checking and cross checking to try to make sure nothing’s been missed. The real question is why inherently science-based agencies like NIH and DOE are seemingly incapable of producing the same kind of single RFP documents typically used by DHHS, DOL, etc. Also, it’s very odd that we’ve never worked on an SBIR proposal for which the federal agency has provided a budget template in Excel. In the NIH example discussed above, the budget form was in Acrobat, which means I had to model it in Excel. Excel has been the standard for spreadsheets/budgets since the ’80s.

We (obviously) work on grant applications all the time, and yet the SBIR reconciliation process is confusing and difficult even for us professional grant writers. The SBIR narratives, once we understand how to structure them, usually aren’t very challenging for us to write, but getting to the right structure sure is. For someone not used to reading complicated grant documents, and looking at SBIR guidance documents for the first time, the process would be a nightmare. Making SBIRs “easier” with extra, generic application guides that can be unpredictably superseded actually makes the process harder. This is good for our business but bad for science and innovation.

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Generalized human and social services: ACF READY4Life and Fatherhood FIRE RFPs

Astute newsletter readers saw two useful Administration for Children and Families (ACF) Office of Family Assistance (OFA) RFPs with lots of money available (albeit with overly long names) in our last edition: Fatherhood – Family-focused, Interconnected, Resilient, and Essential (Fatherhood FIRE) and Relationships, Education, Advancement, and Development for Youth for Life (READY4Life). Both have grants to $1.5 million for family formation and resilience services. A phrase like “family formation and resilience services” should make smart nonprofit Executive Directors sit up and take notice, because we’ve seen fewer overt generalized human services grants over the past few years—the kind of grants that we sometimes call “walkin’ around money.

Smart organizations figure out that these kinds of grants can be used to fill in the cracks of an organization’s budget, because the project concepts that can be funded are broad. Also, in most cases, only a process evaluation (e.g., number of outreach contacts made, number of referrals, etc.) is feasible, since there’s usually no way to tract outcomes. In the ’90s and ’00s we saw more broad, general-purpose RFPs, but we’ve seen fewer since the Great Recession. The feds seem to have lost interest in many kinds of general-purpose grants and have instead been targeting particular services, like primary health care and job training.

Many organizations are already doing things like fatherhood and family development, but without calling their activities “fatherhood and family development.” Federally Qualified Health Centers (FQHCs), for example, often serve low-income patients who are impoverished by single parenthood, usually in a female-headed household. Nimble FQHCs should apply for READY4Life, Fatherhood FIRE, and similarly nebulous grant programs, since they can re-brand their existing Case Managers and Patient Navigators as “Family Support Coordinators” and “Parenting Specialists.” Obviously, the FQHC wouldn’t say as much in the proposal—that would be supplantation—but, in the real world, a lot of organizations keep their lights on and their clients happy using these strategies.

Organizations apart from FQHCs should be doing this too. Job training and homeless services providers, for example, often work with populations that need family reunification training, and the organizations are already often providing wraparound supportive services. Funders love synergistic proposals that say things like, “We’re going to do job training services for ex-offenders, and those ex-offenders will also be eligible for Fatherhood FIRE services in order to ensure that they remain in their children’s lives.”

Increased funding for generalized human services typically follows some kind of seismic societal shock. Seliger + Associates began in 1993, soon after the Rodney King verdict civil unrest, which was soon followed by the onset of mass school shootings with Columbine. Then came the Great Recession: the feds respond to social turmoil with huge new grant programs (21st Century Community Learning Centers was an example) and big budget increases for existing programs (like the 2009 Stimulus Bill). With the COVID-19 crisis, the cycle is repeating. Since March, three giant stimulus bills have been passed, with at least one more likely. The enormous civil unrest and protests unfolding after the recent police killing of George Floyd will likely lead to grant programs too; the feds’s objective is to get grants on the streets quickly to nonprofits, which act as a kind of buffer to politicians.

With growing “defund the police” sentiment in big, left-leaning cities, politicians are engaging in a sort of bidding war with proposed police budget cuts; politicians say some version of, “We want to redirect huge amounts of police budgets to solving the underlying problems that generate crime.” Translated, this means, “We plan to fund local nonprofits to conduct some kind of human services.”

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You’d think there’s no pandemic going on: The FCC shuts down its COVID-19 Telehealth grant submission portal

One of the bigger and more interesting RFPs on the street right now is the FCC’s “COVID-19 Telehealth Program,” which has $200 million available for obvious purposes—but grants are being accepted, reviewed, and approved on a first-come, first-served basis (federal RFPs usually have a fixed due date).* Lots of FQHCs are also implementing, or trying to implement, telehealth programs on the fly, since COVID-19 has hit them with a structural double whammy: patients with COVID-19 need to be isolated as much as possible from other patients, and other patients are avoiding health clinics for fear of catching COVID-19. This has had the unexpected side effect of lowering patient volumes at FQHCs, which, like other healthcare providers, have reacted by laying off staff. You’d intuitively think that, during a pandemic, the need for healthcare staff would expand, but that’s not happened outside of NYC intensive care units.

So the FCC program is designed to help FQHCs and other providers move relatively quickly to telehealth, which may help FQHCs achieve a higher patient volume. On Saturday we were working to backcheck a client’s online FCC application, since it’s our standard practice to make sure that applications are as complete and technically accurate as possible before client upload. But when we tried to log into the FCC’s application site, we were hit by a message telling us that the FCC had closed its application portal for maintenance. Is shutting a site down for “maintenance” still necessary in 2020? The error message felt very 2003, and, as you probably know, we’re in the midst of a pandemic, when every day counts. I guess FCC didn’t get the pandemic memo.

Eventually the site came back up, but its closure seems like a metaphor for many of the challenges we, as a society, are collectively facing from bureaucrats during these strangest of times.

The FCC COVID-19 Telehealth grant program is also unusual because it specifically says that applicants can only buy Internet-connected telehealth equipment—meaning blood pressure cuffs or pulse oximeters that automatically relay information to healthcare providers. I’ve seen budgets for how much these devices cost, and they’re crazy expensive, as most medical devices are. But: did you know that something as simple as an Apple Watch can function as a pulse oximeter—except that FDA regulations are blocking this use? This is the same FDA whose regulations stopped independent labs from rolling out virus testing in February. We try not to link outrage stories here, but it’s hard to read “The Infuriating Story of How the Government Stalled Coronavirus Testing” without being justifiably outraged.

Today, pointless FDA regulations are blocking people from using a relatively cheap and widely available device from being deployed in a medical context. Apple.com lists “Series 5” Apple Watches at $399 and they’re shipping today (there’s been a pulse ox shortage). Our FQHC clients already know this, but pulse oxes are useful for determining whether a COVID-19 patient needs to be hospitalized, or needs supplemental oxygen. Most COVID-19 patients can recover on their own without medical intervention, but low blood oxygenation is a key danger metric: a normal blood oxygenation level is around 95 – 100. If a patient’s oxygenation level consistently falls below 90, that patient likely needs advanced care. Most households have a thermometer, but relatively few have pulse oxes. Many COVID-19 patients are suffering from what doctors are calling “silent hypoxia,” in which the patient is essentially suffocating but doesn’t realize they’re suffocating, and pulse ox data can tell the patient whether they need to go in to see their doc or to an ER. It would be relatively easy for Apple to allow Apple Watch users to link their health data with a healthcare provider, and for the healthcare provider go get an alert if a patient’s blood oxygenation level drops below 92 or 90. Cheap solutions exist but the FDA keeps us from implementing them.


* Other federal departments have been funding similar telehealth-related grants programs: for example, the USDA has $40 million available via the “Distance Learning and Telemedicine Grants.” Those grants aren’t due until July 13, however.

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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.

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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.”