Federal grant management isn't for the faint of heart. To help us understand the best strategies to tackle this intimidating task, we talked to Patrice Davis, an experienced senior director of federal grants, to find out what it takes to handle a multi-million grant portfolio.
For this article, we’ll be drawing on Davis’ expertise. By the end, you’ll be better equipped to handle these challenging funding opportunities. You’ll also learn the best practices and common misconceptions about managing government grants.
Because they are funded by tax-payer dollars, federal grants are typically very large—in the hundreds of thousands or even millions of dollars. However, even though you have the potential to win substantial funding, you must do so by following strict compliance regulations.
Federal grants are also highly competitive, as you’ll be competing against other nonprofits from all across the country. This is why despite their large sums, many nonprofit organizations opt to seek out funding from private foundations instead.
As a professional grant management consultant at Grants Works Academy, Patrice Davis has seen even seasoned fundraisers—used to operating in the private sector—struggle with federal grants.
As Davis explains:
"...folks may not realize that the way they operated when they were managing foundation grants will need to change to effectively manage government grants. Once you're managing three, four, or five government grants, things will have to change internally."
Managing federal funding requires a careful and strategic approach. Proper training and internal systems that are built with adaptability in mind should make this journey easier.
What Your Nonprofit Needs To Even Be Considered for Federal Grants
Just because you’ve won private funding doesn’t mean you are ready to be considered for federal grants. Just as there are a number of protocols you must follow once you receive the award, there are also a number of requirements you must fulfill in order to be deemed eligible.
Verifiable Through SAM.gov
For example, you must have an active SAM.gov registration to apply for government funding. Short for System for Award Management, SAM is the system the US Government uses for contract opportunities, contract data, entity reporting, and more. There, you’ll be given a Unique Entity Identifier (UEI) number, which you’ll also need for your application.
By having your organization registered on the SAM website, you make it so the funding agencies can more easily verify that your nonprofit is in compliance with current tax regulations, that you do not have any outstanding federal obligations, and that your nonprofit has not been suspended or is being investigated for fraud.
Davis also shared with us some advice on how to best evaluate your financial systems so you can be sure you have the infrastructure to handle a large federal grant.
She recommends:
Having an annual operating budget
Having detailed fundraising plans
Being consistent with your IRS filings
Having a list of past and pending funding ready
Having an oversight procedure in place
Having a clear and identifiable ethics code
3 To 6 Months Of Operating Capital
It is also critical for your nonprofit to have 90 to 180 days of operating capital in the bank. As Davis explains:
“Many of the government grants are cost reimbursement grants…For those of you who aren't aware, that means they may award you, let's say, a $1 million grant over one year or over two years…and let's say in month one, you accrue $50,000 of expenses. You actually are paying those expenses. The following month, you're preparing a report, a financial report, or a reimbursement request. And then you're going to actually do a drawdown of the amount you actually spent. So, you're actually being reimbursed for your costs.”
Conflict Of Interest And Grievance Policies And Procedures
Believe it or not, having a conflict of interest and grievance policies and procedures in place are also recommended by Davis for those seeking to apply for government grants. They demonstrate a thorough level of transparency and accountability that builds up your nonprofit’s trustworthiness.
Grant Management Policies
Similarly, to be considered for federal grants, you also should have grant management policies in place that show you have the internal infrastructure to handle these awards.
Good federal grant management policies and procedures will include:
A step-by-step process for procurement of goods and services
Federal financial reporting
Subrecipients and sub-recipient monitoring
Details For Each Of Your Programs And Personnel
Finally, when putting together your documents, make sure you have updated descriptions for each of your programs, as well as the resumes of your key personnel that accurately reflect their expertise as those might be required in some applications.
Pro Tip: Remember to stay informed about federal grant regulations and trends. This can be done by following nonprofit leaders such as Davis on social media, looking at nonprofit-focused publications such as The Nonprofit Times, or even by keeping with our blog here at Instrumentl.
At Grants Works Academy, Davis created the ASTACC Method to help nonprofits like you create an effective internal system. This makes managing a multi-million grant portfolio more organized, so there’s less chaos in your day-to-day.
ASTACC stands for:
Analyze,
Systemize,
Team Centered,
Accountability Circle,
Collaborative, and
Compliance.
Below, we’ll go over each of these concepts so you can better understand them and successfully implement them into your nonprofit’s current grant management strategy.
Analyze: Understand the Requirements of the Grant Award
Understanding the requirements of your grant award is the first step in successfully managing it. This means that you must become extremely familiar with the compliance regulations and how they relate to the inner workings of your organization.
Begin by carefully assessing the details behind each of the grant’s requirements. Break down those requirements into achievable, tangible steps and tasks. Ask yourself:
What exactly is being asked of you?
Can you explain each compliance measure?
Do you understand why such strict adherence to every single step is needed?
Now, measure those requirements against your nonprofit as it currently stands. Consider:
What exactly is the funder asking of your organization, and would you be able to fulfill those things?
What are you missing?
How can you best distribute responsibilities among your staff?
By analyzing the grant’s requirements and assessing how they integrate with your nonprofit’s current workflow you can be better prepared to manage the funds once they start arriving.
Systemize: Integrate Compliance Into Existing Systems
Once you’ve analyzed the grant and your nonprofit’s infrastructure, it is time to come up with a plan and systemize it.
By knowing the requirements of the federal grant and your nonprofit’s current standing, you’ll be able to see the gaps between the two. Systemizing is all about filling in those gaps by creating new workflows that make grant management easier.
Don’t wait until you secure the award to implement those changes into your existing systems. Managing federal grants is a long process, and so the sooner you can integrate compliances into your nonprofit's regular workflow, the better prepared you will be for when the funding arrives.
Team Centered: The Accounting Person Can't Be the Only Person Managing This
As you can probably tell by now, grant management is not only a time consuming process, but also a complicated one.
Do not self-sabotage your nonprofit by placing all of these responsibilities on a single individual. Overwhelming your staff in such a manner will make it difficult to keep the systems you implemented in place, to manage the award successfully, and to secure future funding.
Some of the responsibilities that need to be accounted for include:
Budgeting
Capacity Assessment
Creating a Grant Calendar
Creating Feedback Loops
Collecting Internal and External Data
Establishing a System for Performance Metrics
Grant Writing
Creating and Maintaining a Compliance and Reporting Protocol
When integrating compliance systems into your existing infrastructure, make sure to pay special attention to how you’ll divide the different grant management responsibilities.
Just as important as having a team handling the management of your federal grants is having a clear accountability system and a leadership strategy. As Davis puts it:
“Who or what team is the lead on your grants? If I say to my client, ‘Email me a list of all 20 of your grants.’ There should be a person who has that chart ready to go because that chart should be readily available…when all your grants begin and when they end, what the award is, what's the cost share, and what expenses are covered—all of that can be determined when you have a person or a team who's the lead on the grants.”
Pro Tip: Instrumentl allows you and your team to store and access grant-related documents so that you have all the information needed in one place.
Collaborative: Your Team Works Together With External Stakeholders
When managing federal grants, you should also seek to work with external stakeholders and experts when possible.
By having a robust system in place, you’ll be ready to coordinate with those outside your nonprofit. Be it for a possible financial audit or a consulting company like Grants Works, your organization should be ready to work with external parties.
Collaborating with external stakeholders will also help your nonprofit demonstrate federal grant readiness. By working together, you’ll more effectively use the federal grant award to maximize impact while also holding yourself accountable.
Compliance: Have All Your Documents in Place
When it comes to federal grants, ensuring your nonprofit has all its documents in place is not just important, it is a crucial necessity.
As Davis recounts:
“Compliance should be the center of your government grant management—documentation, monitoring, financial stewardship…And, of course, effective and written policies and procedures.”
Maintaining strict compliance is also the best way to avoid committing accidental fraud.
1. You Can Apply at the Last Minute: Even in the private sector, it takes a lot of time and work to complete an application for a grant. Federal awards generally have stricter compliance regulations, so you can expect to spend weeks or even months on a single application.
2. Same as the Private Sector: As we emphasized earlier in this article, there are many differences between the private sector and federal grants. For this reason, even those who have plenty of experience dealing with the former might still find themselves charting unfamiliar waters.
3. It’s Fine to Miss Some Requirements: When it comes to federal funding, required documentation is indeed mandatory. As Davis recounts:
“When I worked at CDC, we had a grant application come from one of the most prestigious universities…And they did not meet what's called a basic threshold. They didn't upload a few of those required documents and their application was not reviewed.”
4. Grant Management Is a Post-Award Activity: While grant management is often thought of as a post award activity, the reality is that when dealing with federal grants, there are many things you must do on the front end in order to be considered for an award.
5. There’s No Training Needed for Grant Management: Federal grant management is a beast in its own right that requires very specific skills. As such, the right training can make a difference in how well your nonprofit handles this process. Having the right tools can also assist in making the job easier. Grants Works Academy and Instrumentl both provide services that can help your nonprofit tackle this challenge.
7. Focus Primarily on Budget and Reporting Deadlines: While budgeting and keeping track of your deadlines is important, there’s a lot more that goes into managing a federal grant than that. Having thorough and robust systems, having all of your documents ready to go, and having oversight and internal control systems is just as important as creating a cohesive budget or submitting your application on time.
8. One Person Can Handle the Entire Application: Federal grants require a complex application process. As such, it can be overwhelming and even detrimental to put its burden on the shoulders of only one individual. Handling the application process as a team, with each person taking on a task best suited for their skills, is the best way to ensure success.
9. One Person Can Handle the Entire Grant Management: As we have emphasized throughout this entire article, grant management—and especially federal grant management—is a difficult and extensive process. As such, rather than having one individual juggle all of these different tasks by themselves, it is recommended to have a team working together, with a leader overseeing their work and ensuring its cohesion.
Build Long-Term Sustainability With Government Grants
Even for those familiar with grants, managing multi-million federal awards can be intimidating and overwhelming. After all, there are many application requirements and compliance regulations you must follow.
However, by analyzing the requirements, being familiar with your organization, and by implementing a thorough system and grant management strategy, nonprofits both big and small should be able to tackle this challenge with the ease of an expert. All it takes is the right training, the right tools, and the right team.
.svg)
%201.png)
