By Vince Siragusa
August 2010 (GO Know)

Anyone who has ever been involved in a fundraising effort will recognize the following scenario in terms of process. A specific need for the organization has been identified. The equipment and training associated with the project will inevitably save time, money, and provide a long lasting impact to the community. Fiscally responsible organizations often factor in some level of cost-benefit analysis in their prioritization of projects, and without a viable funding source, often the project finds itself on the back burner when other costs such as salaries and overhead are factored into this zero-sum game.

While many organizations are exploring ideas on how to most effectively dedicate operating money for organizational priorities, the grantmaker is looking to get as much “bang for their buck” as possible. Grantors might ask themselves, “why support an applicant having no ‘skin in the game’ when another applicant has fully committed their organization and budget to the project’s goal?” A matching contribution doesn’t necessary indicate potential for long term project success but it does show a level of personal commitment that the grantmaker is comforted to see. Why else would the grantee commit their valuable capital investment to the project if not to see it succeed? It is far less common for a project to fizzle out after the grant’s performance period when the grantee is bringing their own contributions to the table.

The matching requirement also safeguards a grantmaker's investment. Time and time again, a cost-share requirement proves to be a perfect way to keep the applicant’s requests more grounded than the alternative. Does the applicant really need the latest and greatest technology to support this project? Is the training available through an on-site, cross-country trip really integral to the project’s success? A matching requirement may help to ensure that organizations are only applying for grant support that is essential to the project.

Additionally, cost sharing is innovative way for the grantor to see that their funds go as far as possible in helping to meet the overall goals of the program. A quality Department of Justice program like the COPS Secure our Schools Grant Program has only $16 million available for grant awards. The required 50% match very quickly turns the $16 million in grant assistance into $24 million in total project money. Those collective funds will inevitably support K-12 school safety and security efforts across the country.

In other instances, such as the Assistance to Firefighters Grant (AFG), the cash-matching requirements come in the form of a sliding scale based on the population number served. The larger the service area population, the higher the match. The AFG program actually points out that the grantee is not required to have the cash match in hand at the time of application, nor at the time of award. However, before a grant is awarded, the Department of Homeland Security (DHS) will contact potential awardees to determine whether the grantee has the funding in hand or has a viable plan to obtain the necessary match. Avenues for attaining the matching funds include support through the operating budget or through other routes such as savings or fundraising—remember this next time you drive by a “Fill the Boot” campaign. Other departments have found success by utilizing relationships with local foundations who might be interested in helping the project and community by posting the necessary match.

Not every program requires matching or cost sharing. Additionally, in some cases, an applicant can request a waiver of cost sharing and clearly prove financial hardship. Please review the program’s guidance document to review the requirements of the grant.