Strengthening Nonprofit Performance through Financial Efficiency

Note: This grant program is not currently accepting proposals. This is a sample RFP from the most recent grant cycle, provided for your information. If this RFP opens again in future, some changes may be made, so you will always want to review the complete details carefully before submitting any proposal.

 

The Trust is seeking to support projects that will enable service providers to create financial efficiencies so that they can redirect financial resources to their core mission, and projects that develop new revenue sources.

 

Problem Statement/Overview

As government funding becomes increasingly constrained and foundation funding as a whole remains level, the most successful nonprofits will be those that use resources most efficiently or are able to raise funds from new sources. Too many rely too heavily on government and foundation dollars.

The Chicago Community Trust seeks proposals from organizations providing social services, aimed at creating operating efficiencies that produce significant monetary savings, result in mergers or generate income from non-government and non-foundation sources. By saving or generating money, these initiatives will allow organizations either to remain viable or to provide additional programming.

Allowable projects include:

Efficiencies. This includes back office collaborative or shared service strategies where multiple organizations pool administrative functions such as finance/accounting, human resources, information technology, transportation systems, purchasing (including supplies or energy), custodial or co-location. Allowable expenses include consulting, systems development or start-up costs for product development. Grants for consulting will not be made unless organizations have determined that they will proceed with the collaboration if the consultant’s report shows savings can be achieved. In some instances, Trust awards may be structured as a combination of a grant and loan.

Mergers. One or more organizations determine to merge into a single organization. This may include "acquisition" of an organization by an acquiring or "parent" organization, or a merger of more equally sized and resourced organizations. Allowable expenses include consulting, fees, systems conversions or integration. Grants for consulting will not be made unless organizations considering a merger have committed to undertake the merger should the consultant's work find no material reasons not to do so.

New Revenue Sources. These include a) development of resource-generating enterprises, either related or unrelated to core mission, that have the potential to generate significant revenue for the organization beyond the cost of operating the enterprise b) fund-raising strategies that develop sources of revenue previously uncommitted to human services. This might include contributions from individuals or corporations. Projects that aim to increase governmental funding, or funding from foundations that already fund human services, will not be supported.

 

Outcomes Sought

The Trust's primary goal is to maintain existing human services and to expand service where possible. Submitted proposals will be assessed by:

  • Amount of financial savings generated by providers that is returned to provider mission
  • Amount of new funding brought to the sector that is used for provider mission

 

Eligible Applicants

  • Nonprofit organizations with evidence of tax-exempt status under Section 501(c)(3) of the Internal Revenue Code or those using a 501(c)(3) fiscal agent
  • Organizations located within and/or primarily serving residents of Cook County, except for regional, statewide or national projects or research that may benefit a substantial portion of Cook County residents
  • Organizations with a commitment to diversity and inclusion for their governance, staffing, and populations served; and explicit adherence to non-discriminatory practices in the hiring of staff or in providing services on the basis of race, religion, gender, sexual orientation, age, national origin or disability
  • Organizations that provide human services

 

Evaluation Criteria

Applicants will be asked to complete an online application designed to collect information about your organization and project. Specifically, the following questions will be asked:

  • Describe your proposed project. Include key personnel, key activities, timetable and structure of organization upon completion of work.
  • Describe the reasons for undertaking the proposed project within the context of the history and conditions of the participating organizations. Describe key relationships between the organizations including board, executive staff, line staff and any other relevant bodies or communities.
  • Describe other funding sources and how they would be used in conjunction with funding from the Trust.
  • Provide staffing plan, with qualifications of key personnel.
  • For mergers:
  • Provide a brief history of the participating organizations and why the combination will result in sustained service provision and administrative efficiency.
  • Describe the planning process to this point and the commitment of the participating organizations.
  • Describe how service populations would be affected by the merger.
  • Describe any new service or financial opportunities expected to develop because of the merger.
  • Describe which components and costs of the merger are covered by this funding proposal, and which are not.
  • For back office collaborations:
  • Is the collaborative open to new members following start-up?
  • Provide calculations and timeline of project cost savings over five years.
  • Provide a five-year budget for the project.
  • Describe consideration of joining an existing collaboration rather than starting a new one.
  • Describe the commitment of participating organizations to making significant changes in order to effect cost savings.
  • Describe the planning process to this point and the commitment of the participating organizations.
  • For revenue-generating projects:
  • Describe the financial return on the proposed innovation compared to its cost projected over five years.
  • Describe how the proposed project relates to existing fundraising and revenue generation activities of the organization.
  • Provide evidence that the proposed initiative will raise revenues as proposed.

Incomplete proposals will not be considered. Proposals for grants must answer all the basic questions about the organizations and should include a narrative that responds to the questions posed in the application. Grant proposals will be evaluated, on a competitive basis, using the following criteria:

  • Financial return on the cost of undertaking the initiative. i.e., money saved or raised must substantially exceed the cost of saving or raising it. Proposals with high rates of return will be favored over those with lower
  • Likely time required to generate savings or new revenues, with a preference for earlier over later returns
  • Strong likelihood that revenues or savings will be realized
  • Significance of services provided by applicant organizations to the well-being of vulnerable populations or communities, with a particular emphasis on service to low-income persons

 

*Special note on diversity and inclusion

The Trust requires all applicants to either adopt the Trust's Diversity Statement or have a similar policy adopted by their boards. The Trust believes that the diversity of our community is a fundamental strength of our region. Our mission to improve the quality of life for the residents of our region is best fulfilled when we embrace diversity as a value and a practice. We define diversity to include, but not limited to, age, disability status, economic circumstance, ethnicity, gender, race, religion and sexual orientation.

Additionally, the Trust asks that applicants provide demographic data on board and staff as well as clients/beneficiaries of the projects. The Trust believes that the board and staff composition of grantees should reflect the diversity and demographics of the clients/community being served, and include diversity among its leadership at the board and senior staff levels to ensure the diverse perspectives needed at the decision-making levels. For this reason, the Trust does take into consideration the demographic make-up of the board, staff and clients of a grant applicant as an important proposal evaluation criterion.

 

Total Awards

This RFP will be open in each grant cycle of 2013. Throughout that time the Trust will make between 10 and 20 grants under this RFP. Grants will typically be in the range of $25,000 to $100,000 for each grant awarded. Successful applicants will receive grants for one year, although successful projects may be renewed. Please think carefully about all the aspects of the proposal project that require support, prioritize what you need and budget for those items.

 

Application Process

Proposal
Interested applicants will complete an online proposal.
Review and Selection
Applicants may receive a site visit, telephone call or other communication from the Trust staff as part of the proposal review process.
The Trust's Executive Committee (board of directors) will make the final grant decision.
Evaluation, Monitoring and Learning Activities
Grant recipients will be expected to meet the Trust's requirements for the submission of financial and narrative reports, including an interim progress report and final report.
In an effort to further the overall program goals of the RFP, inform future RFPs related to this topic and contribute to larger field-building objectives, grant recipients may be asked to participate in periodic meetings to share information on project activities and best practices as well as participate in research-based evaluations.

 

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