Two efficient and effective arguments for unrestricted support – also called core support, general operating support, or covering real costs – came to Dr. Streamline’s attention recently.
The first, a neat little movie called “If We Want Our Funding to Change the World” from the Donors Forum and their work on Real Talk About Real Costs. At only a minute and forty seconds, this video is an efficient and effective introduction to why it’s critical for funders to support nonprofits beyond the “frame of the program” with what they really need to succeed.
And then, the National Committee for Responsive Philanthropy puts a fine point on why core support matters with their recent blog, “Three Ways to Boost Core Support,” for the Stanford Social Innovation Review. The blog post comments on NCRP’s recent research, The State of General Operating Support, 2011 (PDF). The good news is that general operating support increased substantially between the 2008-2010 average of 16 percent and 24 percent in 2011.*
NCRP’s Niki Jagpal and Kevin Laskowski suggest three strategies for boosting core support, including a suggestion that funders add core support to program grants, if program grants are what they provide.
Why? Because every string—every restriction and every application and reporting requirement—imposes costs that are borne by grantees from the very grants that they receive (the “net grant”). As we have previously suggested, restricted grantors are effectively free-riding, trusting that some other donor or some other nonprofit will make up the costs of their charitable preferences.
That’s right. Applying for and reporting on grants costs nonprofits time and money. Grantmakers that impose administrative burden but don’t want to pay for it are, perhaps, confused on this point.
So, you might be wondering, why is Dr. Streamline writing about general operating support?
Well, at the end of the day, perfectly streamlined application and reporting processes still won’t keep the lights on for hard-working nonprofit organizations. Even the most streamlined applications and reports require administrative effort – and funders are powerful partners when their investment supports nonprofit operations and infrastructure.
*This line was updated on August 26 to correct an earlier error.