by Diane H. Leonard, GPC CoAuthor Rebecca Shawver, MPA, GPC
Nonprofit organizations worry about many aspects of grant funding—and finding adequate matching dollars is usually at the top of the list. With each new grant opportunity that requires matching funds, they worry that they won’t be able to apply because they don’t have any.
One of the most overlooked sources of matching funds are in-kind contributions. When funders allow, in-kind donations can be included in the calculation of an organization’s matching funds. It’s important to note that, in our experience, the vast majority of funders will allow them. Now, granted, there are funders that will only accept a cash match; but, there are many others that will accept in-kind donations as an acceptable source of matching dollars.
Remember, it never hurts to ask. Acceptable in-kind resources include (but aren’t limited to) the following:
Donations of Program Space
Program space can include office space, meetings rooms, recreational facilities, classrooms, storage, etc. You will need to calculate your annual expenses for your overall facility and claim the appropriate percentage that will be devoted to your program. But, this is not difficult and it will net you a figure that is probably higher than you anticipated.
Many organizations don’t keep track of program supplies by program. They simply buy the paper and ink cartridges for the common printer. They pay the rental fees and repair bills for their copier each month without considering that these expenses should be proportionally charged to each of the organization’s programs. And, usually, the same is true for the general supply cabinet (i.e. pens, pencils, highlighters, notepads, sticky notes, etc.). Using a reasonable formula similar to the one for determining space costs, grant applicants can easily determine a reasonable monthly amount to allocate for each of their programs.
Many program directors don’t think about the miles that they drive to meetings, airports, and client homes – but they should. Whether or not they are reimbursed for mileage expenses, these costs are real and should be accounted for in a program’s annual budget. They can add up quickly. And don’t forget to include the mileage contributed by volunteers too.
Phone, Electricity, Internet Service, Etc.
So often, organizations simply categorize phone, electricity, internet services, and other shared expenses as general overhead. But if these expenses can be properly calculated for each of an organization’s programs, they are real expenses that need to be quantified. After all, programs couldn’t be operated without them.
Many programs provide bus transportation to field trips, doctors’ appointments, to and from a childcare or senior center, etc. If these expenses aren’t included in each of the organization’s program budgets, they should be. This could also include free bus passes that a local metro service may provide. It’s important to count each expense as if your organization was paying cash for it.
Many programs get free tickets to special events for their program participants. These could be admissions to the local zoo, musical concerts, ball games, etc. Make certain to calculate the value of these tickets because they play an integral part in making your program more effective and exciting for your participants. This may be especially true for seniors that depend on a program for their sole source of socialization and after school programs for educational and cultural outreach.
For the majority of grassroots and volunteer-driven organizations, probably the most important in-kind contributions not to forget are the hundreds (and possibly thousands) of hours that their volunteers contribute for the implementation of each of their programs.
Reasons In-kind Matches Get Overlooked
We have found that one of the primary reasons that in-kind donations are overlooked is because these costs are often not included in the original program budget. Typically, everyone is trying diligently to minimize the costs of a program (whether new or ongoing). Program managers are focused on the bottom line—what do they “really” need to make the program run?
Unfortunately, while they really do need the facilities, program supplies, volunteers, etc., they don’t consider them a “money” expense. It will often fall to the grant writer to explain how in-kind donations can and should be documented to use as matching funds.
For example, if an after-school program has two paid staff and five volunteer workers, the budget for salaries, taxes, and benefits should include the expenses of all seven individuals contributing to the program’s implementation and ultimate success. The expenses of the two paid staff members should be listed as grant funded, while the volunteers should be shown as matching funds.
We realize that it is not uncommon for many clients to leave the value of volunteer time out of their grant budgets because it can be difficult to place a value on it. That is why we recommend that you use the Points of Light calculator to place a value on your volunteers’ contributions.
It is always wise to know the full cost of each of your organization’s programs. But this can only be accomplished by knowing what are the related expenses—and these include in-kind contributions. So take the time now to calculate costs, to determine what in-kind donations are being received, and to place a value on volunteer time and any other key contributions that are essential to your programs’ operation. Then when the next grant opportunity comes around, you will be fully prepared to document any matching funds that may be required.