Federal Money Is Redirected

August 1, 2009       Mark Hrywna      

Scrapping the $50-million Compassion Capital Fund (CCF) because the “range of recipients was too narrowly defined,” the Obama administration has launched the Strengthening Communities Fund (SCF).

Armed with $50 million from the American Recovery and Reinvestment Act (ARRA), the SCF will fund capacity-building efforts through nonprofits, as well as state, local and tribal governments that are responsible for outreach to faith-based and community organizations. Like the CCF before it, the SCF will be administrated by the Office of Community Services, Administration for Children & Families.

Previous CCF grants included the Demonstration Program, Targeted Capacity Building Program and Communities Empowering Youth.

The Department of Health and Human Services (HHS) will award new CCF demonstration program grants in Fiscal Year 2009 designed to expand and strengthen the role of organizations in their ability to provide social services to low-income communities. No new CCF grant awards are proposed after FY 2009, which ends Sept. 30.

The first component, the Nonprofit Capacity Building Program, will allocate $34 million of the $50 million in one-time awards of up to $1 million to experienced lead organizations, which in turn provide capacity building to individual nonprofits. The second component will provide up to $12 million in $250,000 grants to state, local and tribal government offices, designated for faith-based and community outreach.

The remaining $4 million is set aside for support activities, which includes the cost of reviewing and scoring the competitive grant process and information technology support; training and technical assistance to grantees, such as monitoring for accountability and compliance; and the costs associated with research and evaluation of the program’s effectiveness.

There is a 20 percent match for both components of the fund, which can be cash or in-kind contributions, and grants will be administered by the Administration for Children and Families, within the Department of Health and Human Services.

There are five critical areas of capacity building identified by the grant program:

  • Organizations development;
  • Program development;
  • Collaboration and community engagement;
  • Leadership development; and,
  • Evaluation of effectiveness.

Thomas Campbell, program manager for the Strengthening Communities Fund and the Compassion Capital Fund before it, said the capacity building effort will be an intermediary style program with broad eligibility, including governments, universities, tribes, nonprofits and for-profits.

Grants can be used for outreach, education, training, as well as building capacity of the grantee. Distressed communities will be considered a geographic community or neighborhood with an unemployment rate and/or poverty rate higher than the state or national average.

Campbell said the program aims to build up organizations to increase their capacity to do direct service, however, the grants will not fund direct service.

Direct fundraising with grant money is prohibited, he said, as is proselytizing, religious activity and religious education.

A nationally scoped program would be very hard to justify, Campbell said, and while defined areas might be different for each applicant, going beyond two or three counties historically has shown to “diffuse the impact.” Statewide programs, while sometimes successful, would need strong justification that they have the capability and impact statewide.

Nonprofits and faith-based organizations aid families who are struggling during the economic downturn in many ways. Organizations can help people find jobs or get better ones, Campbell said, and they also can aid people in surviving the downturn, such as, through the help of food banks or homeless shelters.

The grants would not fund those services but increase an organization’s capacity to fund them. The grants generally can’t be used for construction or real property. There is some allowance for renovations. However, it must be limited surface renovation, like painting.

“Anything that makes capacity stronger than it was is OK,” said Campbell. He gave the example of a $1,000 grant to a food bank. The food bank can buy food and serve more clients temporarily, but once the food is gone, the organization is not stronger than it was before. If the food bank, however, purchases a walk-in freezer, it would be able to increase its capacity and store more and different food.

The National Council of Nonprofits (NCN) lobbied to include its Nonprofit Capacity Building Initiative (NCBI) in the Serve America Act, which was signed by President Barack Obama last month.

Ann Beltran, public policy analyst for the NCN, said the initiative is different in that it would focus on strengthening small and mid-sized nonprofits through infrastructure and capacity, with a specific preference on resource-challenged areas. “Those may or may not overlap and they really came out of different contexts,” she said. Grants also would be smaller, about $200,000, than the SCF grants to lead organizations.

The SCF funding is more immediate stimulus dollars, with another $50 million proposed in the president’s federal budget.

The stimulus, and SCF, is really trying to reach, as directly as possible, distressed populations and help them with everything from job training to access to federal benefits, Beltran said.

The NCBI had $5 million reserved in each of the next five fiscal years, but still must be authorized within the federal budget. It would require a 50 percent match from a private foundation.

Organizations seeking more information about the Strengthening Communities Fund grant programs can visit www.grants.gov, or call 800-281-9519.  NPT