After 2 years of pretty darn good federal funding (also known as The American Recovery and Reinvestment Act), we are facing what appears to be a lengthy period of lean federal funding. The first salvo fired was an announcement from the Obama administration that Community Services Block Grant (CSBG) funding in the proposed budget is reduced 50% with awards to be based on performance similar to Race to the Top.
According to NASCSP, CSBG agencies provided services to 20.7 million low-income individuals including seniors, children, and people with disabilities in 2009. As a result of these services, the CSBG network reduced or eliminated 34.3 million conditions of poverty. These results come from these organizations focus on mission and serving their communities. These new funding levels put these outcomes in jeopardy.
To be careful, we don't know yet what the final budget will look like or how other federal grants will be affected. However, it's a pretty safe bet to assume that grant levels will be lower whether you receive CSBG funds, CDBG funds, Head Start funds, state or local funding, or the many other sources of funds from government to nonprofit organizations.
Your challenge, simply put, is how to minimize the impact reduced funding will have on delivering services. There are some easier and traditional steps to take around reducing expenses - everything from lawn care to head count. There are also some harder steps that involve looking at your organization strategically. That is, take a look at the programs and services your organization provides and make hard choices based on the value and cost of those programs. Even better, you could also look at opportunities for strategic partnering and merger opportunities that are in alignment with your mission and can help create more focus.
Let's put a positive spin on this. Funding reductions could create an opportunity to look at your organization's focus and service delivery as it relates to your mission. This is challenging for some. However, the payoff may be in keeping the most important services to the portion of the 20.7 million low income individuals you are serving.