Empower nonprofits through unrestricted funding

Lita Pardi

By Lita Pardi, director, resource deployment, Community Foundation for Greater Atlanta

In a recent post, we discussed the importance of nonprofit funding that is not restricted, or tied to a specific use. The Community Foundation acknowledges that providing nonprofits with general operating support, or unrestricted funding, empowers organizations to use the funding most effectively.

General operating support puts the focus on impact

Some forms of funding may put a focus on the number of people served by a particular organization or program. Flexible funding allows organizations to provide programs that have sustained impact on people’s lives. Programs that serve young children are a great example. While providing care to young children is important, we should not focus on how many children participated in a program. True impact is better assessed by knowing how many young children are meeting developmental milestones and are exiting a pre-K program ready for kindergarten.

General operating support empowers nonprofits

Nonprofits experience myriad opportunities and challenges on an ongoing basis, from unexpected facility maintenance issues to potential programmatic innovations. Having unrestricted cash on hand allows organizations to seize opportunities and address issues in a timely manner. Flexible funding can also support an organization as it builds a reserve fund for future needs. Having reserves on hand offers a quicker solution than seeking a line of credit or launching a dedicated fundraising effort.

General operating support is a sign of trust 

Trust is an essential element to meaningful relationships. Building trust can be tough, especially between funders and nonprofits where money is a part of the conversation. It takes incredible courage for nonprofits to talk openly and honestly about their challenges and about what they don’t know. Providing operating support signals that we trust nonprofit leaders’ expertise, knowledge of the field, need of their clients and of their own organizations.

Next time you think about giving a charitable gift, consider giving one that is not restricted in its use. You may be empowering a noprofit to soar to new heights or to address a critical need.