Declining a Grant: How Funders Can Help Turn a Negative into a Positive

When I am asked what I do for a living, I often explain my role as a program professional at the Jim Joseph Foundation, working to support compelling and effective Jewish learning opportunities. Or, sometimes, I discuss my particular role in the Foundation’s grants management process.  What I often gloss over entirely is the seemingly less glamorous responsibility of managing the Foundation’s declination process—basically carrying out the Foundation’s collective decision to sometimes say “No” to a potential grantee.  Even with a policy of accepting grant inquiries by invitation only, this is an important and necessary part of the grantmaking process.

Examining this declination responsibility raises questions and offers important lessons both for funders and for organizations. On a fundamental level, are we abrogating our responsibility of Tzedakah (charitable giving) whenever we say no to a meaningful cause?  When an organization’s grant request is declined—admittedly, not the answer it was seeking—are there any positives it can take away from the process?

To properly address both questions, we should first acknowledge a simple truth - saying “No” can be challenging. The Jim Joseph Foundation is privileged to work with passionate and determined grantees—and always searches for the next successful initiative. Still, while the Foundation has affected tens of thousands of Jewish youth and young adults (Jim Joseph Foundation Portfolio Analysis), all pools of funds are finite; all grants have their limitations in terms of scope and reach. This fact only makes saying “No” more difficult. It goes against our desire to help support more Jewish learning opportunities.

So how does the Foundation both approach and implement its declination process? One of the foremost, authoritative documents in Jewish law, the Shulchan Aruch, states: “One able to motivate others to contribute receives greater reward than the giver (Shulchan Aruch, Yoreh Deah 249:5).” We believe this holds true in our philanthropic world. Many of the potential grantees who reach out to the Jim Joseph Foundation represent organizations or institutions with which we would hope to maintain ongoing relationships, regardless of whether the Foundation awards a grant.  These include summer camps, day schools, social service organizations, study abroad programs, universities, Federations, and many other worthwhile institutions with pressing capital needs.  We want to be positive but not patronizing, direct without being disrespectful, and still find a way to be helpful.

A foundation can, in fact, turn the moment of declination into positive outcomes for the grantseeker by being transparent about funding priorities, delivering the message with clarity and with sensitivity, and by assisting, as appropriate, in other ways. This includes:

  1. Helping the organization better understand the strategic priorities of the funder, leaving open the possibility for future funder-organization alignment
  2. Identifying other potential funders that are a better fit for the organization or specific initiative

For the applicant itself, the organization can act intentionally after the grant process and improve efficiency and effectiveness by:

  1. Expending less of the organization’s fiscal resources on pursuing grants that do not align with its mission
  2. Reassessing the proposed grant to learn what about it could be more compelling or perhaps adapted to align with a specific potential funder
  3. Further targeting the list of potential funders based on funding priorities and subsequently reducing staff-time invested to solicit funds
  4. Asking for outside advice on how to improve the organizational model or find avenues for future funding

At the Jim Joseph Foundation, funding can be awarded to an organization for a grant proposal and its renewal.  Typically, funding that is awarded to an organization for several grant cycles eventually comes to an end. It is not prudent for either the funder or the grantee to assume that a grant will continue to be renewed in perpetuity.  Even if a grant had previously been made to an organization, it is imperative for the Foundation to clarify, with as much advanced notice as possible, whether there will be an opportunity for renewal.  This will allow the organization to leverage the remainder of the grant as a runway to find new funding.   It is similarly necessary for a grantee organization to make it clear if its mission has changed, which would affect its eligibility for foundation grants.

A majority of the organizations funded by the Jim Joseph Foundation have experienced at least one declination for an initiative that was not a fit.  But when a potential grantee and potential funder are not a match, saying “No” reflects the Foundation’s best judgment that the proposed grant initiative does not align with the Foundation’s strategic grant making priorities. It is not a comment on the quality or premise of the grant idea.  Beyond this, Saying “Yes” to everything or even saying “Maybe” to everything is both unrealistic and counterproductive for a funder trying to efficiently work towards—and achieve—its goal. And even when a grant is declined, a grantseeking organization can turn a “No” into a positive by charting its next steps to secure necessary funding and further working towards its mission.