Here in my home town of Lancaster, Pa., the School District of Lancaster is dealing with a crisis. The superintendent of the district is alleged to have used grant funds for consultants who had dubious backgrounds and might not have provided any service, yet were paid. The superintendent has resigned, and the district is being investigated by the state and the FBI. Past grants also are being reviewed and scrutinized closely for mismanagement.

This situation has raised a variety of issues within the community, one of which concerns the purpose of a grant. Like many school systems nationwide (and particularly large, urban districts), the School District of Lancaster struggles with finding the funds necessary to pay for its day-to-day operating costs. However, the district has been extremely successful at securing grants–some rather large in terms of dollars–for special projects. Now some members of the community are asking why the district does not have basic necessities in the classrooms, such as textbooks–and why the grant funds haven’t been used to buy them. (If it’s any consolation, in my experience many nonprofit organizations experience the same struggle in covering their daily operating expenses.)

Understanding the purpose of grants is essential for proposal writers, teachers, administrators, school board members, and parents. For the most part, grants are meant to provide seed money for new projects. Grants provide grantees with the financial resources to implement a new project and to see if the proposed outcomes for student achievement really will come to fruition. Or, grant funds might enable a grantee to discover a new model of teaching that significantly increases student achievement and impacts professional development. Or they might enable a district to use technology to carry out administrative responsibilities in a more efficient and cost-effective manner.

Those who have written several grant proposals realize that funding generally is allotted for a specific amount of time. Usually grants cover a 12-month time period, or in the case of multi-year grants, funding covers a three or five-year time period. For multi-year requests, it is common that the amount of money supplied by the funder shrinks in the latter years while the amount of support from the grantee grows. Funders are working under the assumption that if a project is successful and merits continuation, the grantee will find other ways to maintain the project after the grantor’s funding comes to an end. Budgets typically will not allow the inclusion of daily operating costs of the school or district. Only those costs associated with the project are allowable, and in some cases there are several restrictions as far as what can and cannot be included in the budget request.

I have seen directories in the past that list sources of funding for operating expenses. However, these directories are often very small–and for some states, there are no foundations listed that will accept proposals requesting operating funds.

I would suggest that if you haven’t done so already, explain the purpose of grants to your staff and school board members so they have a clear understanding and can educate community members should the question arise. Also, contact local funders and get their perspective on why they do not fund daily operating expenses, and then share this information at a board meeting or perhaps in your district newsletter. A clear understanding should make the grants process more comprehensible and will allow others to see how grants fit into your district’s overall funding plan.

As for the larger issue of accountability that Lancaster’s situation raises, see my column in next month’s issue for some lessons in grants management.

Deborah Ward, CFRE, is an independent grant writing consultant. She welcomes questions at (717) 295-9437 or Debor21727@aol.com.