Responding to your community’s needs during the COVID-19 pandemic is complicated. How you can combat the outbreak and its deepening impact on public health and the economy will differ from place to place. However, effective practices are emerging among community foundations that are applicable and adaptable to many different regions.
Here are some tips and resources from the Council’s team and from community foundations around the country to help you respond in your community.
How Do We Structure and Communicate a Response Fund?
Response Funds support organizations tackling the immediate needs in this crisis that has so swiftly impacted so many, with a special focus on historically vulnerable populations. Typically, these funds:
- Provide one-time general operating support grants
- Accept applications and provide grants on a rolling basis
- Include funding for the immediate economic impacts being experienced by so many, such as those who have suddenly lost their jobs or had their hours reduced, those who cannot work because they are caring for children whose schools have closed, those facing new healthcare costs for testing and treatment, and so on
- Clearly delineate who is not eligible
- Collaborate with community partners to understand the pandemic impacts in order to deploy funds effectively
- Have easy-to-find information about how individuals, businesses, and others can donate to the fund to support their community
For examples on ways to structure and communicate a COVID-19 response fund, take a look at the funds established by the East Bay Community Foundation, the Central Wisconsin Community Foundation, and the Community Foundation of Greater Chattanooga.
What Are the Legal Basics of Different Types of Response Funds?
Response Funds for COVID-19 can be established in many forms. The links below will help you determine which type of fund to implement and the implications of each. Be sure to familiarize yourself with the IRS regulations surrounding grants to individuals, grants to small businesses, and grants from donor-advised funds. Most of the grants that fall into one of these categories require special consideration and/or expenditure responsibility.
- How to make grants to individuals
- How to support small businesses
- How to support crowdfunded campaigns
- What the IRS says about disaster grantmaking
Should We Charge Administrative Fees?
Community foundations often feel like waiving administrative fees is the “right thing to do” during a disaster or crisis. Or you may feel your community expects you to waive such fees. And yet waiving administrative fees is almost always a bad business decision. This is especially true when a global pandemic is causing uncertainty about the value of your assets as well as future fundraising prospects.
Should We Ease the Paperwork Requirements for Our Grantees so They Can Focus on Delivering Critical Services?
Whether it’s IRS requirements or internal foundation practices, there’s often a lot of documentation in grantmaking. Try to streamline your application and reporting processes as much as possible. Consider waiving things that are “nice to have” but not absolute requirements. And don’t require signatures on hard copy agreements during this time. You can substitute digital confirmation of receipt of agreements, which can be as simple as printing a copy of the email that confirms receipt and understanding of the terms.
Are There Special Considerations for Donor-Advised Funds? What About Employer Disaster Relief Funds?
Understanding the rules surrounding grantmaking from donor-advised funds is critical to ensure proper documentation and allowable grants. The link below can help you understand the limitations and exclusions on these funds as well as when expenditure responsibility is required.
Businesses—both for-profit and nonprofit—sometimes wish to establish employer disaster relief funds. Such funds are commonly established as “field of interest” funds, which means that the donor establishes the field of interest they want the fund to support, and the community foundation evaluates prospective recipients and makes grants, with limitations on how much influence or involvement the employer can have in distributions. These types of funds are not donor-advised.
What Can We Do Beyond Response Funds?
In addition to mobilizing capital, many community foundations are also leveraging partnerships, networks, and convening power to aid in the COVID-19 response. Some ideas from around the field include the following:
- Create a one-stop-shop webpage that links to the myriad resources in your community — as an example, see the Santa Barbara Foundation’s list of COVID-19 resources
- Connect volunteers with needs such as for blood bank collectors, tech support for seniors, and loan application guidance — see the Delaware Community Foundation’s partnership with the United Way of Delaware to promote a COVID-19 volunteers site
- Develop a searchable database where community members can find organizations and projects to support — see the Community Foundation of Greater Des Moines’ GIVEdsm.org site
- Hold weekly conference calls for the nonprofit sector to collaborate, problem solve, and collectively identify needs as they emerge — see the Kalamazoo Community Foundation’s partnership with the Kalamazoo County Response Consortium
- Offer webinars to nonprofits as they navigate their own financial survival, providing information on resources such as the SBA Paycheck Protection Program and financing tools like bridge loans — see the Santa Barbara Foundation’s events page
- Make critical connections among funders and nonprofit partners via a Nonprofit Resources Google Group. This discussion-focused group shares information, needs, and resources with each other and with those who may be in a position to aid – see Scranton Area Community Foundation’s full resource page
- Provide resources for immigrants in light of the particular impacts of social distancing many immigrants are facing — see the Ventura County Community Foundation’s 805 UndocuFund joint effort
How Can We Be a Good Partner During This Crisis?
Consider Converting Project Grants to General Operating Support
This can be a fast way to provide flexibility to existing grantees without expending new funds.
If You Are Looking to Extend Loans to Nonprofits, Consider Extending “Recoverable Grants” Instead
A recoverable grant is one in which you can recover a portion or all of the grant in the future. This may be a feasible option to extend to nonprofits that have a viable revenue stream that is simply being deferred (such as while they await public funding or other future income sources). However, because of the unknown nature of this crisis, be prepared to convert such grants to “non-recoverable,” traditional grants if needed.
Approach Local Grantmaking With Humility
This is a good rule of thumb no matter where or when you are operating! Be patient with your grantees—take time to understand how they work, what they need, and what potential barriers they face in receiving your grant, implementing it, and reporting on it. This is obvious if you are funding healthcare organizations and hospitals in this crisis, but it is also true for all organizations operating with insufficient funding, drastic operational challenges as we all shift to remote work, and limited contact service provisions.
While this is a difficult crisis to maneuver, as community foundations your focus on perpetuity allows you the long view that most nonprofits are not afforded. If nonprofits are lucky, they may have cash reserves long enough to last them three to six months. They are counting on your support and partnership to weather this crisis.
How Can We Operate Our Foundation When We Are All Working from Home?
The Council’s COVID-19 Resource Hub lists extensive “virtual workforce” resources on operations, staff well-being, communications, and more in its External Resources page. In addition, there are ample Free Tech Resources from TechSoup and Free Remote-Work Tools from Business Insider.
Adapting your teleworking policies or implementing altogether new ones? Several of your peers have shared their practices, procedures and policies via the Philanthropy Exchange in the Open Exchange, like these sample policies from Central Alabama Community Foundation:
In the same way that you are being patient with your grantees, be patient with yourselves. Across the nation and the world, we are all faced with adapting to this new way of working under mounting health and economic pressures. Yet we are also seeing countless examples of generosity and grace. Take time to celebrate your successes large and small and to support each other. We’re all in this together.