When to Look a Gift Horse in the Mouth

As traditional funding sources become stagnant or decline, many Extension organizations are looking for gifts, grants, and fees for services to supplement or replace traditional funding sources. At first glance, accepting grants, gifts, and contracts may look very appealing. Accepting funding without a critical analysis of all the issues involved and the greater mission of the organization can result in increased costs rather than increased income. Those costs can be in the form of real money, lost opportunities due to over committed resources, loss of future funding due to delivering a low quality product, loss of focus or direction of current programs, and loss of other cooperators or funders because of controversial funding partners. There are always real costs associated with accepting outside dollars. The questions, are we aware of all the costs, and do the benefits outweigh those costs, should always be considered.

An article in the Chronicle of Higher Education (Healy, 1997) explored the growing importance of user fees among Extension organizations. Monies from user fees, grants, and contracts have been the fastest growing source of funds in the last ten years, increasing 64.4% from 1990 to 1996. Total Extension funding increased only 17.3% during the same period. Massachusetts' goal for the next decade, as reported in that article, is to have 50% of Extension funding derived from grants and user fees.

The Futures Task Force for the Extension Committee on Organization and Policy (ECOP) (1987) recommended that both federal and state leaders examine alternative funding sources. They also cited the risks associated with each. Dependence on grants could result in the granting agency controlling programming. Subcontracting could result in Extension working for other agencies rather than the clientele it was meant to serve. Users' fees could limit participation of those who most desperately need Extension programs but who are unable to pay. Even after stating those concerns, the Task Force felt that alternative funding should be pursued.

Building effective collaborative partnerships are critical to successfully using grant funds. These partnerships can make or break a project. Too often a quick "yes" answer is given before a critical examination of the issues takes place. For example, organization X has offered $50,000 for programs in a specific area in which Extension has expertise. Do we accept the money? Too often the answer has been yes before asking some critical questions. Once these questions are answered, we may rethink our quick "yes" answer.

Examine the following questions before accepting funding:

How does this program fit within the mission of our organization? Is it a part of our strategic plans or an emerging priority? If our strategic plans are truly our road map for the future, this "opportunity" should be on or very close to our chosen path.

Do we have the personnel, space, expertise, or other matching resources to carry out the work? If not, we may have to staff and fund the overhead of the operation. Have all the costs of the program been identified? There may be strings attached. Costs to administer the program must also be taken into consideration.

Is this a priority program? Would other programs have to be dropped in order to pick up this program? There could be a real cost of dropping other programs.

What are the implications of accepting the gift or grant? For political reasons, there may be some partners who should be avoided. There are also good partners who have expectations of high quality products. We must meet and try to exceed their expectations if we take their money.

What messages would be sent to other funders? We should never put our vision and core values up for sale. If this impression is left with other funders, we may face increasing challenges in the future. Also, we don't want our current partners to think their projects have become unimportant.

Would the program duplicate those offered by other public agencies or put Extension in a position of competing with other public agencies?

Is there a commitment to continue the program when outside funding ends? Programs can sometimes seem to go on forever, even after funding is no longer available. This is a real cost that can rob resources from other parts of the organization, often higher priority programs.

What do we offer the grantor that they cannot do for themselves? What is our product? What is our competitive advantage in the marketplace? Sometimes funders don't wish to undertake high risk projects themselves for fear of failure. On the other hand, they may see a competitive advantage in our organization that we haven't recognized.

Can we agree or reach consensus on the audience, products, methods, time lines and other items with the parties involved? Are the agreements formalized and well understood by everyone? Solid answers to these questions can resolve potential problems before they arise.

Partnering with others can be a great way to multiply the impact of programs. Outside funding can be a way to keep alive very important programs that are integral parts of our strategic plans and to develop new programs for new audiences. Outside funding can also allow us to focus on an area of importance without taking resources away from other programs.

Accepting these gifts and grants might serve as a short term gain/win with long term costs. Stick to the niche developed for your unit or organization. Keep customer focus, the people the program is being delivered to and the funding party(ies) who are paying to have the program delivered. Keep in mind the primary customer and don't forget there are secondary customers to satisfy as well. Remember to hold yourself accountable for the outcomes to both.

There are, of course, both pros and cons associated with outside funding. Although this article may appear to be rather negative toward the acceptance of outside funding, the intent is raise the reader's consciousness about all issues associated with nontraditional funding sources for Extension. Whiting (1995) identified the paradox associated with external funding--Extension needs to attract external funding but cannot allow that funding to drive programming and jeopardize Extension's reputation for unbiased information.

References

Healy, P., (1997, September 30). Extension services weigh pros and cons of charging fees to users. The Chronicle of Higher Education.

Futures Task Force to the Extension Committee on Organization and Policy (1987). Extension in transition: Bridging the gap between vision and reality. Blacksburg: Virginia Cooperative Extension Service.

Whiting, L. R. (1995). Ten paradoxical challenges: A philosophical reflection. In J. A. Buford, A. G. Bedeian, & J. R. Lindner (Eds.), Management in Extension (pp. 323-336). Columbus: The Ohio State University.