On Unrestricted Funding

What follows is a public comment submitted by Jack Forinash of Blue Sky Center to the folks at Lever for Change, which “funds bold solutions to the world’s biggest problems.” In 2023, they offered the Open Call: “an initiative focused on elevating organizations working with people and in places experiencing the greatest need in the United States: communities, individuals, and families with access to the fewest foundational resources and opportunities.” It offers 250 grants at $1 million each, with no narrative or financial reporting requirements. Funds are provided by MacKenzie Scott; Lever for Change is managing the application process and awards.

The rules state that applicants must have an annual budget of $1-5 million. Blue Sky has annual expenses of about $453,000. We asked if that was a strict requirement and if there were any exceptions, such as a process for requesting a waiver or even an option of partnering with another organization. They answered that Blue Sky is not eligible due to the budget requirements. We are not aware of any rural place-based organization that would meet that requirement (if you do know one, please share this opportunity!).

To the Lever for Change leadership board and relevant grant opportunity decision-making staff,

This opportunity offered by the Open Call is rare: for 250 organizations to receive $1M for operations without reporting requirements, to do what we know needs to get done. We applaud this trust placed in organizations. However, it is our comment that the $1M minimum effectively excludes rural place-based and rural-serving organizations. We propose and request a waiver of this rule for those in rural communities (although there are many ways to define rural areas, if we use population as a single metric and a common definition, USDA defines that as 50,000 population or less). These rural organizations are historically under-resourced, while also being very innovative and resourceful, doing more with less year in and year out. Rural communities continue to steward vast swaths of America (more US counties are rural than not, rural America accounts for 97% of US land), and rural communities are the historic and persistent sources of resources that urban locals need to exist (water, food, clean air, land, et cetera). The $1M threshold is inequitable in that it limits eligibility to just 5% of 501(c)(3) organizations nationwide (see reference below). Rural areas and the organizations that support those populations are vibrant, progressive places that value neighborliness and innovation, even against the odds of poverty, limited access, distance from services, and use of our land for "undesirable" infrastructures such as jails, mines, and dumps. An investment like $1M unrestricted cash into rural organizations—who receive and spend less than urban organizations while doing the same amount and quality of work—would serve us all better, supporting progressive work that brings people together rather than divide by continuing to segregate via popular media about where good work and progress happens. Urban-normativity in philanthropy is hurting progress.

More details are below. Please include this in your sharing with your decision-makers and leaders.

The intent as stated on the FAQ is to reach "smaller" organizations as well as to organizations "with access to the fewest foundational resources and opportunities."

This, by explicit definition, would seem to lead to direct this opportunity for rural organizations, who are by nature smaller and by practice historically under-resourced. According to The National Council of Nonprofits, 92% of nonprofit organizations operate below $1M in annual budgets. Only 5% are between $1M-$5M (3% are above $5M). That means just 1 in 20 nonprofits nationwide are eligible by this strict window. It doesn't relate to a nonprofit's capacity, it seems, for management, since there's nothing to that effect in the reply I received to my initial inquiry or that exists in the FAQ. There's no offering to partner with organizations in a community, combining to achieve a $1M budget, for example. There's no waiver or workaround. 

If we're talking about organizations with the fewest resources and opportunities, smaller rural, place-based organizations are high on that list! According to the USDA Economic Research Service, only 6-7% of US foundation grants go to rural organizations. (Entire report here.) And that might be optimistic. According to the National Committee for Responsive Philanthropy:

I can report that this rings true for us; it's validated by our experience as a rural organization who consistently is deemed ineligible for large national philanthropic initiatives. 

The stated communities that this fund intends to reach is: "people and in places with the greatest needs: ... immigrants and migrants, people affected by justice system involvement (including jails and prisons), survivors of crime, abuse,... and disasters, LGBTQIA+ people, ... individuals and families who have limited assets, ... people experiencing poverty in areas with low economic mobility and access to supporting resources." (from the FAQ). 

Point by point, again, this seems to specifically be relevant to rural and Native communities:

• immigrants and migrants: many rural places rely on immigrants for workforce, as well as for slowing population decline. I'm thinking of meat processing factories in Minnesota, new small businesses in rural towns in Utah, and carrot farms in Cuyama. It's true that 73% of farmworkers are immigrants (Center for American Progress and USDA ERS)

• jails: a disproportionate share of prisons and inmates are located in rural areas; 46% of "correctional facilities" are in rural areas (US Census)

• survivors of crime and abuse: with fewer options for social services and police/reporting oversight, abuse's "effects in rural America are often exacerbated by limited access to support services for victims, family connections with people in positions of authority, distance and geographic isolation, transportation barriers, the stigma of abuse, lack of available shelters and affordable housing, [and] poverty as a barrier to care." (Rural Health Information Hub)

• disasters: natural disasters don't take into account population for where they occur; here in Cuyama for example we're dealing with fires, floods, drought, excessive heat, and landslides alone; man-made disasters (exploitation and waste left by extraction economies) is an ongoing national tragedy happening in rural and Native communities (Harvard)

• LGBTQIA+ people: 20% of LGBTQIA+ people live in rural America, a higher percentage than the estimated 7% of the general total population (Gallup, NPR and the Movement Advancement Project)

• those with limited assets: as a fact, median assets and net worths are higher in urban than rural areas (Employee Benefit Research Institute)

• poverty: 17% of the rural population is poor, compared with 13% urban and 11% suburban (PBS NewsHour)

• access to resources: by definition, rural areas/residents have less access to social, economic, and political resources

If not on this opportunity, I urge you to reconsider the eligibility requirements, to expand the pool of applicants so that truly rural-serving organizations have a chance for such critical operational support. Thank you for your time.

Jack Forinash, Executive Director of Blue Sky Center