Statement of Need

Although this is one of the most important parts of any grant application, it also tends to be one of the most poorly written. One of the reasons for this may be that many grant writers just assume that the need for the project is obvious. Do not assume anything. The grant writer must make the case for both the need for the project and the need for financial assistance to do the project in a very clear, comprehensive, concise, and compelling manner. These are the four C’s for writing any grant application. This section is no place for vague, general, weak, or “stretching” statements.

Grant reviewers are not fond of flowery language. They tend to regard this type of verbiage with suspicion. It is as if the grant writer does not really have anything substantial to say and relies upon words designed to disguise the fact that there is no substance to the proposal. Whenever I read something like that, I feel rather insulted, as if I had been confronted with a particularly bad sales pitch. What counts with grant reviewers is a simple, direct statement of the facts. Please let your facts shine through and speak for themselves. They do not need to be embellished or exaggerated. Do not, under any circumstances, tell falsehoods in your application. This will damage your credibility with the funding agencies and word will get around. Your success rate will plummet rapidly. At the risk of sounding redundant, I will say it again: it is not worth the risk.

As I have said before and will certainly say again, it is very important to be specific. The use of statistics, when available, makes a very compelling case. Individual histories and anecdotes are also helpful. In short, anything which can help the reviewer to get a clear picture of the project should be added to this section of the narrative. The basic elements of a well-written project need section are just commonsense. They are as follows: general description of the situation, the number and type of people affected, the extent to which these people are affected, and what will happen if the project is not done.

It is also extremely important to discuss the need for financial assistance in order to carry it out. The applicant must clearly demonstrate that without grant funding, the project will not move forward. If the applicant has been turned down by other potential sources, it is necessary to specify that and to include copies of the letters rejecting the request for funds. It is always helpful for agencies to know that they are not the only source which is being requested to provide funding. An applicant will have more credibility if it can be demonstrated that potential funding sources were carefully researched and a funding strategy was well thought out.

Another angle to demonstrate financial need is to show the allocation of funds in an organization’s total budget in order to demonstrate that no applicant monies are available. This information will show that all available funds are going toward operating costs and cannot be used for new projects or that other needed projects are consuming the entire budget of the organization. In many cases, a copy of the applicant’s most recent audited financial statement must be submitted along with the application.

In the case of municipalities or counties, information regarding the economic situation of the community is critical. If an area is considered to be economically disadvantaged and demonstrates high unemployment, low median income, and a high rate of poverty, then the assessable base or value of the real estate upon which taxes are calculated is low. This dictates that the local government has only a limited ability to raise taxes and thereby realize additional revenue. It may very well be that the population of this political jurisdiction cannot afford to pay additional taxes which could fund new programs.

In the case of nonprofits, financial need may be demonstrated by a statement that the organization has a small donor base or that a reduction in donations over a certain period of time has occurred. Information should also be given on the nonprofit’s operating costs in order to show the amount of money which is being spent to keep the organization going.

Funding for For-Profit Businesses

This post is written with the goal of assisting individual businesses in their own search for funds as opposed to looking at the broader picture of economic development in a particular city or county. I would strongly recommend that for-profit businesses approach the economic development offices in their area first. Many localities have programs which assist local business. Two examples of locally-administered programs are facade improvement programs in downtowns and revolving loan funds. Most of the time, these programs are funded with monies from the federal or state government. Their goal is to improve local economic indicators, such as the unemployment rate and assessable base.

Economic development departments can also be extremely helpful to individual businesses in that most of them are the referral point for state and federal programs which can help them. Obviously, there is a variation in the services provided by different economic development offices depending on their budget and staffing. Most of these offices provide a complete referral service to local businesses and assist them throughout the entire process up to and including the submittal of the applications for assistance. Most of the time, these services are free.

If your city or county does not have an economic development office which assists local business, the next step would be to contact the state’s economic development department. Most states have specific agencies dedicated to business development and administer financial assistance programs. The business owner would be well advised to either contact the relevant staff member or to search the website.

The major federal agency charged with assisting small business is the Small Business Administration ( SBA provides help in the form of counseling, financial assistance, and expert advice regarding contracting opportunities with the federal government.

S.C.O.R.E. (Service Corps of Retired Executives) is a nonprofit organization which partners with SBA in order to provide free advice and low-cost workshops to small businesses. There are 364 chapters of this organization, which is comprised of working and retired business executives. Its name is therefore a bit misleading. The website can be found at

Small Business Development Centers throughout the country counsel small businesses on their management strategies. These centers are organized to provide for cooperation between the private sector; the educational community; and federal, state and local governments. Women’s Business Centers provide assistance to the female entrepreneur. SBA also provides help to businesses interested in going international.

SBA provides assistance to help small, disadvantaged, and female businesses receive federal government contracts. The agency has a program to provide surety bond guarantees. This helps contractors who cannot obtain bonding through regular channels. These bonds are required for many government-funded projects. If the contractor fails to complete the project, the surety bond will pay the project owner for the cost of the uncompleted work.

Venture capital is a type of private equity capital usually provided for companies that are just starting out and which have a lot of potential in exchange for shares in the company. It is provided through Small Business Investment Companies, which are privately-owned and managed investment funds regulated by SBA. These companies are permitted to borrow funds at favorable rates from SBA in order to provide operating money.

Most of the financial programs provide loan guarantees. The agency’s primary program is referred to as “7(a)”. This program provides a guarantee to a bank loan which is structured to SBA requirements. Businesses may not participate in 7(a) if they have access to other borrowing at reasonable terms.

The Small Business Innovation Research (SBIR) program provides for-profit businesses with the opportunity to access a reserved portion of federal research and development funds. A company applies to become an SBIR firm on a competitive basis. Eleven federal departments participate in the program. In order to qualify, a firm must be American-owned, have less than five hundred employees, be a for-profit concern, and have the principal researcher employed by that business. Funds are provided for the start-up and development phases.

The Small Business Technology Transfer (STTR) Program provides joint ventures involving small businesses and nonprofit research institutions with an opportunity to access a special reservation of federal funds. Five federal agencies participate in this program. This is done in recognition of the fact that small businesses often do not have access to research and nonprofit research institutions do not have the means to translate that research into commercial ventures. The qualifications for participating in this program are the same as the SBIR program except that the principal researcher need not be employed by the small business. The nonprofit research institution must be a federally funded research and development center.

Federal funding for small businesses may also be found at In order to see the universe of grant opportunities available for small businesses (or businesses of any size) go to the site and only specify the type of applicant, leaving all other search fields blank. The searcher may specify one of the following: opportunities which are open to small businesses; those which are open to businesses which are not considered to be small; and those which are unrestricted, meaning that any type of entity may apply. Just to give the reader an example, I conducted this type of search on in late October of 2009. Of the total of 1184 grant programs which were open for applications at that time, 647 were open to small businesses, 615 were open to businesses other than small concerns, and 165 were unrestricted.

Economic Development Administration Grants

The Economic Development Administration (EDA) of the U.S. Department of Commerce gives economic development grants to communities. One of the major thrusts of EDA funding is public works projects in support of new commercial and industrial development which creates a substantial number of new jobs. In fact, the “name of the game” at EDA is “jobs, jobs, and more jobs!” The agency is interested both in projects which create new jobs as well as those which retain jobs which are in danger of being lost. Grants are generally made for up to 50 percent or more of the project cost, although EDA may contribute a higher percentage if an area is experiencing severe economic distress. EDA is particularly interested in projects which have a regional focus, overlapping state boundaries. Examples of projects funded include construction of broadband service and infrastructure for industrial parks such as water and sewer service, roads, and storm drainage. Grants are also made for planning and technical assistance projects. Local governments and regional planning organizations are eligible to apply.

The grant writer is strongly advised to discuss the project with EDA staff in the regional office serving her geographic area. Grant funding of greater than 50 percent is provided to those areas considered to be economically distressed. Criteria for economic distress include a high unemployment rate; a low per capita income; or a special need such as substantial population loss, major natural disasters, closure of industrial firms essential to the area’s economy, and the destructive impacts of foreign trade.

EDA makes funding in several areas including the following:

• Public Works and Economic Development Program-This program funds infrastructure in support of job creation and retention, such as water, sewer and streets.
• Economic Adjustment Assistance Program- This involves assistance given to regions having economic challenges. This assistance may be in the form of infrastructure construction, planning, or technical assistance.
• Research and National Technical Assistance-provides funding for research in regard to economic development best practices which can be applied on a national or international level
• Local Technical Assistance- As its name implies, EDA assists local and nonprofit sectors in economically distressed regions to implement viable and successful economic development strategies.
• Planning Program-Under this program, assistance is given to local planning organizations in the development of their Comprehensive Economic Development Strategy (CEDS). This is discussed in more detail below.
• University Center Economic Development Program- This program promotes a partnership between the federal government and various universities so that the resources of these institutions of higher learning are available to local governments and organizations which need assistance with economic development.
• Trade Adjustment Assistance for Firms Program- A national network of eleven Trade Adjustment Assistance Centers is available to help manufacturing and production firms which have lost domestic sales and employment due to increased imports become more competitive in the global economy.
• Global Climate Change Mitigation Incentive Fund-This program was established to strengthen the linkages between economic development and environmental quality. The purpose and mission of the GCCMIF is to finance projects that foster economic development by advancing the green economy1 in distressed communities.

An area may apply for designation as an Economic Development District. The advantage of this designation is that any subsequent applications requesting assistance for public works projects may receive an additional 10 percent in EDA grant assistance.

The EDA process, in all honesty, is lengthy and complex. The application requires a significant investment of time. However, the part of the process which requires the most substantial amount of money and staff time is the development of a Comprehensive Economic Development Strategy. This is a very detailed planning document which describes the assets and challenges of an area; outlines specific goals and objectives; and describes in detail the specific projects designed to alleviate economic distress, including the timeframe in which these projects will be implemented, the amount of funding needed, the source of that funding, and the responsible entity.

For smaller jurisdictions, it is unlikely that existing staff would have either the time or the expertise to develop a CEDS. There are consultants who specialize in this type of work. However, even when a consultant is hired, the staff time required to support the consultant is considerable. Another factor which increases the amount of work and time put into a plan is the requirement that a committee representing a broad cross-section of the private and public sectors must be involved in the development of the plan. This document must be updated regularly for the jurisdiction to continue to be eligible for EDA funds. In the final analysis, the time and money spent to develop a CEDS is well worth it if the community wishes to receive EDA funding for large projects. More detailed information on EDA programs is available at

EDA has done an excellent job of listing other resources for economic development on this web site. These resources include both funding and technical assistance. The grant seeker should click on “Resources” on the main EDA webpage. This will open up a very helpful listing of organizations and government entities which will assist in this effort. One of the most valuable is the listing of state and local economic development offices. Each state is represented on this listing. In many cases, the link will take the grant seeker directly to the agency within that state which deals with economic development grants. In some cases, however, the link will take the reader to the state’s general website. When that occurs, it is necessary to scroll down the list of various state agencies in order to find the one whose name intuitively implies that its purpose is to promote economic development.

Other resources shown on this site are the following: Trade Adjustment Assistance Centers, University Centers, federal agencies in partnership with EDA, economic development foundations, national economic development organizations; and Economic Development Districts. The page dealing with economic development foundations is merely a searchable database of foundations in general. The researcher will need to specify the words “economic development” in the search. This is not a listing of foundations which only fund economic development projects.

Searching for State Grants

All of the individual states offer a wide array of grant programs in such areas as water and sewer, transportation, parks and recreation, economic development, historic preservation, law enforcement, and fire fighting. States award grants to municipalities and counties as well as nonprofit organizations. Some states will also offer assistance to for-profit entities in support of economic development. If your organization is a non-profit, get to know your local elected officials. It is quite possible that they will be able to supplement your list of potential funding sources by making suggestions from among the state programs with which they are familiar.

I always search for state sources of funding first. The state programs are easier to access than federal programs due to the fact that the applicant is competing only on the state level and not against other applicants around the entire country. A number of federal programs pass funds through to the individual states for distribution. Other state programs are funded solely by state revenues.

There are several ways to search for state grant funds without expending an inordinate amount of time. The most straightforward is to go to your state’s website, find the state agency whose name implies that it regulates the area in which you seek to find a grant, and follow that link to the information on grants administered by that agency. If you are working for a county and wish to find grant funds for parks and recreation and notice that there is a Department of Natural Resources in your state, it could be assumed that that agency is likely to make grants in your area of interest. In general, grant writers working for local governments soon become familiar with which state agencies are possibilities for funding their projects.

There is a website ( which contains links to all state websites as well as the agencies under that state. In addition, there are also links to certain counties and municipalities. It is possible to click on the state in which you wish to search and then click again on the subject matter you are interested in. This will lead you to the appropriate agency, and it will then be possible to search for grant programs under that agency. There are also links to the executive branch departments and boards and commissions in that state, which is helpful if you already know which agency regulates the subject matter you are interested in. This site is very helpful if you are a consultant working in more than one state.

The Importance of Critical Thinking


In the grant field, critical thinking is absolutely necessary. The caveat here is to take nothing for granted. I would like to point out several areas where grant writers should think critically. These are just examples and it is incumbent upon the grant writer to use this type of big picture thinking in all aspects of their work. These examples are as follows:


  • Do not assume that what has worked in another place will work in yours.  It is necessary to consider how the geographic location of that project affected the results.  If that is the case, then it might not be completely transferable to your area.
  • Do not assume that intangibles do not count in a project. Not everything can be measured in a scientific and mathematical way. Most projects do not take into account how individual will (or lack thereof) can affect the results. This is particularly true in projects having a social services component. An after-school program may not take into account students who are unusually ambitious and dedicated.
  • Do not assume that the staff of your agency necessarily has the capacity to carry out a particular project. It is necessary for the grant writer to mentally put herself and her colleagues into the picture of the new project and try to visualize the various pitfalls as well as strengths there might be in a given situation.
  • Do not assume that commonly accepted remedies to problems are always the best way to go. One of the best examples of this is working to create new jobs in a community and not being selective about what types of companies come in. Always putting the creation of new jobs ahead of environmental considerations will, in the long run, be detrimental to the community.


Reasons for Rejection of an Application

There are many and various reasons for rejection of an application.  Some of these are as follows:


  • The grant proposal is poorly written.
  • The project is a poor fit with the need and will not do much to alleviate that need.
  • The proposed activities are not clearly thought out and do not seem feasible.
  • The competition from other applications is overwhelming.
  • The application is good and the need is great, but other projects will serve even needier populations.
  • The funding agency does not have confidence that the applicant has the capacity to successfully carry out the project.
  • The applicant has had problems in administering other grants.

Part of the problem is getting to the real root of the rejection.  This can sometimes be difficult.

A debriefing is a discussion with the funding agency as to why the application was not funded.  Many governmental agencies will be happy to discuss the reasons for rejection.  However, I would urge the grant writer to listen to the debriefings with a bit of caution.  Feedback is sometimes given by staff members who were not actually reviewers and were not charged with the responsibility of assigning points to the application.  When this is the case, something can sometimes get lost in the translation.

Overall, however, it is an excellent idea to request a debriefing.  This information can be invaluable in developing the proposal for a re-submittal or for a submittal to a different agency.  This is especially true for beginning grant writers.  As one gains more and more experience, it will be easy to see the weaknesses in your proposal even prior to submittal.  I would definitely recommend that a proposal still be re-submitted even though there are minor flaws in it.  Sometimes these can be worked out with the funding agency.  Sometimes they are so insignificant as not to matter.  It is important to take to heart the information received in a debriefing and attempt to remedy the problems identified.

Grant Administration- How Hard is This Going to Be?


The grantee should be prepared for many varying requirements in grant administration.  I feel that it would be helpful to give a few examples showing the difference in the required paperwork for various granting agencies.  All funding agencies will request documentation that the funds were spent appropriately and for the purposes specified in the grant application.  This is the very least that one can expect in terms of documentation. 


Probably the simplest grants to administer are those from private foundations.  The application forms can be very simple, sometimes involving no more than two pages.  Sometimes, no grant agreement is required.  The grantee is still obligated to use the funds for the purpose for which they were intended. I am not aware of any foundation or government agencies which would simply send the money and not require some accountability.


Some foundations require several progress reports.  It is also possible that special conditions may be attached to the grant in order to meet the specific preferences of the board members.  These can vary widely.  It may be that the foundation requires the grantee to only utilize American labor and products, or limits funding to certain geographic areas, or wishes to remain anonymous.


Most governmental entities will require the following once the grant is approved:


  • environmental review (this is sometimes done prior to approval)
  • execution of the grant agreement
  • documentation of banking information in order to expedite the processing of payments
  • written progress reports at varying intervals — these could be either quarterly, semi-annually, or annually
  • execution of grant closeout documents


Letters of Inquiry to Foundations

Most foundations require a letter of inquiry as the first contact.  If the project seems to be within their guidelines and funding priorities, they will then invite the submission of a full proposal. 


First of all, the grant writer should restrict the length of this letter to no more than two pages if the guidelines do not specify.  In this letter, your only job is to convince the foundation that your project is a good fit with their fields of interest. 


Prior to beginning the letter, a decision should be made on the amount to be requested.  This will be dependent in large part on the resources of the foundation.  Search material should discuss the total assets of the foundation, along with the average grant amount, the smallest grant, and the largest grant.


The first paragraph should clearly state the purpose of the project so that the reviewer will know exactly what will be done. This is also the place for the total project cost and the amount requested from the foundation.  Lastly, a couple of sentences regarding how the project fits with the foundation’s funding priorities should be included.  These basic facts are important to have in the very beginning, so that they will catch the reviewer’s eye and she will want to read on.


The next paragraph should go into detail regarding the need for the project and include as much statistical information as possible.  This is also the place to make a strong appeal to the emotions of the reader.  It is wise to give one or two specific examples of the distress suffered as a result of the need for the project.  This is where the “human factor” comes in.  The grant writer will be wise to combine hard data and emotion in this section.


Following this, a history of your organization should be given.  This should include a description of similar projects which have been successfully undertaken.  This is also the place to discuss your organization’s mission and its priorities. You want to convince the reader that your organization has the capacity to undertake the project, that your staff has the appropriate skill sets for the work, and that you will give it the priority it deserves so that it may be completed in a timely manner.


The next section of the inquiry letter should go into some detail regarding how the project will be implemented.  It is important to detail each step in the process from beginning to end.  By doing so, the reader may see the feasibility of the project and feel confident that your organization knows exactly what it takes to get the project completed on schedule and within the budget.  Goals, objectives, and positive outcomes will also be discussed here.


Sustainability and evaluation should be discussed next.  Having solid plans in place for both issues assures the foundation that your organization has thoroughly thought through the entire process.  The foundation will want to know that resources have been identified to continue the project beyond the grant period and that a thorough evaluation will be performed in order to determine its effectiveness.


Close the letter by offering to meet with the foundation officials at their office, host a site visit, or discuss the project over the telephone.  Emphasize your willingness to provide any additional information requested by the foundation.

Training vs. Experience

My purpose in writing Getting Your Share of the Pie-The Complete Guide to Finding Grants was to disseminate a complete “how to” guide to the grant world.  The reference component of the book gives the reader additional resources to consult as their grant writing career proceeds.  This will ensure that the serious student is given the tools to keep up with the most current information in the field.  I began with the very most basic element of receiving a grant-identifying the true need-and concluded with steps to be taken if the grant application is not approved.  In the pages in between, I advised the reader on how to develop a fundable project, find the most promising grant sources, develop a strategy for which sources to approach, and write a successful proposal.

However, as in my own experience, time spent on the job is critically important.  There are, as in any other profession, various nuances and subtleties which show themselves as one actually begins to work.  No book can cover all of those situations.  We all know how various judgment points are different at different parts of one’s career.  The seasoned veteran will obviously think of the proper questions to ask and look behind the scenes to see what is not obvious, whereas a novice might tend to take the situation at face value.

One example of how experience is just as important as knowledge is my policy of looking for “deal breakers” in the very beginning of an assignment.  I examine the project closely and consult the funding agency if there is any doubt as to project eligibility.  This may sound like common sense, but the novice has a tendency to want to think that the project is fundable under a particular program regardless of any issues which may be a potential problem.  He may not want to think that this potential source, which may have been very hard to find, may not be the right choice.  I highly recommend that the grant writer minutely examine the program guidelines at least twice in order to ensure that the project is eligible for funding.

Another very obvious skill which the aspiring grant writer can only pick up with experience is making contacts within the various funding agencies.  In my case, this has been carefully developed over the years. I am proud to say that the funding agencies I work with know me as an individual who lives up to her promises, meets deadlines without exception, and understands the restrictions under which that agency is working.  I would advise the novice grant writer to deal with funding agencies with the utmost honesty.  One of the worst things anyone can do is leave the impression that you are trying to “pull the wool over their eyes”. Most of the agencies can pick this up in a heartbeat. Needless to say, this leaves a very bad impression of the grant writer which can linger for years.

Private Funding

Private Funding

Private funding is supplied by wealthy individuals, corporations, banks and foundations. A “foundation” is a non-profit organization with a board of directors and trustees which provide funds for various charitable causes. Most foundations have been organized under federal or state charters. Others have been organized under trust agreements. The following generalities in regard to private foundation funding apply pretty much across the board:


  • Most foundations will accept a brief letter of inquiry as the initial contact, where- as, with government sources, letters of inquiry are never used.  The applicant will submit either a pre-application or an application. The pre-application can sometimes be as lengthy as an application.
  • Many foundations accept inquiries throughout the year.  This is also true of some governmental sources.  However, governmental sources are more likely to have a specific period of time when they will accept applications.  In many cases, this is done once a year.
  • Private foundations are less likely to have specific, concrete rating and ranking systems with points assigned to various factors.  Most government sources of funds spell out very precisely how they will rate and rank an application.
  • Private foundations are more prone to making decisions based on personal factors.  This could include having personal knowledge of the applying organization or being personally acquainted with one of its staff members.
  • Most foundations tend to have less complex requirements for grant administration.  In some cases, a final report may be required. Nearly all federal and state funding agencies require some sort of formalized reporting procedure and may have other administrative requirements which must be followed
  • In line with the idea that foundations are freer to choose their grantees without benefit of a formal rating system, some only give grants to pre-selected organizations. The family or individuals funding the foundation may have an interest in certain subject matter and wish to support only that particular cause.
  • Most foundations are not able to make large grants and, in general, support smaller projects.
  • Foundations are not under the same scrutiny as state and local government funding programs, and thus are freer to utilize their own rules and regulations.  Federal and state funding sources must abide by the laws governing their grant programs as well as the regulations which have been developed to ensure that those laws are followed.  This gives private foundations a much greater degree of internal control.  Governmental agencies are bound by the strictures put into place by Congress and the various state legislatures.