Not that long ago, the standard for paying grant consultants was a commission-based process where a certain percentage of the awarded amount of a successful grant application went to the consultant. This worked for a time, but the results rarely benefited all parties equally. Today’s most common and ethical course of action is to hire a grant professional based on an hourly or flat project rate.
Why the change? Foundations became more protective of their resources and started placing greater expectations on their grantees. Most of today’s grantors will deny any application that features contingency fees for grant writers. Any attempt to hide the cost within administrative fees is dishonest and could be grounds for repudiation. In fact, the practice is now prohibited by leading fundraising organizations such as the Association of Funding Professionals and the Grant Professionals Association. Private, special purpose, operating and corporate foundations want to see their financial support used towards making a direct impact instead of funding the efforts of a grant writer.
In addition, grant consultants deserve to be paid for the time spent on a proposal. They are talented professionals who have developed their skills through intense training and years of experience. Paying a grant consultant an hourly fee or project rate is compensating them fairly for their expertise.
The practice is also more cost effective for the nonprofit. For example, a grant writer who devotes 120 hours to prepare a $1 million dollar proposal may charge $100 an hour. Using the hourly rate pay method would cost the organization $12,000. If paid on contingency, a 5% commission rate would set the nonprofit back $50,000.
Investing in grant services can initially seem costly. The chances of receiving an award can be slim at times; a result of an abundance of worthy projects and not enough grant dollars to go around. But investing in professional fundraising services (after careful planning) can pay off. Organizations should work with professional grant writers that can demonstrate that they will do their best to prepare an application that is not only fundable but also lays the groundwork for future applications to be funded. Grant consultants view their work with nonprofits as a collaboration and share in their success. Nothing is more rewarding than getting that phone call that says, “We got the grant!”
Nonprofits that want to sustain and grow quality programs need to invest in ethical grant writing. Funders want to support organizations that are committed to excellence in programming and fund development and a polished, professionally-prepared proposal is evidence of that.
Arianne Hegeman is a Certified Grant Writer through the American Grant Writer’s Association. Click here to learn more about AGWA.
