Money Without Strings: The Debate Over Operating Support

From The Chronicle of Philanthropy – Live Discussion
September 2, 2008

Eighty percent of the money that foundations distribute to charitable causes is earmarked for charity programs and other purposes, so it cannot be used for basic operating costs like utilities, rent, supplies, and clerical help. Many grant makers say they earmark most of their grants out of concern that otherwise the nonprofit groups will become too dependent. And they say it is too hard to measure the specific results of an unrestricted grant.But in recent years, a handful of grant makers have become more willing to provide money for operating costs. Advocates of operating support say nonprofit groups can be more innovative and manage their operations better if they don't have to worry about following a grant maker's instructions for how every dollar should be used.

View a transcript of the chat with Paul Shoemaker, Executive Director of Social Venture Partners Seattle