A fundraising frenzy

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May 12, 2008
By: Dylan Thomas
Dylan Thomas
Each of approximately 1,100 properties in the Bryn Mawr neighborhood has its own line on a spreadsheet on Ron Sterbenz’s computer.

“We track every household in our neighborhood,” said Sterbenz, co-treasurer of the Bryn Mawr Neighborhood Association (BMNA). “We track every property, and we know the history of every dollar they give.”

The database is one sign that the BMNA, like many neighborhood organizations, is getting more serious and sophisticated about fundraising. Across the city, neighborhood leaders are finding new ways to pay for neighborhood programming that, for the past 20 years, was primarily funded through the city’s Neighborhood Revitalization Program (NRP).

With the program’s future now in doubt, many neighborhoods are scrambling to diversify their sources of income. In most cases, neighborhoods likely will rely on a mix of revenue sources, including grants, donations, event income, city funding from NRP or a successor program and other sources, such as federal program dollars.

BMNA, a nonprofit organization since 2007, encourages neighbors to become members and make tax-deductible contributions.

In March, Sterbenz and co-treasurer Chad Smude sent out 300 direct-mail solicitations targeted to past donors identified in the database. The letter highlighted BMNA’s accomplishments and suggested recipients make a $50 gift.

“It worked pretty well,” Sterbenz said, noting the mailing brought in about $5,000, nearly one-third of the organization’s annual fundraising goal. That was more than BMNA might have raised in an entire year not too long ago, he said.

What works for BMNA, though, may not work for other neighborhoods. Many other neighborhood organizations welcome donations but avoid memberships so as not to seem exclusive.

Some neighborhood leaders expect the annual events to become a major source of income, but many neighborhood organizations are lucky to break even on their annual events.

Most of the neighborhood leaders interviewed for this story said they will ramp-up efforts to apply for grants. But some also worried neighborhoods could soon be competing for funds from the same foundations.

Going for grants

Founded in 1976, Elliot Park Neighborhood, Inc. (EPNI) is one of the oldest neighborhood organizations in the city and among the few that predate NRP. In its early days, EPNI leveraged corporate donations and federal dollars to increase affordable housing and improve safety in the neighborhood, said Susan Braun, EPNI executive director.

“Then the NRP started and all of the focus turned to NRP,” Braun said, “and all of those relationships that predated NRP then evaporated over the course of 14 years because there was really no reason to sustain them.”

By 2006, NRP funds accounted for more than 90 percent of the EPNI budget, with grants and other outside sources of revenue contributing only about 6 percent to the budget, she said.

Now, she said, EPNI must relearn to fund itself. Under a strategic plan developed in 2005 and 2006, the organization is aggressively pursuing donations and grants.

“Some of the board members will say we supported ourselves pre-NRP so we can do it again,” she said.

Braun said EPNI, which has an experienced grant writer on staff, submitted 23 grant applications last year. It won three grants, including a two-year, $100,000 McKnight Foundation grant for a major redevelopment project.

Last year, outside sources of revenue increased to 26 percent of the EPNI budget. Still, Braun said the neighborhood had a way to go toward weaning itself off of NRP.

At the other end of the spectrum is the Lyndale Neighborhood Association (LNA). Executive Director Mark Hinds said the LNA budget was split roughly 50-50 between NRP dollars and other sources of income, mostly grants.

Despite a track record of successful grant writing, Hinds said it was never easy for neighborhood organizations to compete with other nonprofits for the attention of foundations. Most neighborhood organizations are too small, and have too few staff members, to dedicate much time to grant applications, he said.

“We’re one of the larger (neighborhood organizations), budget-wise, … and compared to most nonprofits, we’re not that big,” he said.

The relatively few foundations that contribute to neighborhoods are likely to have more organizations like LNA vying for their attention in coming years, he added.

“I do think there is some danger that if everyone starts looking at same pool of grant dollars that it will become much more competitive,” he said.

LNA recently partnered with two nearby neighborhoods — Whittier and Stevens Square — when applying for a grant, a strategy he suggested could work for other
neighborhoods.

Building a brand

Matt Perry, executive director of East Harriet Farmstead Neighborhood Association (EHFNA), said the organization did no fundraising before he became chair in 2006. Coming from a business background, Perry said, he felt “very uncomfortable” relying on NRP as the single source of income.

“It’s just in my nature to have a portfolio of revenue streams,” he said.

Perry led the neighborhood board in diversifying EHFNA income with grants and other fundraising, but first they set about “branding” the neighborhood.

“If you’re seeking private donations or grants, people have a sense of what you are and what your mission is,” he explained.

In addition to going after — and winning — more grants, the board boosted other types of fundraising. They sold neighborhood T-shirts and set about growing RoseFest, an annual event that last year sold nearly 2,000 tickets, Perry said.

“It’s not making us a profit, yet,” he said. “It will this year.”

The goal for RoseFest is to earn EHFNA about $15,000 a year by holding down costs, selling more sponsorships and incorporating money generating events like a silent auction. It’s an ambitious fundraising strategy, and one not every neighborhood would try.

Braun of Elliot Park said EPNI tried to turn its annual events into significant sources of income but couldn’t get past the break-even point.

“Basically, we had found we could almost fundraise enough to cover our costs,” she said. “But that’s not what we need to be spending our time doing.”

Other neighborhoods will try to copy the EHFNA approach and create a destination event. Lyndale’s Hinds said LNA was considering just that.

There was no one-size-fits-all solution. In a changing landscape, one that may not include NRP, each neighborhood organization is searching out its own path.