What you can do about the chaotic federal funds situation

About the pause/cancellation/unpause of US federal loans, grants, and financial assistance programs: What a scary mess.

Maybe you’ve heard the expression, We’re building the airplane while it’s flying. That’s meant to describe a chaotic and harrowing situation.

This feels more like, We’re dismantling the airplane while it’s flying.

As of this morning, here’s what I know:

• For international aid nonprofits, the impact is already happening, and spreading. Massive cuts to whole programs. Staff layoffs. Spending freezes.
• Other nonprofit sectors: Funding is back. For now.
• Within that “okay for now” group are many that may still be targeted for cuts: A memo from the Office of Management and Budget said: “The use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars….”
• Nonprofits in the rest of the world can’t breathe easy. Ripple effects from overseas cuts, broken contracts, and more is hitting hard and quickly.
• We have seen layoffs in the international sector already. We may see more in other sectors.
• Chaos and confusion are challenging us all.

Here’s my best advice for now:

If you have no direct or indirect federal money in your budget: You are probably okay. But look into it to make sure there isn’t federal money in the pipeline within other sources. It could take some time before you find out if there is any.

If you face a loss of funding (direct, indirect, even potential): Ask your donors to help! This is an emergency, and donors are aware of it – or soon will be. Donors want to help. They already are! Keep your messaging factual and apolitical — unless your mission specifically includes policy/advocacy (see below).

If you are dependent on any large sources of revenue: You are at risk. Large funders of any type — government, corporate, or foundation — can, in in all likelihood eventually will, stop or reduce funding. Build a broad base of individual donors will make you much more resilient and politics-proof. A growing file of individual donors is not only a dependable source of income. It’s a pool of people who can “upgrade” their giving to monthly giving, high-dollar giving, and bequests. Shift emphasis (and budget) toward individual donor engagement strategies. If you’re already doing this, do it more. If you are not doing this, start. Late is better than never!

If your mission includes policy or advocacy in the relevant areas: Be all over fundraising on this issue. Even if you have no funding at risk. You will not only do well with this topic, you’ll play an important role for your donors: You’ll empower them to do something. This is a huge and frightening situation, and people need to take action, even if it’s small. And if they do one thing, they might do another and another. Your fundraising could be a lifeline for your supporters.

All fundraisers: Don’t don’t don’t cut fundraising – programs and people. This may look like a relatively easy savings, but it’s the worst action you can take. It will prolong your financial pain and decimate your long-term viability.

Also all fundraisers: If appropriate, advocate with your elected officials for better policy.

Also, also all fundraisers: Take care of yourself! The chaos and uncertainly are tough to deal with. Give yourself rests when you can. Do fun and relaxing things. Get help from friends (or professionals) as you need it. And make sure you have a community of fundraisers you can connect with for ideas, help, and comradeship. If you don’t have that community now, I recommend you look into The Fundraisingology Lab by Moceanic. It’s a good one, I promise!

I wish you the best. These are trying times. What you do now will help determine how your organization survives the coming weeks — and the years ahead. It will also be a defining time in your career and life journey.