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Support for operations preferred

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Nonprofits prefer operating grants over program-specific funding, but only if those grants are larger and more-prolonged than is typical, a new study says.

The report, released by the Center for Effective Philanthropy, analyzes foundation grant practices and compares them to the types of grants nonprofits say provide the most impact.

Foundations agree on the importance of operating support, the study says, but other priorities, including evaluation of grantmaking and pressure from boards, often mean program grants win out.

Most funders provide operating support to fewer than two in 10 of their grantees, with a median grant amount of $50,000, compared to a median of $60,000 for program grants.

Overall most grants are restricted to specific programs and are short-term commitments, the study says.

The study, “In Search of Impact: Practices and Perceptions in Foundations’ Provision of Program and Operating Grants to Nonprofits,” was funded in part by the Aspen Institute.

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