Recently several organizations have inquired about the potential of private foundations to fund local groups or projects. Many times, one of the main stumbling blocks for organizations is that they do not have Internal Revenue Service designation as a 501 ( c) (3) non-profit organization. There are many reasons for this, some of which may be: they are a very new organization, and papers have been filed, but designation has not yet been received; they may be another type of non-profit depending on their activities; they may not wish to incur the cost associated with becoming a 501 (c ) (3); or they may need to utilize a 501 ( c) (3) organization that has a history of successful projects and financial administration in a grant application.

This is a valuable service RC&D can provide to other community groups. Some private foundations allow use of a conduit (a 501 (c ) (3) organization which will act as a pass-through for grant funds), and some will not, so the relationship is not always appropriate.

The following general rules will apply for use of RC&D as a conduit for grant funds:

Ø The organization should be engaging in activities that match RC&D’s mission and goals of natural resources conservation or sustainable economic development, and should be located within the four-county RC&D area.

Ø A one-page contract will be developed to put in writing the responsibilities of each party. A paragraph will be included, which removes responsibility for RC&D in the case of misuse of any grant funds by the organization. A copy should be provided to the funder.

Ø If the organization is not a paying member of RC&D, we will receive an administration fee equal to 3%-7% of the amount of the grant award, to cover staff time associated with any accounting necessary for receiving and distributing the grant funds. The amount of the fee will be agreed to by both parties in the contract, and could come out of the grant funds directly or out of the organization’s general budget.

Ø Included in the contract will be the possible "turn-around" time involved in processing the funds from the time they are received and deposited by RC&D to the time a check can be prepared and delivered to the organization.