Giving Guide

Giving GuideHow to Effectively Give Away Your Chapter’s

Profits Through Engaged Philanthropy

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Written By:Jacob Cohen (Pomona College ’10)Amy Shultz (Columbia University ’11)Lucy Kahn (UCLA ’11)Rachel Hamburg (Pomona College ‘10)Julia McGill (Vassar '11)

This Giving Guide was written by several Challah for Hunger chapter volunteers, who worked together from around the country. After our final draft, we asked for the thoughts of several philanthropists, and we owe them for their valuable feedback.

Thank You:Abby Rapaport

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Table of Contents

Part A: Introduction to Giving Guide ....................................................................................................... 4–7 1. Letter to Chapter Leaders ..............................................................................................................................42. How to Use This Guide ....................................................................................................................................53. National Giving Policy .....................................................................................................................................64. Executive Summary .........................................................................................................................................7

Part B: The Giving Guide ...............................................................................................................................8–21 1. Creating a Giving Committee............................................................................................................... 8–112. Determining an Issue Area ......................................................................................................................... 123. Considering a Giving Philosophy......................................................................................................13–164. Researching, Vetting and Determining Finalist Organizations ..............................................16–185. Choosing Recipient Organizations ...................................................................................................18–196. Following Up ................................................................................................................................................... 207. Evaluating Your Giving Committee ......................................................................................................... 208. Alternative Giving Concepts ...............................................................................................................20–21

Part C: Appendices .......................................................................................................................................22–271. How to Read a Budget ................................................................................................................................. 222. Sample Giving Program Timeline ............................................................................................................ 233. Exercises for Thinking about Issue Areas and Philosophy .......................................................24–264. Glossary of Terms ....................................................................................................................................27–28

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Part A: Introduction to Giving Guide

1. Letter to Chapter Leaders

As founders and leaders of Challah for Hunger chapters, we spend significant energy raising money and securing broad bases of volunteer support. Developing sustainable chapters with the capacity to consistently bake and sell challah is no easy task, yet the fruits of our labor are abundantly clear: Across the world CfH chapters now raise thousands of dollars each week for social justice organizations.

While every CfH chapter looks different, we are unified in our common practice of using philanthropy to effect social change. Whether directed towards Darfur or a local homeless shelter, giving is fundamental to our work. Philanthropy is the link between our vision for social change and the real differences that our work produces in peoples’ lives.

As one of the main strategies CfH uses to promote human rights and social justice, we must be sure that we are thoughtful in how we engage in philanthropy. Fundraising, it turns out, may only be half the battle; we must now figure out how to best leverage our funds to maximize their impact on the world.

How can we give away our money in a manner that is strategic and responsible, principled and effective? How can we develop giving practices that draw upon the creative and critical capacities of our volunteers?

The capital that we generate has the potential to profoundly affect people’s lives, and to alter the systems and institutions that perpetuate poverty, suffering, and injustice. Yet there are millions of ways to go about creating social change and there are far more worthy causes and organizations than we could ever support. Giving responsibly and effectively requires planning, research, participation, and dialogue; it requires an engaged, multi-step process. If we are going to do this right, we must get our hands dirty and our minds active.


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2. How to Use This Guide

This guide will enable chapters to refine their philanthropic practices and adopt a more rigorous approach to giving. Rather than instructing on where to give, the Giving Guide reviews various models for how to give. We will walk you through some of the questions and issues that may arise as you attempt to implement a more conscientious and meaningful Giving Program at your chapter.

The Giving Guide is broken down into the esential steps for creating a Giving Program. The Executive Summary provides an overview of each of these sections, and touches on the key theories and important debates around philanthropy that you should be mindful of as you proceed.

Throughout the Guide, we have highlighted, in blue, the words and phrases that may be found in the glossary.

The Guide is extensive and may be read through or may be used more like an encyclopedia, where individual topics may be looked up. If you have a specific question or issue, refer to the Table of Contents to browse topics and find the guidance you’re looking for. The National Giving Board exists to complement this Guide with more hands-on support. You can always reach us at [email protected].

Please Note: This guide introduces many concepts that are a part of traditional philanthropy. While CfH is not a grant-giving organization, throughout the guide we use examples from grant-giving entities to model effective ways for your chapter to conscientiously donate money.


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3. National Giving Policy

Note: Since the national cause is Darfur, this guide’s emphasis is local or domestic issues. The guide’s advice is intended to be of use as your chapter considers what to do with the 50% of its profits that are not being delivered to AJWS, and which are targeted to local or regional non-profit organizations and causes.

As CfH continues to grow, it is important that the chapters embody a cohesive set of values. The following parameters set forth by the National Giving Board are meant to promote the organization’s collective influence for positive social change.

Chapters must donate 50% of their profits to CfH’s national cause—currently the American Jewish World Service’s (AJWS) Sudan Relief and Advocacy Fund. The remaining 50% of profits may be donated to non-profit organizations of each chapter’s choosing, so long as they follow essential criteria:

• Recipient organizations must be 501(c)(3) certified, indicating official IRS status as a tax-exempt non-profit corporation or organization.

• Recipient organizations should exhibit a demonstrable commitment to human rights and social justice. Their focus should be on serving, advocating for, or empowering marginalized and vulnerable communities.

• Recipient organizations should have a local or domestic focus, complementing AJWS’s international focus in Darfur to which 50% of chapter funds are already allocated.

Chapters should be mindful that their giving choices represent not only themselves and their campuses, but also the national CfH organization as a whole. In the event a chapter selects an organization that is found to stray from these criteria, it is possible that the National Giving Board will a make a further inquiry into the specific chapter’s rationale and may reserve the right to withhold the donation pending further discussion.


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4. Executive Summary

The task of building a strong philanthropy program within your chapter can often be overwhelming. We have broken down the process and issues into a series of semi-chronological categories. The entire Giving Guide is summarized below:

In the appendix you will also find a timeline that will guide you through the steps presented here and take you through key questions in the process.

Creating a Giving Committee: You should begin by forming a special chapter sub-committee (a “Giving Committee” or “Giving Circle”) responsible for overseeing the bulk of your chapter’s philanthropic process and reporting back to the larger group. You must first determine what powers and responsibilities to entrust to this Giving Committee, and the length of each funding cycle.

Determining An Issue Area: Whether your chapter has $500 or $10,000 to give away to local organizations each funding cycle, choosing a specific philanthropic focus will enable you to make a more informed and strategic decision.

Considering a Giving Philosophy: Even once you have a focus area, there are many different types of non-profits and many different strategies for addressing the issue of concern. The most important thing is that your Committee thinks through the options and comes to a reasoned consensus that will guide its search for recipient organizations.

Researching, Vetting and Determining Finalist Organizations: The Giving Committee will likely spend half of each funding cycle researching and vetting organizations to arrive at a list of finalists. You will have to choose whether you want to initiate a Formal Application Process, a Student Advocate Application Process, or a Research and Interview Process.

Choosing Recipient Organizations: We advise your Giving Committee to conduct site visits with the finalist organizations to get a better feel for the organization. Then the Giving Committee should consolidate its information on each finalist organization, and a final decision should be made (whether by the committee, chapter majority vote, or another decision make process).

Following Up: Some form of “wrap up” communication between the recipient organization(s) and your chapter is important so that your members know the impact of their work and so that you can describe this impact to the broader community. Typically, grant-giving foundations ask for grant reports; instead, your chapter may want to arrange for a presentation by a representative from the non-profit, or a volunteer opportunity with the non-profit for your members.

Evaluating your Giving Committee and Process: After completing a funding cycle, it is important to reflect on what you’ve learned, what aspects you want to change and what should stay the same, and what the next funding cycle will look like. You should also seek out candid feedback from organizations that you have funded; they may be able to help you improve your process, as well.


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Part B: The Giving Guide

Articulating a Clear Policy for Giving CommitteeThe following sections will guide you through some important questions that you will need to answer in order to construct a formal policy statement to guide your Giving Program for years to come. The following is a check-list of all the questions that you should address before forming the Giving Committee:

• How is the issue-area to be determined (by chapter vote, or at the Giving Committee’s discretion)?• How is the Giving Committee to be chosen (formal application or informal application)?• The extent of the Giving Committee’s power: Which authority model is being used? Does the Committee

choose finalist organizations, or does the Committee choose the recipient organizations?• How frequent is each giving cycle (semesterly, yearly)? • Will decisions be made before money is raised or after money is raised? • What are the responsibilities of the Committee Chair?

1. Creating a Giving Committee

Before getting started, it is important that your chapter’s stakeholders agree on a structure for the Giving Committee, as well as the Committee’s responsibilities and powers.

Giving Committee SizeTypically 3-7 people will be an ideal size for your committee. We recommend that your committee not have more than 8 people, including the chair, who is responsible for the Committee’s performance. The Chair's duties typically include:

• organizing meetings, • sending out reminder emails, • and managing the schedule/deadlines.

Recruiting Giving Committee MembersOne method to recruit committee members is for the chapter leaders to email the group inquiring whether anyone is interested in sitting on the committee. A description of the committee’s purpose and powers should be provided in the email, as well as individual member responsibilities. If there is interest from more than 8 people, the chapter leaders can either choose to initiate an application process or make selections through a random process (the latter may be ideal if there is a concern that a selective application process will lead to intra-chapter tension). Chapter leaders may also want to ask specific individuals to serve on the committee. If your chapter is smaller, or you have trouble recruiting committee members, your entire group may want to devote a little bit of time to creating a Giving Program.

Decision-Making AuthorityIt must be clear from the beginning exactly who makes what giving decisions.

Partial Authority Model (recommended): In this model, the Giving Committee may be given authority to determine a list of finalist organizations and to present these organizations to the whole chapter, ultimately deferring to a group vote at the closing of each cycle. This model enables the Giving Committee to perform its work and narrow the field to several quality organizations,


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while still including the voices of the other chapter members in making the final decisions. Your chapter will want to consider who in the rest of the chapter will participate in this decision-making process: Do volunteers have to volunteer for a certain number of hours? What about asking for customer input?

In the partial authority model, the Giving Committee may or may not have a choice over the issue area for the funding cycle over which it presides. It may be beneficial to have chapter members decide on the issue/focus area (ex. food security or environmental justice) through a popular vote before the Giving Committee is even formed, thus restricting the Committee’s search to an issue popular with the chapter as a whole.

Full Authority Model: In this model, the Giving Committee is vested with ultimate authority over choosing the issue area and the recipient organization(s). This model could alienate the voices of non-committee chapter members and cause tension if the chapter does not view the Giving Committee as legitimate. Nonetheless, the full authority model can work if the chapter members trust the committee to act on their behalf.

Choosing a Funding CycleA funding cycle is the sequence and duration of activities involved in awarding a grant. You must decide how often you want to make decisions about giving away your money (frequency of decision making), whether you want to make decisions before or after you have raised money (sequencing), and how often you want to make donations (frequency of donations). Do you want to conduct a new decision-making process every semester or every year? Do you want to raise money before selecting your organizations, or do you want to select your organizations once you know how much money you are working with? These are the critical decisions.

Frequency of Decision Making: Decisions regarding the money reserved for chapter-specific giving should be made on a semesterly or yearly basis. There are some benefits and drawbacks to both approaches:

Option A: Yearly Cycle

BenefitsChoosing recipient organizations once per year allows for a more thorough vetting process and often a more informed decision. The amount you have to allocate is larger than if you were to determine organizations on a semesterly basis, making it more appropriate to have a more thorough application. Selecting an organization as a year-long recipient allows for the development of more substantive post-donation partnering.

DrawbacksChoosing organizations yearly, as opposed to semesterly, means your organization will most likely be giving to fewer organizations in a given year, though you will be able to donate twice as much money.


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Option B: Semesterly Grant Cycle

BenefitsGoing through the grant cycle on a semesterly basis enables the Giving Committee members to have the experience working with a greater diversity of organization. This option also enables your campus to view different approaches to specific issues (for example, supporting a food bank and a communicate garden, to tackle the issue of local hunger), or to give to a variety of issues.

DrawbacksGiven that you are donating less money during each grant cycle, it is less appropriate to burden organizations with an application process. Donating every semester may lead to a less thorough vetting process since the turnaround time is quicker. If is harder to partner with organizations in longer-term ways since you are constantly making donations to new organizations.

Sequencing: The main question with regards to sequencing is determining whether to make your donations before or after funds have been raised. Each approach has its merits and drawbacks:

Option A: Choose organizations after the funds have been raised

In this model, the Giving Committee knows how much money has been raised at the end of each semester or year, and makes its philanthropic decisions accordingly. For example, if a chapter has raised $2,000 total, the Giving Committee will be responsible for donating $1,000, since half will automatically be donated to AJWS.

BenefitsYou know how much money you are working with before choosing organizations, so you can make a more informed decision on how many organizations you would like to support and how much you would like to donate to each. As donations should be made as soon as the decision has been made, there is less time between selecting an organization and them receiving the money, which they may appreciate. You can fund specific projects with specific budgets since you know precisely your level of funds.

DrawbacksYou cannot tell patrons or volunteers exactly where 50% of the proceeds are going, since the decision has not yet been made. You can, however, share the issue your chapter is focusing on, since it would have been chosen earlier in the semester--and then you can even involve customers in selecting the recipient organizations.


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Option B: Choose recipient organization(s) before funds have been raised:

In this model, your committee makes its decisions before the money is actually raised. For example, in May the committee decides what organizations to support in the following school year.

BenefitsYou can tell patrons what their money is supporting. All of the volunteers know where the full sum of the profits are going ahead of time, thereby providing additional motivation for everyone to keep up their work and for customers to buy. You can also relate your education and advocacy efforts, as well as additional programming, to your issue and/or organizations. You can make donations as soon as you the money comes in, rather than waiting through an application process. You can involve the recipient organization(s) in your activities or special events thorughout the semester or year. Recipient organizations may have more incentive to partner with you, since the size of their donation is dependent on your success over the course of the semester.

DrawbacksAs you are making your decision, you won't know how much money you have to give away; you're allocating future income. There are a few implications of this: You cannot commit to an organization to fully fund a particular project or proposal, and once they are selected, you cannot tell an organization how much money they will be receiving, just that they have been selected to receive a certain percentage of next semester’s profits. This may also make it harder to determine how many organizations to support.


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Frequency of Donations: You should make regular (semesterly or quarterly) donations to American Jewish World Service’s Sudan Relief and Advocacy Fund. You can determine the frequency of your chapter-specific donations based on the frequency of decision making and the sequencing of your giving cycle. Keep in mind that money does more good in the bank account of the organization than in your chapter’s bank account.

2. Determining an Issue Area

Determining a funding focus area for each grant cycle is critical; this enables your Giving Committee to develop a specialized knowledge of the issue and its causes, and a stronger understanding of the various organizations addressing the issue, as well as their distinct approaches.

When choosing an issue area, be sure to consider the following questions: Is this an issue that would be meaningful to chapter members and the broader community? Is this issue in keeping with national CfH values and giving policy?

Here is list of topics and issues generally regarded to be within the scope of CfH’s priorities and values: Human Rights Disaster Relief Hunger / Food SecurityHomelessness / Affordable HousingPoverty / Economic Justice Workers’ RightsEmployment (training services, micro-enterprising)Environmental JusticeHealth Services and Health AccessEducation / Education Equity Child Welfare / Children’s Services


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Specificity: Often the most successful Giving Committees are those with more refined funding priorities / focus areas. For instance, rather than choosing “education equity” you may decide you want to specifically address deficiencies in educational opportunities afforded to a) non-English speaking students b) in your college or university’s surrounding neighborhoods. This degree of specificity, though not required, can enable your committee to become “experts” in that particular area, and help narrow the field when it comes time to survey potential recipient organizations.


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3. Considering a Giving Philosophy

Once you have your issue area chosen, opportunities to donate will come from a variety of types of organizations and through many forms of giving. The following categories provide some ways of differentiating between organizations. We recommend that your Giving Committee begin each term with a discussion of these categories before initiating a formal search or application process for finalist organizations. Reflecting on how these questions fit within your chapter’s giving ethos can help make decision processes easier when considering specific organizations.

Geographic Scope: Local versus GlobalA large aspect of making a donation is determining which community you intend to impact. These communities are often categorized geographically into local and global, as well as regional or national. Chapters already donate 50% of their funds to the National Cause—American Jewish World Service’s aid to Darfur.

To complement this global focus, we encourage chapters to donate their remaining funds to a local organization. This proximity will enable partnering beyond monetary donations and will encourage critical engagement with local issues.

Start-Up Organizations versus Established OrganizationsThe funding of start-up organizations has come to be termed “venture philanthropy” in the tradition of “venture capitalism.” Venture funds support innovative and high-potential projects or organizations at an early stage. Start-up organizations seek to be voices of progress and development by addressing a need previously unaddressed or are responding in a new way. As donors to this kind of organization, chapters may be able to have greater influence and impact. However, these starts-ups are generally associated with a higher degree of risk. Before taking on these funding risks, there must be careful readings of plans and proposals in order to determine if the organization or program is likely to succeed.

Established organizations generally have more sophisticated technology and resources, as well as years of experience to learn from and draw upon. On a simply logistical level, there will be more documentation available for you to read and make decisions from.

Project Support versus General FundingWhen an organization asks for “project support,” they are asking for funding for a specific program. Organizations enact their mission through their projects, and therefore project funding is essential to the organization achieving its mission.

On the other hand, general funding is necessary to keep an organization alive and functioning. When an organization asks for general funding, there is by definition less specificity, allowing the organization


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to allocate funds as it sees fit, be it functional day-to-day logistics or a specific project. Often the essential day-to-day aspects do not receive as much support as specific projects because they are sometimes less tangible to donors--but they are no less necessary, and therefore general funding is greatly appreciated by organizations.

Small Organizations versus Large OrganizationsFunders must also grapple with the size of the organizations that they fund. Some relatively small grant-makers choose to only fund small organizations based on the understanding that their funds will be able to make more of an impact. A multi-million or billion dollar budget may seem overwhelming, and a modest grant may feel to be just a “drop in the bucket.” However, it is important to keep in mind that a big organization may have technology, resources and connections to make more efficient use of the funds that they are given. Additionally, their reach is likely to be much greater. The size of an organization may also influence how easy it is to develop a relationship with the organization. It may be easier to form a partnership with a small, local organization than a large, national one.

Direct Services, Community Organizing or AdvocacyOrganizations seek to address their target issues through a variety of strategies. Three of the primary ones are organizing, advocacy, and services.

Service organizations responds to immediate needs and are directed at the alleviation of symptoms of a problem. On the other hand, advocacy and organizing groups attempt to bring about change through public awareness and activism, and/or changes to public policy, public practice, or law. Advocacy projects work to address the root causes of problems by looking at institutions, policies, and institutionalized government practices.

Option A: Social ServicesMany organizations provide services and tangible goods to address people’s immediate needs. Examples include: food pantries, homeless shelters, and health clinics.

BenefitsGiving money to social service organizations expands their capacity to address immediate needs and helps organizations turn away fewer needy individuals and families. Without funding to cover immediate needs, communities cannot focus on longer-term success and crisis prevention. The results of these programs are easy to see in the short term.

Also social service organizations are often willing to take on short term volunteers–you may be able to have your chapter volunteer there for a few hours.

Drawbacks

Meeting immediate material needs on a person-by-person basis is often a temporary fix for


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a more deeply rooted, endemic problem. These goods and services might provide relief in the short-term without changing the structures or policies that create crises. This is why such aid is often called a "Band-Aid solution."

Option B: Organizing For ChangeStructural changes are seen as addressing long-term healing versus applying a Band-Aid.

Community organizing can help to create self-sufficient, engaged communities. Once organized and funded, recipients will be poised to design and promote programs and policies that directly affect their lives and communities.

Example: If your issue area is hunger, you may want to donate to an organization engaged in mobilizing homeless people to demand an increase in food stamp benefits.

BenefitsCommunity organizing builds the self-sufficiency, confidence, and long-term capacity of individuals and communities. It allows individuals most affected by an issue to identify problems in their community that need to be tackled. Once organized around a single issue, and empowered to effect change, communities can apply these skills (leadership, administrative, etc.) and experience to other or future issues.

Drawbacks Because of the structural nature of the work, the results of community organizing projects are often not immediately apparent. It can be a chaotic process that moves in fits and starts.

Option C: Advocating for ChangeDue to a variety of factors, low-income communities are often under- or mis-represented within the U.S. political system. Advocacy groups research and seek changes in public policy to address the structural challenges facing low-income communities.

Example: If your chapter wants to address child hunger, you could choose an organization who advocates for changes to the Farm Bill, the national legislation that includes the School Food program.

BenefitsAdvocacy efforts give a voice to individuals rarely heard in public debate.In acting to change public policy, either by increasing the social safety net, or by tacking the root causes of social problems, advocacy efforts can make it so that direct service organizations are less needed.

Drawbacks Compared with direct services and community organizing, advocacy can feel less connected to specific communities. It may be a challenge to ensure that advocates truly represent the interests of the community they purpote to represent. Results are often slow and witnessed over a long period of time.


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Please note that CfH encourages all chapters to engage in their own advocacy efforts, whether or not they donate money to advocacy organizations. For more information, contact our national Education and Advocacy Committee ([email protected].)

Closing ThoughtsCommunity organizing, advocacy and services are each worthy strategies for making the world a better place and addressing the causes of human suffering. When considering where on the organizing-advocacy-service spectrum your chapter ought to engage, it can be helpful to consider the urgency of the problem in relation to the long-term benefits of your money. It is important to note that many organizations use multiple strategies to create social change. For example, an organization that addresses homelessness might run homeless shelters, and advocate for political change that will make it more affordable for their clients to rent housing.


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4. Researching, Vetting and Determining Finalist Organizations

Equipped with both an issue area and a sense of your chapter’s giving philosophy, you can begin to search for specific finalist organizations. Committee members may also want to educate themselves on the issue generally by speaking with experts or professors who have experience in the area you are seeking to address.

Before your chapter donates to any organization, it is important to be certain that the organization is efficient and fulfills a mission that you are interested in supporting. There are many different ways to gather information about prospective organizations and to narrow the field to a few finalist organizations. The following strategies can be combined as your chapter sees fit.

Note: 3-5 finalist organizations is an appropriate number and will allow your Giving Committee to conduct site visits and present thorough accounts of each organizations to the rest of the group.

Traditional Grants ProcessNote: Although CfH is not a grant-giving organization, the following section, will present a traditional model used by such organization.

Your Giving Committee seeks to ensure that the chapter’s funds will support the best possible programs and projects. You may decide to use a proposal review process, a process typically used by grant-giving organizations, in order to learn about the programs that need financial support. A grant proposal is the medium through which an organization requesting funds can communicate with the funder, presenting their qualifications and plans and asking for the funding. These are the general steps used:

• A Request for Proposals (RFP) describing, in detail, what the group is interested in funding and what information a grant proposal should include is issued, with a deadline for submission..

• The RFP is distributed to eligible nonprofit organizations, either broadly (through a public posting) or narrowly (to select organizations that your Committee has already researched).

• The proposals are reviewed and finalists chosen.

Please keep in mind: This process can demand a lot of time of both the Giving Committee and the applicants. We do not recommend using a formal application process if you do intend to give less than $5000.

Student Advocate Application ProcessAnother option for gathering information on non-profits relevant to your issue area is to publicize the existence of funds to the campus community, inviting students to submit applications on behalf of organizations with which they are affiliated. In this model, students who have interned or volunteered at a non-profit organization can advocate for their organization by seeking funds from CfH. The applicant essentially becomes a mediator between CfH and the recipient organization, communicating the recipient organization’s needs and vision for the funds.

This process could be a great opportunity to involve volunteers, customers and other campus members in your chapter. Additionally, having students advocate for their organization enables them to gain


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new skills.

This process can be combined with the proposal review process, but, again, please note the time required of applicants.

Research and Interview ProcessIn this process, each Giving Committee member can be assigned the task of researching several organizations and choosing a single organization to nominate as a finalist. Before embarking on individual research, it is important that the Committee has thoroughly defined the topic/issue area, geographic scope, and giving philosophy.

Methods of gathering information: • Reading online literature• Reaching out to professors or other campus members involved in non-profit work related to

the issue area• Interviewing non-profit organizations (organizations should be happy to answer questions

from potential funders). Questions may include:• Requesting updates on programming• Looking for detailed descriptions of program• Asking about holes in their literature

After completing thorough research on their organizations, committee members should prepare reports on the organizations that they wish to nominate as finalists to show to the rest of the committee.

Other Research ToolsMany donors use online rating resources such as Charity Navigator to help evaluate organizations. Charity Navigator, GuideStar and other similar sites rate organizations based on their financial health. Their ratings are broadly based on two categories: organizational efficiency (efficiency of using financial resources) and capacity (staff support and resources necessary to carry out mission). This information can be helpful but CharityNavigator.com also understand that financial health is only one piece of an organization’s quality. For example, while such ratings may take into account how efficient an organization is with its financial resources, they may not evaluate how effective or ineffective it is at achieving its mission.

The financial health assessment is based on the tax returns that organizations submit to the IRS. When using these evaluations, you should keep in mind that there is some degree of flexibility and interpretability in the way these forms are filled out; often larger organizations with experienced accountants are able to convey data in ways that reflect more positively on their organization.


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5. Choosing Recipient Organizations

Site VisitsOnce your Committee has determined finalist organizations, it can be helpful to conduct site visits. Although you may have spoken with organizations in the process of determining finalist organizations, site visits enable members of your Committee to spend time at the physical location and interact with the organization in a hands-on or experimental manner.

Tips for site visits: • Go in pairs and take turns asking questions.• Make sure to schedule an appointment beforehand, explaining the purpose of the visit and

who you are. If you want to speak to a specific program manager, be sure to notify them when you are making an appointment.

• Prepare by reading the organization’s website and brochures. Write down a list of questions you would like answered. Your committee may want to prepare questions to ask of every finalist organization.

• Begin with broad questions about the organization’s mission and goals; follow with more specific questions about programs you are interested in funding.

• After asking questions, be sure to provide information on CfH and your Giving Committee’s process, as well as when you will notify them with a decision. This means that your committee has to be very clear about the process and timeline.

• Write up notes and impressions to share with the other group members.

Selection Criteria and Critical QuestionsRegardless of whether you have collected information through proposals, site visits, or literary research, you will need criteria for evaluating organizations. Here are some questions that may guide you in evaluating an organization/project and developing selection criteria. Some of these questions assume that you are considering funding a specific program or project of a non-profit:

Mission: What is the organization’s mission? Does its mission align with your chapter’s values, principles and ideals?

Context of Goal: What is the goal of the program for which funds will be directed? Where does the organization or project fit in with all of the other work being done to address the stated problem? What problem does it address or community need does it fill? What will be the outcome achieved as a result of your funding? Is the project/program significant?

Community Need: Who is the target population? Is the organization needed in the community? What would happen if this organization closed its doors tomorrow? Does the organization understand and work with the culture of the community?

Plan: Is there a clear plan in place? Is the program logical and sensible given the economic and social climate described? Are there apparent holes in their plans?


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Competency: Does the organization appear capable of bringing the project to a successful conclusion? Is the plan achievable with the budget presented? Is this organization credible? What specifically was our money used for when we have given to them in the past?

Partnerships: Is the organization partnering effectively? Is the organization’s program or service unique? Do they utilize community volunteers?

Clarity: What is going to be done and how will it be accomplisheded?

Group Decision-MakingWhether the Giving Committee is choosing the recipient organization from amongst the finalists, or the entire chapter is involved in the decision-making process, there are various models that you can use for group decision-making. If you want to have a conversation with the entire chapter, be sure to think about who is able to participate: Can anyone show up to the meeting? Do you need to volunteer a certain number of times? Do customers participate?

Consensus: In consensus decision-making, the group reaches an agreement that is acceptable to everyone, even if it’s not everyone’s first choice. This process can be extremely time-consuming, but good decisions usually result when consensus occurs.

Majority Vote: Many people like this type of group decision making because everyone gets a voice in the final decision. Majority vote is generally considered the most fair and efficient tactic.

Note: Every person involved in the group decision should have the information they need to express an informed opinion. A group meeting may be held for the Giving Committee to educate others on the finalist organizations.

6. Following Up

Your chapter volunteers and customers will likely want to know what impact they have made. For most donations, informal check-ins with your contact person at the organization will suffice. Joining the organization's email list will provide you contsant news of the organization's work, which you may summarize and pass on to your volunteers. You may also ask for more personalized updates directly from the organization. If you are funding a specific project or program, you may also ask that pictures be included for your chapter’s publicity purposes.

7. Evaluating Your Giving Committee

Take time to examine your short-term and long-term philanthropic goals and whether your committee is functioning effectively in service of your chapter’s goals. If your chapter is trying to alleviate local hunger around campus, how effective has your philanthropy been in accomplishing this objective? It is important to check-in at the end of every funding cycle in order to reflect on what you’ve learned and what you would like to do differently in the next funding cycle. You should also seek out candid feedback from organizations that you have funded; they may be able to help you improve your process as well.


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8. Alternative Giving Concepts

Long-Term Partnering with Recipient OrganizationsThe relationships between your chapter and the organizations you support have the potential to last years and involve more than monetary support. Some key benefits of long-term giving to the same organization (1 to 3 years) include:

• A deeper knowledge of the organization, its inner workings, and proof of its impact.• The ability to witness the effect of your chapter’s donations over time.• Increased levels of trust and returned effort on the part of your recipient organization.• Consistency in your chapter’s education on your campus. Advocating the same message over

time is potentially more effective than sporadic causes. • Ability to contribute to the recipient organization and their cause through volunteer efforts

and non-financial contributions.• Alternative programming, like bringing in speakers from the organization(s) that you support.

If long-term partnering is the intention of your chapter, here are some basic questions and ideas to help you think more about partnering with your recipient organization.

• View them as a partner in some decision-making in your chapter. They can help guide you to donate in ways that most benefit them. Follow up with them on how your money is being used.

• How big is the organization? Where is it based? How accessible is it to your chapter volunteers?• How exactly does your organization carry out its service? What is the process? Who does what?• Be volunteers that help with the very programs you are funding through your philanthropy!• Create opportunities to develop non-financial partnerships. Some ideas include:• Volunteer your time. For example, at Pomona, chapter members tutor local high school students

who were part of a college-prep program that the chapter supported through one of their donations.

• Have members of the recipient organization become involved with your chapter baking and selling (have a day where its members volunteer for you).

• Honor your recipient organization at an event, either fundraising or volunteering.• Have someone from the recipient organization come speak to your chapter about the

organization.• Raise/collect material donations that they might need.

Note on Short-Term or One-time Partnerships: Short-term, one-time grants and partnerships are also appropriate for CfH chapters. With the quick turnover of college students on campuses, each new generation of participants will be free to give grants as they see fit and are meaningful to them.

Giving to a variety of organizations can allow participants to educate themselves on new issues and how different organizations operate. This short-term approach will take more effort in vetting new organizations, but this process itself can be greatly rewarding.

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Campus GivingSome chapters have experimented with alternative giving initiatives, including on-campus giving.

The Pomona College chapter has created a $1,000 annual slush fund to support various on-campus groups who are spearheading time-sensitive projects that serve or advocate for nearby low-income communities. The Pomona Giving Committee discusses applications and makes decisions on a case-by-case basis. Recipient student groups are held accountable through reporting and presentations. The local slush fund has been a useful way for the Pomona chapter to build relationships with other student organizations and to support on-campus social justice efforts around workers’ rights issues.

Weekly Fundraisers

The Stanford chapter has pioneered a model in which the chapter partners every week with another student organization, in order to raise money for a specific, pre-selected non-profit organization. The selling table includes information on the non-profit that has been chosen for that week, and the partner student organization helps bake, manage the sales table, and publicize the event.

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Part C: Appendices

1. How to Read a Budget

An organization’s budget is a valuable tool in understanding its financial health, as well as how it operates and functions. Budgets can be organized in many different ways and the terms used may vary. A large organization may have more information to include than a small start-up. Budgets can be difficult to maneuver and can look messy and overwhelming, certainly more so than the modified sample budget provided in this packet. The following questions are meant to help locate key information.

• Story: Is the budget detailed and thorough? Do you understand where the organization dedicates its resources? What story does the budget tell?

• Income: Does the project or organization have any earned income (that is, income not donated, such as ticket sales or interest gained)? If so, how is it accounted for? Are there other sources of income? Are there plans to seek other funders? This is important so that you know the organization/project will have the opportunity to be successful in the long run.

• Totals: Do the dollars add up? If not, this may be a lack of attention to details in general or that the organization is not taking the funding proposal very seriously.

• Closing the Gap: Look to see how much funding has already been committed and how much still needs to be raised. Does this seem reasonable and realistic?

• Earmarks: If an organization is asking you to fund a specific project, where would your funding fit in with their total budget? Is there earmarked funding already listed for the specific project you are considering giving to?

• Overhead: How high is overhead? Low overhead means more of your funds go directly to the cause, but high overhead is sometimes the price of high quality technology and professionals that make an organization run well. It is important to remember that a project cannot exist in isolation, especially if it is to be sustainable. For example, the largest portion of CfH’s budget goes to salaries and stipends, generally considered overhead; for CfH, these expenses insure that staff and Chapter Advisors are able to support chapters.

• Expenses: Is there a specific project with itemized expenses?

If you are unfamiliar with terms such as direct project expenses, overhead, personnel expenses, please be sure to refer to the glossary in this guide.

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2. Sample Giving Program Timeline

An overview of the key questions and a sample timeline.

Weeks 1-2: Form Giving Committee and choose issue area • Sizeofcommittee - Will vary based on chapter size and resources• Committeemembership – How will you recruit members?• Powersof committee – Does the committee recommend organizations for the chapter to select?

Or does the committee make a final decision?• Determinegroupdecisionmakingprocess: Who will be part of your decision making group? Do you

want to use consensus or majority vote?• Choosingafundingcycle – Determine frequency of decision-making, sequence of decision making,

and frequency of donation.Weeks 3-4: Research issue area and discuss giving philosophy • Determiningafocus – Which issue area do you want to fund? Consider using the exercises in the

appendix to help you do this visioning work.• Fundingphilosophy – What type of organization will you fund? Consider the following aspects and

characteristics:• Small vs. large organization• Direct service vs. organizing vs. advocacy• Start-up vs. established organizations• Project support vs. general funding• Global vs. local

Weeks 5: Determine how you will select finalist organizations• TraditionalGrantsProcess – You publicize the availability of grants, and organizations apply for funds• StudentAdvocateApplicationProcess–Students nominate organizations and apply on behalf of

them• ResearchandInterviewProcess–Members of the committee search for and interview organization

in your issue areaWeeks 6-10: Determine finalist organizations (Using the selected technique above)

• Weeks 6-8: Continue to solicit applications or conduct phone interviews and research • Week 9: Review applications and information collected • Week 10: Determine finalist organizations

Week 11-12: Conduct site visits with finalist organizationsWeek 13: Present finalist organizations to chapter and determine recipient organizations • Reviewselectioncriteriaandcriticalquestions• Ensure that all group members are provided with sufficient information

Week 15: Notify organizations • Defineexpectationswithrecipients – Set up times for them to present to your group, or for larger

grants set a date for a report.Week 16: Reflection and evaluation

• How effective has your chapter been in carrying out its objectives?• Is there anything you would like to change for the next giving cycle?

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3. Exercises for Thinking about Issue Areas and Philosophy

Dream Big! Community Visioning (Helpful in Arriving at an Issue/Focus Area)

OverviewThis tool uses drawing as a way to envision how you want your campus or community to look in the future.

Why use this tool?An old Japanese proverb warns that “Vision without action is a daydream. Action without vision is a nightmare.” A common mistake “philanthropists” make is taking action after action without having a clear vision. We need to have a clear picture of the world we want to create in order to plan how we will get there. Our values drive our vision, and our vision in turn drives our philanthropy. If we are not led by vision, we fall into reacting instead of proactively transforming our community, country, and world.

How do I use this tool?As a group, this tool will help you discuss your common vision, and then develop a shared philanthropic strategy for reaching that vision.

Step 1: Decide how far in the future you would like to vision for, then draw what you want your community, region, or country to look like at that time. Be optimistic, ambitious and uninhibited!

Step 2: Write down several of the values that are reflected in your drawing.

Step 3: If you are working with a group, identify key themes and values you have in common. Discuss how these themes could form the basis of a shared vision for community/ region/country.

Step 4: Begin thinking about how philanthropy can lead to your future vision.

Choosing an Issue

OverviewThis tool will guide an individual or group through a brainstorming process, in order to choose an issue to address through your philanthropy.

Why use this tool?Not every issue has an equal impact on people’s lives. We need to choose issues that impact many people’s lives, and which can be effectively addressed through philanthropy to a 501(c)(3) organization.

How do I use this tool?We encourage you to do this exercise in a group, so that your philanthropic philosophy reflects several people’s thinking about what the community needs.

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Step 1: Start with the Dream Big! Visioning tool (above). Come to agreement on what the group would like to see for the local community (city, neighborhood) in the long-term.

Step 2: Brainstorm a list of the issues that would need to be addressed in order to achieve your vision.

Step 3: Consolidate this issue list into a smaller number of primary issues, such as education and food access, to address through your philanthropy.

Step 4: Review the key criteria for choosing an issue, and discuss which issues on your list meet all three criteria. Add criteria that may be specific to your situation.

Step 5: Choose one issue to address through your philanthropy. This decision may require some discussion or debate.

Root Cause Tree (Helpful when Thinking about Giving Philosophy)

OverviewThe Root Cause Tree helps you visually analyze the symptoms (fruit), institutional causes (trunk), and underlying systemic causes (roots) of a problem. This tool helps you define your individual analysis about a problem if you complete it as an individual exercise, or create a shared analysis of a problem if you complete it with a group.

Why use this tool?Determining a problem’s root causes will help you avoid band-aid solutions, or solutions that only address symptoms. Our analysis of a problem will determine the strategy we use to solve it. You must be able to articulate your analysis in order to develop an effective philanthropic strategy. It is important that people have a shared analysis of a problem so that they can have a shared plan of action to address the problem.

How do I use this tool?Step 1: Decide what issue to analyze using the Root Cause Tree. Typically, you want to analyze the main issue that you’ve chosen for your giving.

Step 2: Use the blank Root Cause Tree chart on the next page. Start by filling out the top level of the sheet with the impacts or symptoms of the issue. These impacts are represented by the fruit; they are problems that you can see or touch in your community

Step 3: Ask yourself or the group, “What are the structures and policies that create and institutionalize the problems we see (the fruit)?” or “Why do these problems exist in our communities?” Fill in the trunk section with structures or policies that institutionalize the main issue you’ve chosen.

Step 4: Ask yourself or the group, “What are the underlying historical, social, political, or economic root causes of these problems?” or “Why do these structures or policies (trunk) exist?” Keep asking “Why?” in order to get to the root causes.

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Step 5: Discuss what your analysis of the main issue means for your philanthropic philosophy. You may want to consider a philanthropic strategy that goes beyond the symptoms (fruit), and address structures or policies (trunk), in order to make lasting change in your campus or community.

Sample Root Cause Tree: Environmental Justice

Fruit: What impacts or problems do you see facing the community?• Landfills in certain neighborhoods only • Lack of nearby park/open green space• Air pollution/toxins in neighborhood causing asthma

Trunk: What structures, practices, and policies institutionalize the problems?• Community is unable to lobby city government to change practices• Political system favors richer neighborhoods that donate to their campaigns• Broken health system that does not provide care to poor youth

Roots: • Housing policies• Capitalism

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4. Glossary of Terms

The following is a list of terms that you may encounter through your giving work.

501(c)(3): The section of the United States tax code that defines nonprofit, charitable, tax-exempt organizations. 501(c)(3) organizations are public charities, private operating foundations, and private non-operating foundations.

Annual report: A voluntary report issued by an organization or corporation that provides financial data and descriptions of its activities. Annual reports vary in format from simple documents listing the year’s programs to detailed publications that provide substantial information about the outputs and outcomes and more.

Assets: The amount of capital or principal (money, stocks, bonds, real estate, or other resources) controlled by a foundation or corporate giving program. Generally, assets are invested and the resulting income is used to make grants.

Community foundation: A community foundation is a tax-exempt, nonprofit, autonomous, publicly supported, philanthropic institution composed primarily of permanent funds established by many separate donors for the long-term diverse, charitable benefit of the residents of a defined geographic area. For example the Community Foundation of the Hudson Valley includes the Parenting Family Fund for Poughkeepsie, as well as the Beacon National Night Out Fund.

Direct Project Expenses: These are expenses that are specific to the project funded. This includes all expenses besides overhead (see below) that are related to the project. These include travel costs, printing, space or equipment rental, supplies, insurance, or meeting expenses for the project.

Discretionary funds: Grant funds distributed at the discretion of one or more members of the board of directors, which usually do not require prior approval by the full board. The governing board is able delegate discretionary authority to staff.

Endowment: Funds intended to be invested in perpetuity to provide income for continued support of a not-for-profit organization. The interest on the investments is the continued income for the organization.

Excise Tax: The annual tax of 1 or 2 percent of net investment income that must be paid to the IRS by private foundations.

Funding cycle: A chronological pattern of proposal review, decision-making and notification of funding. Some donor organizations make grants at set intervals (quarterly, semiannually, etc.), while others operate on a rolling cycle.

General/operating support: A financial gift made to further the general purpose or work of an organization, rather than for a specific purpose or project; also called an unrestricted or basic support.

Grant: An award of funds to an organization or individual to undertake charitable activities.

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Grantee: Also referred to as a grantseeker, the individual or organization that receives a grant.

In-kind contributions: Gifts of goods or services instead of cash. This can include donated space, materials or time.

Overhead(fixedcosts):Ongoing expenses necessary to the continued of operation of a non-profit but that do not go directly to a project. Overhead expenses are all costs except for direct labor and direct materials and can include everything from salaries to rubber bands. Often overhead constitutes a bigger percentage of the budget when an organization is starting out.

Personnel Expenses: The expenses for all the people who will work on the project. These may be employees of the organization or independent contractors. If they are employees, the budget should list their title, the annual pay rate and, if the person will be working less than full-time or less than 12 months on the project, the portion of time to be dedicated to the project.

Private foundation: A nongovernmental, nonprofit organization with funds (usually from a single source, such as an individual, family, or corporation) and program managed by its own trustees or directors. Private foundations are established to maintain or aid social, educational, religious, or other charitable activities serving the common welfare, primarily through the making of grants. Example: Bill and Melinda Gates Foundation.

Public charity: A nonprofit organization that qualifies for tax-exempt status under section 501(c)(3) of the IRS code. Public charities are the recipients of most foundation and corporate grants. Some public charities also make grants.

Public foundation: A nonprofit organization that receives at least one-third of its annual income from the general public (including government agencies and foundations), as opposed to receiving 100% of funding from an individual or specific family (see private foundation). Public foundations may make grants or engage in charitable activities. Public foundations, along with community foundations, are recognized as public charities by the IRS. Their primary focus is on grant making.

Trust: A legal device used to set aside money or property of one person for the benefit of one or more persons or organizations.

Trustee: A foundation board member or officer who helps make decisions about how grant monies are spent. Depending on whether the foundation has paid staff, trustees may take a more or less active role in running its affairs.

Part C: Appendices

Documents

Giving Guide