Historically, government on the federal, state, and local level has supported initiatives related to workforce development. Programs that help those workers who are disconnected from the workforce and face the highest barriers to reentry are directly aligned with the work that employment social enterprises do. Social enterprises, while earning revenue through their business lines, often use funding from these programs to help cover the social costs related to their mission of supportive employment.
Recently, both President Trump and a Republican controlled Congress have demonstrated a desire to make significant cuts to government agencies, including programs and departments that support workforce development activities. While the current political climate is at best uncertain, and the amount of available funding likely to be reduced over the next few years, there is still funding available to support the work that social enterprises do. For our first quarterly learning topic for 2018, we will explore the availability of federal funds for social enterprises and the potential effects that budget cuts may have.
In this first learning guide for the topic, we will explore:
- The major sources of federal funding for social enterprises
- How to find out about funding opportunities
- The availability of funds for different purposes
- Key factors to consider before applying
Sources of Federal Funding
According to the U.S Government Accountability Office, nine government agencies oversee as many as 44 different programs supporting employment and training for those facing barriers to participation in the workforce. REDF has found that from among these are two programs in particular – SNAP E&T and WIOA – from which many social enterprises benefit. Additionally, the Department of Labor administers grants for which it may be appropriate for certain social enterprises to apply.
In this learning guide we will explore the basics of these sources of funding, how to identify opportunities, and what to be mindful of before applying. In the upcoming weeks through March 2018, we will post additional learning guides that will go into greater detail into each of these programs and the impact of the current political climate on them.
The Supplemental Nutrition Assistance Program (SNAP) provides monthly food benefits to assist low-income individuals in purchasing the food they need. A part of this program is SNAP Employment and Training (SNAP E&T) that helps SNAP participants gain skills, training, or work experience to increase their ability to obtain regular employment that leads to economic self-sufficiency. Each state has its own program. In some, the state disburses the funds; in others, the county does. While it is likely that the eligibility requirements for SNAP will change as part of changes to the budget, SNAP E&T funding appears to remain relatively intact.
Workforce Innovation and Opportunity Act (WIOA) is the largest source of federal funding for workforce development activities. State and local Workforce Development Boards (WDB) set the funding priorities for their areas. WDB have representatives from the business community, community colleges, and elected officials to ensure that funding is directed towards those programs that address the needs of the local economy. Funding for WIOA has been particularly threatened by recent changes to the budget.
Department of Labor Grants
In addition to WIOA funding, the Department of Labor administers a number of different funding opportunities related to workforce development. Some examples include:
- Training to Work
- Face Forward
- Environmental Workforce Development & Job Training
Like WIOA funding, the current budget reduces Department of Labor funding significantly, including those programs related to employment and training.
How to find out about available grants
Even in more predictable political climates, identifying grant opportunities and finding requests for proposals (RFP) can be challenging. Your social enterprise will need to proactively seek out opportunities through a variety of different channels. Growing and leveraging your professional network is essential to keeping yourself apprised of new opportunities. To successfully do so, you should:
- Build relationships with your local workforce boards and health and human services departments
- Get to know the regional Department of Labor and Food and Nutrition Service Officers for your area
- Sign up for the Department of Labor mailing lists
These are the people who will know when opportunities are coming up. Since the usual turnaround time for grants is only a matter of weeks, it really helps to know what’s coming up as soon as possible so your social enterprise can be fully prepared and has the time to put together a competitive application.
Availability of Funds
The availability of funds is, in part, dependent on what the funding is for. REDF has found that some employment services are harder to fund than others.
Factors to consider before applying
As with all sources of funding, there is a careful balance to be struck between the funding source and your program. If your program is strong, have allegiance to that program and do your best to fit your funds to your program and not the program to the funds. This should be kept front of mind when assessing any new funding opportunities, and the federal government is no exception.
Be sure to be clear about the eligibility requirements for your target population. For example, “low income” can mean different things to different social enterprises and government agencies. Make sure your definition is in line with that of the funding for which you are applying. If it is not, make sure you understand the impact that this difference may have on the amount of funding you would get.
Number of grants and frequency
The greater the number of grants that are offered, the higher the likelihood that a quality proposal will be funded. Grants that are offered on annual or biennial cycles suggests that there are regular opportunities to secure funding and that funding could potentially be recurring.
Federal grants often have stringent requirements that can sometimes be an administrative burden on a social enterprise. Many grants have strict requirements for intake, testing, documentation, and follow-up that may be different than how your social enterprise currently operates. Be sure that you fully understand these requirements up-front and compare the anticipated amount of work relative to the anticipated amount of financial return.
Similar to administrative costs, be mindful of the infrastructure it requires to comply with the stringent reporting standards of many federal grants. Be sure to reflect on your social enterprise’s current infrastructure and reporting mechanisms. It will make life a lot easier if you have strong systems in place before going after federal funding.
- Even in the current political landscape, federal funds are available for social enterprises
- Three common sources are SNAP E&T, WIOA, and the Department of Labor
- It is essential to be proactive in researching upcoming funding opportunities
- Fit the funding to your mission, not your mission to the funding
- Make sure you have the infrastructure in place to properly administer the grant, if awarded