Monday, July 02, 2007

Pricing Grant Writers - What Should We Pay for A Grant Writer?

I've written several posts (their links are listed at the end of this post) about how to hire and begin working with a grant writer.

The next question is: what is fair compensation for a grant writer?

First of all, I've said it before, here, and I'll say it again. Never pay a grant writer a portion of a grant that your organization receives after they write the proposal for it. This is called 'contingency pay', and it is unethical in American fundraising. The most reputable/established professional affiliations in the United States revoke memberships if members are found to be taking pay from grants received. (For example The Association of Fundraising Professionals ) Why shouldn't your organization pay a percentage of each grant that your writer wrote and you guys received? It jeopardizes your relationship with the grant donor because they expect their grant (donation) will pay for what you said you were requesting the money for; not for your overhead costs (cost of the grant writer). Grant writers' hourly rates or salaries are fundraising and overhead expenses - they are not programs/project expenses. If grant donors learn that you're spending their donation on costs other than what you said you'd spend the money on - they won't give to your organization, again; and they'll let other grantors know that your organization did this to them.

Second, grant writing is only successful when your organization has a strong healthy reputation, when the program that you are requesting the money for is meeting a real need in your community well, and when your organization's reputation among the non profit and grant donors' communities is strong. In other words, whether a grant is received or not is not only based on whether the grant writer is good enough - it is mostly based on whether your organization is in a strong position to receive grants. Having a talented, knowledgeable, experienced, and successful grant writer IS important; but successfully raising grants is a team effort between the grant writer and the organization (as is true of all operations of your organization, not just fundraising). Good grant writers are professionals with expertise that you seek - so you pay them for their work. It's just like when you hire a CPA, or lawyer. You are investing in the future of your organization; increasing its assets, increasing the number of strong relationships with donors, increasing the potential success of your projects/programs, and in the end achieving your mission statement's work.

First, budget for a grant writer. Ask colleagues at other non profit agencies who have worked with grant writers that they're really happy with what they spent on their grant writer. Did the grant writer charge by the hour or did they hire them as staff? If the fee was hourly, what was it? How much experience did their grant writer have? Ask colleagues at a few different sized non profit agencies how much they spent on their grant writer and how much experience each had. You'll begin to get a picture of how much you should expect to pay for various experience levels in your region.

Next, contact local or regional professional fundraising and grant writing affiliations. Ask them if they can indicate what the going rate is for professional grant writers (at various experience levels). If they are not sure, ask them if an area non profit or community foundation/organization has recently conducted a fundraising professionals' salaries survey. Many communities do. If so, get a hold of it and look up what the going rate/pay is for various experience levels.

Decide how long you will need this grant writer. If you know that you have a large capital campaign that you're beginning a year from now - plan on having hired the grant writer at least six months prior to the beginning of the capital project's beginnings. Why? Various grant donors meet at different times to decide who they'll give grants to. Your grant writer will need time to write a strong proposal before the grant donor's deadline - and also allow for the grant donor's decision making time. If the campaign will last three years - you'll need to budget for a grant writer for at least two and a half years (this may vary). If you need to get a grant to pay for a grant writer for three years, there are grant donors who offer grants specifically for overhead or fundraising costs - but they are few and far between. If, though, you can raise the money for the grant writer through grants - do it. Just don't pay any portion of any grant to an expense that you did not tell the grant donor you'd be paying for with their donation.

In Seattle in 2005, for instance, the two or three most reputable contract grant writers also had the longest careers. Their hourly fees ran between $100 - $120 an hour. They were the exception. Most professional contract grant writers in Seattle at that time (who had 5 - 10 years' experience and were good at what they did) received an hourly rate between $40/hour - $90/hour (depending on expertise). The Seattle non profit sector is mostly open, educated, and up on the latest paradigms. Seattle non profits mostly understand that for quality one must hire an experienced professional and be willing to invest resources, team work, and time in the best for their mission's work.

Do not lessen the amount of time you hire a grant writer for, based on the grant writer's cost. Invest in the grant writing process, as much as your organization is investing in grant writing as a fundraising method. Be dedicated to this effort because it takes time, resources, and team work.

Lastly, while interviewing various candidates, consider whether they value themselves. In other words, if they have twelve years of successful grant writing experience but charge very little - be a bit leery. Get references and check them.

Conversely, when hiring a grant writer always remember that successful grant writing is as contingent on the organization applying for grants as the grant writer's abilities. For instance, if a grant writer is excellent at what they do, but the non profit organization that they worked for mismanaged assets - the non profit may not have received grants because of the organization - not because of the grant writer's abilities.

Here are more blog posts that will help you if you're about to hire a grant writer (contractor or staff):

How Do We Afford Grant Writing?

What Are the Steps to Hiring A Grant Writer?

Grant Writers On Commission

Your Agency's First Grant Writer Starts Work Monday

Why Some Grant Writers Suck...


Anonymous said...

Overhead and operating expense is the same damn thing, so, where's the logic? AFP? Besides you just should not include it as part in the budget that's submitted; all I keep finding is alot of double-standard-talk frankly.

Arlene M. Spencer said...

Dear Anon,
I understand your frustration. If you can, re-read this post and click through on the links that I provide, at the end, too. I do make my case, here.

I reference the AFP only to demonstrate that professional ethical affiliations require members not to pay portions of grants earned as commission. Nothing more.

Good luck,

Anonymous said...

As a person that is new to the grant writing, I'm struggling with the pay structure issue. I've read your thoughts and many non-profits are hesitant to share this type of proprietary information.
I'm considering a flate fee 0f $250 for foundations, payable if the award is made or not, as well as an hourly rate of $45 per hour based on an 8 hour minimum for government grants. I make the assumption that gov. grants are more labor intense.I live in California.Does this structure sound reasonable?