**[Strengthening Your Council by Increasing Non-NPO
Funding]{.underline}**

**I. Denise S. Schlegel -- Pennsylvania State Rural Development Council
-- Moderator**

-   There are many ways to raise money---"effective begging."

-   "Begging" must be driven by passion.

-   Successful identification of the passions that drive potential
    contributors can lead to more effective fundraising.

**II. Wendy Dant Chesser -- Indiana Rural Development Council. Former
Executive Director of Indiana Rural Development Council.**

-   Discussed IRDC recent success in obtaining state funding.

-   It took 4½ years to get funding from IN General Assembly.

-   \$4.2 million per year was allocated for rural development
    initiatives as part of "Energize Indiana," a comprehensive economic
    development plan.

-   The first element, the Rural Development Council fund (\$1.2 million
    annually), goes to support IRDC and other regional development
    organizations. The Council administers this fund.

-   The second element is a rural development administration fund (\$1.4
    annually) for community projects in seven target areas including:
    workforce issues, telecommunications, and a pilot project to
    increase economic development in rural areas. IRDC administers this
    fund, but an additional advisory council must approve allocations by
    IRDC (these people are appointed by governor/legislature).

-   The third element is a value-added research fund (\$600,000
    annually). It is administered through the Commissioner of
    Agriculture's Office.

-   It took years and perseverance for Indiana to get to this point.
    Flexibility and inclusion of new partners (at many different levels
    of collaboration) is important.

-   In 1999, the first initiative was sent to IN state legislature for
    \$1 Million for the Council. This was unsuccessful.

-   In 2000, a bill was put forth to authorize Council to implement the
    Rural Economic Development strategy. It passed the state Senate
    50-0, but died in House Ways and Means Committee.

-   In 2001, a similar bill was put forth. It passed the Senate, passed
    House Agriculture Committee, passed House Ways and Means Committee,
    but all the money was stripped from bill. Even without funds, the
    Council performed these duties to show the state that they were up
    to the challenge. This work won IN a steady and growing group of
    champions.

-   In 2002, budget problems meant that the budget was reopened.
    Momentum was building and ultimately led to 2004 success. IRDC
    cultivated agency and legislative champions, one in each chamber,
    one from each party. They were able to pull their caucuses towards
    support of the IRDC.

-   Worked with other associations to ensure that IRDC provisions were
    included in other associations' legislative agendas. Organizations
    included: Indiana Chamber of Commerce, Farm Bureau, electric
    cooperatives, the state municipal league, and the counties.

-   Reasons for success were that Governing Board members and other
    beneficiaries of the funding were important advocates from
    grassroots. Rural communities and elected officials were committed
    to doing the work when they received information. Received
    substantial press exposure through having the National NRDP
    conference last August.

-   Indiana had to focus on economic development initiatives with budget
    constraints. IRDC began as policy council, but moved to more
    project-based to increase visibility and raise credibility. Then,
    were able to go back to policy-orientation with connections had
    already made.

-   Now that have funding, must perform. Facing a gubernatorial
    transition in 18 months time and must continue proving worth of
    work.

**III. Scott Truman -- Executive Director -- Utah Rural Development
Council**

-   Don't jeopardize cooperation of potential partners by going after
    the same funding sources. Decided not to revisit those foundations
    that funded the University for Council funding. As a result, the
    university has been a cooperator, and has given the Council
    significant in-kind contributions.

-   Focus shouldn't be on one person, but about what the Council as a
    group can do for potential partners/funders. This has proven
    lucrative and has allowed the Council to influence policy through
    the cache received from completing projects.

-   Many avenues for possible funds: Review grants for the Forest
    Service, and receive a fee which helps underwrite Council costs.
    Applied through state for TANF grant-attracted to these types of
    grants because the university doesn't charge overhead for
    administering the grant. In return for saving the state money
    through grant administration, the state provided some administrative
    funds for the Council.

-   "Smart Utah" program: Organize call-in service centers for
    communities as job creation mechanisms---created 147 jobs in
    impacted communities.

-   Received a USDA-RD grant to create Native American "smart sites"
    that will help for job creation in one of the five federally
    recognized tribal governments in Utah. Have helped them get
    non-profit and 8-A status for preferential treatment in government
    contracts as minority-owned businesses.

-   Have received state funds through an appropriation. As federal
    funding has gone down, amount of state appropriations have increased
    slightly.

-   Received \$500,000 from the National Fire Plan and saved a sawmill
    in a rural community through the collateral of a small-diameter
    sawmill obtained through the \$500,000.

-   Conference planning has been an important source of revenue. With
    registration fees and corporate sponsorships, raised about \$40,000
    at each conference. Not all of this goes to conference costs, so
    some can go to Council.

**IV. Marcie McLaughlin -- Executive Director of Minnesota Rural
Partners**

-   MRP began 9 years ago with seed funding from NRDP. This initial
    funding allowed the MRP to establish itself as a strong Council.

-   Began as a national partnership within a state organization, but
    quickly realized did not want to be under state control. Set up as
    501(c)(3), which allowed MRP to keep some money separate from
    conferences, etc.

-   Rural Summit (annual conference) is the outward sign of what the
    Council does throughout the year. Helps with networking, information
    exchange, informal strategic planning, and a vehicle for private and
    non-profit/foundation contributions. The conference also allowed the
    Council to get information about changes to be made or raising new
    issues. During national conference in MN, focused on how the
    attention of a national audience could help partners within the
    state get their message out. As part of conference, also presented
    first rural policy forum with the help of senior HHS leadership. The
    Northwest Area foundation liked the idea, and provided money to
    develop this panel and to move forward with the Rural Policy Forum.
    This is still in existence and available to others as a resource.

-   As a 501(c)(3) many additional sources of grant funding were
    available to the council, i.e. grants to develop entrepreneurship.

-   Summits have had specific focuses that bring new groups of players
    to the table that may help fund the Council.

-   Partners are in many different areas (non-profits, foundation
    community, etc.) and utilize their connections at all levels.

-   MRP sees value in national network and is willing to contribute
    resources to help keep the Partnership going, because what happens
    on nationwide level helps residents of rural Minnesota.

**V. Discoveries from fund development information -- Denise Schlegel**

-   Bob Ho and David Barr have developed a non-NPO funding handbook that
    may be useful when return to individual states.

**VI. Questions and Answers**

Q: Scott Truman: how does fundraising like the sawmill project fit into
work plan and how do you deal with liability issues for a volunteer
board of directors?

A: Haven't dealt with liability issue, but may have to examine that
issue in the future. Get around some other issues by being affiliated
with university (i.e. bidding and purchasing, accounting, etc. done by
university). Fundraising opportunities may not be in workplan---they may
come up in unforeseen emergency situations. In these cases, may shift
priorities and make these integral parts of workplan. Make sure that
mission areas are broad enough to accommodate these kinds of emergency
situations. Because these areas often require the building of
large-scale partnerships, they tend to fit within missions.

Q: Wendy Dant-Chesser: do you feel that years were lost working toward
policy when focus of Council shifted to projects. How many years were
lost concentrating on projects instead of policy?

A: Don't feel time was lost because projects were critical to building
credibility. Also, when we got into communities, we found some policy
needs.

A: Cheryl Hinckley, TX: Collaboration between Texas and Indiana on
community visits, allowed IN to accomplish more through projects and
allowed TX to use visits to focus on policy.

Q: Wendy Dant Chesser: with advisory capacity by a state group on some
council activities, is independence compromised? Have you sought sources
of private foundation funding?

A: Committee only has oversight over small part of Council duties. Also,
have credibility to strategically suggest people to sit on this
committee, and many of them are friends of, and well informed about, the
Council. About private foundation funding, haven't concentrated on this,
but have created a non-profit arm to raise funds from private sources.
This provides a safety net in case other funding sources dry up

A: Scott Truman, UT: In Utah, haven't gone foundation route. Only a few
foundations in Utah, and don't want to compete for limited funds with
potential partners

A: Marcie McLaughlin, MN: In Minnesota, there is a rich philanthropic
tradition. Need to be attentive to goals of the foundations you seek
out. Have gotten the Minnesota Council of Foundations and the Minnesota
Council of Non-profits in the MRP network, which gives the Council
information about what foundations are looking for. Also, need to be
aware of the National Rural Funders Coalition.

A: Denise Schlagel: Most important to match your vision with the
foundation's vision. May have to select small projects that match
mission.

Q: Has thought been given to approaching individuals in charge of
foundations not for money, but for their championship for expanding this
initiative at high levels? If viable, how could the NRDP address this
issue collectively?

A: Marcie McLaughlin, MN: Need to be re-establishing network with
non-profit world. The Rural Funders Network had done some of this work,
but we don't have anything to propose to them right now. Must identify
what major foundations we want and target to them.

A: Denise Schlegel: Different foundations focus on different levels
(i.e. national, regional, state, etc.). Need to focus efforts on the
right foundations according to your mission. 65,000 foundations and only
2000 have web presence. The National Rural Funders' Collaborative
website is [www.nrfc.org](http://www.nrfc.org/), or through the Kellogg
Foundation website.