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2314
University Ave. #20
St. Paul, MN 55114
Phone: 651.642.1904
Fax: 651.642.1517
Greater MN: 1.800.289.1904
Email: info@mncn.org |
cHARITABLE FUNDRAISING:
tHE bASICS
Planning
for Fundraising
Unlike for-profit
businesses that receive revenue from their business practices
and distribute profits to stakeholders, and nonprofit organizations
receive revenue from individual donors, community and private
foundations, corporate giving programs, government grants and
contracts, and earned-income practices and use all revenue toward
mission-related programs and administration costs. Organizations
that have received tax-exempt status are free from federal income
taxes and may grant their donors tax deductions for their financial
gifts.
Organizations starting
from scratch should incorporate a plan for generating both earned
and contributed income into an overall organizational development
strategy. It’s a common misperception that nonprofits must survive
on grants alone, or that nonprofits cannot generate a “profit.”
Nonprofits can and should budget for an operating reserve. Funders
like to see evidence of organizational sustainability and may
ask the question, “If the organization’s funding is dependent
on a source that dries up, can the organization survive?”
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Plan early –
It’s a good idea to start planning a fundraising strategy
before incorporating. The incorporators or initial board should
start looking for donors immediately. Many nonprofit organizations
have been started from a loan or initial investment from an
interested individual. It may be very difficult to get a bank
loan if the organization is brand new and has no financial
track record.
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Look ahead –
When planning a budget and income-generating strategy for
a start-up organization, try to plan at two to three years
in advance. It takes time to build relationships with funders
and many opportunities will not be available right away. Also,
a key to planning is setting specific goals. Base these goals
on the research conducted and the ability of prospective funders
to meet those goals.
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Check your message
– Will the organization be able to make a strong case for
support when it comes time to approach prospective donors?
Does the organization’s priorities match the priorities of
the prospective donor? Donors must feel motivated before they
will give. The fact that they have the means to give doesn’t
mean they will.
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Lastly, thank
donors. Donors want to know that their gift is appreciated
and is having its intended impact. Keeping donors informed
and connected and recognizing their contribution is the best
way to maintain the relationship.
—Excerpted from Handbook for Starting
a Successful Nonprofit
(Minnesota Council of Nonprofits)
nonprofit fundraising
registration requirements
The charitable solicitation Act,
Chapter 309 of the Minnesota Statues, states that nonprofits must
register as a charity with the Attorney General’s Office, Charities
Division if a charitable organization is intending to solicit
contributions in excess of $25,000 a year, or has paid officers
or staff, or uses a professional fundraiser to file a Charitable
Organization Registration Statement. The organization must include
a copy of its articles of incorporation, its IRS determination
letter, and a most recent financial statement. The filing fee
is $25.00. It must be done within 30 days of reaching $25,000
in contributions. Forms can be downloaded from the Minnesota
Attorney General's - Charities Division web site.
soliciting
gifts from individuals
Individuals
in the United States account for nearly 88 percent of all charitable
giving in the country. While over 62 percent of household giving
in the United States in 1993 was directed towards religious organizations,
over $40 billion went towards health, human services, arts and
other types of charitable organizations. This document outlines
some of the several different types fundraising that can be used
to solicit contributions from individuals. Each of these ideas
should be considered in the context of an organization's mission
and strategic plan, because none of them are appropriate in all
circumstances. It may be wise to consult with a professional advisor
to construct a fundraising campaign that fits the needs and resources
of your organization.
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Ask individuals
to support your organization through membership fees or dues.
Through memberships, sponsors, supporters, or other individuals
can provide support to your organization on an annual basis,
often receiving a newsletter or another symbol of membership
status. Establish donor membership categories which depend
on the amount of a contribution. This can help to encourage
higher donations because varying degrees of honorary benefits
can help emphasize upgraded memberships.
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Direct mail
appeals are an increasingly popular means of reaching a significant
number of potential donors. There are several books that describe
a full range of direct mailings, and this is certainly an
area in which professional fundraisers can assist you.
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Phone appeals
may be an appropriate way to reach individuals in their homes.
While probably most successful when targeting past donors
who are familiar with an organization, they can also be used
to educate the public about the organization and its current
program activities.
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Highlighting
the tax benefits to donors who make gifts of stocks or other
tangible personal property may help to encourage larger gifts
to an organization. Planned gifts, including trusts, insurance
beneficiary designations, forms of deferred giving or other
legal means can also attract individual donors. Similarly,
bequests or gifts specified by the Will of an individual upon
death are commonly made, and also provide possible tax benefits
to consider. Consult with a tax advisor before actively soliciting
these types of donations.
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Door-to-door
canvassing is a mostly seasonal appeal used to reach individuals
in Minnesota. While door-to-door canvassing can be expensive
for an organization in terms of paid staff time spent on the
street, it is a highly personal way of raising awareness about
an organization. It can generate community interest and participation,
as well as funds, in support of the charity.
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Special events
fundraising commonly raises money for and awareness about
an organization. Whether it's a banquet, silent auction, car
wash or walk-a-thon, this can be an effective way to boost
an organization. The key to a successful special event is
to minimize expenses through the use of volunteers and donations
of related items. Finding a sponsor or patron to underwrite
the cost of an event can significantly reduce the expenses
to the organization.
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Federated fundraising
campaigns are a direct way to reach thousands of people across
the state. These are annual campaigns carried out for the
benefit of member agencies under some common banner or federation
name. The Combined Federal Campaign (CFC) for instance, represents
pooled federal employee contributions for financial support
of eligible nonprofit organizations. The United Ways and the
Cooperating Fund Drive are other independent federated campaigns
that reach individuals primarily through corporate support
and access.
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Principles and Practices for Nonprofit Excellence
Principles and Practices for Nonprofit Excellence
are based on the fundamental values of quality, responsibility and accountability.
The ten characteristic accountability principles distinguish the nonprofit
sector from government and business. The 133 management practices provide
specific guidelines for individual organizations to evaluate and improve
their management.
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UPCOMING
MCN
FUNDRAISING EVENTS
Philanthropy
Leaders Breakfast Series
Dates:
Wednesday, February 14 - Alex Cirillo, 3M Foundation
Tuesday, March 27 - Lisa Campbell and Heidi Weaver, Target Community Relations/Target
Foundation
Thursday, April 12 - Kaying Hang, Otto Bremer Foundation
Wednesday, May 23 - Sandra Vargas, The Minneapolis Foundation Wednesday,
June 13 - Dan Johnson, United Health Foundation
Time: 8:00 - 9:00 am
Location: Town and Country Club, St. Paul
Fee: $35, open to MCN members only
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info
2007 Grantwriting
Clinics
Grantwriting
endeavors too often drain an organization’s limited resources and
end in frustration. In this workshop, participants will gain knowledge
that will help them to better understand and implement a more strategic
grantwriting and development process.
Dates:
Thursday, February 15
Thursday, May 17
Thursday, July 12
Thursday, November 15
Time: 9:00 am - 12:00 pm
Location: Minnesota Council of Nonprofits Conference
Room
Fee: $85, open to MCN members only
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info
Preparing
for Grantwriting Webinar
Participants will learn many of the basics
in getting prepared for grantwriting and will leave with a better sense
of how to do research on funders, how to prepare material and gear up
for grantwriting. This session is designed for people who are new to grantwriting,
have limited experience, or would like a basic overview of essential practices.
Dates:
Tuesday, March 20
Tuesday, June 26
Tuesday, September 11
Time: 1:00 - 2:00 p.m. (Central Time)
Location: From any online computer
Fee: $35 for MCN members/ $50 for nonmembers
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info
Writing
Your First Grant Proposal Webinar
This Webinar will cover the overall purpose
of each section of a grant proposal, suggestions for how to include a
lot of information within the specified page limits, and common proposal
weaknesses and how you can avoid them during this fast-paced one-hour
session.
Dates:
Tuesday, March 22
Tuesday, June 28
Tuesday, September 13
Time: 1:00 - 2:00 p.m. (Central Time)
Location: From any online computer
Fee: $35 for MCN members/ $50 for nonmember
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Fundraising
Brown Bag Lunch Series
If you are currently working as a development
staff person in a nonprofit, you are invited to join these informal discussions
and information sharing groups.
Dates: First Friday of each
month
Time: 12:00 pm - 1:00 pm
Location: Minnesota Council of Nonprofits Conference
Room
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MCN FUNDRAISING PUBLICATIONS
2007 Minnesota Grants
Directory

With more foundations, increased
indexing, and greater levels of detail for many of the foundations included,
the new edition of this popular grantseeking guide is now available.
Regular Price: $50.00
MCN Members: $25.00
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info
100 Top National
Grantmakers in Minnesota

Published by Access Philanthropy,
this publication provides a detailed overview of the top 100 national
grantmakers that grant funds to nonprofits located in Minnesota.
Regular Price:
$90.00
MCN Members: $45.00

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