The Unique Practice of Arts Grantmaking – GIA PreConference

Submitted by Barry Hessenius on October 17, 2014

Good morning.
“And the beat goes on…………”

The Unique Practice of Arts Grantmaking: GIA PreConference (Sunday 10/12/2014)

This day-long preconference was intended for newer program officers, trustees and foundation executives – but the reality was that the attendees were split between newbies and those who are recognizable names in the philanthropic community with long resumes. The combination of the two made the questions throughout the session very interesting and relevant.

As many of the readers of this post may not be involved in foundations or government agencies that make grants, my attempt here is to give those who deal with funders – but at arms length, and who perhaps don’t fully understand how the grant making process really works, or what the issues are for the funders themselves. I want, if possible, to de-mystify a little bit the world of arts grantmakers, and to try to humanize those in that field so that those dependent on the funders might have a little better idea who they are dealing with and how they do their work.

I think there are two fundamental things to bear in mind if you want to understand grantmakers:

First, like you, these people are professionals and they want very much to have a positive impact on our field. They know very well the challenges you all face, and maybe they even have a better understanding of the challenges we face as a field – because most of them have as part of their charges and portfolios a range of arts organizations across the various disciplines – various sizes, compositions and ages. From your perspective, program officers can seem indifferent to your needs and situations. That’s understandable, but I can categorically state that 98% of them care deeply that the arts thrive. They spend their waking hours trying – sometimes against the odds, and much like a lot of you – to make a difference. Their objective though isn’t specifically to make art or present it, that’s what you do. Their job is to grow it, to protect it; to enable you to do your job. They don’t want to do your job for you, they want to do what they can so you can do your job better. Perhaps they are not always your close friend, but they are never your enemy.

Second, they are not really in charge. Their boards are. Their job is to realize the objectives of the founder / board, and while often they disagree with some of the prescriptions and priorities imposed on them – their job is to make those priorities realizable. That’s not so easy. Most of you have had some experience with imperfect boards, but most of your boards are on the same page with what you as the staff want to do. That’s not always true with foundations or even government funders. The program officers don’t set the overall objectives, nor construct the funder’s ecosystem for determining where funding goes, and (in a general sense) to whom. Many have input into the process at various points, but that’s not the same as being an equal player in that process. Those who have been in this arena for a long time have learned how they can move, even if only in small and seemingly unimportant ways, their organization closer to the direction they see that would benefit the field, territory and constituents they serve. But often times they need to do that quietly, on the sly and even invisibly. You try doing your job invisibly sometime. As funder officers are trying to help you do your job – in part by trying to better understand you and your job – it would be equally helpful if you try to understand them and their jobs. The more grantors and grantees can understand the challenges faced by each other, the better each will ultimately fare in meeting those challenges. We’re all on the same side here.

This all day session was divided into four sessions: While I tried to hit the highlights, this encapsulation is by no means comprehensive. I am merely trying to paint a general picture of what funders are doing as part of their grantmaking practice in the arts as presented in this excellent session.

Session I: Turning Vision into Reality – led by Vickie Benson program director of the McKnight Foundation, and Regina Smith, senior program officer, arts and culture, at the Kresge Foundation.

How to move from mission statement to a fully realized funding program.

Bullet Points:

There isn’t likely an ideal linear approach to progress; no step by step blueprint. The point is that every funder and funding goal is unique.
While aspirational, funders face multiple priorities and multiple masters.
Developing program strategies is a constant negotiation.
Even successful programs are in a state of constant evaluation, rethinking, adaptation.
While the trend of “scaling up” is gaining traction, Roberto Bedoya suggested consideration of “scaling out” as well.
Julie Fry of the Hewlett Foundation, offered that Asset Building is not specifically about problem solving. It is more about problem identification.
It’s important to embrace the fact that the paths are not always clear and that the competing conversations are often disconnected.
Arts funders often work in in silos. The best option is to build bridges between the silos.
The program officer’s job is not popularity.

The bottom line: There is no off the shelf blueprint to design programs that are effective, efficient, fair and equitable and address the priorities of the funder. And that makes the program officer’s job very often problematic at best. While it is enormously satisfying awarding money that can make a difference to individual organizations (and artists), it is also difficult to always be right in your assessments and conclusions. Those seeking the money must ask themselves if it would be any different for them? And if their answer to that question is: “Yes I could do it better and make it all work“, then my guess is they just don’t have a clue. Though it may sound wrong, it isn’t as easy as it sounds to use limited money to have highly positive impacts.

Session II: Supporting Artists and Arts Organizations: What do Funders Need to Know to Encourage Financial Health and Sustainability – led by Janet Brown – President / CEO GIA, and Cynthia Gehrig, President Jerome Foundation.

The need to understand the financial health of arts nonprofits, of all sizes, as well as the unique marketplace in which they reside. Turning around the undercapitalized nature of the sector.

Capitalization – not cash flow, but savings. Having the cash to execute strategy. Both capital and revenue are essential: capital to change organizational structure or direction, and revenue to conduct and sustain day-to-day activity. Adequate capital addresses risk taking. Adequate revenue insures continuity of operation.

Bullet Points:

A majority of grant applicants in the arts are undercapitalized – meaning they have negative liquid cash on hand (apart from Endowments et. al.) and are basically living month to month.
Applicant fear is that if they have a surplus, a grantor will say: “You don’t need our money.”
More often than not, applicants underestimate costs and overestimate income.
The arts funding community is very diverse. The old adage is: “If you’ve met one funder, you’ve met one funder.”

GIA led a consensus agreement of its membership on a set of common principles about the urgency of the capitalization issue, including: 1) Encouraging surpluses and operating reserves – break-even is not enough. 2) Encouraging organizations with untenable business models to take steps to adjust how they do business so they can move to operating reserves. 3) Offer, whenever possible, general operating support, and 4) Support project support that includes the cost of overhead and indirect costs for the project.

Funders help the field by taking harder looks at applicant balance sheets and asking questions to determine whether the applicant has an effective business model in place – i.e., one that generates revenue and capital.
While there may be understandable reasons for an organization to continue to pursue programs that are ultimately unsustainable (legacy, Board and political reasons), asking questions about past commitments as ongoing Albatrosses for organizations is essential. The field benefits if we break the cycle of under capitalization.

Session III: Looking Deeply at the Community You Serve – led by Maurine Knighton, senior vice-president of grant making, The Nathan Cummings Foundation, and Justin Laing, senior program officer, The Heinz Endowments. (Note: Unfortunately, due to a passing in the family, Justin was unable to be at the conference.)

How to create an equitable funding practice with authentic community voices informing program development.

Equity is unquestionably one of the major issue in the arts field today. What does equity mean? Simply put, it is a fairer distribution of power, access and allocation of funds, resources, and opportunities. Equity manifests itself in a myriad of ways. Racial equity might be defined (as does Race Forward as: “A vibrant world in which people of all races create, share and enjoy resources and relationships equitably, unleashing individual potential, embracing collective responsibility and generating global prosperity.”

The question is how do we in the arts promote and facilitate more equitable outcomes for everyone?

Bullet Points: Advice on how to proceed

Get clear about what you want to accomplish; develop a theory of change and start with self-awareness.
Self-assessment includes appreciating your own world view (including its limitations); understanding and valuing the world views and practices of other cultures; developing the fluency and capacity to interact respectfully and effectively with cultures other than one’s own. (And we may need help with some of these steps.)
Don’t assume you already know everything you need to know.
Most culturally specific arts organizations are small to mid-sized; most have missions that articulate a social justice purpose.
Don’t automatically assume less aesthetic rigor or artistic quality for smaller culturally specific arts organizations.
Be creative and expansive in adjusting your approach. One size never fits all.
Find the sweet spot between solid practices and responsiveness
Seek out important practices you are already using.
Equity doesn’t necessarily imply absolute equality.
Widen the circle – connect people; develop a ‘kitchen cabinet’ of trusted advisors and colleagues to help with ideas, feedback, assessment and identifying other thought partners.
Weigh ALL the options
Be humble and take the lead from those you intend to benefit.
Embrace new ways of thinking, listen more than talk, ask questions, borrow from others, keep learning and bear in mind no approach is perfect.

Session IV: Is All This Really Working – led by Pam Korza, co-director Animating Democracy, Americans for the Arts, and Edwin Torres, newly appointed Deputy Commissioner, Office of Cultural Affairs, New York City (and former program officer at The Rockefeller Foundation) and congratulations Eddie.

How can you measure and evaluate program and grantee success?

Evaluation is a systemic process to determine merit, worth, value or significance. We do it because it promotes accountability, improves decision making, increases our knowledge base which helps us with sustainability and building capacity, and it increases our case making ability.

Bullet Points:

Evaluation is not an audit. It’s not about blame.
Kinds of evaluations: a) Baseline Study – an analysis describing the situation prior to an intervention, against which progress can be assessed and comparisons made; b) Cluster Evaluation – Looks across a group of projects to identify patterns and factors that might contribute to variations in outcomes and results across the sample; c) Formative (Real Time) Evaluation – Carried out while a program is underway to provide timely, continuous feedback as work progresses; d) Emergent Learning – learning that happens in the course of a project when goals and outcomes are not easily defined; e) Participatory Evaluation – Engages a range of participant stakeholders in the process of designing the evaluation so it is useful and relevant to all involved; f) Summative Evaluation – Assesses the overall impact of a project after the fact.
Theory of Change – A systematic measure of what needs to happen in order for desired outcomes to occur, including an organization’s hypothesis about how and why change happens as well as the potential role of an organization’s work in contributing to its vision of progress.
Measuring what matters – types of change: 1) Individual, organizational, community, structural / systemic, field wide; 2) Artistic / cultural (intrinsic value, access, equity, development / innovation / capacity; in pacts, excellence; 3) economic, social, environmental, educational, health etc.
Einstein said: “Not everything can be counted. Not everything that can be counted, counts.”
Outcomes count. “At the end of the day, what matters is the strength and usefulness of what has been built, not how elegant was the blueprint.” – Steven Schroeder, former President, Robert Wood Johnson Foundation

Sometimes the tools and process of evaluation may have as much or more meaning that the results of the evaluation. (Ian David Moss observation)

For those of you not funders, my best personal advice is to build a relationship with the funders who operate in your area, your world. A relationship is a two way street. It’s not just about asking for what you need – it’s shared time, mutual learning and the creation, over time, of respect, trust and the opportunity as peers to move forward. It may sometimes be about help, but it offers much more than just that limited support; it offers the potential of real learning and true friendship.

This was a very good preconference and I thank the presenters for their clear and astute thinking and for their presentation in a real world sense.

Have a good day.

Don’t Quit
Barry