Managing Grants Within a Member-Driven Mission: 6 Tips

Effie Panos, Guest Blogger

This guest article was written and submitted by Effie Panos, Accounting Principal at Strategic Association Solutions. Please see the end of this article for Effie's bio. 

By: Effie Panos

Amid federal funding shifts, 52% of federally funded nonprofits are experiencing financial instability. Many organizations are struggling to deliver programming and serve their communities at this time.

However, many foundations recognize this increased demand, with 37.3% anticipating an increase in their giving to nonprofits in 2025. Nonprofits seeking additional funding may find more luck partnering with independent, community, corporate, or operating foundations rather than the federal government.

If you successfully obtain a grant, your work doesn’t stop there. In a grant landscape study conducted by Euna, 45% of respondents listed grant management as their largest struggle in the grant process. For member-based organizations, approaching grant management through a member-driven lens can add another layer of complexity.

This guide will walk you through actionable steps to help you navigate the highs and lows of securing grant funding. These tips will empower you to balance your priorities and manage your grant strategically.

1. Apply for grants that align with your mission.

While it may be tempting to pursue any available funding, it will be easiest and most beneficial in the long run to look for grants that align with your mission and member base. Use the grant-seeking process as an opportunity to revisit and refine your mission statement.

Start by defining your priorities. For example, a natural history museum may focus on:

• Educating the community about endangered species
• Advocating for environmental policy changes
• Building community among members

Then, use specialized grant databases to find grants related to your focus areas. For organizations like the natural history museum presented above, Thompson Grants’ online grant database guide recommends seeking grants through the Environmental Grantmakers Association (EGA) for environmental and sustainability-focused organizations and through Candid’s Foundation Directory for foundation grants. Other, more general sources include Grants.gov, GrantStation, and GrantScape.

2. Involve members in funding priorities.

As Strategic Association Solutions explains, “All goals should ultimately put the member experience at the forefront.” Since members are at the core of your mission, they should have a say in what your organization funds.

Survey members to identify the programs, initiatives, or services they value most. Mapping members’ preferences to your internal goals can help you better understand where your priorities overlap and pinpoint areas you may not have thought to focus on. Ask members questions like:

• Which of our current programs, initiatives, or services do you find most valuable?
• Which programs should we expand if we acquire additional funding?
• Are there any unmet needs our nonprofit could better address?
• What new services, events, or resources would you like us to offer?

If the survey responses help you unlock new insights, consider forming a member advisory committee for more regular member input. Gather a group of your most engaged members to consistently brainstorm new ideas and collect feedback that improves your organization and member experience.

3. Create a separate grant budget.

Typically, grant funders have specific requirements for how you can use grant funding. For example, recipients of National Leadership Grants for Museums must use the funding to “support projects that address critical needs of the museum field and that have the potential to advance practice in the profession to strengthen museum services for the American public.” 

By creating a separate grant budget, you can more easily track grant spending and ensure you use funds according to the associated restrictions. Follow these steps to develop your grant budget:

1. Review grant guidelines. Identify allowable expenditures and any funding restrictions. For example, some funders may not allow you to use funds for lobbying activities. Note the reporting requirements and deadlines, and share these stipulations with your team.
2. Set up a unique budget category in your accounting system. Track grant revenue and expenses separately with a different account, class, or project code, depending on how your system works. That way, you’ll simplify compliance reporting and avoid commingling funds.
3. Break down the grant award by expense category. Allocate the funds to different categories, such as program supplies, events, and technology. If your funder has provided pre-set budget categories, use these in your system for easier reporting and management.

If your funder allows you to use grant funds on indirect or overhead costs like payroll and rent, factor those in as well. If not, be sure to still calculate them so you can present the overall cost of managing the grant to your board.

4. Forecast cash flow around grant cycles.

While some grant funders may disburse all grant funds upfront, others may pay in installments or give reimbursements. Depending on your funder’s disbursement schedule, create a calendar with expected payment dates and reporting milestones. Remember to build in a buffer in case you don’t receive funds on time so you can continue serving members appropriately, no matter what.

Then, develop a cash flow projection to better predict how much cash will flow in and out of your organization and when. This month-to-month document should include:

• Beginning cash balance
• Expected inflows, including grant installments, membership dues, and donation revenue
• Expected outflows, including grant-related expenses, payroll, and overhead
• Ending balance

Using conservative estimates helps ensure you have enough money to cover your expenses each month. If you need help assembling your cash flow projection, partner with a firm that provides membership-based nonprofit accounting services.

5. Monitor and report grand spending.

Conducting monthly or quarterly grant budget reviews helps you comply with funder requirements and keep your spending on track to support your program or project effectively. Compare actual spending to your budgeted allocations, and use this data to make more accurate projections in the future.

Make the reporting process go more smoothly by organizing documentation like receipts, invoices, contracts, and timesheets. That way, you’ll have proof of your expenditures and can more quickly develop funder reports.

6. Communicate outcomes.

In addition to sharing grant outcomes with funders, you should also reveal the positive effects of this funding to your members. Use these tips to make your grant communications more engaging:

• Break down financials. While you’ll likely attach your grant budget and other financial data to your report, members may be unfamiliar with the technical jargon. Explain important financial insights more tangibly so all members can easily digest them.
• Use visuals. Visual elements catch readers’ attention and help further explain complex data. For example, you may add photos of your community participating in a grant-funded event alongside a graph showing increasing event attendance over the course of the grant’s disbursements.
• Emphasize impact. After reading your grant report, members should easily be able to point out the difference these funds made for your organization and mission. Include member testimonials, the number of participants, and outcome data, such as advocacy wins or increased understanding of your museum’s subject matter, found via survey.

Share grant outcome information across channels, such as your website, newsletter, and social media, so it reaches as many members as possible. Members who participated in grant-funded programs will feel empowered to know they were a small part of something that made a huge difference in your community.

Grant management is complex for any organization, but especially member-driven nonprofits during economically volatile times. By keeping your mission and members in mind throughout the process, you’ll more confidently pursue and manage grant funding to grow your organization and better your community.

About the Author: Effie Panos, Accounting Principal, Strategic Association Solutions

Effie Panos is an accomplished accounting leader and business operations specialist. With a strong portfolio of over 30 years of achievements focused on organizational improvement, profitability, and efficiency, she has helped both nonprofit and for-profit organizations enhance their internal processes, procedures, and applications.

As a self-starter and team player, Effie brings a blend of management and extensive accounting experience, with expertise in financial management, Generally Accepted Accounting Principles (GAAP), operations, change management, budgeting, forecasting, and revenue optimization to clients.

Effie holds a Bachelor of Science in Accounting from the University of Illinois. She has held many previous roles in nonprofit accounting and operations, most recently as a Controller for A Safe Haven Foundation and Vice President of the Not-for-Profit Division at Quattro Business Support Services.