Five More Reasons to Care About Federal Funding

Some organizations receive funding from the federal government. They might apply for competitive grants, operate a cooperative agreement, or receive formula funding. They might receive some combination of different sources of federal dollars. When headlines blaze about the latest proposal from Congress or the White House to slash federal funding, one imagines that these organizations are feeling the heat.

But what about the rest of us? We’re glad you asked. Here are five reasons you should care about federal funding, even if your organization doesn’t receive it.

1. You might be receiving federal funding without knowing it. Vast swaths of the federal budget—from healthcare to housing, from job training to child care and more—go directly to state and local governments for regranting. Politicians at the state and local level like to pound their chests about balancing budgets while Uncle Sam racks up red ink. In reality, federal dollars make up 31 percent of the average state budget, and 23 percent of the average local budget. Most people are at least somewhat aware that Medicaid is partially federally funded, but did you know federal dollars reached your local school lunch, energy assistance, or storm water drainage program?
2. Federal funding cuts could increase demand for your services. That local youth center might not be built or operated if federal lawmakers end the Community Development Block Grant program. This could increase demand for services at your local YMCA, but it’s also not a stretch to imagine it impacting a wide range of others, from the arts to youth violence prevention organizations and more.
3. Which gaps will philanthropy fill? Maybe you don’t apply for federal government funding partly because you’ve had success seeking philanthropic support. At the same time, your donors are likely going to be cultivated to support other services in your community that will be affected by federal funding cuts. For instance, the local police department may reach out to your community for more support as it faces financial stress because Congress slashed the Community Oriented Policing Services (COPS) program. This is just one of many ways donors and organizations could be stretched ever thinner in the wake of decreased federal funding.
4. Less investment now could mean more future demand. A good fourth-grade teacher can increase their class’ lifetime earnings by $700,000. Yes, you read that right. So federal funds that eventually find their way to teacher quality improvement programs (like Title II of the Elementary and Secondary Education Act) can have a massive impact on the long-term need for nonprofit job training, housing, and nutrition assistance.
5. You have a stake in our democracy. Regardless of whether you receive federal funding in any form, you and your organization are invested in our political system. That system relies on a decennial census to fairly spread electoral power across every community, an effort that urgently needs adequate federal funding in order to meet its obligations.

These are just five of many reasons to care about federal funding issues. Did we miss a reason of which you’re particularly mindful? Please let us know in the comments.