Institutional Compliance

My institution at the time was a large 501c3 research organization with over $100 million in grant revenue per year, and an award portfolio of almost $1 billion. Like most nonprofits and research institutions, we lived and died by our ability to procure grants and maintain a healthy sponsored projects portfolio. Participation in proposal development was mandatory for researchers, and the institution was constantly forecasting workload needs based on submitted, pending, awarded, and closing grants. The culture at my institution encouraged PIs to aim for large, multi-year grants with padded budgets, since these were the most likely to yield an automatic no-cost extension or two. Furthermore, most researchers could only maintain employment through their grant portfolios. Given this environment, it is easy to understand how this PI believed that the grants being awarded to him were his personally.

Accountability to the Donor

Unveiling the truth about grant awards is rather anti-climactic. In the simplest language, grants are non-repayable funds or products, disbursed by a sponsor to a recipient. Most awards support a specific project and require some level of compliance, evaluation, and reporting. Sponsors of all kinds have the money and desire to advance certain agendas, activities, or research areas, but do not have the internal resources to do so. Specifically, foundations and not-for-profit organizations award funds based on a recipient’s ability to further a mission or goal, as well as fulfilling the work outlined in a proposal submission. Although a PI or team submits the proposal, sponsoring organizations do not recognize individuals as entities that can or will share responsibility on the same level. Instead, that burden falls to the organization or institution to which those PIs and teams belong. Moreover, a single person cannot carry out the proposed work or research to the degree that an organization can.

Tax Liability

The additional issue of tax liability is enough to dispel the erroneous notions of possession from most researchers. Institutions with the capacity to receive grants are either exempt from IRS tax liability, or they are large enough to absorb said tax liability. Excepting most scholarships, fellowships, and some disaster relief aid, if a grant is awarded and accepted by an individual, that person will be responsible for paying all the tax liabilities associated with it. I will never forget a meeting where I met a handful of faculty members who had been accepting grants awarded to them personally. The IRS had finally caught up with them and was demanding over $50,000 in back taxes, with the penalty for non-payment being time in prison. Had the institution accepted these awards, there would have been no tax liability at all.

Remember, grants are made to institutions, not individuals. Understanding why grants are awarded, and what the researcher’s role is in administering the award is vital for an organization’s ability to survive an Office of Management and Budget (OMB) audit. As Project Directors or PIs, you have been selected by your institution to act as the representative for the award. You have been made accountable for managing the programmatic requirements supplied by the sponsoring organization. While this is an awesome responsibility, it does not make the grant funding yours. Should there be an audit issue down the road, you may end up quite grateful for this fact.

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1. Money is scarce and grants are difficult to receive as a new grantee.

   Wrong. In 2013 more than $855 billion was awarded in grants, with $520 billion from the Federal Government and $65 billion from foundations and corporations. The remaining funds were from individual donors and bequests. More applications are submitted now than ever before, which make competition difficult. However, donors tend to favor excellent proposals from new grantees and investigators to support original ideas.

2. Grants are about money to fortify our budget.

   Wrong. Grants are about good ideas that lack the money to be executed. However, good ideas need to be effectively researched, developed and written in terms that are compelling and convincing. Further, good ideas must have an excellent presentation to attract the attention of the donor.

3. Grants are awarded to those who have the greatest need.

   Wrong. Grants are awarded to those who have the ability to deliver on the donor’s interests. Frequently, donors are looking for applicants that demonstrate credibility, strength, ability, and commitment. You must also parallel the donor’s goals with yours. In other words, make the match between you and the donor.

4. Prestigious institutions get all the money, no one else has a chance.

   Wrong. The big-name institutions often have proven to be good stewards of the grants they receive; they are credible for delivering, and for complying with the donor’s guidelines. This is why donors continue to fund their efforts. However, many relatively unknown institutions do the same and have earned the confidence of their donors. Don’t be intimidated by the reputation of prestigious institutions. At the end of the day, the money goes to those who have established credibility, have a quality proposal, and deliver on the promises made to the donor.

5. Writing a proposal is hard.

   Wrong. Most people confuse something that is time-consuming with something that is difficult. Writing a proposal will take quite a bit of time, relative to the product. Like anything else, the writing process can be made easier through practice and patience, and by using the proper mechanics, techniques, and grammar. Most importantly, if you are passionate about your subject, writing a proposal can be a much easier undertaking.

6. We can put a winning proposal together in a couple of weeks.

   Wrong. Certainly, a proposal can be composed in a couple of weeks, but the quality will suffer heavily. Grant complexity varies, and some may take months to complete. It takes time to do the research on your topic, assemble the right team, and gather institutional buy-in. The final processes of writing the proposal, discussing it with the donor, rewriting, and editing can take weeks. Meanwhile, your competition has probably taken the time to do it right. If you ask yourself whether you can still compete with them and the answer is no, wait until the next cycle and do it right.

7. To win grants, I need to apply to as many programs as possible.

   Wrong. Many institutions and individuals believe a shotgun approach is the way to get funded. The true results are a burned-out staff, multiple failures, and disillusionment. Instead, how about writing five proposals to receive three grants? If you produce quality work and make the proper match between you and the donor, this is entirely possible. Remember to ask yourself: “Is this the best work that I or my team is capable of?” If the answer is yes, you are ready to submit a quality grant, and greatly increase your chances for being funded

8. I have to write the proposal all by myself.

   Wrong. Proposal writing is a team effort. It will involve collaborators, partners, departments throughout your institution, fiscal officers, evaluators, graphic designers, and editors. It takes a community to write a quality proposal that will overtake the competition.

Buying into any of these myths can stifle your efforts to write proposals. Debunking them can allow you to clear the path toward a rewarding effort that gives you freedom, flexibility, and credibility.

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