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Several of the Local Organic Food Co-ops have made use of matching grants or funds in their development, sometimes in co-operation with a local credit union or municipal government.
The Philanthropy Journal's, Ret Boney talks to Carl Pitruzzello, director of advancement services at the University of New Haven, about how nonprofits can maximize the corporate matching gifts their donors are eligible for but may not be taking advantage of.
Question: Why are matching gifts an important source of income for nonprofits?
Answer: It's free money that's available to nonprofits, and in these difficult times, anything you can do to maximize giving to an organization is a good thing.
In the United States, roughly 10 percent of all corporate philanthropy is through matching gifts, and about one in every 10 gifts to a nonprofit is eligible for a match.
Most corporations will match gifts made by their employees to institutions of higher education, hospitals, health-services organizations and other less-controversial nonprofits. Not as many, however, will match gifts made to religious organizations.
Last year, about 11 percent of all of the University of New Haven's donors who pledged through our phone-a-thon were eligible for a matching gift. Given that it's typically a one-to-one match, you can make a strong case when talking to a donor that their $50 gift is really worth $100, or for larger donors, that their $10,000 gift could be worth $20,000, depending on their employer's matching-gift policy.
It's a small part of the total amount raised, but it's free to the donor and they are able to double or even sometimes triple the amount of their gift - so why not take advantage of it?
Q: Are matching gifts frequently overlooked by nonprofit development staff?
A: This is frequently the case, and not knowing about matching gift programs is the primary reason. The opportunity for a match is often overlooked simply because the donor doesn't know their employer has a matching-gift program in place, or they don't know what steps to take to get the gifts matched.
According to the Council for Aid to Education's latest report, there was about $170 million in matching gifts to higher education organizations in 2007, but that was only from reporting colleges, so the actual number is significantly higher. It's even higher when you include all nonprofits.
And there's more money out there that companies don't fulfill in matching gifts because they don't know their employees have made a donation.
Unless donors are proactive, it often gets overlooked, so the more information you give the donor at the time they make the gift, and the more follow-up you do, the more likely the match will be fulfilled.
Q: What is the potential benefit for nonprofits that focus on identifying matching gifts?
A: If one in 10 gifts is eligible for a dollar-for-dollar match, you can add 10 percent to your giving program, and that's a significant number. Asking for a matching gift is notasking for anything more from donors - it's capitalizing on something that already exists.
And once a donor knows about matching gifts and how to use them, it's not just for one year only. For consistent donors, that doubled gift can continue for years.
Another benefit is that a match can boost donors into a higher giving society or recognition level than they could qualify for on their own. Legally, the company gets the credit for the matching gift, but the donor gets "soft-credited."
We really try to promote that by counting the matching portion of the gift as part of the individual's giving total in our annual donor report.
Someone who gives $500 can make it into our President's Society of donors, which starts at $1,000, if they receive a match.
It's a win, win, win. The matching-gift company is happy because they're getting listed in the donor report and can report to the community that they and their employees are supporting worthy causes; the donor is happy because they're able to give more; and the recipient organization is happy because it is receiving twice the donation, or more.
Q: What steps can nonprofits take to maximize matching gifts?
A: First and foremost, you have to be committed to matching gifts and to putting a program in place. There needs to be organizational commitment, otherwise everything else is irrelevant.
Second, you need access to critical information, primarily a list of the companies that sponsor matching-gift programs. There are services that maintain databases of all the matching-gift companies in the U.S. and Canada that can provide this information for a fee.
Then you want to gather employer information from your donors so you can determine which donors are match-eligible. Once you have access to this information, it's a matter of communicating match eligibility to your donors as frequently as possible. Promote, promote, promote.
At the University of New Haven, we publicize matching-gift opportunities on our website and in our gift acknowledgement letters. During our annual phone-a-thon, our callers have access to that information and are able to tell donors whether or not their employer offers matching gifts.
We segment our fundraising mailers and include matching-gift information to eligible donors. And we send reminders. If we know a donor works for a matching-gift company, we'll send monthly reminders and include the form donors need to complete in order to trigger a match from their employer.
The easier you can make it for people the better. Think about it - if a donor is willing to make a gift, they likely are willing to fill out a form, assuming you've made it easy for them.
People are tied up with other things and often they just don't think about requesting a match from their employer. So, if you don't trigger the action, it's not going to happen.
The most important point is that if donors believe enough to invest in the organization, they're going to be happy to invest even more without having to write an additional check.