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Communicating with funders when funding is delayed
When funds via contracts are delayed, what are your top strategies for effectively communicating with the funders about the effects on your objectives/deliverables and asking for extensions to spend down funds and/or meet outcome expectations?
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Talk with your opposite entity contract manager, assuming there is a signed contract with payment terms and cancellation notice clauses, ask why payment is held up and explain that unless payment is made according to the contract terms, your nonprofit will not be able to maintain the schedule of work in the contract. In a follow up call, after giving them some agreed upon time to fund but funds haven’t appeared, explain that you don’t want to have to do this but an internal “stop work” order may have to issue. This is usually sufficient incentive to cause action on their part, but maybe not. Tell them that before issuing this stop work order, you will need to seek legal counsel and to escalate the matter with their supervisor because of the gravity of the matter. Following that, if no payment issues, continue to go up the feeding chain in the agency with that message. Of course, you have to consider the risks of losing the contract entirely vs the potential rewards, but if the $’s are significant, you have to protect your reserves so that you can continue your work on other projects. Your reserves are what allow you to invest in your entity’s future growth, maintain the quality of your work, continue to remain in financial health, and retain and compensate staff. If failure to pay on their part threatens this, then not taking action, increases the risk to your non-profit and threatens its financial health. You can’t get into the position of funding a project internally that may cause your non-profit to fail and be unable to fulfill commitments on other projects – been there, done that, unwillingly, and it was painful!