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What is a ‘performance indicator’? By one definition (found in the GPRA Modernization Act of 2010) it is “a particular value or characteristic used to measure an output or an outcome.” As a value, an indicator may be quantitative. As a characteristic, it is often quantitative, but it may also be qualitative.

 

It is often prudent to use two or three performance indicators to measure each output or outcome that is proposed to be the focus of an objective. Using one indicator alone is sometimes all that’s needed, but using more may yield findings that just one might miss.

 

Purposes of Indicators:

Use of indicators makes it possible to determine the extent to which the intended beneficiaries of a project or initiative in fact experienced a desired benefit. In turn, such determinations contribute to decisions about necessary interim or midcourse corrections and about the ultimate effectiveness of the project or initiative in achieving its objectives and attaining its goals. These determinations, as culled from evaluation reports, then contribute to decisions about continuing appropriations or allocations for specific grant programs.

 

In order to be useful in gauging the success and continued funding-worthiness of a project or initiative, performance indicators should have several attributes:

  • Specific
  • Measurable
  • Observable
  • Valid
  • Reliable
  • Pertinent

 

Indicators measure how closely a performance target has been met. If a target has been met or exceeded, based on the indicators used, the finding either implies or demonstrates a benefit. The more an intended benefit can be reported, the more successful a grant program will appear to be.

 

Performance Targets:

A performance target defines a criterion for success for an output or outcome. It sets a threshold for deciding whether a project or initiative is doing well or poorly in a given aspect. A usefully constructed performance target has several attributes:

  • Quantitative (number or ratio) preferably
  • Realistic or feasible
  • Reflective of experience
  • Reflective of baseline data
  • Valid
  • Reliable
  • Pertinent

In a multi-cycle project or initiative, the data collected during the first funding cycle will play several roles. It will corroborate or correct the baseline data presented in the original proposal. It will furnish a new basis for comparisons at intervals (e.g., quarterly or yearly) during a multi-cycle funding period. It will form a possible rationale for making midcourse corrections before the initial funding cycle ends.

 

Illustration:

  • Context – a high school physics science education project
  • Desired Outcome – that participants will demonstrate increased knowledge of the scientific method as implemented in a physics lab
  • Performance Indicator – that participants will list in correct sequence the contents by topic of a complete physics lab report
  • Performance Target – that 90% of participants submit a correctly sequenced physics lab report

The vocabulary of budget development is part of the language required for writing successfully funded grant proposals. This final set of entries covers words and phrases from R-Z.

RECIPIENT: An individual or organization that will receive a grant or has received a grant.

REGULATIONS: Administrative guidelines for government grants, issued after enabling legislation, which establish and define eligible applicants; eligible beneficiaries; the nature of activities to be funded; allowable costs; selection criteria for proposal review; and other requirements. Example: At http://www2.ed.gov/policy/fund/reg/edgarReg/edgar.html are found the Education Department General Administrative Regulations (EDGAR).

REPLICABILITY: The proven or predicted ability of a project’s effective activities and strategies to be transportable to another setting and to generate similar results in it; it is a factor in considering the potential impact of an initial grant award and is a criterion often associated with grant programs that fund demonstration projects. Also see: Demonstration Grant.

REQUEST FOR PROPOSALS (RFP): A formal invitation to apply for a grant that describes what types of applicants are eligible to apply; when proposals are due; the program selection criteria; the contents required in a complete proposal; anticipated levels and durations of funding; and other considerations. The specific length and contents of an RFP vary widely from one grant program and one solicitation to another. Also may be called: request for applications (RFA).

RESTRICTED FUNDS: Funds that a grant recipient may use only for predetermined purposes – such as those defined in the approved budget of a funded grant proposal – and that consequently it cannot expend as general funds.

REVIEW PANEL: A group of peers or experts retained by a grant-maker to evaluate the merits of grant proposals in a grant competition and to recommend which ones should be funded. Sometimes the reviewers may include one or more directors or trustees of a foundation.

SALARIES: The compensation of professional and technical personnel – who are typically limited only to those holding a post-secondary degree – before the addition of fringe benefits.

SEED MONEY: A grant award intended to help start a new project or initiative or to launch a new non-profit organization.

SELECTION CRITERIA: The formal set of factors a grant-maker uses in scoring and ranking a set of competitive proposals to determine which ones it will select for funding. Also may be called: criteria or review criteria.

SINGLE POINT OF CONTACT (SPOC): A person in state government whom an applicant must inform when it is applying for a federal grant in the US. A list of single points of contact is at www.whitehouse.gov/omb/grants_spoc. Some states have a SPOC, others don’t.

SOFT FUNDS: The funding of staff positions or other resources using grant funds rather than other means such as revenues from tax levies; it reflects the premise that such assets are not as secure, over the long term, as those funded using other means (e.g., annual tax levies). Also see: Hard Funds.

STANDARD FORM: A blank template that an applicant must complete and submit, as each specific program requires, with its application for a federal grant. A comprehensive collection of standard forms is at http://www07.grants.gov/agencies/aforms_repository_information.jsp, but be certain to observe strictly the cautionary guidance available at this site.

SUB-GRANTEE: A lower-tier recipient (e.g., a county agency) of grant funds from a higher-tier recipient of those funds (e.g., a state agency) and not directly from the grant maker; also called a sub-recipient. Also see: Grantee.

SUPPLANTING: A deliberate shifting or displacement in the source of funds (e.g., state or local) used to afford a given resource (e.g., personnel) in an organization because of the availability of federal grant funds after a new grant award. One caveat in many government grant programs is “Do not supplant.”

SUPPLIES: A cost category for consumable resources such as paper, pens, pencils, postage, folders, files, binders, paperclips, toner, blank data storage media, and similar office products. Definitions and thresholds for value of the discrete items vary widely across grant programs and funding agencies. Also see: Materials.

SUSTAINABILITY: A measure of the perceived likelihood that an applicant (and its partners, if any) will be able to obtain and use funding (and other resources) from itself and/or other sources to continue its proposed project or initiative after its initial grant funding ends. Grant-makers of all types often favor proposals that exhibit a high potential for sustainability.

TRAVEL: A cost category for costs associated with going place-to-place, including fares (air, bus, train, taxi, or shuttle), vehicle rentals or leases, mileage, tolls, meals, tips, and lodging. Every item assigned to this category must be clearly defined and well justified.

UNIFORM APPLICATION FORMS: The standard forms that applicants must complete and submit with applications for federal grants; several of them require specific or detailed budget information. Examples: SF-424 and SF-524. In federal programs, these are associated with specific grant opportunities posted on www.grants.gov.

UNRESTRICTED FUNDS: Funds from a grant or any other source that an organization may use for any legal purpose, such as general funds or operating funds.

WAGES: The hourly compensation of non-professional personnel – typically all of those who do not hold a post-secondary degree – before the addition of fringe benefits, if any.

Later posts will tackle types and sources of data used in winning grant proposals.

The vocabulary of budget development is part of the language required for writing successfully funded grant proposals. This set of entries covers words and phrases from M-P.

MATCHING FUNDS: The share of a proposed project’s total costs, which comes from any source other than the specific grant being sought; the matching funds may consist of the fair market value of donated resources (in-kind contributions) or of actual cash to be spent (cash) or of both. See the table for examples when an applicant is requesting a $200,000 grant.

Calculating Matching Funds
Match Required Grant-Maker Share Local Share Total Budget
50% Match = 1:1 $200,000 grant $200,000 local     $400,000
33% Match = 2:1 $200,000 grant $100,000 local     $300,000
25% Match = 3:1 $200,000 grant $66,700 local     $266,700
20% Match = 4:1 $200,000 grant $50,000 local     $250,000
10% Match = 9:1 $200,000 grant $22,500 local     $222,500

 

MATCHING GRANT: A grant awarded to an applicant with the intention of matching some of the funds (i.e., as a partial match) or all of the funds (i.e., as a total match) awarded to an applicant by another source. Also see: Challenge Grant.

MATERIALS: A cost category for consumable resources such as media (books, workbooks, compact disks, videodisks, or software), references, and training products. The category is often conjoined with Supplies or is subsumed as a part of Supplies. Also see: Supplies.

MULTIYEAR BUDGET: A budget covering all or part of two or more consecutive fiscal or calendar years. Many grant-makers require a budget for an entire multiyear project period at the time of the original application.

NON-COMPETITIVE GRANT: A funding program from which applicants are eligible for a grant award if they complete and submit required materials by a given deadline. Also may be called: a formula grant, an entitlement grant, an allocative grant, or a budget earmark.

NOVICE APPLICANT: An individual or an organization that has not received a discretionary grant directly from a specified unit or level of government (e.g., a federal agency) or from a specified grant program within a defined time-span (e.g., the last five fiscal years).

OTHER: A cost category commonly used in state and federal grant programs for budget items that do not fit other categories. Every item assigned to this category should be as clearly defined and well justified as every other item in a proposed budget. Avoid using this cost category for budget line items vaguely identified as “contingency” or as “miscellaneous.

OVERHEAD: See Indirect Costs.

PASS-THROUGH: A scheme for the distribution of funding where a first tier of grant recipients (e.g., state agencies) administers a grant program, awards sub-grants to a second tier of eligible applicants (e.g., school districts); and performs a yearly program audit of the second-tier grant recipients. Also may be called: flow-through funding.

PERSONNEL: A cost category for the human resources or labor, internal to the applicant as an organization, who will be involved in implementing a project; it includes positions paid in salaries and those paid in wages, and it excludes all independent contractors (e.g., evaluators and other consultants). Personnel may or may not be paid out of a proposed grant budget.

PRIVATE FOUNDATION: A legally defined type of nonprofit organization whose directors or trustees conduct charitable programs for social, cultural, educational, religious, or other permissible purposes.

PROGRAM OFFICE: An administrative unit, within a grant-making organization, that implements or coordinates the details of conducting a grant program, including the review and ranking of applications.

PROGRAM OFFICER: An administrator on the staff of a grant-making organization who runs a specific grant program, manages grant competitions, and provides technical assistance either to potential grant applicants or to existing grant recipients or to both.

PROJECT: The proposed plan for which an applicant requests grant funds.

PROJECT INCOME: The revenue an applicant’s project is expected to generate during a given time-span; it may include products sold, membership dues, service fees, earned interest, and funds raised by other means. It may also be called: program income or revenue.

PROJECT PERIOD: The total time for which support of a discretionary project has been approved; it is usually a series of one-year budget periods. Most project periods last one to five years; some may be longer, others may be shorter. Also see: Budget Period and Grant Period.

PROPOSAL: A written application of vastly varying length and content, submitted to one or more grant makers, describing a plan or initiative to meet one or more identified needs, and requesting partial or full funding for its support. Some grant-makers and grant programs require much more formal, detailed, and highly structured proposals – narratives and budgets – than do others. Also may be called an application or a funding request.

A later post will cover entries in this glossary starting with letters R-Z.

The vocabulary of budget development is part of the language required for writing successfully funded grant proposals. This set of entries covers words and phrases from H-M.

HARD FUNDS: The funding of staff positions or other resources using annual tax levies or similarly predictable and renewable revenues rather than by grant funds; its character reflects the premise that such assets are more secure, over the long term, than those funded using grant funds. Also see: Soft Funds.

IN-KIND CONTRIBUTION: A non-cash donation of labor (paid staff or unpaid volunteer), facilities, equipment, materials, or supplies to carry out a project. Applicants for grants must exercise extraordinary care in calculating the cash value of in-kind contributions and in identifying, tracking, and reporting the sources of such contributions. Also see: Matching Funds.

INDIRECT COSTS (IDC): A cost category for costs that are not readily allocable to or identifiable with operating a specific grant program; it is also often called overhead. Indirect costs = direct costs x approved indirect cost rate. Such costs commonly relate to administration and facilities. Generally, a government grant-maker reimburses indirect costs only after it has negotiated and approved an indirect cost rate with the grant recipient. As grant-makers, foundations are less apt to allow full or partial recovery of an organization’s indirect costs than are units of government. Also see: Direct Costs.

INDIRECT COST RATE: An annually revised percentage established by a unit of government for a grant recipient that the recipient uses in computing the amount it charges to a grant to reimburse itself for indirect costs it incurs in doing the work of the grant-funded project. A foundation grant-maker also may solicit and approve an applicant’s proposed indirect cost rate before it considers a proposal from it or awards a grant to it.

INVITATIONAL PRIORITY: An area of special focus which a grant-maker would prefer to see an applicant address in its proposal, but which does not affect the review, rating, or rank ordering of proposals.

LEAD AGENCY (Applicant): The organization that submits a proposal on behalf of a partnership of two or more organizations and that serves as the grant recipient. If funded, the lead agency is legally responsible for implementing and administering its funded project, for properly managing all grant funds, and for submitting all required reports.

LEAD AGENCY (Grant Maker): Particularly in federal grant making, the agency or program office with the primary responsibility for approving or funding a project; it reviews the proposals, coordinates with other involved agencies, and notifies the applicant of its funding outcome.

LETTER OF COMMITMENT: A brief official letter that conveys the willingness of a partner organization to commit cash or other resources to a proposed project; it specifies the terms and conditions of the commitment, the precise resources to be offered or delivered, and the actual or estimated values of those resources. Also see: Letter of Support.

LETTER OF INQUIRY (LOI): A brief, but formal, mode of grant application, typically one to five pages long, often used when an applicant seeks a grant from a foundation; it commonly includes an introduction, a problem statement, objectives and activities, an evaluation plan, an organizational capacity statement, and a budget. The letter of inquiry often forms a basis for deciding whether the foundation will request a full proposal from an applicant. Informally, also known as an LOI.

LETTER OF INTENT: A brief official letter or e-mail (or other specified form of notification) from a potential applicant to a grant-maker that conveys its intention to apply for funding. The grant-maker may request or require the letter of intent to gauge the number of applicants likely to be competing for funding in a given grant program. Alternatively, some grant-makers may use the term as a synonym for letter of inquiry.

LETTER OF SUPPORT: A brief official letter that conveys the enthusiasm, endorsement, and encouragement of an individual or an organization for an applicant’s proposed grant project and for its request for funding, but does not explicitly commit resources to it. Also see: Letter of Commitment.

LEVEL FUNDING: An amount of grant funding that does not change from year to year during a multiyear grant.

LEVERAGING: A measure of the potential role that a given grant award is likely to have in attracting other funding or resources to a proposed project or initiative. As the specific grant-maker requires, an applicant may present either a ratio of requested grant funds to total project funds or a ratio of requested grant funds to funds from other sources.

MARKET VALUE: The economic value of a resource (e.g., volunteer labor at minimum wage) as determined up to the date and time an applicant submits a proposal (e.g., the wage rate in effect on or before that date); often, an applicant determines market value by checking an official government publication or website or by reviewing a grant program’s regulations.

A later post will cover entries in this glossary starting with letters M–P.

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