1. S- Sustainability Resources: Budgeting and Cost

2. Agenda 1. Discuss readings- Brooks Chapters 6, 7 4Brainstorm sources of cost and income 2. Hands On Activity – Work as a team to Fill in Parameters for First Place Fund for Youth (p.96)

3. Once you have established Community Need developed a Logic Model and formed and Assessment Plan, the next question is, how you will pay for or SUSTAIN your program. Needs Assessment Cost Logic Model

4. Mobilizing Resources 1. Define the Capabilities Needed 2. Devise a Human Resource Outline to meet each capability need 3. Develop a resource plan 4. Put on the Numbers Brooks Ch 6 p 86

5. 1. Define the Capabilities Needed Start by reflecting on the activities and who will do them.

6. Figure 6.1 The Capabilities – Resource Model

9. 2. Devise a Human Resource Outline to meet each capability need

10. 3. Develop a resource plan

11. Figure 6.2 Sources of income for American nonprofits* * Salamon 2002

12. Figure 6.3 Types of earned income for social enterprises

13. Table 6.3 The Product Profile Map Source: James & Young (2006) High mission impact Low mission impact Positive profitStarsCash cows Loss-makingSaintsDogs

14. Income sources 4 Three main sources of nonprofit revenue –Fee income, which is about half of the total –Donations, which are about one fifth –Government, which provides the balance 4 Different nonprofits rely on different types –Social welfare: 52% government, <1/3 earned –Health: less than 6% is donated –But arts groups are half funded by private giving –Religious institutions are not government funded 4 Figure 6.2 shows income sources for all nonprofits 4 Figure 6.3 shows social enterprise earned income types

15. Table 6.4 Revenues from membership dues for various nonprofit enterprises, 2003 Enterprise type Percentage of income from dues Labor organizations66.02% Social clubs59.61% Business leagues40.27% Public charities (all 501(c)(3)) 0.90% Source: Steinberg (2006)

16. Table 7.1 Source of donations to American nonprofits, 2005 Living individuals76.5% Foundations11.5% Bequests6.7% Corporations5.3%

17. Figure 7.1 Average annual contributions to various types of causes and charities among those making positive contributions, 2003

18. Raising funding is connected to being able to demonstrate effectiveness

19. http://www.socialresearchmethods.net/kb/pecycle.php Utilizing results includes for publicity and fund raising for non profits: http://www.9wsyr.com/news/local/story/More-parents- reading-to-their-kids/MCwPYPKY20SPNrUHf1p0Pw.cspx http://www.9wsyr.com/news/local/story/More-parents- reading-to-their-kids/MCwPYPKY20SPNrUHf1p0Pw.cspx

20. 4. Put on the Numbers

21. Activity: p 96 First Place Fund for Youth Use the CLASS project planning tool to walk through the above 4 steps as a group for “First Place Fund for Youth”

23. Novel Approaches to Raise Money

24. Dan Pallota – 1 st 10 minutes To accompany Brooks Ch 8 Entrepreneurial Fundraising and Marketing

25. For Discussion: Dan Pallotta: The way we think about charity is dead wrong http://www.youtube.com/watch?v= bfAzi6D5FpM

26. Inspirational Stories from Students For Final Project

27. http://www.localsyr.com/bridge- street/video/d/video/jennifer- nadler-lemoyne-speaker-bridge- street-3271/5011371 Soc Club Events on Video

28. Local grad to pedal cross country for area's homeless 4 http://www.localsyr.com/mostpopular/story/ Local-grad-to-pedal-cross-country-for- areas/d/story/UpgtCu_Jf0yzmb3zHuVUKQ http://www.localsyr.com/mostpopular/story/ Local-grad-to-pedal-cross-country-for- areas/d/story/UpgtCu_Jf0yzmb3zHuVUKQ

29. Father and daughter continue mission for special needs playground near Phoenix 4 http://www.youtube.com/watch?v=w6lx18u bmyo http://www.youtube.com/watch?v=w6lx18u bmyo

30. First list all of your assumptions in a sheet/tab called parameters

31. Crucial for Final Project 4 This exercise will help you complete the S portion of your final project 4 For your final project DO NOT just tweak your Imagination Library budget- it will likely lead to many mistakes. 4 Instead start from scratch and build a new smaller budget for your program just like we will practice today – Use the last 2 tabs of your Project Planning Tool in Excel

32. 1.Daycare Budget than explore the full flexible spreadsheet - Use digital handout parameter sheet, run scenarios as a class

33. The Scenario: Use this to complete the Parameters

34. Cost Concepts Cost Output Variable Costs Semi-Variable Step Costs Fixed Costs 4 Key question: how does each change as the cost unit (or unit of activity your agency performs – visits miles, packages, clients) changes

35. Cost Concepts Cost Output Fixed Costs 4 Fixed costs do not change as units of activity (kids) change.

36. Sheet A-1,cell C 27 is the proportion of the monthly salary we are responsible for (remember we are only one of the 4 childcare sites see assumption 5 in parameters) A-1, C25 is _____ Administrator salary/month

37. Cost Definitions Fixed vs. Variable 4 Fixed Costs (do not vary with output): –Top administrators and resources they use. –Financial, legal and other services provided organization. 4 Variable costs (vary directly with output): –Consumables: materials, supplies, gas used in transportation –Printing/postage/communication –Part time personnel providing service directly –Legal, financial and other services tied directly to output –Equipment (and O&M) used directly in service provision 4 Semi-variable costs (fixed cost + variable cost per unit): –Phones, utility rates. 4 Step costs (vary in lump with output): –FT personnel –Facilities/utilities/equipment (and O&M) tied to personnel Source: Bretschneider

38. Cost Concepts Cost Output Variable Costs Variable Revenues 4 Variable costs are to fixed costs as electric bills are to monthly rent charges. 4 variable costs do change as units of activity (kids) change.

39. Sheet A-1 is a quick clue that it is a parameter. then look for cell C 20 (in sheet a-1) (it is “Food costs/day/child”) B6 is the number of children in the daycare (see previous slide) A-1, another parameter, C20 is “Work days/month”

40. Cost Concepts Cost Output Semi-variable Secretary paid by hours of work required, but may require standard benefits package such as health benefits. 4 Semi-variable costs do change as units of activity (kids) change but they start off with a fixed cost.

41. http://www.labor.ny.gov/stats/lswage2.asp http://www.labor.state.ny.us/workforceindustrydata/descriptor.asp

42. Not needed here but would be like… =flat cost + (# clients*($5.00))

43. Cost Concepts Cost Output Step Costs 4 change only when units of activity (kids) reach steps (i.e. by law need one staff member for every 5 kids)

44. Sheet A-1,cell C 20 is “Work days/month” B7 is the number of employees A-1, C 21 is Hours/day/emplo yee (i.e. 8 hours a day) A-1, C 24 is Hourly wage-- daycare worker (i.e. $6.50/hr)

45. Share literacy letter as an exemplary solicitation letter – example of where a liberal arts edu can help!

46. Estimating Personnel Costs 4  How do I assess the value of volunteers?  http://www.independentsector.org/programs/r esearch/volunteer_time.html http://www.independentsector.org/programs/r esearch/volunteer_time.html  Summary: The estimated dollar value of volunteer time is $19.51 per hour for 2007.

47. Cost Concepts Cost Output Variable Costs

48. Cost Concepts Cost Output Semi-variable Phone and utilities included in Rental

49. Cost Concepts Cost Output Step Costs