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Taking Control with a Funding Plan

Updated: Mar 6, 2021

Make It Work for Your School

Lisa sat at her desk reviewing the school budget for the next board meeting. She was the director of a K-8 charter school near Denver, serving 500 students. The school had recently been designated as a Title 1 school and was serving a community with many needs. She desperately wanted to win the Board’s approval for her new project but the budget was not looking good.

Funding Plan
Could she learn how to take control of her budget to provide the resources her students needed?

It was September, and the state would base per-pupil-funding on enrollment figures as of October 1. Enrollment was stable, but not growing as she had hoped. Several new schools had opened nearby, and they all seemed to be competing for the same students. The other schools were offering specialized programs or brand new facilities that she just couldn’t compete with. She had a plan to offer one-to-one devices to all her students, incorporating the new technology with the school’s curriculum and instructional strategies.

Lisa wanted to develop new homework polices and train all her teachers in improved engagement techniques. She wanted to give her students access to technology that most of them did not have at home. And she was sure that this new program would increase enrollment and stop the losses as students transferred out to the other schools mid-year. But the budget doesn’t lie; the money simply wasn’t there.

As Lisa sat there feeling disappointed, she got a phone call from a friend. Kim was the director of a local nonprofit organization that supports young adults with leadership training and opportunities for community service. When Kim asked how she was doing, Lisa expressed her frustration and disappointment. Kim knew about the program she had planned and was disappointed with her. But then, Kim asked a question that changed everything.

“What’s your funding plan look like?” Kim asked.

“Funding plan?” Lisa answered. “Well, we do a few fundraisers. The parent group is planning a book fair and a 5K later this year. I’m not really sure you can call that a plan, though.”

Kim shared how nonprofits develop funding plans, including fundraising events, donations, grants, and sponsorships. She told Lisa that this plan was based on their annual budget and their projections for what was needed to run the programs they offer. Then she invited Lisa to visit her office so she could show her how it works.

As she hung up the phone, Lisa wondered if it could be that simple. Could she learn how to take control of her budget to provide the resources her students needed?


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What Charter Schools Can Learn from Nonprofits

Charter schools operate within a unique funding structure. As schools they rely on per pupil funding, but as nonprofits they have the opportunity to develop additional funding streams. Nonprofit organizations have developed effective strategies for fundraising because many rely almost exclusively on contributions. We can learn to make those strategies work for charter schools. You can increase your funding with a plan that includes revenue from diverse sources, including grants, fundraising, donations, and business support.

Types of Support

Let’s define the various types of support that may benefit your school.

  • Fundraising – a financial contribution in exchange for goods or services, such as the purchase of cookie dough, paying for a car wash by students, or buying snacks at the booster club snack stand

  • Donation – a one-time offering of money, services, or products, often to meet a specific short-term goal or general overhead costs, with no expectation of receiving value in return

  • Philanthropy – (a special type of donation) a commitment to support long-term goals, with multiple, generous offerings to support major efforts or continuous expenses, with no expectation of receiving value in return

  • Grant – an agreement where an agency gives funds to the school to meet a specific goal within a specific time frame defined in the agreement 

  • Corporate sponsorship – a donation of money, goods, or services from a corporation or business for a specific event, project or funding need

  • Business partnership – a donation from a business in exchange for advertising or marketing privileges over a period of time

Consider the focus for each type of giving.

  • Fundraising is often a community event. Teachers, parents, and even extended family members contribute to the cause and volunteer their time because they want to support the school. They receive a product or service in exchange for their contribution, but often the product or service is not the primary motivation.

  • A donation is connected to the donor’s perception that achieving a specific goal is important. You will be successful in attracting donations when you can clearly articulate the benefits of the goal you want to achieve. 

  • Philanthropy is based on your vision and the transformation you promise. Philanthropists are willing to wait years to see the results of a project, if the vision aligns with theirs. They invest in your success, not in a specific project or goal. 

  • A grant is focused on meeting the funder’s goals. Your proposal will be successful to the extent that it furthers the grantmaker’s agenda. 

  • Corporate sponsors want to fulfill their organization’s mission to invest in their communities. They appreciate the opportunity to support your school’s activities and expect some small recognition in return, such as a thank you note on your social media pages and website. You want to build relationships with key employees who are decision makers in the organization.

  • Business partners want to be associated with successful events and projects. They expect value in exchange for their contributions, through marketing opportunities and the right to be associated with your success. These partnerships are generally the most formal, requiring a signed agreement to define the terms and costs involved. You will attract business partners when you can demonstrate success with other similar projects.

Successful school leaders understand the importance of developing all types of giving to sustain a school and create a legacy. You can have greater impact through lasting partnerships that support your goals.


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A Balanced Approach

The school support pyramid helps you see how your funding plan can work.

School Support Pyramid
School Support Pyramid

At the base of the pyramid you will findgeneral school funding. This is state revenue based on enrollment for public schools. It may also include special program funds, such as Early Literacy funding that many states offer, and funds for federal programs such as Title I and Title II.

The next level is school-based fundraising. This includes any money raised from school-sponsored or parent group–sponsored activities. Whether the activity is sponsored by school staff, parent volunteers, or a formal group such as the PTO or Booster Club, there is some exchange of value (a product or a service is purchased) and the proceeds are donated to support school goals. This is the second level on the pyramid because it is generally the first optional fundraising activity that schools go to. It is familiar and easy to understand for both parents and school staff members.


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The third level on the pyramid is donations. This includes any voluntary contributions to the school that are not tied to receiving anything in return. Some schools develop a recognition program for donors, with designations for various donation amounts. Others invite donors to pay for a brick or stone with their name engraved in a pathway or on a wall. Schools can solicit donations from parents, extended family members, and even wealthy patrons. It takes time and consistency to develop this type of donor program and many schools do not take advantage of this opportunity. That’s why this is the next level up. It is less common and not always successfully implemented. The keys to a successful donation program are relationships and shared vision. The donor needs to feel that he is contributing to something meaningful that aligns with his values, and that he can trust you and your organization to fulfill your promises.

The fourth level on the pyramid is grants. Some school staff members write small grants to support individual projects or classrooms. Some school leaders write larger grants for specific initiatives. Others rely on major federal grants to build or expand school facilities. Very few schools have developed the type of grants pipeline that consistently seeks and attracts grant funding. The ones that do are often part of a network of schools that can provide a grant-writing team, but I believe more school leaders would add grants to their revenue stream if they understood how to manage the process.

The final level of the school support pyramid is business support, which includes corporate sponsorships and business advertising. At this level, you are partnering with businesses to achieve specific goals, such as paying for an out-of-state competition for your students or furnishing a new computer lab. In exchange, the business or corporation gets recognition of some sort for its contributions. In some cases, these agreements may include payments throughout the year, such as a fee for advertising placement on your website. In other situations, they may be tied to a specific event such as sponsoring your annual 5K Run and displaying a large banner with the corporation name at the event.

How to Set Funding Goals

When I was a charter school director, I tended to leave fundraising to the parent group. I approved the schedule of events and let them know what we needed, but I didn’t know how to guide them to support our school goals. Since then, I have learned what it takes to lead successful fundraising. I’ve learned how to set funding goals and what’s important to consider as you set your goals.

The first step in setting your new funding goals is to understand your current situation. Review your school’s financial status to determine how much money you need to raise. Consider your expected revenues from per-pupil funding and any other budgeted revenue, add any upcoming programs you want to support that are not currently funded, and calculate the total deficit.


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Next, you will need to understand your school’s fundraising experience. Review your records to discover what has worked in the past, how much has been raised and which activities have been most successful. Continue what is working and increase the fundraising goals by about 10% for the upcoming year.

For example, suppose your parent group sponsored an Annual Gala and Silent Auction last year and donated $10,000 to your school. In addition, you raised another $5,000 from a couple of book fairs, and received another $5,000 in donations by individuals. The total fundraising revenue last year would have been $20,000. Add 10% to that total as your goal for this year, unless you have an urgent need that justifies a higher goal. Then decide if you want to continue developing those two areas of fundraising, or if you are ready to explore a different category such as grants or corporate sponsorships.

Take the total fundraising goal and divide it across at least two categories. Continuing with the example above, you could divide your efforts between fundraising and donations again and simply increase the goal, or you could consider adding a small grant to your plans. Set a specific goal for each fundraising category and decide exactly what that money will be used for. Write down your goals and commit to them.

Funding Targets

Developing new sources of revenue takes time and consistent effort. While I suggest a 10% growth goal the first year, you don’t want to stop there. Develop a plan and set goals for the next two years, and then revise annually. It can be helpful to know what other schools are doing, so I’ve developed the chart below. While your numbers will be different, you should pay attention to the proportions. Schools find more success with activities near the base of the pyramid. It gets harder as you consider categories further up the pyramid.

Fundraising Chart
Fundraising Chart

Develop Your Funding Plan

To take full advantage of fundraising opportunities, you need a funding plan. This plan will outline where you think your supplemental revenue will come from, how much you expect to attract, and when you’ll receive it. You can develop this plan yourself and seek feedback on your goals from board members and key staff members, or you can invite supportive stakeholders to work with you to develop the plan as a committee.

Align your efforts with your vision and strategic plan, and map out the next two years.Focus on one area first until you have established your procedures and begun to see results, and then add another category. Before long, you’ll have a school wide culture that celebrates community and grants support.


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Make It Work for Your School (conclusion)

Lisa learned that day that she could support her goals with careful planning and a new approach to fundraising. She met with Kim and learned how to develop a funding plan, and adapted the strategy for charter schools. She presented the plan to her board of directors and won approval.

Lisa worked with her staff and parent volunteers to develop a yearlong plan to raise money for the project. They scheduled several fundraising events, applied for two technology grants, and won a corporate sponsorship from a local IT firm.

At the end of the school year, Lisa invited Kim to lunch at their favorite café. “I’m so excited!” she told Kim when they met. “I am ready to order iPads for all my students next year, and my teachers are looking forward to the new training. It’s all thanks to you!”

Kim laughed and said, “You did it! All I did was show you how nonprofits like mine handle fundraising. You figured out how to make it work for your school.”

Lisa smiled warmly and continued, “You know what the best part was? Working together with my staff and parent volunteers to make this happen. Our fundraising events were more successful than ever. We learned how to connect better with donors and we figured out how to let businesses support us. I have a grant writing committee now, and one of my parent volunteers even joined the board of directors! Now I know I have someone on the board that truly understands how important fundraising is. I bet we raise even more next year!”

Watch for my upcoming book,Fearless Funding: 30 Day Challenge for Charter Schools. Get ready to improve your fundraising results with daily tasks you can fit into your busy schedule.

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