CAPTURE JANUARY 2016 Q1 ISSUE 01 | Page 19

2016 Q1 ISSUE COSTTREE CAPTURE. 19

THE TEN PERCENT

However, if you decide to pursue the grant because it is a strategic imperative to expand your scope of service, then you will at least know what you are getting into.

Then, the question to ask yourself is, “Which route do I want to go? 10% de minimis or true cost reimbursement?" In Exhibit A, you will see that with the 10% de minimis route, you will receive $8,225, which ends up being 7.93% reimbursement from the government—less than its name implies. Because the true indirect cost is $135,935, you would then need to fundraise for the remaining $127,710 left uncollected from the grant, in order to fulfill the requirements of the grant. Or, if you take the step to get a NICRA under the new Uniform Guidance, you will be able to receive your full cost reimbursement of $135,935 from the federal government.

MAKE AN IMPACT.

What if you are able to fundraise the $127,710 and DID NOT have to use it as a subsidy for Grant 2? In that case, you would be able to DOUBLE your efforts on Program A and still be able to do the grant. Your impact footprint has doubled, likely a better solution in everyone’s book: Doubling your service of your core mission AND expanding your reach with a new program supported fully by the grant for your true cost.

In conclusion, 10% de minimis is definitely a step in the right direction, but knowing your true cost, understanding how to use that to maximize impact, and leveraging the new Uniform Guidance to maximize indirect cost reimbursement, gives nonprofits the leap they need to be sustainable while making the impact they exist to make.