Challenges Rural Organizations May Face in Seeking Philanthropy Support

This section provides an overview of the barriers that rural programs face in building relationships with and receiving funding from philanthropies.

Lack of Access to Major Foundations

Part of the perceived urban bias in philanthropic investment is because many national philanthropies in the U.S. are located in urban communities. Organizations in urban communities consequently have increased opportunities to make contact and build relationships with philanthropies through conferences and meetings. Rural programs may not have funding for staff to travel to conferences or events, where they might have greater access to philanthropies, affecting their ability to meet funders and build relationships.

Inability to Meet Matching Fund Requirements

Grant programs sometimes require that an applicant have resources to match the funder’s investment, which may present a barrier for some rural organizations. Other kinds of matching grant programs may also present challenges for rural programs. For example, employee matching gift programs are often funded by corporate philanthropies that match donations made by employees. Large corporations with matching fund programs may be concentrated in urban areas and may encourage employees to donate to local organizations.

Demonstrating Impact with a Small Sample Size

Philanthropies want to understand programs' potential to make an impact. They often ask applicants to estimate the impact of their program. A rural program operating in a community with a low population density may make a large impact in that community, but serve a small population. Philanthropies may not be able to invest in programs that serve a small number of people, regardless of how promising the program is. In an effort to increase their sample sizes, some rural communities are partnering with other rural communities facing similar issues to secure funding.

A “Needs-Based” Rather than “Asset-Based” Narrative

Much of the research exploring rural communities has focused on disparities and needs, with limited attention to the strengths and assets present in many rural communities. This narrative of despair and hopelessness negatively affects how rural communities are perceived by philanthropic organizations and the public. Philanthropies may perceive that there is nothing they can do to address the challenges facing rural communities, deterring them from investing.

Real or Perceived Lack of Organizational Capacity and Staff Expertise

Rural programs face unique challenges to building organizational capacity. They may not have adequate funds for staff salaries and program administrative costs. Limited resources often mean that rural programs cannot invest in business development. Additionally, rural programs may not have funds to dedicate to recruiting and retaining staff with specialized skills and knowledge in areas that are important to philanthropies, such as data collection, analysis, and evaluation. Even sophisticated rural programs may experience challenges in securing philanthropic funding if funders perceive a lack of capacity because these programs are located in a rural area.

Misperceptions about Rural Communities

Rural communities are incredibly diverse; no two rural communities are exactly alike. They also face different challenges than non-rural communities. One report by the National Committee for Responsive Philanthropy, Rural Philanthropy: Building Dialogue From Within, describes several misconceptions about rural communities that could affect philanthropic investments:

Self-sufficiency. Rural communities are known for their altruism and volunteerism and there is a perception of a self-help, mutual aid tradition in rural America. This concept that volunteerism replaces philanthropy might affect philanthropic investments in rural communities.
Diversity. Funders may not be aware that rural areas are becoming more diverse due to an increasing immigrant population in the rural workforce.
Demand for arts and culture. The U.S. Department of Agriculture's Economic Research Service found a disparity in foundation funding for arts, culture, and humanities in urban areas compared to rural areas. From 2005 to 2010, 14.46% of foundation funding to urban areas was dedicated to arts, culture, and humanities, compared to 9.46% of funding to rural areas. Some funders may underestimate demand for cultural resources in rural areas, due to a characterization of cities and urban areas as cultural hubs in the U.S. Misconceptions of rural areas as less sophisticated than urban areas may make it more difficult for rural programs to secure funding for arts and cultural activities.
Impact of a single organization. In urban areas, many organizations may have overlapping missions or address the same key health concern. If one organization fails to receive funding, others may be poised to serve the same target population. In contrast, one rural organization or program may serve multiple functions and provide critical services to the entire community. Funders may not be aware of the impact that a single local nonprofit can have on health and well-being in a rural community.

Funding Needs for Tribal Communities

Tribal communities have historically received a small amount of funding from foundations. According to Foundation Funding for Native American Issues and People, a report by the Candid in cooperation with Native Americans in Philanthropy, only 0.3% of the share of total foundation giving in 2009 focused on American Indian communities. Of this 0.3%, only about a quarter of grant dollars was targeted toward rural communities. This report theorizes that the lack of funding could be due to a lack of understanding about the role that philanthropies could play in improving Native American communities.

Resources to Learn More

Foundation Funding for Native American Issues and Peoples
Document
Describes trends in foundation giving to Native American communities from 2000 to 2009. The report describes potential reasons for the lack of philanthropic funding of Native American programs and provides recommendations for future funding priorities.
Author(s): Lawrence, S. & Mukai, R.
Organization(s): The Foundation Center, Native Americans in Philanthropy
Date: 2011

Rural Philanthropy: Building Dialogue from Within
Document
Provides a comprehensive overview of challenges that make it difficult for rural programs to receive funding from philanthropic organizations.
Author(s): Swierzewski, R.
Organization(s): National Committee for Responsive Philanthropy
Date: 8/2007

Small but Tough: Nonprofits in Rural America
Document
Compares the nonprofit sector in rural and urban America and describes some key barriers faced by rural nonprofits.
Author(s): Neuhoff, A. & Dunckelman, A.
Organization(s): The Bridgespan Group
Date: 9/2011