Report: Rural-Based Organizations Receive Fewer Grants than Urban NPOs

A popular online dating service likes to say that city folks just don’t get it.

What the city slickers do get is grants—and they get them at a much higher rate than rural folks.

According to a report issued by the United States Department of Agriculture Economic Research Service, rural-based organizations received just 5.5 percent of the real value of domestic grants from 2005 to 2010. Considering that 19 percent of the population live in rural areas, the conclusion is that most grants go to urban areas.

While that estimate might seem low, the author also examined other ways to determine the amount of financial support rural-based projects received from foundations in 2010. The number improves slightly (to 6.2 percent) when grants that benefit rural purposes, including rural development, rural health and agriculture, are included.

A few weeks ago, we wrote about how nonprofits can thrive in a small town. Understanding where grants go can help a nonprofit operate better. The report says understanding the distribution of grants is important for many reasons. Often geographic-based government or public programs partner with nonprofits for programming (or nonprofits substitute for the government programs) and understanding the data can help policymakers maximize the effectiveness of government programs.

The study used information from the largest 1,200 to 1,400 foundations, focusing on grants of at least $10,000. This data accounted for half of the total value of grants given by foundations in the U.S. in 2010.

Plus, once the grants are given to rural areas, the money isn’t spread out equally. More than 18 percent of non-metro counties did not receive a single grant from 2005 to 2010. However, some counties received more than $10,000 per person.

While the data focused primarily on the grants given by larger foundations, the report said smaller foundations are more friendly to rural organizations. In 2005, the value awarded to rural organizations was 7.5 percent of all grants, and fell to 7 percent in 2009.

Nonprofit Resource Memo highlighted three other findings from the study:

  • The average dollar value per person of grants from large foundations to rural organizations was $88, versus $192 per person in metro counties.

  • Counties with more college-educated residents (even when grants to universities and students were removed from the sample) received more grants per person.

  • Rural organizations received more grants related to higher education, environment, and recreation/leisure than their urban counterparts.

For rural nonprofits, this report can be a downer or just affirmation of their belief that they are fighting an uphill battle. However, rural-based nonprofits can overcome this by being more strategic in their grant writing and persistent in their approach.

Do your research. Don’t just apply for the first grants that pop up on an internet research. Find smaller foundations based in your area. Foundations are more likely to invest in areas they know and are involved with so if you stay local with your grant applications, the foundations will be more likely to underwrite your work.

Also don’t fret, a large pool of money is still available. The percentages listed above are based on hundreds of billions of dollars, so even a small percentage spread amongst the many rural-based nonprofits can have a massive impact.

For more data and finding, read the full report here.

  • Phoebe Mergy

    I was very discouraged when I began to read this article as I live in a rural small town. And have just bought a large house to open a women’s emergency shelter. After reading the entire article I’m now encouraged, to apply for grants at my local foundations gives me some hope as we do have a wealth of local ones. Thank you!

    • Lincoln J.L. Arneal

      Thanks for the feedback, Phoebe. I am glad you stuck with the article to the end. Keep up the the good work and making a difference in your community!