Public policy grant making: Building organizational capacity among nonprofit grantees

Federal restrictions deter the involvement of private foundations in public policy making. In the 2000 grant year, public policy grant makers funded approximately 15,000 public policy grants worth more than $2.4 billion. These funds support the actions of nonprofit "policy actors." Previous research suggests that funders that are committed to exerting influence in a policy system will invest in policy actor capacity development. This study seeks to identify the practice of funder investment in policy actor capacity. Three areas of capacity development are considered: research and communication capacity, resources acquisition capacity, and management and governance capacity. Consideration is also given to the concept of "holistic investment." Are funders concerned with the overall capacity of the organization or just with specific dimensions of capacity? Records of grants made by 407 of the largest foundations in the United States serve as the data for the study.