Although the Maclellan Family Foundations support ministries outside of the United States and are deeply committed to the growth of faith-based initiatives, the Foundations will not make any grants directly to any organization not recognized by the Internal Revenue Service as a 501(c)3 public charity.  Neither will they solicit nor review grant applications from non-exempt organizations.

 

Two options are open to non-exempt organizations in seeking funds in the United States: 

 

First, there are sources of information available to non-U.S. organizations that explain the process for establishing a U.S. affiliate that is qualified to receive grants directly from U.S. foundations. One such site is The Foundation Center Online, which has an extensive on-line library covering all aspects of grants, both seeking and making. A good starting point would be their FAQ entitled "Where can I find information on grants to non-U.S. organizations?"

 

Secondly, a grantor may consider a grant request in support of a project implemented by an organization that does not currently have 501(c)3 public charity status with the Internal Revenue Service if the grant application is submitted by a “fiscal sponsor” or sponsoring organization, i.e., either a U.S. affiliate with 501(c)3 public charity status (established as described above), or a U.S. organization with 501(c)3 public charity status that enters into a fiscal sponsorship agreement with the non-exempt organization.  The fiscal sponsor may seek funds for such a project and later, if a grant is approved, will be legally responsible to monitor and control the grant funds.  Grants made to “fiscal agents” (known as “pass-throughs” or “conduits”) are not appropriate.

 

A sponsorship agreement with a fiscal sponsor must be in place before the sponsor applies for a grant.  In such an agreement, the fiscal sponsor stipulates that the project is compatible with the sponsor’s own mission and purpose, and that the sponsor has formally adopted the foreign organization’s project by a process that includes: 

 

a.	a formal review of the proposed project by the executive leadership of the sponsoring organization;
b.	a resolution by the sponsoring organization’s board adopting the project.
c.	a formal grant agreement that includes: performance requirements, the right of the sponsor to withdraw given non-performance, the right of the sponsor to re-direct grant funds to another end-recipient in order to ensure performance.

 

The fiscal sponsor ought at all times to treat funds received as its own money, retaining full discretion (“spending authority” or “variance power”) over the use of the funds.  The handling of such funds should always reflect its normal procedures and accounting.  Sponsoring organizations should independently investigate their legal responsibilities to be sure they comply with IRS and other US Government regulations pertaining to fiscal sponsorship.