Drawbacks of Government Funding

Updated: Jul 31, 2019

By Alvin Codner:

Drawbacks of Government Funding

In my opinion, the three most significant downsides of government funding are the spending limitations on government grants, the application process of obtaining a government grant, and the lack of sufficient funding that most nonprofits need.

When it comes to government grants, there will always be spending limitations based on the government agency an organization is receiving the grant from as well as what type of nonprofit category the organization is in. As stated by (Feiock & Andrew, 2006, p. 761), government contributions to the nonprofit sector can take many forms including direct grants, subsidies, and tax exemption. They go on to state that governments also subsidize nonprofit activities by supplying in-kind resources. So, in a sense, when a government agency provides funding to a nonprofit, the government sets the terms on how the organization is allowed to spend within a specific area. Based on my knowledge, I know some government grant terms consist of doing a research study on the organization’s clients or community they serve in order to provide positive/progressive statistics back to the government agency that provided the grant. Downside about that task is if the organization doesn’t perform well, within the time provided by the government, to present the results of the research study, the government may no longer provide a grant for the upcoming year.

As for the application for obtaining government grants, it is a lengthy process. According to Polaris Grant Central, preparing government grant proposals usually require arduous work and tons of research and planning. Based on what I learned in my learned in my Grant writing class at FAU, these grants are far from easy to write. The research consists of knowing the nonprofit organization in totality, searching the proper government grant for that fits the nonprofit, researching the grantor, in totality, following detailed and specific rules asked by the grantor, and much more. Some organizations actually hire a professional grant writer to write government grant proposals for the organization. The downsides about the application process for obtaining government grants are the extreme time factors that come into play while preparing a government grant proposal and spending the money on hiring an outside grant writer. Another downside is even if an organization follows all the guidelines and write perfect grant proposal, the government still doesn’t have to give the grant because they have a bunch of other nonprofits to choose from. It’s a competitive field when it comes to receiving government grants. Nonprofits must apply in a timely manner.

For my last significant downside of government funding, I stated the lack of sufficient funding that most nonprofits need. This downside is simply based on my opinion and experience working in the nonprofit field. I used to work for a nonprofit organization called Playworks which provides help in social skills to students at low income elementary schools. Playworks offers an Americorps position which is their entry level position. For those who don’t know, Americorps is a civil society program supported by the U.S. federal government, foundations, corporations, and other donors engaging adults in public service work with a goal of "helping others and meeting critical needs in the community." The downside about the Americorps position with Playworks is that majority of times, the salary doesn’t match the cost of living. I worked with Playworks of San Francisco, California in 2015. The average cost of a 1 bedroom apartment was $3,500 and my living stiped was $2,000. In order to apply for housing, you must make 3 times the rent. Section 8 housing had a 6 month to a 2-year waiting list. I state all of this to say, the government can at least acknowledge the funds provided to Americorps members should be greater than the cost of living depending on the city and not less.


(2012). Advantages and disadvantages of government grants. Retrieved from http://www.polarisgrantscentral.net/instruction.htm

Feiock, R. C., & Andrew, S. A. (2006). Intl Journal of Public Administration. http://dx.doi.org/ 10.1080/01900690600769530

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