Ten Critical Questions to Ask before Requesting Funds for a Capital Project

The questions below provide a convenient checklist that organizations can consider in evaluating their projects and their readiness for funding.

1. Is our organization sustainable and does it have the capacity to manage a capital project?

• • To assure its sustainability, the organization should operate in accordance with the Foraker Nonprofit Sustainability Model – that is, it should be well established and focused on its mission, with a stable and engaged staff and board of directors, adequate unrestricted funding to carry out its mission and partnerships that help it operate more efficiently.
  • If no in-house capacity exists to manage a construction project, a plan exists to acquire project management services.

2. Does the project meet a documented public need?

• • The project should provide some public benefit beyond meeting the internal needs of the organization.
  • There should be hard data demonstrating the need for the project.

3. Is the project part of our organization’s strategic plan and consistent with the community’s development?

• • The organization’s strategic plan should indicate how the project fits into its mission and overall facilities planning.
  • The project should fit within community development plans and reflect community priorities.

4. Have opportunities for partnerships been explored?

• • Opportunities for co-location, shared programming, or shared administrative functions have been investigated to ensure the best facility is developed to meet the community’s needs.

5. Is the project the right size?

• • The project’s space requirements have been professionally evaluated to meet the organization’s needs, and the total size is affordable.

6. Has site control been established on a suitable site?

• • A site for the project has been selected that meets the space requirements, is in an appropriate land use zone, has no insurmountable environmental issues, and anticipates reasonable development costs.
  • The organization has ownership of the site, a legal agreement to purchase, or a long-term lease agreement.

7. Is there a valid project cost estimate?

• • A professional cost estimator, contractor, or experienced project manager prepared the cost estimate.
  • The project cost estimate includes not only construction costs but also all associated “soft” costs – usually 30% to 50% of construction costs.

8. Is there a realistic plan of capital funding?

• • A plan exists that identifies realistic sources of funding for the project, including local contributions. This plan should be appropriate to the human capacity and infrastructure of the organization and should ensure that it does not jeopardize current operational funding.

9. Is there a business plan for sustainable operation of the facility?

• • The cost of operating the programs to be housed in the facility and operational costs of the facility itself are known and adequate revenue identified to cover them on a sustainable basis.

10. Is there a realistic schedule and development plan?

• • A plan has been established for procuring design and construction services in accordance with funding requirements.
  • The project schedule realistically reflects the time required for design and construction.