Navigating the Federal Funding Freeze: A Roadmap for Nonprofits (Part 1)

Co-written with Jennifer (Jen) Wasem

The recent turmoil in federal funding — delays, freezes, and the shuttering of government agencies — has left many nonprofits in a precarious position. If your organization relies on federal grants, what should you be doing right now to address immediate needs and ensure long-term sustainability?

Too often, nonprofits hesitate to communicate financial distress until it’s too late. If you don’t tell donors, funders, and your community what you need, they’ll assume everything is fine. Then, when you reach out six months later with a crisis, their ability to help is limited. So, what steps should you take today to keep your doors open and your mission moving forward?

1. Engage Your Donors Proactively

Your donors — whether individuals, foundations, or corporate partners — want to support your mission, but they can’t act if they don’t know what’s happening. Transparency is key.

• Specificity matters. Instead of saying, “If our funding doesn’t continue, our mission is in jeopardy,” say, “The $50,000 we were promised would have provided meals for 5,000 children this year.” Concrete details create urgency and drive action.
• Host regular check-ins. A monthly or quarterly Zoom chat with leadership keeps your community informed and engaged. This way, donors don’t just hear from you when you’re in trouble — they stay connected to your work throughout the year.
• Keep storytelling at the forefront. Share stories of resilience — your team’s, your community’s, and your nonprofit’s. Donors need to see both the challenges and the impact of their contributions.

2. Balance Crisis Management with Mission Execution

Not every team member should be reacting to funding disruptions. If the entire board and leadership team are focused on emergency fundraising, who’s keeping programs running?

• Divide and conquer. Assign a dedicated team to address funding challenges while others remain focused on service delivery and donor engagement.
• Empower your board strategically. Some members should be actively advocating for funding solutions, while others focus on ensuring the nonprofit’s operations stay on course.

3. Strengthen Community Connections

With government funding uncertain, strengthening your nonprofit’s community base is more important than ever.

• Offer tangible ways to engage. Remind supporters of the programs they can be part of —whether through volunteering, advocacy, or peer-to-peer fundraising.
• Leverage grassroots fundraising. Small dollar donations and engaging major donors, crowdfunding campaigns, organizing young professionals volunteer groups - all can help bridge financial gaps and keep your mission moving.

The Bottom Line: Be Open, Be Specific, and Keep Communicating

Nonprofits that thrive in uncertain times are those that embrace clear, proactive communication. You can be a leader in your mission space and express financial need at the same time. The organizations that do this well attract the support necessary to weather financial instability while staying true to their mission.

Don’t wait until the crisis is at your doorstep. Start the conversation now, build strong donor relationships, and keep your community engaged. Your mission—and the people who depend on it—deserve no less.

AND STAY TUNED -- in Part 2, we will explore how to craft the right messages and effectively engage your donors.

Alexandra N. Cohen - Founder, ANC Consult. Helping nonprofits and businesses succeed through strategic planning, grant research and writing, and impactful messaging to drive growth, secure funding, and amplify mission impact.

Would you like to chat? Schedule a virtual coffee with me here --> https://calendly.com/anc-consult/30min

With 20 years of nonprofit executive leadership and over $100M driven towards philanthropic initiatives, Jennifer (Jen) Wasem of Jenerous Living Philanthropy brings a wealth of creativity and strategic direction to philanthropy. Her efforts have earned industry-wide recognition and success with Fortune 500 corporate partnerships, mid-level and major gifts, workplace engagement, and peer-to-peer fundraising projects.??

Schedule a chat with Jen --> https://www.jenerousliving.com/booking-calendar/discovery-call-1