What are Regional Collaboratives?

Regional Collaboratives bring together government agencies, foundations, and other philanthropic organizations to target financial resources and strategic thinking on creating jobs and careers. They align funds to help create and expand workforce partnerships. They help bring together local leadership and target strategic thinking on creating jobs and careers, and helping businesses succeed in a post-recession economy.

There is no one single model for a regional collaborative. They range from a collection of public and private sector organizations that agree to fund the same projects to highly structured groups that combine their funds and award grants together. Click here to see where NFWS is currently operating.

The governance for collaboratives

Some collaboratives are built on very structured agreements between funding organizations in the community that spell out how, as a group, the collaborative will award grants. Other collaboratives represent loosely structured agreements to work together.

In several cities, private funders, public-sector leaders, research organizations, Workforce Investment Boards, employers, advocacy groups, organized labor, and service providers have joined together in steering committees. These steering committees direct funding for existing and new workforce partnerships. The steering committee can consist of funders who collaborate in a variety of ways, from coordinating their respective grantmaking based on agreed-upon principles, priorities, and strategies, up to and including blending their funding for targeted investments.

None of the regional collaboratives that are part of the National Fund are incorporated as 501(c)(3) organizations. They see their roles as temporary alliances that have come together to address a particular problem, rather than as permanent institutions that require a separate administrative structure.

Staffing

A regional collaborative is a good way for individual funders to share the administrative costs of operating a workforce partnership initiative. All National Fund regional collaboratives have hired an independent staff person to manage the local initiative. Regional collaborative staff may be an employee of one of the funders or may be contracted from a local organization such as a grantmakers association, but they report to the full collaborative. Many regional collaboratives also engage national consulting firms with expertise in workforce development to provide advice and strategic guidance to their initiatives.

Financial management

To varying degrees, all collaboratives have aligned their investments in workforce partnerships. Some have blended public and private funds, like in Boston and New York City. Others have worked to align their grantmaking decisions, such as in Baltimore, Milwaukee, and Rhode Island.

Blended funding

In the blended funding model, each funder pledges an amount to the overall initiative. The objective is for these combined or blended funds to be allocated by the collaborative for workforce partnership grants, research, evaluation, management, or other related activities. In reality, many public and private funding organizations do have restrictions on how their money can be spent and what activities their money can support. So the collaborative takes responsibility for keeping track of these restrictions, rather than requiring grantees to do so.

In Boston, for example, the SkillWorks Funders Group blends investments from 14 foundations and public funding sources so that service providers – workforce partnerships – receive one, single grant. The California Employment Department, in the Bay Area, works with several foundations to design a request for proposals that public and private funders use to solicit, review, and award grants. In New York City, individual foundations award grants to a 501 (c)(3) created by the New York City Small Business Development Services Department that then makes grants.

Aligned Funding

Some collaboratives do not engage in joint grantmaking. Rather, private and public funders meet as an informal steering committee to discuss the needs of jobseekers, entry-level employees, and employers in the community, and how each funder can contribute to achieving a shared vision. In turn, each funder follows its own grantmaking procedures, soliciting proposals and awarding grants to support the work of local workforce partnerships.

While this approach does not offer simplified funding for grantees like the blended funding approach, it is effective at bringing together investors around a common purpose on an important issue. The aligned funding strategy makes it possible for public and private funders to work closely together, even if the funders in a community have limited experience with such philanthropic collaboration.

Public/Private Co-Investment

How a collaborative manages its funding is, in many ways, determined by the capacities, limits, and restrictions under which philanthropic organizations operate. For example, the by-laws of many foundations do not allow them to manage public funds. As a result, when public and private entities in a regional collaborative co-invest, different models for managing the investment may be utilized. Regional collaboratives may be managed by a foundation or other private philanthropy, managed by a public agency, or a third party may be charged with managing the distribution of funds.

In Boston, for example, both the city agency and the state agency implementing the Workforce Investment Act transfer funds to a “mutual fund” managed by a community foundation. The community foundation awards contracts to local organizations that implement specific aspects of the local initiative. The contracts clearly spell out what the local organizations are to do and deliver, thus allowing the public funders who contribute to the “mutual fund” to know that they are paying only for specific activities that directly support their mission.

In other instances, philanthropic organizations work with public agencies to coordinate grantmaking. Each organization awards its own grants and contracts. But they work together to review proposals so as to increase the likelihood of coordinated and efficient funding.

Yet another example is when the philanthropic organization and public agency award grants to a third party, such as a nonprofit organization, which uses these funds to compete and award grants. The third party, of course, follows the grantmaking guidelines set by the regional collaborative.

One other approach being used by some collaboratives involves philanthropic organizations making grants directly to a public agency, such as a Workforce Investment Board, to strengthen the public sector approach to worker training and career support along the lines of the collaboratives’ vision.

Accountability

Managing the investments of multiple funders is complicated. In some collaboratives a large community foundation – such as the Boston Foundation, New York City Community Trust, or The San Francisco Foundation – serves both as chair of the funding collaborative and as fiscal agent for the initiative's funds. Their legal status as 501(c)(3) nonprofit organizations makes them eligible to receive grants from both private foundations and from public agencies. As fiscal agents, the foundations are, in effect, the recipients of grants from the other investors.

The fiscal agent provides written reports to each funder on the progress of an initiative, in accordance with that funder’s reporting expectations as stipulated in its grant award letter. Funders also receive regular updates at funders’ meetings from the staff or consultants responsible for managing activities, and they receive written progress reports from the grantees. The fiscal agent tracks any funds that are restricted as far as what specific activities they can be used for.

For More Information

Funder Collaboratives: A Philanthropic Strategy for Supporting Workforce Intermediaries