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Blend or Braid

The terms blending and braiding are used frequently, often together, and generally with little definition.  However, they refer to two very different approaches to fiscal coordination.   Rather than lump them together, let’s pull them apart and identify the settings where each is most useful.  Next week, we’ll explore some tips on how to develop your blending and braiding models.

 

Defining Blending

Blending funding involves co-mingling the funds into one “pot” where case managers can draw down service dollars, personnel expenses can be paid, or other program needs can be met.

Water In BucketIn order words, blending is a lot like a family’s bank account.  Each month, my husband and I deposit our paychecks into one bank account.  When we go to write a check for the mortgage, we can’t tell whether his paycheck or my paycheck paid for the mortgage.

So, if you can’t tell which funding stream’s dollars paid for a given expense, when can you do this type of funding?

  • When all of the services/expenses that are part of your program are allowable under all of your funding streams.
  • When you are able to track the eligibility of all of your clients, to make sure each funding stream has a sufficient number of eligible clients being served.

 

Defining Braiding

Braided funding involves multiple funding streams utilized to pay for all of the services needed by a given population, with careful accounting of how every dollar from each funding stream is spent.

BraidingTo simplify this concept, let’s use the visual of a braid.  If each funding stream is one rope in your braid, you initially have separate ropes.  In order to meet the needs of your client and pay for a variety of services, you bring those ropes of funding together.  However, your funders aren’t interested in paying for all of the services your client needs, so when you are done providing services, you pull those funding ropes apart and report back to your clients in the services each funding stream independently paid for.

Complicated, isn’t it?  Unfortunately, this is the approach we usually have to use.  Many of our funding streams are only permitted to cover specific services or may have time limits on the length of services.  By bringing multiple funding streams together, we can be more comprehensive in the services we provide, but we also need to be careful in how we track those services, so we can report back to our funders.

 

Which One Should You Use

A few signs that you need to use a braided funding model include:

Tip 1: Using federal government funding? You will probably have to braid your funding streams, unless you have explicit permission from your funder.
  • One or more of your funding streams cannot pay for one or more of the services you provide.  For example, if your services include screening for health issues and  one of your funding streams does not allow anything related to primary healthcare, you may need to braid.  Or, if your services include stipends for participation and one of your funding streams disallows any direct financial payment to client, you may need to use a braided model.
  • Tip 2: Using contracted federal funds that did NOT go through a grant process? Make sure you are designated a “vendor” – this decreases the complexity of the auditing requirements for some of the more complicated funding streams.

    One or more of your funding streams requires detailed accounting of the number of clients who received services paid for by that funding stream AND the services they received.  This has to be directly tied to the reimbursement request.  For example, you have to enter the client and their services into a database developed by the funder, which generates the payment amount.

  • One or more of your funding streams has frequent and in-depth audits, where auditors want to see how each dollar was spent, separate from all other programs and funding streams.

A few signs that you can use a blended funding model (less paperwork!):

  • You are largely using funding streams that come as lump sums, such as foundation grants, and have discussed your plan to blend funding with your funders (or included it in your grant proposal).
  • Tip 3: Using foundation funding? Most foundations allow their funds to be blended, but don’t forget to share your model with them and make sure it meets their needs!

    All of your funding streams are appropriate for all of your expenses.  For example, any funding stream you are using could pay for your curriculum expenses, stipends, and food for a youth leadership training seminar.

  • Your funders are interested in seeing the number of clients eligible for their funding who were served, the outcomes of those clients, and your overall program budget.  They are less interested in seeing exactly how many services their funding paid for, separate from all other funding.
  • You have open and frequent communication with your funder and can share your plan for how you will blend, get feedback, and move forward as partners.

Regardless of which model you use, talk to your funders and make sure they are comfortable with your choices, make sure you understand their contracting and auditing requirements, and be ready to solve problems together!

 

Reminder: Blending and Braiding are Just a Means to an End

One of the big downsides to the complexity of public/private funding models is how easily the funding can take over your mission.  The last thing we want to do as we work on blending and braiding funding is make decisions about programs, services, and clients based on the funding alone.  Funding is just a means to an end!  Ultimately, we want to make a difference with the funding, not just spend it.  Open communication with your funder is important because at the end of the day, even if they want to see the evidence that the money was spent appropriately, they chiefly want to know it made a difference.

For more information, visit Spark Policy Institute’s Blending & Braiding resources at: http://sparkpolicy.com/fiscalsolutions.htm.

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Introducing Spark Policy

At Spark Policy Institute, we are dedicated to helping communities and policymakers solve complex problems.  The Spark blog will focus on concrete strategies and actions you can take as you seek to make a meaningful difference on issues that are challenging, complicated, and critically important to you and your community.

 

What are complex problems?

Called “intractable problems” by some, complex problems have a mix of stakeholders at all levels of government, each of whom have different funding sources, mandates, and expectations; these problems also have private stakeholders, consumers, and communities that cannot be left out.

What are some examples?

  • As regards the obesity epidemic, finding the policy and individual behavior change solutions that can reduce obesity and its associated illnesses;
  • With healthcare access and reform, moving beyond playing politics and into making a difference;
  • With water policy in the arid west, finding solutions that balance environmental, agricultural, and population needs;
  • Healthy food access and its intersection with transportation infrastructure, water, land-use planning, nutrition education, and schools; and
  • Behavioral health and its intersection with all aspects of our lives, from workplace productivity to juvenile justice involvement to physical health outcomes.

Spark’s work is dedicated to the challenge of addressing complex problems such as these, bringing together a combination of research, engagement of all stakeholders, and information dissemination to help find solutions.

 

What do we know about these complex problems?

We recognize that regardless of which policy arena a problem emerges from, common issues are often present:

  • Policy solutions identified in one arena are likely to cause unintended consequences in others;
  • Money talks – part of identifying any policy solution is understanding how public and private funding operates, what the limitations are, and where to find opportunities to leverage;
  • Sustainable solutions and change in the status-quo are only successful when a wide range of stakeholders are involved in identifying both the problem and the solution; and
  • Finding solutions is only the beginning – implementing change is a long, slow process that requires commitment, resources, regular evaluation and feedback, and engagement of all the stakeholders.

 

How do we solve these complex problems?

As Spark has grown, we have built skills and expertise to tackle complex problems in a wide variety of arenas: human services, health, behavioral health, natural resources, agriculture, housing, juvenile justice, criminal justice, education, early childhood, and diversity / disparities.

The Spark team we have assembled over the years now includes a mixture of:

  • Researchers who are adept at working in messy, complex settings and bring a wide variety of methodologies to their work including fiscal and legal research, evaluation, network analysis, q-methodology, focus groups, and many other quantitative and qualitative approaches;
  • Facilitators who understand how to inform dialogue with external information and input, and can create a safe environment where all stakeholders, including community members, consumers, and even youth, can participate fully in complex policy dialogues;
  • Project managers whose approach reflects the needs of their clients, and who can remain flexible as the policy environment changes; and
  • Product developers, who specialize in ensuring reports, white papers, presentations, and other materials are rich in information and attractive in presentation, but more importantly, are committed to making sure no product becomes yet another report that sits on a shelf.

 

What does a “solution” look like?

Every problem has a different solution, and we know that the solutions that are first tried often fail to address fully all the complexity of the problem.  What does a solution look like?  There is no single answer – every system is different.  Maybe the solution includes changes in how funding is utilized by government agencies.  Maybe it includes changes to policies related to access to care.  The solution might be about how non-profits mobilize and educate their communities.  It may also include new voices having a say in the decision-making process.  Sometimes a solution is about changing how existing policies are implemented and sometimes it requires an overhaul of laws and regulations.

 

Join Us

Join the Spark Team in our dedication to solving complex problems.  What are the issues facing your community?  How can you tackle them?  Each week, the Spark blog will release new tips, tools, research, and information to help you find those solutions.

Do you have any questions you want answered?  Please let us know the topics you want to learn more about!