Each year, community-based organizations across Washington State respond to complex needs in their neighborhoods. These organizations support youth development, reentry programs, access to education, health equity, and food security. While the state often praises its work publicly, a significant financial barrier continues to undermine its impact: reimbursement-based grants.
Reimbursement models may appear neutral. On the surface, they suggest that once services are rendered, expenses will be repaid. However, this model fails to account for the economic reality of small and historically underfunded organizations. For many, this funding structure is not simply inefficient; it is exclusionary and economically unjust.
The reality is clear. Reimbursement grants are not investments in community infrastructure. They are financial instruments that force organizations to operate with delayed resources, unstable cash flow, and increased administrative burden. In most cases, they do not provide capacity. Instead, they provide recovery.
The Structural Flaw of Reimbursement
When a community-rooted organization receives a $100,000 grant award, the headline may suggest growth and sustainability. However, if the award is reimbursement-based, the organization must first spend the money, either out of pocket or on credit. This requirement assumes that small organizations possess reserves or credit lines equivalent to much larger institutions.
The burden of fronting capital for state-funded work often results in the following: delayed programs, postponed hiring, disrupted payments to vendors, and leadership burnout. Organizations spend time preparing documentation rather than delivering services. This is not simply inconvenient. It is economically punitive.
Large institutions with substantial financial reserves, access to credit, and internal grant management capabilities are well-equipped to navigate this model. Most community-based organizations are not. This gap exposes the racial and structural inequities embedded in the current grant administration process. Organizations that are closest to community needs are expected to carry the most significant financial risk.
Reimbursement Limits Ownership and Innovation
The reimbursement model also undermines the long-term potential of community work. When an organization is forced to prioritize immediate compliance over strategic development, it limits its ability to build sustainable infrastructure. Reimbursement-based funding locks organizations into transactional cycles rather than allowing them to develop scalable, lasting solutions.
Additionally, these grants rarely allow for asset creation. There is no product to resell, no intellectual property to retain, and no equity built into the transaction. The organization undertakes the work but ultimately achieves no tangible growth or increase in its long-term value. For the state, this may appear efficient. For the community, it is a loss.
Reimbursement Is Worse for Larger Grants
A common myth in grantmaking is that larger awards increase capacity. In truth, larger reimbursement-only grants often worsen the financial risk. If an organization cannot safely float $10,000, it certainly cannot float $250,000. Yet, six-figure contracts from state agencies often carry the exact reimbursement-only requirement. These grants are used to support work with profound social implications, including education equity, behavioral health support, and family stabilization.
Despite their size, these grants still offer no upfront capital, forcing organizations to delay services or decline opportunities. In some cases, the most transformative projects are left unfunded not because of merit but because of inaccessible financial terms. This is not a question of fiscal responsibility. It is a question of economic justice.
A Policy Solution: The Community Reinvestment Grant Model (CRGM)
Washington State must transition away from reimbursement-only funding models and adopt a more equitable structure for public grants. The Community Reinvestment Grant Model (CRGM) provides a policy framework to accomplish this goal.
The CRGM proposes the following:
- Prohibit reimbursement-only models for grants over $100,000.
- Require upfront or milestone-based disbursements for all eligible grants.
- Create a statewide Community Reinvestment Fund of $10–25 million to pilot the model across various sectors.
- Establish an advisory board composed of community leaders and small organizations to ensure oversight and accountability.
- Scale reporting and compliance requirements in proportion to the size of the grant.
This model prioritizes equity by acknowledging the fiscal realities of organizations that have historically been excluded from traditional funding pipelines. It ensures that community-based institutions are not only able to access grants but are positioned to succeed and grow from them.
Fund Us Forward WA: A Statewide Call to Action
Fund Us Forward WA is a statewide campaign to replace outdated reimbursement models with equitable, investment-based funding. This campaign is rooted in a simple principle: public dollars should support public power. It is not enough to distribute funds. The state must distribute them in a way that builds capacity, promotes ownership, and allows community organizations to lead the work they are best positioned to do.
This campaign is not just about funding. It is about transforming the relationship between the state and the communities it serves. A true partnership cannot exist when one party is required to absorb all the risk while the other controls all the resources.
By shifting to a reinvestment model, Washington can lead the nation in equitable public grantmaking. This is not radical. It is rational. It aligns with values of efficiency, transparency, and justice. Most importantly, it returns dignity and trust to the organizations that have long carried the weight of community care.
Join the Movement
Fund Us Forward WA invites organizations, policymakers, funders, and residents across the state to join this movement. Together, we can demand a grantmaking system that is responsive, just, and capable of supporting real community transformation.
Our communities deserve more than reimbursement. They deserve reinvestment.
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