Grantmaking Policies

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Policies

The Mellon Foundation’s grantmaking policies cover a range of issues that may arise when proposing and managing a Foundation grant, including:  1. grant eligibility; 2. grant inquiries and submission of an invited proposal; 3. use and management of grant funds; 4. modification of grant terms; 5. use of consultants and contractors; 6. expenditure responsibility requirements; and 7. conditions on the payment of grant funds.  

The Foundation makes grants to organizations that advance its charitable mission and strategic goals. Our grantees include organizations that are large and small, established and new, based in the US and around the world. The Foundation makes most of its grants to and through organizations in the United States that have been determined by the IRS to be section 501(c)(3) public charities.  The Foundation also makes grants to charitable organizations outside the United States that have 501(c)(3) status or that are equivalent to US public charities. Foundation staff will work with a prospective foreign grantee to determine whether or not an organization can meet the equivalency standard. 

Additionally, the Foundation may exercise expenditure responsibility (see Additional Grant Considerations) to make restricted grants to organizations that are not 501(c)(3) public charities, including for-profit organizations and organizations outside the US without a charitable equivalency determination. The Foundation does not make grants to individuals. 

If an applicant’s proposal is approved by the Mellon Foundation, the grantee will be required to enter into a standard grant agreement with the Foundation before the grant is funded. This grant agreement and the finalized proposal establish the terms of the grant.

Many of the policies described below are memorialized in the Foundation’s grant agreement; therefore, prospective grantees are encouraged to read through these policies in advance of submitting a proposal. The Foundation is available to discuss any questions grantees or prospective grantees have regarding these policies. 

Information regarding the Mellon’s program areas and grantmaking priorities can be found in the program area descriptions—Arts and Culture; Higher Learning; Humanities in Place; and Public Knowledge—and in our  annual report


Types of Grants

Mellon makes project support grants and, depending on the type of institution, general operating support grants. Project support grants include spendable grants, endowment grants, and program-related investments. Some of our grants include a matching requirement. On occasion, the Foundation also awards grants for the creation or strengthening of a cash reserve. 

Project Support Grants

Spendable Grants

Spendable grants are to be spent according to the proposal, including its schedule and budget, and conditions specified in the Foundation's grant agreement. 

Endowment Grants

Endowment grants establish institutional funds that are subject to specific spending limitations as indicated in the grant agreement and proposal and governed by applicable state law.

The Foundation will only consider requests for endowment funds from institutions that can demonstrate the financial capacity to manage the funds on an ongoing basis. Recipients of an endowment grant are to invest and manage the funds prudently and in perpetuity. When requesting an endowment grant, an organization with an endowment under $100 million must provide documentation that demonstrates its capacity to invest and manage endowment funds.

General Operating Grants 

General Operating grants support the core operations and overall mission of the grantee. 


Use and Management of Grant Funds 

For grants awarded by Mellon, the Foundation’s grant agreement specifies the terms of the grant, including the use of grant funds and reporting schedule. Grant funds must only be used for the purposes, over the timeframe, and in the manner set forth in the grant agreement and finalized proposal.
 
Awarded grant funds may not be expended on project costs incurred prior to the grant start date or after the grant end date without the Foundation’s prior written approval. Unless specifically discussed in the proposal, grant funds cannot be used as collateral, to offset other financial obligations (including interest payments on lines of credit, and securing or servicing debt), nor to meet cash-flow or general operating expenses. In carrying out grant-funded projects, grantees must comply with all applicable local, state, federal, and international laws, regulations, and rules, including data privacy and intellectual property laws. Grantees are also expected to maintain controls to see that use of grant funds complies with the rules and guidance promulgated by the United States Office of Foreign Assets Control

Organizations awarded endowment grants must also adhere to their state’s Uniform Prudent Management of Institutional Funds Act (UPMIFA) statute in the investment, management, and spending of such grant funds. UPMIFA statutes generally provide that, subject to the intent of the donor, an organization awarded endowment funds may expend or accumulate as much of the endowment fund as the organization determines is prudent for the uses, benefits, purposes, and duration for which the endowment fund is established. An organization must receive the written approval of the Foundation if it wishes to modify or release a restriction on the management, investment, or purpose of an endowment grant.

Record Keeping

Grantees are required to retain accounting records, detailing all receipts and expenditures, for a minimum of three years following submission of the final grant report. Organizations receiving expenditure responsibility grants are required to keep records for four years. With reasonable notice, the Foundation reserves the right to conduct on- and offsite audits of records related to the use of grant funds.

Conditional Payments 

Payment(s) towards grants awarded from the Foundation may be conditioned on the satisfaction of specific requirements. Where conditions are established, the Foundation will not make payment on the award unless and until all conditions have been met. The Foundation reserves the right to rescind a conditional grant when conditions have not been satisfied in a timely manner.

Collaborative Grants 

Foundation grants may involve work undertaken by collaborating institutions. In such cases, the Foundation typically awards grant funds to a single grantee, who is responsible under the terms of the award for reporting on the activities and expenditures of the collaborating organizations. 

Notification and Cooperation 

Grantees should promptly notify the Foundation of:

  1. significant organizational changes during the term of the grant, including changes in key personnel and changes in tax status;
  2. reported concerns about the legality or propriety of the grant activities or use of Foundation funds, and
  3. filed claims alleging harassment, discrimination, or a hostile work environment; financial impropriety; or breach of fiduciary obligations by senior leadership of the organization’s board.

If the Foundation learns of such allegations, it expects grantees to cooperate with reasonable requests of the Foundation to understand the grantee’s policies and procedures, including what steps were taken in response to the allegations.  

Right to Discontinue Funding and Require Return of Funds 

The Foundation reserves the right to modify a grant, discontinue funding, or terminate a grant and require the return of grant funds if a grantee fails to materially comply with the terms of the grant or becomes unable to carry out the purposes of the grant.  

Changes in Grant Terms 

Grantees should inform the Foundation of any significant changes in proposal grant activities and should request advanced approval to modify grant terms. Grant modification requests considered by the Foundation include:

  1.  extension of the grant period to permit additional time to complete supported activities;
  2. reallocation of funds to permit spending in a manner different than that described in the original budget (e.g., from one budget category to another);
  3. rollover of funds from an older Foundation grant into a newer grant given for the same purpose;
  4. extension of the matching period to permit additional time to satisfy a matching condition; and
  5. transfer of grant funds from the original grantee to another organization. Grantees must obtain advance written approval from the Foundation for these and other material changes.

Upon request, the Foundation will consider requests for changes in grant terms. Non-routine changes, such as repurposing a grant, may require approval of the Foundation’s Board of Trustees. Please see Managing a Grant for more information. 


Workplace Conduct Standards 

The Foundation gives high priority to the realization of equality of opportunity for all members of society. Accordingly, the Foundation expects grantees to seek to foster a workplace that is free from discrimination, harassment, and workplace misconduct; take appropriate affirmative steps to encourage equal employment opportunities for women and underrepresented groups to the fullest extent allowable under applicable law; and have appropriate policies and procedures for training staff, receiving and addressing complaints regarding sexual harassment and other forms of workplace misconduct, and prohibiting retaliation against persons who make good faith complaints. 


Grant Work Products

The Foundation aims to maximize the use and reach of intellectual property created with grant funds in order to broaden the impact of both our work and the work of our grantees. This principle and the Foundation’s expectations regarding the use and dissemination of grant work products are described in Mellon’s Intellectual Property Policy, which all grantees and prospective grantees are encouraged to read. 


Additional Grant Considerations 

Particular considerations apply for grants involving grant-produced work products, the use of consultants and contractors, the exercise of expenditure responsibility, or grants that are subject to a matching requirement. 

  • Use of Consultants and Contractors: If a significant portion of the grant budget will be paid to consultants or other third-party vendors, grantees should follow the Foundation’s Guidelines for Grants Involving Consultants and/or Contractors (PDF). 
  • Expenditure Responsibility: In order to make a grant to an organization that does not have a public charity determination from the IRS, the Foundation may elect to exercise “expenditure responsibility” in accordance with federal tax law. Under the expenditure responsibility rules, the Foundation is required to establish procedures for assuring that grant funds are spent solely for the charitable purposes intended, and must receive reports from the grantee, and make reports to the IRS about the grant expenditures. If the Foundation elects to exercise expenditure responsibility, the grant agreement will require the grantee to spend grant funds only for the specified charitable purposes, maintain grant funds in a separate account for charitable purposes, and report on how the funds have been spent. 
  • Matching Grants: Both spendable and endowment grants may be subject to a matching requirement. In order to satisfy the Foundation’s matching requirement, matching funds must be newly received and in hand; pledges will not qualify. Gifts intended to meet the matching requirements will be valued as of the time of transfer to your organization. If the Foundation awards a matching grant, it will pay matching funds in installment amounts specified in the Foundation’s grant agreement upon the submission of gifts that meet the matching requirement. 

Grantee Portal Terms of Use 

The Foundation provides grantee and prospective grantee organizations with access to its Grantee Portal to streamline and enhance the processes for proposing and administering grants. Use of the Grantee Portal is subject to the Foundation’s Grantee Portal Terms of Use. Grantee and prospective grantee organizations are responsible for ensuring that their institutional representatives (“users”) follow these Terms of Use, including designating the principal investigator and other users who may have access to a proposal and any confidential information contained therein, ensuring that users do not share accounts, and maintaining the security and confidentiality of accounts, and are responsible for any violations of these terms.