STEP-BY-STEP

Choosing a Fiscal Sponsor

Key Questions to Consider Before Selecting A Partner

Community Challenge Grants Program

Fiscal sponsorship is one way for community projects to access funding, follow the law, and handle administrative work. A good sponsor lets you focus on your mission. This guide helps you identify your needs, review possible sponsors, and ask the right questions.

1

Determine Your Needs

Start by outlining your project's scope and what you're looking for in a fiscal sponsor.

Mission and Objectives

  • What is your project's mission and goals?
  • Is this a short-term project or long-term initiative?

Support Needs from the Sponsor

Do you have these needs?

  • Grant Administration (grant writing, reporting)
  • Fundraising (access to donors, strategic guidance)
  • Legal Support (contract review, compliance help)
  • Operational Support (HR, payroll)
  • Financial Management (accounting, budgeting, reporting)
2

Research Potential Sponsors

Gather information before you meet.

Experience and Reputation

  • Have they sponsored similar types of projects?
  • Have they faced legal or financial issues?
  • What do current or formerly sponsored projects say?

Services and Capacity

Review their website and public materials for:

  • Mission
  • List of included services
  • Fee structure
  • Sample sponsorship agreement
  • Staffing structure and contact info
3

Evaluate Your Options

Ask focused questions of potential sponsors to assess fit.

Control and Ownership

  • What rights and assets does your project retain?
  • How much independence will you have?
  • Will you be a separate legal entity?

Legal and Insurance

  • How are taxes and audits handled?
  • Does the insurance the sponsor carry meet City requirements?
  • Who owns project funds and property?

Fees and Included Services

  • What is the admin fee (flat or percentage)?
  • What's included--and excluded--in that fee?

Financial Management

  • How are funds tracked and reported?
  • Can you access real-time or regular reports?
  • How do you request disbursements and what is the turn around time?

Contract Terms

  • What happens if the relationship ends?

Staffing and HR

  • Will the sponsor hire staff for you?
  • Do they handle payroll, benefits, and HR issues?

Responsiveness and Support

  • How quickly do they respond to requests?
  • Do they assist with fundraising, grant writing, or compliance?

Legal Standing and Compliance

Confirm the organization is in good standing with:

  • California Franchise Tax Board
  • California Secretary of State
  • California Attorney General Registry of Charities and Fundraisers
  • Not Suspended or Debarred in SF
4

Select A Fiscal Sponsor

After reviewing your options, choose the fiscal sponsor that best aligns with your project's mission, capacity, and long term goals.

Agreements and Accountability Measures

  • Confirm expectations around roles, responsibilities, fees, and services
  • Formalize the relationship through a written fiscal sponsorship agreement