A fiscal sponsor is any non-profit tax-exempt 501(c)3 organization, or other tax exempt entity such as school, college, university, or city, town, county, or tribal government, that agrees to provide fiduciary oversight, financial management, and sometimes other administrative services to help build the capacity of groups or individuals engaged in activities related to the fiscal sponsor organization's mission. To be eligible for our grant funds, an applicant’s fiscal sponsor must be located, as determined by the address used for payment of taxes, in the state of Minnesota. Your fiscal sponsor will receive and distribute the grant award, meaning the grant award check will be made out to the fiscal sponsor. In exchange the granted funds would be part of the fiscal sponsor’s tax reporting, removing the tax burden from you. This makes the fiscal sponsor legally responsible for the completion of the project and for the proper management of the grant funds. The fiscal sponsor is also responsible for verifying that the Final Report is accurate. Fiscal sponsors usually charge a flat fee or request a percentage of granted funds to provide this service. 

The applicant, or group/organization without nonprofit status, applying for a grant must have a written contract with the fiscal sponsor that specifies the responsibilities of each party. This contract must be submitted as part of the grant application package. R2AC has a sample contract for a fiscal sponsor you may use. (We can provide a printed copy upon request if you visit our office.) The fiscal sponsor must sign the grant application form and, if a grant is received, sign the grant contract and review and sign the final report.