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Ask and Ye Shall Receive

December 1, 2006
by Douglas Tieman
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Centers can cash in on fund-raising strategies that encompass staff, alumni

Prior to the 1980s, philanthropic contributions directed toward the alcohol and drug addiction recovery field were extremely limited. A few philanthropists did provide financial resources to establish facilities for specific programs. However, the kind of comprehensive fund-raising programs that are commonplace today at colleges and hospitals simply did not exist. Even philanthropy toward research or public policy initiatives was extremely atypical. In fact, an article published by the federal government in the '80s suggested that addiction was the disease that ranked dead last in support by philanthropy in the United States.

The general belief system in the field during the 1980s, an era when nearly every treatment center was doing well, was that if a facility was well-run, it didn't need to do any marketing. The idea was that it should be at capacity with insurance providing a comfortable operating margin. Furthermore, said operating margin should provide ample financial resources for reinvestment in whatever growth strategies the facility would choose. Given this happy state of affairs, there was little fund-raising activity in the addiction treatment field, other than in a few isolated situations.

That would begin to change dramatically as the decade unfolded. As with many of the earliest innovations, two of the treatment facilities that first began to look at implementing a bona fide development effort were Hazelden and Caron Treatment Centers (then the Caron Foundation). The chairs of both treatment organizations were concerned that the lucrative market trends of the '80s would not continue indefinitely. Both had extensive experience with other nonprofits in their communities and decided to apply similar fund-raising tactics to addiction treatment.

Many obstacles to launching such an effort existed in the early years. Treatment center boards and the compliance officers of the day had numerous concerns. Would soliciting funds from graduates of an addiction treatment program compromise the client-therapist relationship? Would it harm the vulnerable adult? In general, was it in good taste? If an institution could bypass those barriers, there were additional questions as to when the fund-raising effort could be done, how long postdischarge might be appropriate, how it could be done, and by whom it could be done.

Having been at Hazelden in the early 1980s, I well remember these discussions. Once all the appropriate policies and procedures were put in place, the next major battle was waged around the internal culture, as fund-raising was viewed internally as a radical concept. As a development officer at the time, I recall a great deal of mistrust, concern, and questions by the clinical staff as to whether this was appropriate, what development offices were doing with client lists, and what exactly would happen on solicitation visits.

Since actions speak louder than words, the ensuing results ultimately would help institutions realize the significant benefits of being involved with a fund-raising effort. As philanthropy helped the more aggressive institutions in expanding their new building programs more rapidly, developing their new programs more effectively, and awarding significantly greater numbers of scholarships, other facilities began—albeit reluctantly—to enter the world of fund-raising as well.

The real impact might have come in the 1990s, when managed care profoundly wounded the treatment field. No longer was it easy to have a solid bottom line. No longer was it easy to expand via accumulated margins. No longer could a treatment organization depend on the insurance industry to sustain it as a solid economic institution. Those institutions that already had a strong development program in place did well during this time; these included Hazelden, the Betty Ford Center, Caron, Phoenix House, and Father Martin's Ashley. Other treatment centers began to see the wisdom of a comprehensive fund-raising effort. Unfortunately, many that did not have the resources to invest in a top-flight program saw less-than-desirable early results and oftentimes pulled the plug too soon.

However, many stuck with it and implemented a comprehensive program. They began recruiting qualified individuals to oversee the fund-raising function, and started to see the positive results philanthropy could bring to their institution. Long gone were the concerns that were commonplace in the early '80s. Now the concerns were about recruiting the right type of personnel, implementing the right type of software package, hiring the right consultant for a feasibility study for an upcoming capital campaign—all of the concerns that other nonprofit groups experienced. With that historical background, I now lay out the components of a strong development effort.

Begin with the board

The heart of fund-raising for any organization begins—and ends—with the board of directors. And every board must have a good mix of the three Ws: work, wisdom, and wealth. If the organization is young, chances are it has plenty of workers—the folks who had the vision and tenacity to start the organization and the elbow grease to get it up and running from zero. If it's been around for quite a while, it might have plenty of the wise—those able to recount its history, how it got over the early hurdles, and who supported it when and why. Alas, the one group few boards ever seem to have enough of is the wealthy—those who can write the checks all nonprofits need to stay afloat, and who have friends and colleagues who will attend the institution's special events and support its annual fund by writing their own checks.