By Ret Boney [Editor's note: This series continues PJ’s look at the policy work of nonprofits and philanthropic organizations.] Changing the underlying laws and regulations affecting people and issues nonprofits care about is one way to bring about real change, experts say. They also say a lack of funding for policy and advocacy activities prevents many from making much headway, and some from even trying at all. “Budgets are tight and so much of the money is tied to specific projects that it’s difficult to shake some loose for an advocacy effort,” says Kay Guinane, counsel for the nonprofit advocacy project of OMB Watch, a government watchdog group in Washington, D.C. In addition to those lean budgets, two other issues affect funding, says Elizabeth Heagy, president of the Center for Lobbying in the Public Interest, based in Washington, D.C. First, more than half of nonprofits receive government funding, she says. And while nonprofits are prohibited from using government money for lobbying, Heady says, many erroneously believe that means they can’t use any of their funds for lobbying, private funds included. Second, the private foundations that fund nonprofits tend to favor grants for direct services, and often stipulate that their dollars can’t be used for policy and advocacy activities. But nonprofits can use some types of funding for lobbying, Heagy says, including general operating support from foundations, contributions from individuals, and earned income. “If you diversify by making sure you have a good mix, you’re going to have a pot that can be used for lobbying and, in general, for advocacy work,” she says. The most effective way for foundations to fund social change activities is through core operating-support grants, says Ruth Holton-Hodson, director of public policy for The California Wellness Foundation in Woodland Hills, Calif. “Just funding social-service providers isn’t going to change the equation,” she says. “You have to make sure the voices of the people most affected by policies can be heard and can participate in the debate.” The foundation made policy funding a centerpiece of its mission when it was created in 1992. It believes that addressing the issues it cares about, including the lack of access to affordable healthcare, teen-pregnancy prevention and violence prevention, fundamentally requires change at the policy level, Holton-Hodson says But it’s not a risk-free endeavor, she says. “Change isn’t something that can happen in a three-year period,” she says. “It takes long-term commitment. You have to be willing to be there for the long haul and take all the bumps along the road.” More than half the foundation’s funding is through general operating grants, Holton-Hodson says, and its grant agreement letters are written to provide nonprofits with all the leeway provided them under the law to pursue advocacy and lobbying work. And a new strategy for the foundation will be to host training sessions for its grantees to let them know the foundations believes in and supports advocacy, and to teach them how to do it effectively. While private foundations can’t earmark grants for lobbying, they can fund a variety of activities, such as education efforts and nonpartisan research and analysis, and nonprofits should find ways to fold those activities into their grant proposals, Heagy says. Another way to maximize limited nonprofit dollars is to join coalitions of groups pursuing the same policy changes, she says. “One of the benefits is it’s cost-effective,” says Heagy. “You’re not starting from scratch and funding the work solely. You can join groups that are more sophisticated and have more skills.” Heagy also says the mere act of becoming engaged in public policy and advocacy efforts can attract funding. “I believe that most organizations that become engaged in public policy really come to be seen as leaders and experts in their issue area, not only by policy makers,” she says. “It attracts funding because you’re taking on more of a leadership role.” Funding is a perpetual challenge for nonprofits, but by seeking a variety of funding sources, joining forces with other groups and simply becoming more involved the policy process, nonprofits can influence systemic change, experts says And flexible grants from foundations can dramatically increase nonprofits’ ability to advocate while furthering funders’ missions as well, they say. “Nonprofits would appreciate an approach from the funding world that would reward activities that lead to long-term solutions as opposed to short-term fixes,” Guinane says. Other stories in series: Part 2: Lack of staff capacity and skills limit policy work by many nonprofits. Part 3: Fear of retribution stifles voices of many charities, experts say. Part 4: Lack of understanding, fear can limit board support and action, experts says. Stories in previous series: Part 1: Policy and advocacy should be part of nonprofit toolkit, experts say. Part 2: Foundations can influence policy without hurting status, experts say. Part 3: Advocacy critical to fulfilling nonprofits’ missions, experts say.