Key Term

What is Operating Support?

Definition

Operating support refers to funding that covers an organization's day-to-day expenses and general operational costs, including staff salaries, rent, utilities, office supplies, and administrative expenses. Unlike restricted or program-specific grants, operating support provides nonprofit organizations with flexible funding that can be used to maintain their basic infrastructure and keep their doors open.

Significance

Operating support is crucial for nonprofit sustainability and effectiveness, yet it's often one of the most challenging types of funding to secure. Many donors prefer to fund specific programs or projects, creating a 'starvation cycle' where organizations struggle to maintain their core operations. When donors provide operating support, they enable nonprofits to invest in essential infrastructure, retain talented staff, respond to emerging needs, and maintain long-term financial stability. This type of funding is particularly valuable during economic downturns or crisis periods when program-specific funding may decrease but operational costs remain constant.