Chapter 10: Funding the Recovery¶

On August 4, 2020, 2,750 metric tons of ammonium nitrate exploded in a warehouse in the port of Beirut. More than 200 people died, more than 6,000 were injured, 300,000 lost their homes. The Karantina public hospital, 900 meters from the epicenter, was badly damaged.

Within days, a Rotary club in London opened a donation page and got in touch with a club in Beirut. The Lebanese club, which would be the local sponsor, was already in contact with a Canadian club, which would become the international sponsor. The project targeted the hospital, and the London club became the rallying point for fundraising across Great Britain and Ireland. It set up a single channel to pool donations from clubs and districts and keep transfer fees down. Rotarians organized a classic car rally from one end of Great Britain to the other, a Lebanese picnic, a street collection.

By mid-February 2021, the target of about $400,000 had been reached. The global grant application, for $391,000, was submitted on February 20, 2021, to equip a pediatric and neonatal operating room and a pediatric ward. The Rotary Foundation approved it on March 30, 2021. In Great Britain and Ireland, 116 Rotary clubs, 2 Inner Wheel clubs and 4 districts contributed; worldwide, more than 150 clubs and districts in seven countries.

The destroyed pediatric ward itself was rebuilt with help from the Swiss government. The global grant does not pay for the walls. It pays for what goes inside them.

This is not an economic recovery project: it is a hospital. But it is a real timeline and a real funding package, published by Rotary's magazine in Great Britain and Ireland, and they tell you what your club needs to know before it promises anything.

What the scene teaches¶

The first lesson is about time. From the explosion to approval, almost eight months went by. And this was a well-run project, carried by a network mobilized from the first days, for an obvious need. A global grant is not an emergency tool. If your club waits until relief is over to start building its application, it will add those eight months to the ones it has already lost.

The second is about separating the walls from the activity. The building was paid for by a foreign government; the equipment, by Rotarians and the Foundation. That split applies a Foundation rule, and the rule weighs heavily after a disaster, when half the visible needs are buildings.

The third is about where the money comes from. The $391,000 did not come from one donor. They were pooled by more than 150 clubs and districts in seven countries, in a single application the Foundation approved. The article does not break down how much came from district funds and how much from the World Fund; but knowing who can put in what, and in what order, is a skill.

This chapter gives you that skill: the right source of money for the right period.

The principle: every source of money has its purpose and its timing¶

The Foundation Code sets the general doctrine: the role of Rotary International and the Foundation is "to be a resource and to assist in long term disaster recovery." The same text specifies that donors eager to give for a disaster should be directed to an established local relief committee, "not The Rotary Foundation," to avoid delays and processing costs. And it adds: "Noting that the immediate need for districts impacted by disasters is typically cash, The Foundation discourages donations of goods, unless requested by a local committee."

In other words, the Foundation positions itself for the long term, and it prefers money to goods. Beyond that, it offers three tools. All the figures that follow are those of the Terms and Conditions in force in July 2026; the Foundation reserves the right to change them at any time, and Appendix E shows where to check the current version.

Tool	Who applies	Period	Amount (July 2026)
Disaster Response Grant (DRG)	the affected district only	six months after the disaster	up to $25,000
District grant	the district, once a year	Rotary year	up to 50% of the SHARE allocation
Global grant (GG)	a local sponsor and a foreign sponsor	after approval, over several years	budget of at least $30,000

The Disaster Response Grant: the bridge for the first six months¶

Under its July 2026 terms, the Disaster Response Grant (DRG) funds "relief and recovery efforts in areas that have been affected by natural disasters within the past six months." Grants go up to $25,000, paid by the Foundation "to districts located in the affected area only."

What it can pay for: water, food, food vouchers, medicine, clothing and construction materials. Food vouchers and construction materials did not appear in the 2019 version. For a club focused on recovery, those are the two lines that matter: vouchers spent with local merchants, materials bought from suppliers in the area.

What it does not pay for, among other things: purchase of land or buildings, loan guarantee schemes, cash donations not assigned to a person or an organization, "continuous or excessive" support to the same person or community, and any expense incurred before approval.

The operating rules:

The applicant is a committee of at least three Rotarians, including the district governor and the district Rotary Foundation committee chair (DRFC). This committee is responsible for working with the affected community to identify its needs.
The district must be qualified. The funds can neither be used by another district nor sent to another district.
Payment goes to a bank account controlled by the district, with two signatories. No payment to a club; the district pays suppliers directly.
Internal caps: up to 20% for contingencies, up to 3% for administrative costs.
The waiting line: if the disaster fund is empty, the application waits until money comes back in, at most until six months after the disaster.
The report is due within six months of receiving payment. A district can apply for a new Disaster Response Grant only after reporting on the previous one.

For a disaster of magnitude, the October 2026 Foundation Code provides an exception. The Trustee chair can approve the creation of a fund specific to that disaster, with Disaster Response Grants of up to $50,000 and at most two open grants per affected district for one year. The disaster must meet three of four criteria: be natural; affect at least one million people; receive worldwide media coverage; exceed the economic capacity of the area. Rotary must also have enough presence on site to manage and monitor the grants. The district does not request it itself: the creation must be recommended by a current Foundation trustee, a member of the Rotary International Board or the general secretary (Foundation Code, article 21.010). The district can alert one of these people; the decision belongs to the Trustee chair.

Keep the essentials in mind: the Disaster Response Grant is short, district-level and capped. It does not fund a two-year economic recovery program. It carries the first six months and can kick off the transition (Chapter 4).

The district grant: the small, flexible tool¶

Under its July 2026 terms, the district grant funds "small-scale, short-term activities." It is funded only from District Designated Funds (DDF), and a district can devote up to 50% of its SHARE allocation to it, for a single grant per Rotary year.

Three of its eligible activities bear directly on recovery: community assessments; construction and renovation; microcredit with a microfinance institution that is registered and has been operating for at least three years.

It is the only Foundation tool that can pay for both an economic assessment ahead of a global grant and a small renovation. But its calendar is rigid:

the application must be made no later than May 15 of the Rotary year in question;
payment requirements must be met before May 31, or the grant is canceled;
the previous year's grant must be closed before any new payment;
the final report is due within twelve months of payment, or within two months of the funds being fully spent if that comes first;
activities must be completed within 24 months of the funds being transferred to the club or the beneficiary.

The practical consequence: when disaster strikes, this year's district grant may already be committed to other projects. Ask your DRFC in the first week.

The global grant: the recovery tool¶

The global grant (Global Grant) is the tool that carries a real recovery project. Its July 2026 terms first set out what a project must be:

respond to the findings of a community assessment and be designed with the host community;
be sustainable, in the precise sense the Foundation gives the word: "Sustainability is the capacity for outcomes to be maintained locally and to serve the community's continuing priorities";
be measurable, using the standard measures of the monitoring and evaluation supplement, an April 2015 document referred to by the 2026 terms: check its current version with the regional grants officer (Chapter 13);
be carried by two primary sponsors, a club or district in the project country and a club or district in another country;
cause no harm.

They then set the funding:

Minimum budget of $30,000, maximum World Fund contribution of $400,000.
80% match on District Designated Funds: every dollar of DDF committed brings in 0.80 dollar from the World Fund.
Cash is not matched, whether it comes from Rotarians or not. Paid to the Foundation, it carries a 5% surcharge for processing costs.
At least 15% of contributions to a humanitarian grant must come from outside the project country.
Cannot contribute cash: a cooperating organization, a vendor, a person who benefits from the grant. The text adds: "Funds should never be collected from the people who will benefit from the grant-funded activities."
Financing can no longer be changed once the grant is approved.

Take a typical example. Your district commits $20,000 of DDF; the World Fund adds $16,000. The foreign partner club and its neighbors contribute $10,000 in cash, which is not matched. The budget reaches $46,000: it exceeds the minimum, and the foreign share can be checked line by line. The figures are fictitious; the calculation rules are those of July 2026.

Three budget items are capped separately, each at 10% of the total: contingencies, project management (which can include a project manager and a cooperating organization's project-specific administrative costs), and measuring results. The 2025 Guide to Global Grants can be read as a 10% cap for all three together; the Terms and Conditions are what count.

Review depends on the amount requested from the World Fund. Up to $50,000, the application is reviewed by Rotary's general secretary. From 50,001 to $200,000, a subject-matter expert analyzes it and the project receives a mid-project visit from the Cadre of Technical Advisers. From 200,001 to $400,000, the Trustees review it on fixed dates, with a prior visit and an audit or mid-project visit. Above $50,000, payment is made in installments, each one after a progress report and a Cadre visit.

Reports are made by both sponsors. The first progress report is due within twelve months of the first payment, then every twelve months; the final report, within two months of the end of activities. Records are kept for at least five years. And one rule should be posted in every district: "The Foundation won't approve new grant applications from grant sponsors that have any overdue reports for any Foundation grant."

What the global grant does not pay for¶

For a recovery project, five prohibitions in the July 2026 terms decide almost everything.

Prohibition	What it means after a disaster
Expenses before approval	what the club did during the emergency will not be reimbursed
Purchase of land or buildings	the covered market cannot be bought with the grant
New construction or additions to a place of living or work	no workshop, school, shelter, container or mobile home
Completion of a never-occupied building	the site halted by the disaster is not finished with it
Activities run mainly by another organization	the project must be initiated, controlled and managed by Rotarians

The construction rule is worded without ambiguity: "New construction of, or additions to, any structure in which people live, work, or engage in any gainful activity, such as buildings (schools, homes, low-cost shelters, or hospitals), containers, and mobile homes." It adds that if the project depends on such construction, it must be paid for with other funds.

The Foundation Code keeps a more open wording on construction "in conjunction with strategic partners." Do not rely on it: the Terms and Conditions are the operating rule. Repair and renovation, on the other hand, are not among the 2026 prohibitions; the line between repairing and rebuilding should be discussed with the regional grants officer before you write a single line of budget.

The same text adds other prohibitions: no unassigned cash donations (Chapter 5 returns to this), no goods that would become the property of the club, the district or a member, no unrelated activities bundled into one application.

Programs of Scale: out of reach for a club alone¶

For the record, the Foundation Code provides each year for a single grant of $2 million, Programs of Scale, for a three- to five-year program carried by a club or a district with outside partners, who must contribute at least $500,000 in cash. Selection is by competition, in two stages. A disaster-hit club will not compete for it alone; a district or a group of districts, several years after a major disaster, perhaps.

What the economic development policy makes possible¶

Economic recovery has an explicit place in the Foundation. The policy for the community economic development area of focus (April 2024) lists among its goals: "Strengthening communities' economic resilience and adaptive capacity in response to environmental and climate-related hazards and natural disasters." Microcredit, entrepreneurship and vocational training, small businesses, cooperatives, income-generating activities and smallholder agriculture all fall within its scope.

The guidelines for this area of focus, in their April 2024 version, set five requirements that shape a recovery project.

No assessment, no review. "The Foundation will not consider projects without a community assessment." The same guidelines call for collecting baseline data before the project. Your assessment form (Chapter 3) is the first piece of the file.
A costed sustainability plan. The application describes "a two- to four-year plan for how the community will replenish funds after the global grant is complete." About funding that other actors plan to raise, the text adds in parentheses: "The Rotary Foundation and clubs cannot provide indefinite support."
Training that is not a one-off course. It "shouldn't be a standalone course or one-time intervention." Any major equipment requires a three- to five-year financial plan.
Goods as a small share. Distribution of items such as wheelchairs or sewing machines must remain "a small part of a project's budget."
Ineligible projects. Among others: "Projects that only seek to donate equipment," infrastructure with no direct economic outcome or no operation and maintenance plan, rehabilitation of community centers, projects initiated by vendors who want to sell their products, and small scattered activities bundled into one application.

The consequence is clear for a club that would like to hand out "restart kits" to disaster-hit merchants. Funded by a global grant, that project has to become a training, credit or cooperative project, in which the goods handed out are only a small share, with a baseline and a plan for what comes next. A pure equipment donation is ineligible.

Microcredit is eligible, under the conditions of section 11 of the Terms and Conditions: a microfinance institution registered and operating for at least three years, capital lent out at least twice over at least eighteen months, a capped interest rate, training that goes beyond managing the loan, and no guarantee scheme. Any application that includes microcredit goes through an additional area-of-focus review, whatever its size. Chapter 6 details these rules; remember here that your club does not lend itself, it funds and checks a lender.

Rotary's Six Steps to Sustainability sheet sums up the spirit of it all in six headings: know the community, encourage local engagement, provide learning opportunities, buy local, find local funding, measure your success.

A real project, at its own scale¶

The Khokana project in Nepal, told in Chapter 7, gives a sense of scale. A Nepali club and a Canadian club put together an economic development global grant to train about 150 women affected by the 2015 earthquakes in income-generating activities. The Canadian district's page lists a cost of $42,263, a start on May 15, 2017, and a planned end on December 31, 2018.

Two years between the earthquake and the start, a modest budget, a local partner who stays: that is the realistic scale of a recovery global grant carried by clubs. The sources are Rotary publications, with no assessment of incomes.

Handing off between the three grants¶

The three tools do not compete: they hand off to one another. This book proposes chaining them as follows, adapting to each disaster.

Period	Main tool	What it funds for recovery
First six months	Disaster Response Grant	vouchers with merchants, materials bought locally
Current or next Rotary year	district grant	community assessment, small renovation, pilot project
After approval, over two to four years	global grant	training, credit, cooperative, equipment, monitoring

flowchart LR
    A[Disaster] --> B[Disaster Response Grant<br/>affected district<br/>first six months]
    A --> P[Prepare the file<br/>during the emergency]
    B --> C[District grant<br/>assessment, renovation, pilot]
    P --> C
    C --> D[Global grant<br/>local and foreign sponsors<br/>training, credit, cooperative]
    D --> E[Sustainability plan<br/>two to four years]
    F[Club funds<br/>and earmarked donations] -.-> B
    F -.-> C
    G[District DDF<br/>matched at 80%] -.-> D
    H[Club cash<br/>not matched] -.-> D
    I[Outside partners<br/>walls, buildings, loans] -.-> E

The diagram expresses a simple rule: you prepare the file during the emergency, because the global grant reimburses nothing that comes before its approval.

The real timeline¶

The July 2026 terms frame the timeline with four cancellation deadlines: an open application must be submitted within twelve months; a submitted application must be completed and approved within six months; payment requirements must be met within six months of approval; activities must start within twelve months of payment.

In Beirut, a mobilized network took a little under eight months from disaster to approval. In Khokana, the project started two years after the earthquake. The disaster guide suggests, without citing a source, a rough order of two to three years between the disaster and the closing of a global grant; that is a planning estimate, not a Foundation rule. These three reference points are enough to tell disaster survivors one thing: your club promises nothing for next month.

Two technical points need checking with the DRFC. The 2025 Guide to Global Grants, which is neither the July 2026 terms nor the October 2026 Code, states that committed DDF is drawn from the year in which the application is approved; check this point with the regional grants officer as well. And the Foundation Code refers to a three-year SHARE cycle without describing how it works in the passages read: do not assume that this year's donations will be available this year.

Money outside the Foundation¶

The Foundation is only part of the plan. The rest comes from four sources.

Club and district funds. An exceptional budget voted at a meeting, the district disaster fund if there is one. These are the only funds available right away, and the only ones that can pay for what the Foundation excludes.

Donations received. The disaster guide sets a rule that matters here more than anywhere: money given "for the emergency" does not go to reconstruction without the donor's consent. Tell donors, from the start of the fundraising, what their money will be used for and over what period. A campaign announced as "economic recovery over three years" can be managed without renegotiation.

Funds held by an action group. The October 2026 Rotary Code of Policies allows an action group to collect donations for a club or district project and to hold up to $100,000 of them, more with the general secretary's approval. The Rotary Action Group for Community Economic Development (RAGCED), for its part, presents itself as a complement to the Foundation for projects that do not fit its grant models; the legal structure behind this offer changed between its two websites, and it needs to be confirmed with the group (Chapter 11).

Outside partners. Local governments, the national government, donors, foundations, businesses, banks. They are the ones who pay for the walls, like the Swiss government in Beirut. Two documented arrangements deserve a club's attention:

The interest-free loan. In Christchurch, after the February 2011 earthquake, the trust that grew out of a merchants' committee funded the temporary shipping-container mall with an interest-free loan of 3.36 million New Zealand dollars from the earthquake appeal trust, supplemented by a bank grant, then by a public grant of 1.27 million for its relocation in 2014 (Chapter 9).
Test, then scale up. In Haiti, after the 2010 earthquake, the microfinance institution Fonkoze first received more than $174,000 from Mercy Corps to test its program with 500 clients, then $8 million from the American Red Cross to extend it to 18,000 borrowers, according to the specialized press of the time (Chapter 6). A small grant that proves, a large one that scales: your club can play the first role.

Beneficiary contribution¶

The Minimum Economic Recovery Standards (MERS) observe that livelihood assets have more value for people when they feel ownership of them, and cite as a frequent starting point an equal cost share, to be adjusted according to the risk borne by the beneficiary. The MERS describe it as common practice, without making it a rule.

In a global grant, this runs into a Foundation rule: money is never collected from beneficiaries. The contribution can take other forms: labor, with the explicit consent of those involved, which the terms require; repayment of a loan to a microfinance institution, within the microcredit rules; a contribution paid outside the grant budget, into a community fund provided for by the sustainability plan, an option this book proposes and no Foundation text provides for. Have the chosen form validated by the regional grants officer before you write it into the application.

Separating the walls from the activity¶

This is the rule that comes back in every chapter of Part III, and it gets decided when you build the funding plan. For each need, ask two questions: is it a building, or what happens inside it? And who pays for each of the two?

Need	Who can pay for the walls	What the global grant can pay for
Destroyed covered market	local government, national government, donor	merchant training, credit, management committee
Vocational training workshop	local government, business, other donor	trainers, curriculum, tools as a small share
Cooperative warehouse	cooperative, donor	governance, accounting; storage eligible case by case
Small renovation of a shared space	district grant, club funds	nothing, if the renovation is the sole purpose

A note on the third row: the July 2026 terms list among possible infrastructure "storage units, fences and security systems, water or irrigation systems, or greenhouses." A storage facility is therefore not automatically excluded, but the line with a building where people work should be discussed before submission.

In Turkey, in 2023, the affected districts applied this separation without naming it: the container city was to be funded by cash donations collected in the district, and global grants were to cover its health, education and hygiene needs (Chapter 11).

Controlling money, yours and other people's¶

After a disaster, money arrives fast, from many hands, and passes through people in a hurry. The July 2026 terms provide a framework that your club can also apply to its own funds.

A dedicated account. The sponsors of a global grant keep a bank account used only for Foundation funds, without mixing in fundraising proceeds, dues or governor's funds; one account per grant if possible, otherwise separate bookkeeping for each. The signatories are members of the sponsor clubs or districts. The Disaster Response Grant account requires two signatures for every transaction.

Pay against proof. Nothing is paid to a vendor, a cooperating organization or a beneficiary before the expense is incurred or the service delivered, and the organization reimbursed hands over the original invoice or receipt. Receipts and bank statements are kept for at least five years. The Foundation can at any time review a grant, audit it or suspend payments; a sponsor that breaks the rules returns all the funds and can be barred from grants for up to five years.

Conflicts of interest. Section 10 of the terms speaks directly to a club that buys local. Every conflict, actual or perceived, is disclosed in the application. Members of a selection committee disclose their personal, family or business ties before selection begins. A vendor who is a club member, or whose business is owned or managed by a member, is chosen only after a fair and transparent bidding process showing that it offers the best product at a fair price. The terms for district grants and Disaster Response Grants repeat these rules.

Listen to beneficiaries. The Core Humanitarian Standard (CHS), in its 2024 edition, calls for safe and accessible ways for all groups in a community to raise a concern or file a complaint, and for every complaint to be handled. It also calls for identifying, preventing and managing the risks of corruption, fraud, misuse of resources and conflicts of interest. We propose translating this simply: a phone number or an address known to all beneficiaries, read by a member who does not manage the project.

The pitfalls¶

Pitfall	Why it happens	Remedy
Building the global grant after the emergency	there are not enough hands during relief	assign two members to prepare the file from the second week
Budgeting a building in a global grant	it is the most visible need	separate walls and activity; find another payer for the walls
Promising survivors a date	you want to reassure	give an order of magnitude, not a date
Assuming the district grant is available	nobody checked	ask the DRFC in the first week
Letting a report go overdue	the presidential handover made people forget	one person in charge of reports, appointed for the whole duration
Recycling emergency donations into reconstruction	the money is sitting in the account	ask donors for consent, or announce the purpose when fundraising
Reusing figures from an old guide	they circulate in presentations	check the Terms and Conditions in force and date every figure
Collecting money from beneficiaries	you think it builds their ownership	a contribution in labor or by repayment, validated by the Foundation

The seventh pitfall deserves a word. The disaster guide itself contains Foundation figures that the 2026 texts have replaced: a Disaster Response Grant progress report at least every twelve months where the 2026 terms require a report within six months, records kept for seven years where the terms say at least five, a district fund match presented in several contradictory forms. No book, this one included, replaces reading the texts in force.

What your club now has in hand¶

At the end of this work, your club has a funding plan: for each part of the project, the source of money, what it pays and does not pay for, the timing of each application, and who pays for the walls when there are any. It is the piece of the recovery file that Appendix B places after the choice of levers.

In Beirut, the money was found because more than 150 clubs and districts each knew what they could put in, and where. What remains is to know who, in your club and your district, will carry this package for three years, when the presidents have changed three times: that is the question of the next chapter.