This is a multi-site case study, conducted on four small Faith-Based Organizations (FBOs), in Los Angeles, CA in mid to late 2010. This study was prompted as a result of Office of Faith-based and Community Initiative (OFBCI), and its policy, the Faith-based and Community Initiative (FBCI) which allowed FBOs to partner with government entities, by receiving government funding, to deliver social services.

The purpose of this study was to explore the techniques that small FBOs have implemented to build the necessary capacity to gain and sustain funding. Research in the area of small organization capacity building remains scarce, therefore this research helped to detail some of the techniques that have been used to build capacity.

The McKinsey Assessment Grid (MAG), also known as the The Organizational Capacity Assessment Tool (OCAT), in this document referred to as the MAG, uses a theory of change to address capacity building, and was used to gather the data from the FBOs in regards to capacity building. It was found that while small FBOs are successfully increasing their capacity, there is no systematic approach that is used.

The findings conclude that in the relationship between government and FBOs, FBOs need to continue to find systematic techniques that will assist in building capacity to successfully gain and sustain funding from government; and that there needs to be more equity in the relationship.

Key Words: OFBCI, the FBCI, Small FBOs, capacity building