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"Our partnership with BSI has been a wonderful opportunity to strengthen public private partnerships on behalf of the early care and education industry in our state."

Jamie Palagi, Former Chief, Early Childhood Services Bureau

Montana Department of Public Health and Human Services
Contracting with a Consultant

Contact the consultant who seems to be the best match for your organization and is most qualified to meet your needs. Let them know you are interested in their services. Ask them to develop a written document describing the specific services he or she believes you need. Make sure this contract details:

  • The services they will provide. For example, will they actually write the grant proposals or just identify the potential funding sources and leave the grant writing to you?
  • The cost (in time and money) involved.
  • An estimate of the time commitment required of the board, staff, and other people in your organization.
  • What the organization is expected to provide, such as meeting space, copies of training materials, refreshments, travel reimbursement for the consultant, and other expenses that won’t be included in the consultant’s fee. 

To minimize misunderstandings, certain basic issues should be addressed clearly in every organizational consulting contract. The more effort put into the contract preparation, the greater the likelihood of a successful professional relationship and project.

Be sure the following are included in the contract:

  • Name the parties to the contract, giving full legal names of both the provider and recipient of services. For the service provider, include the businesses or corporations the individuals represent.
  • List the specific activities to be accomplished and specify the tasks to be completed by the consultant or trainer. If this list is extensive, it can be included in a Scope of Work document that is attached to the contract.
  • Describe what will be expected of board members, staff, and others, in terms of time commitments, attendance at retreats and planning sessions, and completion of tasks (like finishing a survey).
  • Identify what the nonprofit organization's staff and board expect to have achieved when the project is completed.
  • Describe the process of the assistance including:
    1. a brief statement describing each specific activity that the consultant will carry out under the contract, including who will be involved in the activity, e.g., consultant and organization staff, consultant, staff and board, consultant only, etc. Also include estimated hours/rate for each activity item listed.
    2. the hourly rate that will be charged to the applicant organization. This rate may vary depending on the type of work to be conducted, and more than one rate may be listed. Consider negotiating a flat consultant fee for the entire project, not including travel and incidental costs.
    3. deliverables (such as a written strategic plan, or documentation of the decisions made at a retreat) and the results expected, and by when,
    4. timeline for the major steps to be completed, and when the engagement will end
    5. criteria to determine the completion and the form in which it will be presented, e.g., a written report at minimum, statistical analysis, and/or verbal presentation.
  • Identify any special considerations or additional requirements pertaining to the work, e.g., the provision of secretarial/clerical assistance in producing the final report.
  • Specify the amount of compensation to be paid to the consultant/trainer, the conditions under which it will be paid (such as upon receipt of the deliverables specified above), and the timeframe for payment.
  • Include language that will spell out the legal relationship between your organization and the consultant.  If the consultant is an independent contractor (such as a sole proprietor business) language should be included in the contract specifying the nature of the relationship, and that the consultant is not an employee of  your organization. This is important for liability and tax reasons. If the consultant works under a corporation (like a Limited Liability Corporation) then their corporate structure should be mentioned.  

    In Montana, all independent contractors must hold a current Independent Contractor Exemption Certification. For more information about Montana rules, see the Independent Contractor Central Unit (ICCU) of the Montana Dept. of Labor

    For more information on IRS income tax regulations affecting independent contractors (including reporting payments on a form 1099-MISC), see,,id=99921,00.html.
  • State the date the contract will go into effect.
  • Set a date by which the work is to be completed.
  • List the conditions and notification requirements (for example, 30 days) under which the contract can be terminated.
  • Complete negotiations with the consultant based on the submitted contract, especially defining fees and reimbursed costs, before the contract is signed.
  • If required, have the board of directors or appropriate committee or officer review and approve the contract before it is signed,
  • Have the consultant and the appropriate organizational representatives sign and date two copies of the contract. Keep one signed original for the organization’s files; return the other signed original to the consultant.

Once your organization has chosen a consultant to work with, be sure the team confirms the focus of the project with your staff and board, including the need or issue being addressed through the consulting project, deliverables, specifics of the proposal, what is expected of each staff and board member, and the costs to be incurred.

Lessons Learned: When the project is completed, review not only how well it has built your organization’s capacity, but also what you have learned from the relationship with the consultant. Identify if your selection process was adequate and if there are any components you would add to future contracts or that need particular attention.

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