We found ourselves in a similar situation last year. Interestingly enough, matching funds are often an instigator for giving among your established donors and generating new supporters. Why? Because someone promising 1/2 the money does show a strong belief in your organization, as well as making you responsible for generating a stronger support base. Many other foundations like to give in a matching support effort rather than be the "only one" on board for funding. If you are awarded this piece of money, bring it up in subsequent grant requests as a reference..."we would be pleased to have you partner with xyz foundation in supporting this program effort..." Our donors were all sent letters explaining how their donation DOUBLES in value to the organization when applied against a matching grant...Our gifts were on an average 25% higher due to that fact. It is difficult when we focus solely on 1/2 dollars...it is easier when we see it as the magic doubling of our donations towards a goal. Sell it that way to your donors and you will definitely come out ahead.