The primary objective of this dissertation is to study the management of public and nonprofit resources and financial risk. Governments will be able to use its findings to continue to provide public services in collaboration with other sectors, including the nonprofit sector. Nonprofit financial self-sufficiency and sub-award grant mechanisms between the government and nonprofit sectors are two primary areas to be examined. This dissertation consists of three essays. The first investigates how the diversification of nonprofit revenue portfolios influences extreme revenue risks; the results show that the chance of extreme revenue loss increases when revenue sources are highly correlated to each other. The second essay examines the impact of strenuous state fiscal conditions on nonprofit organizations based in different U.S. states in order to report on generalizable empirical research on sub-award grant mechanisms, state and local government grants awarded to nonprofit organizations. The third essay explores the nonprofit sector’s response to economic shocks, and whether specific state characteristics intensified or mitigated the impact of the economic crisis. The findings from this dissertation can help nonprofit-sector scholars and practitioners understand different perspectives of market risk, revenue risk and portfolio development, and financial stability related to government grants.