ABSTRACTCommunity groups play an important role in the protection and enhancement of biodiversity in New Zealand. Substantial funding for community-based conservation projects is provided by government and non-government organisations. Given the scale of the threats to biodiversity conservation and the limited resources available to mitigate impacts it is imperative that funding is allocated to projects that are cost-effective and likely to achieve anticipated conservation outcomes. We reviewed the eligibility criteria and range of project information sought from community-based funding applicants by eight New Zealand environmental funding providers and found that providers do not seek sufficient information to reliably evaluate or identify projects that are likely to deliver the best outcome at least cost. Processes for vetting applications can be improved by: formalising and standardising the use of thorough ex ante project assessment protocols; requiring that project managers develop specific, measurable, achievable, relevant and time-bound project goals; evaluating ecological and socio-cultural project objectives separately; incorporating ancillary and socio-cultural benefits in application forms and assessment protocols and designing protocols that are more sensitive to the aesthetic, social, cultural and spiritual values that motivate participants in community-led projects; and ensuring that all funded projects include monitoring, evaluation and reporting components.