Even in the best of times, nonprofits can find it challenging to boost visibility, gain more donors and raise funds. Success often demands a complex mix of strategies, including annual fundraisers, email campaigns, and social media marketing, executed over an extended period of time.
Partnerships with businesses are proving to be a critical component in filling those gaps, according to several local nonprofits. These partnerships appear to be evolving in recent years, as businesses explore more ways to support nonprofits beyond matching gifts, sponsorships and annual fundraising campaigns.
Williams Comfort Air, a business that specializes in HVAC and plumbing, not only contributes to nonprofits with matching gift campaigns; it invests in marketing campaigns on their behalf. As part of its partnership with Outreach, Inc., which serves homeless youth, Williams Comfort Air hired professional production crews to develop radio spots and video productions and promoted the nonprofit’s story to larger audiences.
First Person Advisors, a benefits and compensation advisory firm, recently established a foundation in partnership with Central Indiana Community Foundation (CICF) and Selflessly. The foundation will be funded through one percent of the company’s annual revenues, as well as matching of individual employee’s gifts of up to $1,000 a year each.
In keeping with a volunteerism tradition started in 2014, OneAmerica, this week, launched its Week of Caring at a time when volunteerism is significantly down due to the COVID-19 pandemic. While the volunteer efforts may look different due to social distancing requirements, OneAmerica associates are finding creative ways to donate their time, including hosting storytelling sessions for underprivileged youth and assisting with letter writing campaigns.
The virtual format of Week of Caring also allowed associates to reach an unprecedented number of nonprofits.
“This is as hands-on as it can safely be, with associates creatively using the resources we have and maximizing technology, talent and teamwork,” said Jennifer Pittman, vice president, enterprise communications and community affairs at OneAmerica. “Nonprofit organizations need our help now more than ever, and while giving back may look different in 2020, we remain committed to our community volunteerism.”
Business partnerships that extend beyond annual donations can have a significant impact, according to several local nonprofits.
“A lot of times businesses underestimate their influence,” said Jason Chenowith, CEO of Outreach, one of the nonprofits William Comfort Air has supported annually. “Helping us get in front of people who don’t know us is equally important as the donations we receive. As a nonprofit, you always need to get your name in front of new people. It’s an endless cycle as you try to get people exposed to what you do.”
The campaigns sponsored by Williams Comfort Air continue to open doors — long after they were first launched, Chenowith said.
“There are times when I will introduce myself to people and they already know the name of Outreach. You can’t quantify the value and benefit of that,” he said. “We are very, very grateful for major donors but that’s not what keeps us alive. It’s an army of people who give $25 or $50 on a regular basis. When a business leverages its social power, it can make a big difference. It allows us to build relationships among individuals.”
Heather Parker, director of development communication for The Julian Center, another nonprofit supported by Williams Comfort Air, said a committed business sponsorship is critical for numerous reasons.
“When employers are willing to reach out to their employees on their own behalf it exposes us to donors we normally wouldn’t have,” Parker said. “Secondly, nonprofits are able to tap into sizable amounts of money that are unrestricted. It gives the agency more flexibility to cover things they might not have otherwise. That’s a great benefit.”
Matt Tyner, director of marketing for Williams Comfort Air, said that the company seeks to get a better understanding of a charity because they want to share how donations are making an impact.
“We want to see them come to life,” he said. “A lot of companies are hesitant to promote their community giving, thinking it may come across as not being humble. It should be considered an opportunity to engage their donor bases. As a result of hearing those stories, some donors decide to become annual givers.”
After listening to the charities they serve, Williams Comfort Air also launched summer giving campaigns to offset revenue shortfalls during a slow fundraising period for many organizations. “There’s a lot of giving at the end of the year and at the beginning of the year,” Tyner said. “That’s why we put a significant amount of our giving into the summer months. We want to be a bit of a bridge during the periods where there’s less giving.”
When the pandemic hit, the financial support from Williams Comfort Air helped nonprofits continue to serve their communities at a critical time, he said.
Taking more creative approaches to business-nonprofit partnerships not only benefit nonprofit agencies, said Mark Minner, president and chief strategy officer for First Person Advisors. Developing avenues for employees to support nonprofits can impact morale and foster a sense of fulfillment as part of their employment with a company..
“From our experience, that’s just how people are wired. Giving back is really important in their lives and they expect their employer to have that same type of commitment.” Minner said. “As an employer, we have a unique opportunity and role to facilitate opportunities to make their dollars go further faster … to make more of an impact,”
First Person Advisors had already committed to developing a foundation before the global pandemic reached Indianapolis. Working in partnership with CICF and Selflessly, the advisory firm decided to accelerate the launch of the foundation as needs in the community grow.
Minner said other businesses interested in developing a deeper commitment to nonprofits can start with matching programs, if they don’t already have one in place. Establishing a foundation can take significantly more effort, but the impact is so much greater than the time to set it up, he said.
“It really has a significant return in terms of the level of connectivity people feel to the organization,” Minner said. “We can help employees make a difference. It’s great to hear stories from our employees about how appreciative they are to be able to help people.”
Every organization has its sacred cows — those employees considered above reproach. Until now, you may have been able to justify their position. But as organizations are forced to rethink their staffing models, become leaner, and figure out how to move forward in today’s pandemic-ridden economy, it may be time to face the challenge of analyzing your approach to sacred cows.
Many staff members perceive that these sacred cows are able to work according to their own rules with few consequences for various reasons: personal relationships with leadership, strong technical talent, strong relationships with key funders or constituents, lineage to another super star who is critical to the organization. In some cases, these employees are considered sacred cows for reasons no one can ever really figure out. They flaunt their power and, everyone — including you, knows who they are and talks about them in whispers. Unfortunately, these sacred cows are a fact of organizational politics — and highly destructive.
Every employee commitment survey we administer includes some item related to “fairness,” often in the context of “My manager applies rules and consequences fairly and consistently in the department.” Nine times out of 10, this will be among the lowest rated metrics for organizations that are formally getting employee feedback for the first time. And, more often than not, these sacred cows are at the root of the fairness tree.
The perception of unfairness causes many employees to question their own value and how — or better yet, if — their contributions are really being appreciated by the leadership of the organization. Employees begin to wonder why they work so hard and give so much if the rewards are not fairly distributed. Employees also may wonder just what it takes to get ahead in the organization. And those companies trying to instill healthy corporate cultures — where recognition and rewards are based on performance, team behaviors, and modeling the values of the company — negate any significant progress by protecting the sacred cows.
For those in leadership, what to do? The first step is to recognize there is a problem. When questioned, leadership can get defensive about all the reasons this individual is really valuable, a key player, too hard to replace, has too many community ties, etc. You have your reasons. But weigh the perceived value of one or two problem individuals against the cost of a harmful negative influence on your culture and the rest of your employees. Reign in the mavericks and be sure to apply the same standards to them as you do for the entire workforce. And make sure they understand you are serious.
Strong stakeholder relationships? The relationship needs to be with the organization and not one individual. Strong technical talent? Perhaps, but often behavioral nightmares for their colleagues. Spouses, siblings, in-laws and other relatives? They need to understand that they will be held to a higher standard simply because of the potential perception of favoritism.
An interesting exercise would be to ask your leadership team if there are any sacred cows in your organization and what they believe the impact to be. Then listen. You’ll know what to do.
Jan Breiner Frazier, the managing member of Planning Plus, LLC, has been a consulting professional since 1988. She has designed and facilitated strategic, annual, and operational planning sessions for a multitude of organizations. Her work with non-profit boards and associations has included strategic planning, board development, and committee structure.
As COVID-19 continues to change everything in our world and our communities, nonprofit organizations have stepped up to fill in the gaps and meet the needs of those who have been impacted. During the early stages of the pandemic, many nonprofit organizations were able to secure Paycheck Protection Program (PPP) forgivable loans and receive generous donations from individual donors and philanthropic institutions. These economic boosts enabled nonprofit organizations to increase and expand services to meet the urgent needs in our communities as the pandemic unfolded.
As PPP funding runs out, and donor fatigue settles in, concerns are increasing about the resiliency of nonprofit organizations as they navigate the challenge of fulfilling their missions with such little certainty on the horizon. Strong leadership and strategic thinking at the executive and board levels have never been more important as nonprofits not only strive to sustain through this time, but also build resiliency for the future.
At Hedges, we describe resiliency as an organization’s ability to weather crisis, sharpen focus, adapt to changes in the landscape, and emerge with the capacity to have even greater impact. We believe the responsibility of building resiliency ultimately lies with the board of directors in partnership with executive leadership.
The board chair is central to nonprofit resiliency and has a unique role in leading and influencing others through the COVID-19 crisis. Yet, many are unsure of how and where to focus energies among so many priorities. Here are four areas where board chairs can lead, engage and hold fellow members accountable, and foster organizational resiliency:
Evaluate, support, and compensate executive leadership. It is the board chair’s responsibility to ensure the full board is supporting the executive director’s success. At the very least, executive directors are entitled to an annual performance review to gain an understanding of where they are excelling and where they can improve. Too often, this process is lacking, which can leave high-performing executive directors feeling undervalued and low-performing executive directors keeping the organization from reaching its full potential. A strong board chair will lead a formal performance evaluation process, which is the foundation for a collaborative and effective working relationship between the board and executive leadership and ensures the organization has the executive talent needed to thrive. Board chairs seeking resources on this topic can begin here.
An effective board chair will make it a priority to partner with the executive director. Monthly one-on-one meetings, in which the executive director shares what is going well, where they are feeling challenged, and what support they need, ensures the board chair is in tune with the organization and its leader. If the executive director is not meeting expectations, the board chair has the responsibility to clarify expectations and engage the board in identifying supports and resources that can help the executive director succeed. Professional development opportunities, including coaching, mentoring, and training, are a few examples.
Additionally, the board should review the executive director’s compensation package to ensure the organization is always able to recruit and retain top talent. The Central Indiana Salary Survey Report, published every two years by Charitable Advisors, is an invaluable resource containing local compensation and benefit data. It can be downloaded here.
Be a fundraising champion. The board chair does not need to be a fundraising expert but does need to be a fundraising advocate. A strong board chair educates and influences fellow board members and executive leadership to double down on fundraising efforts now in the interest of the long game. First, the board chair can urge fellow members and the executive director to avoid cutting fundraising expenses as a short-term fix, as it will have long-term consequences. Second, an effective board chair sets the expectation for and executes 100% board giving to the organization. This includes facilitating conversations among board members to determine individual contribution levels or a combined board goal, monitoring board gifts, and making asks of those who have not yet given. Third, the board chair reminds fellow members they are expected to introduce individuals in their networks who may be potential donors. This can be done in a variety of ways and staff can play a facilitating role. Lastly, a strong board chair champions board engagement in stewardship efforts through such activities as donor thank you calls and letters.
Indianapolis social entrepreneur Jeb Banner, in this article published in the Stanford Social Innovation Review, provides further insight into why every nonprofit board needs fundraising champions.
Build operating reserves. The importance of the rainy day fund has become abundantly clear in 2020. According to experts, three months of cash on hand is a bare minimum to safeguard an organization in times of uncertainty. Yet, data shows that 32% of nonprofit organizations have less than three months of operating reserves and 62% have six months or less (2018 State of the Nonprofit Sector Survey, Nonprofit Finance Fund).
While it can be difficult to secure operating capital above and beyond annual expenses, it is not impossible. A strong board chair will address the need for establishing, restoring, or increasing operating reserves to build short and long-term stability for the organization. Once there is board agreement, a policy should be created and approved to outline appropriate minimum and maximum thresholds, how funds will be invested, and how funds can be used.
The board chair should encourage the finance and development committees to work in partnership to create a strategy and a timeline to secure unrestricted funds that can be held in reserves, most likely from loyal donors who have demonstrated support to the organization over time. Jill Robisch, vice president and senior business development officer, Nonprofit Services, The National Bank of Indianapolis, encourages nonprofit organizations to hold short-term funds in a liquid fund like a money market account that is governed by a short-term working capital policy.
Longer-term investments should be guided by the organization’s investment policy statement and held in longer term investments, such as equities and bonds. Robisch said that, over time, organizations should work toward having enough income generated from long-term investments to serve as the organization’s short-term liquid capital. A strong board chair will also hold the organization accountable for staying focused on building the reserve funds in accordance with the policy developed and agreed upon.
Make every seat count. As the proverb goes, a chain is only as strong as its weakest link. The same is true for nonprofit boards. Members are recruited with the expectation that they will bring their knowledge, skills, and expertise into the boardroom. And, yet, how many board seats are taken up by individuals who don’t attend meetings or are not meeting board expectations? A strong board chair will make every seat count by enforcing bylaws that call for the removal of members who do not make meeting attendance requirements or are otherwise not fulfilling the expectations of board membership. These conversations should be approached thoughtfully and carefully and provide an opportunity for the member to make a graceful transition from the board, potentially into another volunteer role within the organization with a lesser time commitment. Similar conversations should be had with members as they reach their term limit as determined in the organization’s bylaws.
Addressing board disengagement and term limits will create room for new board members, presenting an opportunity to deepen the organization’s commitment to diversity, inclusion, and equity at the governance level. A strong board chair will task the board with revisiting the ideal board composition for the organization, ensuring that it is diverse and representative of the community, and make needed adjustments to member recruitment strategies. The board chair also should be responsible for creating a boardroom environment that allows all members to have equal voice. Organizations struggling to diversify their boards or provide an equity culture should seek outside sources, beginning with answering these initial questions from BoardSource.
Nonprofit resiliency is not a buzzword; it is hard work. With board chairs focused on best practices in nonprofit governance, including a willingness to support the executive director and lead others toward shared goals, nonprofits will weather this uncertain time ready for greater impact. This is their time to lead.
Erin Hedges founded Hedges in 2002. The Indianapolis consulting firm is focused on increasing nonprofit capacity and impact. Hedges, who is passionate about board leadership, currently serves as Board Chair for Dove House and the Lilly Family School of Philanthropy Alumni Board. She also is a past Chair for Joy’s House.
Nearly six months have passed since the first case of COVID-19 was reported in Indiana. Since that time, the majority of the state’s nonprofits have faced significant challenges in maintaining services to support their missions, according to Indiana Nonprofits and COVID-19: Impact on Services, Finances and Staffing, a new report released by the Indiana United Ways and the Indiana Nonprofit Sector Project.
Of the 512 nonprofit organizations responding to a survey, 71 percent reported major revenue shortfalls since March 1 due to the pandemic; 60 percent reported suspending or ending programs; 67 percent cancelled a fundraising event; and 23 percent had laid off or furloughed staff. While the percentage of nonprofits reporting staff layoffs and furloughs was relatively low compared to other metrics, 43 percent reported greater demands on existing staff because of an absence of volunteers.
Report co-author Kirsten Grønbjerg, director of the Indiana Nonprofit Sector Project, Distinguished Professor at O’Neill School of Public and Environmental Affairs at Indiana University Bloomington, said the results were surprising because of the extent of the impact across a significant number of nonprofits. “I don’t think we have ever seen this kind of widespread impact before,” Grønbjerg said. “It’s drastic and intense.”
With previous economic downturns, Grønbjerg said, a portion of nonprofit organizations may have been impacted because of declining revenue. However, the COVID-19 pandemic has left few nonprofits spared, except those that provide essential services.
“Our findings point to an increased need for services that the pandemic itself created. I think the safety net nonprofits play for the community took a beating. How well they’re going to recover is the big question,” she said. “The CARES Act has been an important component in allowing them to continue to operate.” About half of the nonprofit organizations surveyed received loans under the Payroll Protection Plan under the CARES Act.
Kathryn Habecker, co-author of the report and impact and advocacy manager at Indiana United Ways, said that a significant number of Hoosiers were struggling even before the pandemic hit. New data on Indiana ALICE (Asset Limited, Income Constrained, Employed) families show that “more than one-third of Indiana households faced significant economic hardship well before the pandemic hit. Many already were just a paycheck, car repair, or medical bill away from disaster,” she said. “Unfortunately, many more have joined their ranks over the last three months.”
While the report detailed the extensive impact COVID-19 has had on nonprofits, it also revealed how organizations are implementing creative strategies as a way to continue to support the growing needs of residents impacted by the pandemic, Grønbjerg said.
Statewide, collaborations have been developed among nonprofits, United Way, foundations, local and state government officials, schools, chambers of commerce, hospitals, universities and major employers to determine how to best meet of the community, said Grønbjerg, citing a COVID-19 coalition that meets twice a week in Bloomington.
In the coming months, Grønbjerg said, these types of collaborations will become more essential since nonprofits play such a critical role in the community, especially during a time when eviction and utility shutoff moratoriums have started to expire.
“We view these developments as silver linings on otherwise very dark clouds. If nurtured and sustained over time, these collaborative efforts may provide the basis for stronger communities with better safety nets going forward,” Grønbjerg said.
By Shari Finnell, writer/editor Charitable Advisors
When Bryan Orander launched Not-for-Profit News in 2001, the internet had not yet reached its saturation point; only 52 percent of American adults reported using it at the time, according to the Pew Research Center. And Orander considered the e-newsletter as nothing more than a project to keep him busy while starting his consulting business, perhaps a tool that would help a few people find jobs, he recently said.
As NFPN celebrates its 20th anniversary year as an online weekly publication with more than 14,000 subscribers, Orander reflected on how the nonprofit sector of Central Indiana has navigated various changes during that period, including internet saturation, the economic recession of 2008, technology advances, evolving giving patterns, and, currently, the impact of a global pandemic and unprecedented racial equity protests.
Orander, founder and President of Charitable Advisors, a consulting firm, said no other period in the past 20 years fully matches the challenges faced by nonprofits today, but there were similarities during the economic downturn of 2008.
“From our vantage point — from 2008 to 2010, we saw job ads drop off, donations being directed to basic needs and away from the arts and the environment,” he said. “We’re now seeing a lot of the same things. Right now, at least, COVID-19 relief funds are being directed to human services and basic needs. That makes sense.”
Studies reveal that many nonprofits weathered the 2008 recession fairly well, Orander said, which gives him reason to hope that many of them will survive the current turbulent period. Here are some of Orander’s perspectives on the trends that continue to shape the nonprofit sector in Central Indiana.
Increasing dominance of the larger nonprofit: Orander said some of the same patterns that have dominated the B2B sector, including the decline of small businesses, seem to be playing out in the nonprofit sector.
“Looking at the bigger picture over the past 20 years, it appears that the nonprofit sector has evolved with more clearly defined, substantial nonprofits. It’s almost a case of the-haves and the have-nots,” he said. “The organizations that are able to hire the best people, invest in advanced technology and implement the best techniques are getting better and better at raising money and attracting donors. Meanwhile, a lot of other nonprofits are being left behind. And that gap is getting bigger.”
Changing profile of donors: Citing a 2019 report published by the Indiana University Lilly Family School of Philanthropy at IUPUI, Orander noted that the number of people donating has decreased from two-thirds of U.S. households in 2000 to slightly over half in 2016. “While overall charitable donations continue to slowly increase, the number of people donating is decreasing. We have a donating class and the rest,” he said. “People with less means are giving less, while people of means are taking over a bigger share of the giving.”
While overall giving hasn’t declined, Orander said, nonprofits need to be more strategic about how to target wealthier donors. “You have to be sophisticated at soliciting donations, and that seems to leave smaller nonprofits in a tough position because most have not developed major donors.”
Models of charitable giving are evolving: During the past 20 years, Orander also has noticed changes in the giving model — with some donors moving from a focus on organizations that align with their values to a model that generally focuses on a donor’s loyalty to a cause. “There are continuing studies on this, but it appears that charity and cause in terms of giving are viewed differently among different generations,” Orander said.
For example, he said, younger people are more likely to be loyal to a cause, such as environmental concerns, while older people tend to support nonprofit organizations that align with their passions and beliefs. Since younger generations may be more passionate about a specific cause, they may decide to give through an engaging online campaign or work for a for-profit employer that is dedicated to their cause.
Crowdfunding also has changed the charitable giving model, Orander said. “There are so many ways that people can give online; there’s now a fuzziness between charity and giving. A lot of people don’t discern the difference between giving to a food bank or to a worthy person through an on-line crowdfunding platform.”
Businesses competing with nonprofits for new hires: As a professional recruiter, Orander also has some perspectives about how hiring trends are impacting nonprofits’ ability to compete for talent.
“A positive trend is that the younger generation wants to be involved in a worthy cause. They want to make a difference, so they would traditionally be more likely attracted to nonprofits,” Orander said. “However, for-profit businesses have realized that their prospective employees want to be part of a making a difference, so they often affiliate themselves with a cause.”
Socially responsible companies have become so mainstream, that “the lines are kind of blurry between working at a nonprofit with a cause or a for-profit that has a cause,” Orander said. “Employees may determine that, either way, it’s possible for you to make a positive difference. But with some employers, you can make more money and still make a difference.”
Impact of starting a new nonprofit: While it’s not impossible, it is much more difficult to start a nonprofit with real impact than it was 20 years — even without the challenges presented by the COVID-19 pandemic, Orander said. “It may not be difficult to create one, but it’s harder and harder to rally the people and the resources to do anything with it,” he said. Many new nonprofits are created in response to a personal or family tragedy or loss and not because the community doesn’t already offer those services, Orander has observed.
The Future: As Orander looks forward to continuing NFPN’s role in the Central Indiana nonprofit sector, he foresees developing more opportunities to connect people, organizations and resources, with a focus on informing and inspiring through the news and stories it delivers.
“When we first surpassed 10,000 subscribers, I knew we were really helping to connect and inform people in the local nonprofit community. We had become the go-to place for jobs and news,” Orander said. “It felt like we were making a difference. I feel the same way now. It’s been an interesting and humbling experience.”
Nonprofit organizations on the frontlines of supporting immigrants, refugees and other foreign-born residents have been regularly encountering challenges to ensure critical, sometimes life-saving, information is adequately relayed during the COVID-19 pandemic.
In addition to language barriers, these individuals are more likely to be employed in jobs that put them at higher risk for infection, are denied unemployment benefits, lack health insurance, and have fears about accessing medical care and resources — all factors that jeopardize their ability to navigate the pandemic, according to several local nonprofit organizations.
“Those of us who are fluent in English are struggling everyday to understand COVID-19,” said Dana Harrison, interim executive director of the Immigrant Welcome Center. “‘What did the governor say? What is going on with schools?’ It’s changing daily.” For foreign-born newcomers, those COVID-19 directives — from stay-at-home orders to how to protect themselves from the virus — can be extremely difficult to understand, Harrison said.
Rethinking the ceiling for grantmaking in a time of crisis
During the past 18 years, board members of The Clowes Fund have been invested in understanding the challenges facing immigrants and refugees as they shifted their focus to supporting those populations and workforce development initiatives.
When the pandemic hit the U.S., a subcommittee of Fund board members and staff immediately gathered to determine how it could best meet needs in the community. Realizing they didn’t have the resources of larger foundations, The Fund was intent on making a significant impact through a more concentrated effort.
“We used to be one of the largest foundations in Indianapolis,” said Elizabeth A. Casselman, executive director of The Clowes Fund, Inc. “That’s no longer the case. We work hard to find our lane. We were looking to find the gaps and then identifying the organizations that were working to fill those gaps.” The result was a plan to distribute unsolicited funds to current grantees, allow for more flexibility with an unrestricted grant format, and focus on program areas with the highest needs, including immigrant services and workforce development.
Just a few weeks later, the Fund awarded 21 small emergency grants totaling $220,000 to numerous organizations, including Gleaners Food Bank of Indiana, the Undocumented Hoosiers Fund of the Indiana Undocumented Youth Alliance, administered by Broadway United Methodist Church, and other organizations that serve populations who may not be eligible for other types of relief funding.
The unexpected grants came as a welcome surprise for many of the organizations that received them — giving them the support to continue their mission in the midst of an uncertain and turbulent period.
However, the extent of the damage caused by the pandemic weighed heavily on the board members, who started questioning if they had done enough, Casselman said. “There was a strong sentiment among Clowes family members and non-family members that it does no good to sit on these assets when there’s such a great need. We were worried we would look back and say we took too safe of a position.”
They were already familiar with the math that guided decisions throughout the foundation’s 68-year history — across four generations of the Clowes family. “With a foundation, the only legal requirement is that we must distribute at least 5 percent each year,” said Casselman, referring to the value of net investment assets. “Yet, all too often it begins to be interpreted as the ceiling rather than the floor.”
From a strictly financial standpoint, a conservative approach — the 5 percent floor/ceiling — also would have been the most responsible decision for ensuring that the foundation exists into perpetuity, continuing to support the intent of the founders’ mission, Casselman said.
“If you have several years of 6 to 7 percent, you can pretty quickly erode your funds,” Casselman added. “We realized those policies served us well in the long run. But these are exceptional times. And exceptional times demand an exception response.”
As a result of that strong sentiment among the board, including family and non-family members, the Fund doubled its grantmaking commitment by spending an additional 5 percent more than its typical grantmaking through a $3.2 million draw from the corpus of its endowment in 2020. Through The Clowes Fund COVID-19 Plan, the board approved spending an additional $2 million in grantmaking for 2020 and reserved $1.2 million to supplement grantmaking in 2021.
“Failure to respond in an exceptional manner would likely cause the Fund board and staff to look back with regret,” said Edith Bowles, Clowes Fund vice president. Bowles said they believed it is possible to make an unprecedented decision without damaging the long-term fiscal health of the foundation.
Meeting needs in challenging times
As with its previous response, the Fund quickly distributed unsolicited and unrestricted grants in July — in amounts ranging from $50,000 to Exodus Refugee Immigration, Inc., to $150,000 to Local Initiatives Support Corporation (LISC) for a comprehensive set of loans for minority-owned businesses. Median grant size was $40,000, significantly higher than Clowes Fund grants awarded in previous years.
Harrison of the Immigrant Welcome Center, as well as those of other organizations supporting the immigrant, foreign-born and refugee population of Indiana, were immediately met with challenges in the midst of the pandemic. “The challenges were always there … language barriers, higher risks of infection, an inability to qualify for government resources, lack of health insurance,” Harrison said. “They intensified with the pandemic.”
Every day, the Center intervenes on behalf of immigrants, ensuring that they’re getting access to food pantries, and unemployment benefits, rental assistance and healthcare they’re entitled to but are afraid to access.
Language barriers are especially problematic in a state with inadequate language translation options.
“When the government first issued stay at home orders, some families would not open their front doors or leave their homes, endangering their lives because they were critically low on food,” Harrison said. “In their world, when the government says stay at home, they stay at home.”
Immigration status concerns also instill fear among individuals who are undocumented, Harrison said. With the public charge rule, there is also widespread concern that applying for social benefits could jeopardize any chance of being granted legal permanent resident status, Harrison pointed out. “It’s been very successful in putting absolute terror in our immigrant population,” she said.
The Clowes Fund grant, along with other grants from other foundations, came at a critical time, Harrison said.
“The size of the grant we received from the Clowes Fund gave us some critical breathing room — the freedom to keep on some temporary staff members on a more permanent basis. We did not have to operate in financial fear,” Harrison said. “We were absolutely stunned. It helped transform our year.
“If we had not received that money there would have been the prospect of very hard decisions on the horizon, including reducing positions to part time,” she added.
Cole Varga, executive director of Exodus Refugee Immigration, Inc., said the organization has been focused on meeting the needs of refugees who have been displaced from nations like Syria, Burma, and Yemen under troubling circumstances made even more challenging because of the pandemic. In addition to helping refugees get settled in apartments, schools and jobs, the organization regularly helps them understand basic living skills, such as writing a check, purchasing groceries and accessing health care and social services.
As the impact of COVID-19 intensified, the Exodus team ramped up their efforts to assist refugees in applying for unemployment, and rental and utility assistance. Those efforts were complicated because of language barriers, said Varga, noting that Exodus provided interpretation. “Different government agencies are a bit behind with equality in terms of language access,” he said.
“Unemployment in Indiana has a massive backlog, making it even more difficult to navigate if you don’t speak English,” Varga added. “Some of them didn’t even have WiFi. It would have been impossible if we had not helped them out.”
Because of the added complications of applying for benefits as a non-English speaking resident, unemployment benefits sometimes didn’t arrive for more than two months. As a result, some families were unable to buy food or pay rent and utilities during that time, Varga said.
Grants have helped refugees face difficult circumstances, especially during the period in which Congress has debated on how to move forward with unemployment benefits, Varga said. “The Clowes Fund helped remove those barriers.” he said. “When a single mom lost her job at a restaurant, we were able to stand in and help fill in the gap.”
As part of its mission, La Plaza, Inc., another Clowes Fund grant recipient, provides one-on-one counseling to Hispanic high students to improve their chances of graduating from high school and college. The team also provides support to the families of the students, ensuring that they receive healthcare, utility and rent assistance, and other resources.
The pandemic complicated the ability to deliver those services because most of the engagement had been in person, said Miriam Acevedo Davis, president and CEO of La Plaza, Inc.. Also, La Plaza was sensitive to the increased need for mental health counseling as well as helping families understand the signs of anxiety and depression.
“It was an enormously scary time,” Acevedo Davis recalled of the first several months of the pandemic. “We were serving an area that had been identified as a hotspot, based on a lot of the information we had.”
La Plaza team members initially worked from home, ensuring that the families they served were adequately protected with PPE, medical services, food, childcare and other resources. Additionally, they were sorting out the complications of working with some students who were trying to study from home without WiFi or had the responsibility of caring for younger siblings.
Acevedo Davis described the Clowes Fund grant as extraordinary for several reasons. Not only was the grant unsolicited, it was issued quickly and without restrictions.
Acevedo Davis said those factors were critical. “We did not have to worry about writing a report about what we’re going to do and anticipated outcomes, or spending a lot of time tracking it,” she said. While La Plaza has processes in place for reporting and tracking, additional restrictions would have been difficult to complete at a time when employees were working from home and working hard to meet the needs of the community they served, Acevedo Davis said.
“They (Clowes Fund) told us, ‘We want to get the money to you quickly. We know you’ll do a good job supporting the most vulnerable,’” Acevedo Davis said. “With those restrictions gone, we could move quickly so that students and their families could get the critical help they needed during a difficult time.”
Acevedo Davis said The Clowes Fund, along with other local funding sources, have provided critical support during an incredibly challenging time for nonprofits and the communities they serve.
“We are in awe of how quickly our funding community moved to provide funds to organizations,” she said.
The Clowes Fund COVID-19 Relief Grants recipients included: Broadway United Methodist Church (Undocumented Hoosier Support Fund); Exodus Refugee Immigration, Inc.; Gleaners Food Bank of Indiana, Inc.; La Plaza, Inc.; Local Initiatives Support Corporation; Mary Rigg Neighborhood Center, Inc.; Second Helpings, Inc.; Shepherd Community Center, Inc.; The Immigrant Welcome Center, Inc; and RecycleForce. Other awards were granted to organizations in New England states, including Massachusetts, Maine and New Hampshire and New York, and other regions.
by Shari L. Finnell, editor/writer, Charitable Advisors
For School on Wheels, an Indianapolis nonprofit that provides tutoring for children facing homelessness, the potential loss of funds from its annual fundraiser in 2020 would have been devastating — a significant blow to its ability to carry out its mission in the midst of the COVID-19 pandemic.
Education Celebration generates 25 percent of School on Wheel’s annual budget, according to Amber Ewing Kostoff, CFRE, vice president of development. In 2019, it brought in more than $270,000 from sponsorships, live and silent auctions, ticket sales and a matching gift opportunity for about 400 attendees.
“It’s a big deal for us,” Ewing Kostoff said.
When Indiana started reporting its first cases of COVID19, School on Wheels event organizers immediately started considering alternative options for their 2020 Education Celebration. It was originally slated for April, just weeks after Indiana Governor Eric Holcomb started issuing statewide restrictions, including a shelter in place order, effective March 25.
“When all the news about the pandemic and the restrictions coming to fruition, we didn’t feel comfortable about having an event with more than 400 people in a room,” Ewing Kostoff said. At the time, we weren’t sure how things were going to look like going forward.”
As with hundreds of other nonprofits in Indiana, School on Wheels had invested a significant amount of time and resources into event planning because of multiple benefits. A successful fundraiser not only provides an avenue for generating funds, it gives nonprofits the opportunity to meet donors and volunteers face to face, showcase the mission, and recognize sponsors, volunteers and supporters.
While inclement weather always has posed a threat to plans for galas, 5Ks, parties and other event fundraisers in Indiana, COVID-19 has had an unprecedented impact — disrupting plans for nonprofit organizations of all sizes throughout the year.
Zoobilation, one of the most widely anticipated black-tie fundraising events in Indiana, was canceled for the first time in its 34-year history. Organizers originally had postponed the date, moving it from June 12 to August 14, in the hopes that it could be hosted in a safer environment for its 5,000 guests by that time. The fundraiser supports general operating expenses for the Indianapolis Zoo.
With COVID19 undergoing a resurgence, Zoobilation organizers last week announced its decision to cancel the event. “It was painful to cancel it but not difficult considering what was in the best interests of our guests and partners,” said Julie McDearmon, CFRE, director of Institutional Advancement at the Indianapolis Zoological Society.
Organizers of Rev Indy, an IU Health Foundation fundraiser that supports statewide trauma and critical care programs, also decided to forego its 2020 celebration because of the potential health risks, said Carol A. Howard, executive director of Rev.
“We spent months weighing all the options to safely hosting Rev this year,” Howard said. “Our number one goal as a leading healthcare organization is to safeguard the health, safety and well-being of all of our guests, vendors, chefs, entertainers and volunteers.”
The cancellation of these major fundraisers followed extensive research and planning, according to their organizers. Some of the questions that emerged included: Do you approach sponsors and ticket holders about maintaining their financial contribution — even in the face of their own potential economic hardships? What about investing in the logistics of planning an alternative virtual event? And, with cases of COVID19 resurging in Indiana, how do you plan for future events?
“There’s not a one-size-fits-all solution,” said Zoobilation’s McDearmon, who noted that she has previously worked at nonprofits of varying sizes and resources. “Ultimately, you have to do what’s best to protect your brand and reputation as well as those of your sponsors and partners. If you can’t host your event safely, then you need to weigh different options.”
McDearmon said it’s also important to include committee members in conversations about how to move forward.
Howard stressed the importance of being fluid with planning in the midst of a changing environment.. “We are in a time that ‘new’ event concepts can be born and executed safely during this time, which ultimately can create new opportunities for non-profits in the long term.”
As part of its planning in the wake of COVID-19 and social justice protests locally and nationally, Rev organizers announced that some of the proceeds from its canceled 2020 event would be directed to the Iu Health Foundation’s Racial Equity in Healthcare Fund.
Ewing Kostoff pointed out that virtual events may be a possibility. School on Wheels hosted an online option and, as a result of that event and the generosity of its donors, reached its fundraising goal. “Focus on what makes sense for your individual organization,” Ewing Kostoff said. “It has to make sense for what you’re trying to accomplish. Who is your audience? How do you get them engaged? What can your staff do in a short amount of time? Those are critical questions to ask.”
School on Wheels Hosts a Virtual Event
When event organizers for School on Wheels’ Education Celebration first understood the initial impact of COVID-19, they made plans to postpone the April event to June 25. “We hoped things were looking different by then,” said Ewing Kostoff. “We also wanted to try to get the event in before the end of our fiscal year..”
With uncertainty increasing about the viability of hosting the June 25 event, the team started exploring another Plan B, an option that would take them into unchartered territory. The Education Celebration committee members researched online for tutorials on how to host a virtual event. They also contacted other nonprofits that had switched to virtual events, including Second Helpings and St. Mary’s Child Center.
After making the decision to host a virtual event, the planning committee focused on several critical areas, including how to deliver value to sponsors. “By the time we got to March, we had already secured all of our sponsors,” Ewing Kostoff said. “We felt we had to deliver the benefits that we promised them from an in-person event, something creative and equitable.”
While the organization wasn’t able to offer sponsors tangible items like a table with dinner, they realized they could adhere to the idea of highlighting their brands in a program. In addition to featuring the sponsors on the homepage of the Education Celebration site, they featured them in an ad in the Indianapolis Business Journal, social media posts and other platforms. “We tagged them at every opportunity,” Ewing Kostoff said.
Another critical focus was the event’s auction, which relied on the donations of local businesses. Typically, organizers would approach businesses for gifts to sporting events, concerts, hotel stays and restaurants. “We felt we couldn’t go to those people and ask for those things,” Ewing Kostoff said. “We didn’t want to ask restaurants for donations at a time when they’re closing their doors. We never want anyone to feel pressured”
However, Ewing Kostoff said she did heed the advice of some of her fundraising peers:“It never hurts to ask. Give them an option.”
While the donated items were smaller in scale than in previous years, bidders paid more than they had anticipated. “They wanted to support what we’re doing,” Ewing Kostoff said. “We have the most amazing sponsors. They stuck with us and showed us, ‘We’re with you.’”
Promotion also was a key consideration as part of the event planning, Ewing Kostoff said. With an in-person event, organizers were focused on a limited number of people. That focus shifted significantly with an online event.
“We could widen the scope of our audience,” Ewing Kostoff said. “With an in-person event, you’re limited to the number of people you can put in the room. We reached out to all the supporters, sponsors and people who attended any of our events in the past. We let them know that we’re doing a virtual event and invited them to sign up to receive text messages.”
They also included online event details in newsletters and all of their social media channels, and encouraged their supporters to invite their friends to the online event.
When planning an online event for the first time, Ewing Kostoff said, it’s important to keep the right focus. “Focus on what makes sense for your individual organization, what you’re trying to accomplish and how to get your audience engaged,” she said. “And focus on it being the best virtual event you’ve ever done. Don’t try to compare it to what we’ve done in the past.
“That took the pressure off our team,” Ewing Kostoff added. “We’re really proud of what we were able to pull together. It was wonderful to see how many people came through that day and the next day.”
Another key takeaway from Ewing Kostoff was the importance of conveying the message of the nonprofit’s mission in the midst of the pandemic.
“We provide tutoring for children facing homelessness. We typically provide that tutoring onsite, in schools and in shelters,” she explained. “When things started to shift in March, we really did have to pivot. We had to figure out how to reach those students. One of the barriers for a lot of kids we work with is technology. We started having conversations with our partners about ways to get students the tools they need so they don’t fall behind.”
School on Wheels consistently explores different ways to convey the message behind its mission, Ewing Kostoff said. “Our mission doesn’t go away. The need for education never stops, We try to stay focused on the importance of what we’re doing and how to embrace new ways to talk about what we’re doing.”
Zoobilation Looks Ahead
While Zoobilation has an enviable reputation, selling out all of its 2019 tickets in less than 10 minutes, organizers don’t take its popularity for granted.
“We pretty much plan the next year before we even finish the current year,” said Julie McDearmon. “Before we decided to postpone, we were already planning Zoobilation 2021. We’re constantly having to look forward — even strategically looking five years out to determine how to keep it exciting. It’s a constant cycle.”
Before its cancellation, Zoobilation 2020 was projected to raise $2.5 million in support of the zoo’s mission of empowering people and communities, both locally and globally, to advance animal conservation. That amount represented approximately 8 percent of the Indianapolis Zoo’s annual operating revenue.
When making the decision to cancel Zoobilation, organizers prioritized the health of its supporters as well as the long-term reputation of Zoobilation and its partners, according to McDearmon.
They also considered the economic fallout caused by COVID-19. “Our restaurant partners and many sponsors have been hit hard this year and are struggling. That was another strong consideration in canceling Zoobilation,” she said.
McDearmon also said it was important to offer ticket holders various options in response to the cancellation of the event. They were given the opportunity to donate the cost of the tickets, ranging from $300 (general admission) to $600 (Premium Experience), as a charitable gift; repurpose the ticket for Zoobilation 2021 or request a refund.
“We know many people are struggling right now. All of us at the Indianapolis Zoo are grateful that people are being very generous and letting us keep their Zoobilation ticket fee or sponsorship as a full donation,” she said. “We also realize that there are some who aren’t able to do that.”
Early on, as Zoobilation committee members discussed options for the 2020 event, they considered the possibility of hosting a virtual event, McDearmon said. Their research included observing virtual events hosted by other zoos and aquariums.
At the end, they decided it was not a viable alternative for Zoobilation. “When you have a production that’s this big, you have to pay a lot to execute it well. You need to consider if you can give your guests the same experience they expect and pay for normally,” McDearmon said. “Virtual events may work for some nonprofits, but the Indianapolis Zoo decided the event execution wasn’t there for us.”
As in previous years, McDearmon, her events team, and other Zoobilation committee members are already looking ahead. Plans for Zoobilation 2021 are underway, including logo and other creative development and corporate partnerships.
With COVID-19 impacting all nonprofits in some way, it’s important to explore many options to determine the best path forward, McDearmon said.
“Every nonprofit organization has varying degrees of resources,” she said. “There isn’t a one-size-fits-all solution for every nonprofit as they navigate the special events landscape during this challenging time. My advice would be to protect your brand, image and reputation, and that of your sponsors and partners, when you determine how to proceed.”
Rev Indy navigates a new path
For the past six years, Rev Indy has played a vital role in supporting IU Health’s mission.
“Our funding goals have been focused and deliberate to ensure no matter where you are injured in Indiana, you can access IU Health Trauma Care,” Howard said.
Funds raised from Rev 2019 were specifically directed to support 911 access trauma ESO integration, a new mobile critical care ambulance and trauma education.
Like other nonprofits, the discussions about what to do with Rev 2020 started early in the year, as COVID-19 cases were being reported in Indiana. The decision-making process involved several factors, Howard said.
“If we took a ‘show must go on’ perspective during a public health crisis, it may make our guests feel we are being irresponsible or inconsiderate of their health,” Howard said. “The long-term impact could be a significant loss in giving. Since we are a healthcare organization, our decision will be under a microscope.”
Also, since the serving of food and beverages is a significant part of Rev, many of the biggest contributors to Rev are facing economic challenges caused by the pandemic, she said. “Many restaurant partners have been facing months of lost revenue.”
“Another consideration was the safety of staff members and volunteers working during the event,” Howard said. “We had to ask ourselves, ‘How will this outbreak impact the safety of our team? Are we risking their well-being?’ These are questions we had to consider.”
After outlining their concerns, the Rev committee consulted with its legal team to navigate options as COVID-19 updates emerged. “They were extremely helpful in looking into all of our concerns,” Howard said.
With Rev attracting a large crowd of guests intermingling over food and drinks, the risks were clear, Howard said. “With large events, it is difficult to enforce social distancing and occasional bottlenecking of people in certain areas, such as entrances, egresses, and restrooms.”
While the Rev committee eventually decided to cancel the event, they also used it as an opportunity to expand its impact.
“Over the last year, we have been looking to expand Rev’s funding opportunities,” Howard said. “In the wake of the Black Lives Matter movement, a donor asked how he could help IU Health do something about the stark differences in health among racial and ethnic groups, which were brought to the forefront during the COVID-19 pandemic.”
Howard said that IU Health had already been addressing these differences on many fronts, needed a focused fund through which donors could support a broad range of initiatives.
“The IU Health Foundation created the Racial Equity in Healthcare Fund to support IU Health’s work in advancing equitable care for all and we felt it was a perfect time to expand our funding opportunities,” she said. “This fund will support creative and effective initiatives addressing health inequities among Hoosiers.”
Rev ticket holders and sponsors were given the option to donate funds to the IU Health Foundation to reduce racial equity in healthcare or statewide trauma and critical care programs, or to transfer their tickets to Rev 2021.
Top sponsors who chose to donate their funds were invited to “Taste of Rev,” an Aug. 1 event that allows up to four cars from each company to drive around the Indianapolis Motor Speedway, stopping at pit stop locations along the way for pre-packaged food and beverages and photo opportunities.
“We also accommodated everyone who requested a refund for this year’s event if either options did not work for them,” Howard said.
By Abby Rolland, former communications project manager, Lilly Family School of Philanthropy
As states slowly resume operations and the U.S. tries to return to normalcy in the wake of a devastating health and economic crisis, nonprofits continue to serve on the frontlines.
To learn what is happening on the frontlines, Lilly Family School of Philanthropy reached out to alumni working in nine charitable subsectors. Classified by the National Taxonomy of Exempt Entities (NTEE) Code: religion, health, education, human services, public society benefit, international affairs, foundations, animals and the environment, and arts, culture and the humanities, these graduates provided insight about how their organizations responded to COVID-19 and what they are learning.
Insights
In the religion subsector, Winterbourne Harrison-Jones serves as a senior pastor at Witherspoon Presbyterian Church on the city’s westside. He explained that the old models of worship have been challenged, and the church has had to find new ways to connect, show care and form community.
Winterbourne Harrison-Jones
“We’ve had to create virtual spaces for spiritual development and social engagement. The coronavirus has challenged many congregations to think quickly and creatively to stay true to teachings of the church, while also navigating a new environment.”
Harrison-Jones shared videos of services, messages, and music on the church’s Facebook page in order to connect with church attendees.
In the education field, Richard Trollinger works as a senior philanthropy advisor to Centre College in Danville, Ky. In March, the college created a relief fund for students needing immediate assistance during the spring semester. Now, it’s shifting its focus to discuss the ongoing needs for students long-term.
Trollinger also serves as the coordinator of a group of 21 chief development officers at liberal arts colleges in the Southeast.
Richard Trollinger
“We have had Zoom meetings to discuss when and how to reboot our overall fundraising programs, especially major gifts. We want to examine all angles in major gift fundraising and learn from each other before moving forward.”
The subsector public society benefit includes organizations such as United Way. Lisa Busse serves as the engagement senior manager at United Way of Central Indiana (UWCI), which rapidly developed a response to the virus crisis by working with other funders to launch the Central Indiana COVID-19 Community Economic Relief Fund. Busse leads a team that is not only raising funds for the needs in the community during the pandemic, but for UWCI’s regular programming as well.
Lisa Busse
Those fundraisers meet with donors online, openly sharing the challenges of the global pandemic while also illustrating the need for United Way and the impact it has had for over 100 years. Combined with three prior rounds of grants made since March 24, C-CERF has granted $21.5 million to 186 organizations in Central Indiana that serve individuals and families affected directly and indirectly by the COVID-19 pandemic.
Working in human services arena at Gleaners Food Bank, Bethany Watson, director of grants and foundation relations, has seen the number of food-insecure Hoosiers rise dramatically as a result of COVID-19. In April, the nonprofit distributed more than twice the amount of food as it had in April 2019. Gleaners and other nonprofits that are focused on food insecurity have rapidly adapted their services to feed more hungry individuals.
Bethany Watson
Watson said her degree in philanthropic studies has helped her navigate the challenges of a new environment, including writing grants and mananging relationships with funders to help Gleaners make a difference for those facing food insecurity and hunger.
At The Nature Conservancy (TNC), Erin Crowther serves as the donor relations manager. The environment- and animals-focused nonprofit has found new ways to creatively adapt to the new environment and engage with its constituents and the conservation community.
Erin Crowther
“We’ve developed ‘TNC TV’ episodes featuring different aspects of our mission, we held an online board meeting, and we celebrated the 50th Anniversary of Earth Day from all corners of the globe,” Crowther said. “We recognize the comfort our natural world can bring to those who engage with it.”
International affairs organizations based in the U.S. have implemented innovative fundraising campaigns, participated in global giving days, and developed their own emergency responses to COVID-19, according to Lilly Family School of Philanthropy visiting research associate Kinga Horvath, a Fulbright Scholar from Hungary.
“Pooled funds and collaboratives have also become an innovative vehicle to leverage donors’ resources and common interests in order to tackle global societal challenges, locally and globally,” she explained.
Kinga Horvath
Horvath and the rest of the Lilly Family School of Philanthropy research team have worked on collecting data about giving and COVID-19 from around the U.S. and the world in order to assess its national and international impact.
Some foundations, such as Ball Brothers Foundation (BBF) in Muncie, have developed a rapid grant program that is designed to pay out small grants quickly, according to BBF president and COO Jud Fisher. The program assists with immediate needs, and allows BBF to respond quickly without changing many of their systems. In addition, Fisher noted that the foundation is also continuing its general grantmaking cycle.
Michelle Turchan of Riley Children’s Foundation urged nonprofits to be nimble and to ask constituents, volunteers, and donors how they are impacted by the crisis and can best be served.
Michelle Turchan
“We’ve developed a relief fund that allows the hospital to serve the specific needs of families impacted by this health crisis,” said Turchan, regional gift officer. “We know that many of our constituents are in a particularly heightened state of stress, and we want to be sure that we are continually able to best serve them.”
Arts, culture, and humanities organizations face a tough road ahead.
“During previous disasters, sharing space and taking solace in the healing power of the arts has allowed us to grieve together and heal together,” explained Tania Castroverde Moskalenko, executive director of the Miami City Ballet.
Tania Castroverde Moskalenko
“The nature of this pandemic hasn’t allowed us to do that. The current situation has forced many of us to pivot to virtual presentations via digital platforms and social media channels,” she said. “Most of us are planning, creating, and producing content in order to stay connected to our audiences. We are determined to continue impacting lives through our work.”
Lessons
What are some of the takeaways that nonprofit practitioners can learn from peers in the philanthropic sector?
Use a virtual learning/community environment to your advantage. Discover new ways to connect with stakeholders and those passionate about your mission. How can you use online platforms to connect in virtual ways that you weren’t able to or hadn’t tried before?
Be creative in communicating and engaging with your donors. Host regular Zoom meetings. Invite donors on tours of your organization, implementing your community’s recommendations for social distancing. Share stories about recipients or beneficiaries of your organization. Find ways to continually engage with your donors.
Identify ways to regularly meet with your board. Although the virus has altered programs and schedules, it’s important to keep in touch with your board to discuss the ever-changing situation. Keep them involved and engaged, and use their expertise and connections to continue to demonstrate your nonprofit’s case and mission.
Collaborate with others. Search for opportunities to collaborate with other nonprofits, and with businesses and government entities. Much can be accomplished if individuals and organizations work together to better serve their communities.
Listen and respond accordingly. If you’re a public charity, listen to your beneficiaries and the community to see where your mission matches need. Be open and nimble to adjusting plans if you find that your constituents need something different from you. If you are part of a foundation, listen to your grantees and find ways to be flexible in order to quickly respond to community needs. In addition, deliver on your previously-made awarded grants in order to help nonprofits as much as possible during this time.
Since June 2020, Abby Rolland has served as a fellow at The Patterson Foundation in Sarasota, Fla. She holds a master’s degree in philanthropic studies from the Indiana University Lilly Family School of Philanthropy and an undergraduate degree from Gettysburg College.
Through a collaboration with the Indiana University Lilly Family School of Philanthropy, The Patterson Foundation created the Fellows Program. Through this effort, the foundation aspires to create a network of future leaders aligned in its innovative approach to philanthropy.
With questions still lingering about the Paycheck Protection Program (PPP) Flexibility Act, the Small Business Administration (SBA) recently released revisions that clarify guidelines for loan forgiveness, payroll requirements, exemptions and other basic aspects of the program. For the record, this is the SBA’s 18th “interim final rules.”
Nonprofit organizations also should be aware that $129 billion of funds still remain available, although the deadline for the program was June 30. Legislators are expected to determine whether to extend the PPP application deadline as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, but some lenders have closed their portals.
The updates for the PPP Flexibility Act include:
Extended period for loan forgiveness: The loan forgiveness covered period — the timeframe for which the borrower needed the PPP loan proceeds as they tried to continue operations, was originally set for eight weeks. However, the SBA has extended the allowable covered period time frame to 24 weeks. In other words, organizations now have the flexibility to use the PPP loan proceeds with a specific 24-week time frame instead of an 8-week time frame.
A more flexible payroll requirement: Under the new guidelines, a minimum of 60 percent of the PPP loan proceeds must be utilized by payroll to be eligible for full forgiveness. The original PPP guidelines required that 75 percent of the PPP loan proceeds must be utilized for payroll expenses. The rest must be spent on rent, utilities, and other business-related expenses.
Safe Harbor provisions for loan forgiveness: The original CARES Act stated that the PPP loan proceeds had to be used to maintain employment and wages at the previous levels. However, the PPP Flexibility Act has added a Safe Harbor provision in case the organization was impacted by state or national restrictions and, as a result, was unable to return to normal economic activity, or was not able to re-hire previously furloughed employees or fill vacant positions despite efforts to do so.
Process for loan forgiveness: The borrower must complete and submit to the lender a form called the Loan Forgiveness Application. Two forms exist: SBA Form 3508 and SBA Form 3508EZ. These must be supported by documentation to substantiate the eligibility and utilization of the loan funds. Within 60 days, the lender must review the Loan Forgiveness Application and make a recommendation to the SBA about forgiveness and the forgiveness amount. Within 90 days, the SBA will provide the forgiveness amount to the lender.
It’s also important to know that as part of the general loan forgiveness process, the SBA will review the loan for compliance with:
the CARES Act
SBA rules or guidance applicable at the time of the borrower’s application
Terms of the borrower’s PPP loan application; e.g., borrower lacked an adequate basis for the certification made on its application
If the SBA determines that the borrower was ineligible for the PPP Loan, the loan will not be eligible for forgiveness.
The SBA also provides a specific calculation for the loan forgiveness amount, which equals payroll costs (details to be considered) plus non-payroll costs.
Details about payroll costs: For the employer, compensation must be paid to employees who principally reside in the United States. Compensation is defined as salary, cash tips, payment for vacation and parental, family, medical or sick leave. It also includes allowance for separation or dismissal payment for retirement benefits and payment of state or local taxes assessed for an employee’s compensation.
Non-payroll costs include interest payments, lease payments, and utility payments. The eligible non-payroll costs cannot exceed 40% of the total forgiveness amount.
Notwithstanding the Forgiveness Application, the nonprofit organization must be prepared to provide supporting documentation to the lender outlined as follows:
Payroll: Documentation of verifying eligible cash compensation and non-cash benefit payments for the covered or alternative covered period including data such as bank statements or other payroll reports. Such reports must document the amount of cash compensation paid to employees, payment receipts and the average number of FTE employees on payroll employed by borrower on Jan. 1, 2020 and the end of the covered period.
Non-payroll: The requirement for supporting documentation includes verifying the existence of the obligations/services prior to Feb. 15, 2020 and eligible payments from the covered period. Eligible non-payroll includes business mortgage interest payments, business rent or lease payments and business utility payments. Applicants may need to provide cancelled checks or online banking activity to prove payments.
Notwithstanding some recent news from the Small Business Administration, you should talk with your relationship bank for details about its specific processes. In addition, the SBA also provides readily accessible materials from the following URL: https://home.treasury.gov/policy-issues/cares/assistance-for-small-businesses
John Haggarty, vice president, Gail Bradley, vice president, and Dave Voris, region manager, Treasury Management, represent many years of experience in understanding the unique needs of nonprofit organizations. They focus on wrapping specially designed depository products, Treasury Management, and Funds Management together to help each nonprofit organization manage their cash flows in the most economical way.
By Sara Johnson, director, IU Executive Education, O’Neill School
Unprecedented times. It’s the phrase we keep hearing over and over from leaders around the world to describe the major shifts we’re seeing across all sectors due to the COVID-19 global pandemic.
And in these unprecedented times, we must provide unprecedented leadership.
IU Executive Education at the O’Neill School’s faculty — including Mary Anna Weber, Tom DeCoster and myself — have led teams through crises before. Our experiences can help leaders learn to do the same, starting with five key concepts to form the foundation.
Authenticity
Be authentic. You are going through this crisis just like your team. Be real about how this situation is challenging you, just as you want your employees to share how they are handling things. Don’t vent, though. Save sharing those frustrations for your peers, your family, or someone in a similar role.
Clarity
Be clear about your expectations and your messages. Rich communication channels involve reading body language and being face-to-face with a person. Having face-to-face meetings on Zoom or Skype is better than not seeing someone at all; however, it’s still not the same. People may be distracted physically — working on their sofa and trying to balance a laptop — or emotionally by their current situation. Be sure you clarify your messages at the end of virtual meetings. We know this is an important way to end any meeting, but it’s even more important now.
Empathy
Be empathetic. Lead with grace, focus, and understanding, while being patient and forgiving when everyone is trying to adapt to a “new normal.” Some people have never worked in their home environment before. They may be trying to find ways to work there at the same time their partners are also working from home or while their kids are doing homework. They may also be trying to figure out how technology, like how to log on to the office system remotely. Recognize that all of this can be a challenge.
Expect productivity to dip a bit as people adjust. If you have extremely high standards of performance, you need to relax that a bit or your own frustration will rise. That helps no one at this point. A boss once reminded me, “No one gets up in the morning and decides they are going to go to work and do a really bad job.” If you hired the right people in the first place, their performance will come back. Good people want their leader to succeed, too.
Consistency
Be consistent. Be the person your team knows you to be. Don’t take on behaviors that are inconsistent with who you are. You are a leader and when things are in an upheaval there is a tendency to get into the operations where you can be in greater control. There is no greater time for you to be leading rather than focusing on operations. Keep the sights set ahead and point the way for your team, even if the future is a bit muddied in your own mind. Leaders never have total clarity when leading. Don’t let a little fog stop you from ensuring your team is still moving forward.
Intentionality
Be intentional. Make it a point to communicate regularly and with purpose. There is a balance between inundating people with multiple communications to the point they get overwhelmed and even confused. Know what you specifically want to inform people about, even if it’s simply what you know and don’t know at a given point. People appreciate hearing from you even if it’s just that you don’t have information yet. This builds trust and lets them know you are still there, monitoring developments.
Keep in mind that right now you are helping your team make sense of this new and unpredictable journey. One thing that helps in sensemaking is consistent leadership and being a leader who can be trusted. If you lead with these behaviors, you will ensure your team can trust you to be that same person who looks out for and leads them on the average “day at the office.”
Sara Johnson is clinical assistant professor for the Paul H. O’Neill School of Public and Environmental Affairs and Director of IU Executive Education. Professor Johnson teaches graduate and executive education courses. She is a Fellow of the American College of Healthcare Executives (FACHE) and recently served the College as the Indiana Regent. As Director of Indiana University Executive Education, Professor Johnson leads a team of over 40 faculty and staff who are engaged in providing the highest level of leadership development and strategic organizational consulting.
