Angela Francis

Research Friday: Government contracting part II: Adapting in an era of less

 

posted by
Anjali Deshmukh,
Director

and
Angela Francis,
Manager
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing series,we invite a nonprofit scholar, student, or professional to highlight current research reports or studies and discuss how they can inform and improve day-to-day nonprofit practice.

Conducted in January and February 2013, Nonprofit Finance Fund’s 2013 State of the Sector survey assessed the financial and management challenges facing 5,983 organizations across the country. As income disparity continues to grow, many nonprofits are struggling to meet overwhelming community need amid the stark realities of funding cuts. Many are recognizing that this dynamic may be here to stay.

When NFF began this survey in 2009, many of our clients were in “triage” mode: they were dealing with mission and finance-related emergencies, relying on short-term coping strategies—like reserve depletion and staff furloughs—to make ends meet until the financial crisis was over. Five years later, temporary stimulus funding has come and gone, replaced instead by ongoing cuts to government funding. Organizations reliant on government funding continue to experience a “death by a thousand cuts,” says NFF client Sharon Stapel, Executive Director of the New York City Anti-Violence Project. “In isolation, the cuts may seem small,” says Stapel, “but over time, they speak to a larger, more serious trend that will have an impact on the health, happiness, and safety of our communities.”

Research Friday: Government contracting in the new normal

 

posted by
Anjali Deshmukh,
Associate Director

and
Angela Francis,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing series,we invite a nonprofit scholar, student, or professional to highlight current research reports or studies and discuss how they can inform and improve day-to-day nonprofit practice.

Nonprofit Finance Fund’s (NFF) 2013 State of the Sector survey explored a variety of financial and management challenges facing organizations across the country. The core story, as told by nearly 6,000 respondents, is of a fragile balancing act between rising community need and shrinking or stagnant resources for social programs. Particularly in the last several years, in the wake of the financial crisis, organizations have struggled with a variety of challenges related to government support.

In the United States, we rely on government to provide key economic supports. We expect the federal, state, and local governments to play a role in educating our children, helping communities rebuild after natural disasters, and improving our collective quality of life. To deliver on this mandate, services like public education are administered by the government, while many other complementary programs - such as job training and placement - are outsourced to nonprofits. According to a 2010 Urban Institute study, nonprofit organizations (with records of income data) reported that nearly one-third of their revenue sources came from the government.

Small nonprofits, big impact

posted by
Anjali Deshmukh,
Associate Director

and
Angela Francis,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing weekly series, each Friday we invite a nonprofit scholar, student, or professional to highlight current research reports or studies and discuss how they can inform and improve day-to-day nonprofit practice.

There are over 1.5 million nonprofits in the United States. Of those, three-quarters (almost 1.2 million) have annual budgets under $1 million, and most are even smaller. What these organizations lack in size, however, they make up for in impact. They respond to localized needs, are absolutely critical to community building, and are staffed by people with deep knowledge and caring for the communities where they live and work. These organizations often serve communities that have been abandoned by countless others. Yet, in the Nonprofit Finance Fund’s (NFF) work with small nonprofits (most recently through our Capital and Capacity for Economic Recovery Initiative), we’ve found that these essential organizations often struggle to match available funding sources to their actual needs, which results in a number of challenges. So what are some of these challenges, and what makes small nonprofits different from their larger counterparts? Our new report, Small Organizations Solving Big Problems, explores this question.

Research Friday: Controversial Nonprofit Compensation: Are We Missing the Point?

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing series, we invite a nonprofit scholar, student, or professional to highlight current research reports or studies and discuss how they can inform and improve day-to-day nonprofit practice.

We often talk about nonprofit executive compensation in skeptical terms: how much is too much? While no one supports wasteful public spending or abuse of power, the cases that grab headlines and provoke legislation are actually far from the norm. At Nonprofit Finance Fund (NFF), what we see far more often is staff turnover due to burnout and low pay. We routinely work with nonprofits that are struggling to determine if it’s financially possible to make a much-needed new hire, even on a part-time or contractor basis. This week’s installment of Research Friday will examine a range of new data from the field about our sector’s human resources—often, our most powerful but undervalued form of capital.

Research Friday Board Engagement: Thinking Beyond the Wallet

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing series, we invite a nonprofit scholar, student, or professional to highlight current research reports or studies and discuss how they can inform and improve day-to-day nonprofit practice.

Earlier this year, Nonprofit Finance Fund (NFF) received 4,600 responses to our annual 2012 State of the Sector Survey. Since then, we’ve been using these data to share key nonprofit sector trends on issues like the rising demand for services, shrinking government support, and the precarious financial health of organizations. This week’s installment of Research Friday looks at what the survey results tell us about nonprofit board engagement in tough times.

Since 2009, our survey has asked nonprofit leaders to indicate what management actions they are taking to cope with the recession. In both 2009 and 2010, nonprofit leaders told us that they were "engaging more closely with the board" by increasing the number of annual meetings, sharing new types of reports, or in other ways. In those years, nearly two thirds of respondents (59 percent and 60 percent, respectively) ramped up their communication with the board. So what happened in 2011, and what are respondents planning for 2012?

Research Friday: The Results are In - State of the Sector 2012

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing weekly series, each Friday we invite a nonprofit expert to highlight current research reports or studies and discuss how they can inform and improve day-to-day nonprofit practice.

Earlier this year Nonprofit Finance Fund (NFF) asked for a few minutes of your time to help us tell the collective story of the nonprofit sector. And that you did. Thanks to you, we received a record 4,607 responses nationwide to our 2012 State of the Sector Survey, more than doubling responses from last year. Notably, human services agencies that comprise our social safety net were represented quite well and the same held true for Arizona responses. With your help, we’ve amassed a wealth of current information on demand for services, trends in government support, board participation, and financial health. Using this data, we now have an opportunity to start some difficult but important conversations about the true state of our sector.

Research Friday: Looking Back - 2011 makes a strong case for capital

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing weekly series, each Friday we invite a nonprofit expert to highlight a research report or study and discuss how it can inform and improve day-to-day nonprofit practice.

At Nonprofit Finance Fund (NFF), we use financial data every day in our work with nonprofits and their funders. One source of data informing this work is our annual State of the Sector Survey. Throughout the year, I’ve been blogging about key trends from our 2011 survey, which was completed by nearly 2,000 nonprofit leaders nationwide. They told us about their organizations’ financial outcomes from 2010 and speculated on what 2011 would bring. As we look back on what was certainly a challenging year, I thought it would be interesting to revisit some of their expectations.

Research Friday: Battling Domestic Violence with Data

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! As part of a continuing weekly series, each Friday we invite a nonprofit expert to highlight a research report or study and discuss how it can inform and improve day-to-day nonprofit practice.

At Nonprofit Finance Fund (NFF), we use data to help us understand and communicate the financial reality facing nonprofit practitioners on the ground. In previous Research Friday posts, I reviewed key findings from our annual Sector Survey on increased demand for social services and the cash crisis facing providers. This week, in honor of Domestic Violence Awareness Month, I’ll examine the impact of these issues on a specific subsector: Domestic violence service providers in California.

With support from the Blue Shield of California Foundation, NFF recently released Navigating a New Course, a report on the challenges these organizations are facing. Although this study focused on California service providers, anecdotal evidence suggests that domestic violence organizations throughout the country are confronted by similar challenges. The report was primarily informed by two sources:

Research Friday: Many Nonprofits Face Cash Crisis

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! For this week's post, we welcome Angela Francis, Senior Associate, from Nonprofit Finance Fund to discuss NFF's recently released State of the Sector survey findings. We've had a great response thus far to Research Friday, our weekly series on nonprofit research. We welcome your comments, feedback, and suggestions!

At Nonprofit Finance Fund (NFF), we use data and capital to drive our work with nonprofits and their funders nationwide. One source of data informing this work is our annual State of the Sector Survey. Earlier this year, nearly 2,000 nonprofit leaders completed the survey, and the results help us to better understand and communicate the economic reality facing nonprofit practitioners on the ground. In a previous Research Friday post, I covered some key survey takeaways on the increased demand for services in 2011, and how this is communicated to funders. This week, I want to delve a little deeper into the survey responses that we received in another key area: cash available to manage risk.

As we work with clients, provide workshops, and present on nonprofit finance issues, one question pops up again and again: how much cash cushion should a nonprofit have? One of my NFF colleagues recently explained why the answer is different for every organization and depends on a number of factors. As a rough benchmark, though, NFF recommends nonprofits should have enough cash to sustain operations for at least three months. Having less than one month of cash at your disposal is generally considered a cash crisis.

A more ideal situation is holding three to six months of cash, which makes it easier to start thinking long term and building up reserves: a rainy day fund, facility reserves, etc. Organizations with reserves are better prepared for an emergency (major building repairs, loss of a primary funding source, severe economic upheaval), and, in a crisis, it's more likely that they can continue providing their services uninterrupted.

Research Friday: State of the Sector 2011: All quiet on the nonprofit front

posted by
Angela Francis
,
Senior Associate
Nonprofit Finance Fund

Welcome to Research Friday! For this week’s post, we welcome Angela Francis from Nonprofit Finance Fund to discuss NFF’s recently released State of the Sector survey findings. We've had a great response thus far to Research Friday, our weekly series on nonprofit research. We welcome your comments, feedback and suggestions!

Nonprofit Finance Fund recently completed its third annual "State of the Nonprofit Sector" survey with the help of nearly 2,000 nonprofit leaders nationwide. Respondents came from large organizations and small, and from all sub-sectors, and include a small sample from Arizona.

Since we started this undertaking in 2009, we've heard each year that demand is on the rise, and that remains the expectation for 2011. To meet this growing demand—which comes on top of each previous year's increases—nonprofit managers continue to be resourceful in their efforts to balance mission, capacity, and capital. From collaboration to cost management, nonprofits are trying to protect their (precious little) infrastructure and enterprise while serving even more people.

This balancing act becomes increasingly difficult when organizations experience upheaval—whether due to a recession, the loss of a funding source, or unexpected expenses. Yet even smaller changes, such as a program expansion, can quickly overwhelm a nonprofit operating on paper-thin margins with no cushion to absorb the risks and expenses associated with growth. In Arizona, 35% of our survey respondents reported having less than 1 month of cash on hand (10% had none), which is fairly consistent with results nationally.

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