Non-Profits Led by People of Color Confront the Crises of a Watershed Year
By the Building Movement Project
In the current unprecedented climate, nonprofits led by people of color (POC) have become the vanguard of crisis response in their communities. Yet even as they perform urgent new work, many face profound challenges to their long-term financial stability.
These are among the key findings of the Building Movement Project’s newly published report, “On the Frontlines: Nonprofits Led by People of Color Confront COVID-19 and Structural Racism.” The report draws on a nationwide survey of more than 430 non-profit leaders of color; we’re presenting excerpts below.
Given the slow and/or ineffective responses of government actors, communities of color have come to rely on POC-led nonprofits for urgent assistance. In response, organizations are coordinating emergency provisioning, advocating for immediate services and structural change, and identifying innovative ways to fill gaps left by government agencies. As one survey respondent based in Memphis noted: “We never closed. We actually had to hire more people in order to meet the demand that was put on us by COVID.”
Organizations are adapting to meet the pressing demands of their communities and filling gaps left by ineffective government policies and systems. POC-led organizations are creating new direct service programs and reshaping existing ones. A majority (51 percent) of organizations have increased services by a little or a lot. Just under half (43 percent) have increased mutual aid support which includes providing basic services through existing relationships with individuals, families, and partners. (However, over a quarter of organizations are providing fewer services because some or all of their work cannot be easily adapted to a remote mode.)
In addition to providing needed services, nonprofit leaders of color are engaging in advocacy for their communities. Advocacy work increased for 48 percent of the survey respondents in the wake of the pandemic. This increase was evident in two-thirds of organizations that typically engage in advocacy, and in 53 percent of grassroots groups and 50 percent of health and human services organizations.
Respondents noted that their advocacy is focused primarily on ensuring that policymakers and government agencies are meeting the needs of communities of color, immigrants, and refugees, particularly with respect to crisis response and recovery plans. For example, a coalition of indigenous groups worked with companies and municipalities to obtain low-cost Internet for community members. A Latinx group advocated for the relocation of Wi-Fi hot spots to residential areas where refugees and low-income households are concentrated. An Asian American and Pacific Islander health organization pushed for public health responses to be designed and delivered in a culturally and linguistically appropriate manner.
As a result of Covid-19, POC-led groups that traditionally engage in organizing as a core activity are facing changed circumstances. Social distancing has led to a marked shift in the ways organizations typically build community power. For example, some groups are investing in new digital technology for outreach and programming. Others are asking recipients of services to become organizational members. Other groups are recognizing that the current environment requires them to train and rely on their staff for advocacy campaigns rather than utilize a community-centered model. For many organizations to survive past the pandemic, creativity and flexibility will be required.
While most of the organizations surveyed are currently on somewhat stable ground due to flexibility extended by foundation funders, emergency funds, and Paycheck Protection Program (PPP) loans created by the Federal CARES Act, many are concerned about their longer-term sustainability. Grant income is up for some and down for others, with a general trend of decline. Earned income is down for most. Individual donations are declining for most, but up for some, as donors are seeking ways to contribute to crisis-response efforts. In addition, emergency revenue increased for 62 percent of organizations, offsetting operating revenue losses that were reported by 45 percent of organizations.
Government funds are comparatively consistent because contracts were already committed prior to the pandemic. This is likely to shift as states lose tax revenues and begin to cancel or withhold contracts to nonprofit service providers, leaving vulnerable communities without access to basic social services.
A significant boost arrived with the passage of the CARES Act, which provided loans to small businesses and nonprofits. Overall, 52 percent of survey respondents reported receiving PPP loans. Some groups reported that the application process was smooth and that they benefited from existing banking relationships. But for many other groups, the process was confusing and unpredictable; they filed paperwork that went nowhere, faced long delays, and spent a lot of staff time on the process. Receipt of a PPP loan seems to correlate with less overall financial stress.
As shown below, 74 percent of those who did not receive a PPP loan are very or somewhat concerned about their organization’s financial stability a year from now, compared to 54 percent of those who received a PPP loan.
Regardless of current stability, many organizations are concerned about their long-term sustainability, six months from now to two years out from the pandemic. One leader observed: “We are running full-force ahead right now – increasing staff and spending money to save as many lives as possible. And we are doing so with deep anxiety that the money might run out.”
Those who receive government support are expecting cuts and austerity measures because of declining tax and investment revenues. While many survey respondents commended the immediate response from philanthropy which included grant extensions, reduced application and reporting requirements, and the conversion of program funds to flexible general operating support, they expressed concerns that these practices would not become permanent. Some leaders noted that large, well-resourced and often white-led groups are the ones that typically receive substantial funds for crisis recovery, and that POC-led groups are still perceived as “risky” investments that have to compete with each other for limited resources.