The business of funding
For nonprofits, the post-Great Recession era amounts to a brave new world of finance that is testing business acumen.
A nonprofit business used to be viewed as not requiring the ingenuity of for-profit endeavors, since there was often a government payment program or foundation grant to provide revenue and keep it afloat. But in the recent turmoil, that support is greatly diminished if not entirely gone and the sector is being forced to develop new models on the fly.
“I think nonprofits have to be creative and think more like businesses these days,” said Nicole Fenichel-Hewitt, executive director of the Children”™s Media Project in Poughkeepsie. “In general we are really using our assets and  talents that we have to think about ways to create new revenue that will help our program. That”™s the gist of it.”
“Everything is much more competitive right now,” said Michael Berg, executive director of the wide-ranging social services agency Family of Woodstock Inc, which operates throughout Ulster County. “Everyone is going for everything they can to keep their programs alive.”
In Rockland County alone the county lists alphabetically seven pages of nonprofits, from A ”“ the Ark of Christ ”“ to Z: the Zoroastrian Association of Greater New York Inc.
Family, which in 2010 has a roughly $7.8 million budget and 160 employees, has been operating for some 40 years, starting as a still-operational 24 hour hotline staffed by a real person and now including a shelter for homeless families, another for recovering substance abusers, a domestic violence shelter, and shelters for troubled teens as well as various programs to build on work done in the shelters and for the community at large.
“We have taken some major hits in the county and state budgets and lost a major federal grant,” said Berg. “But so far, we have pretty much been able to do fundraising to keep programs pretty much intact.”
He cited a grant received several years ago for $200,000 that allowed Family to open the Midway transitional program for adolescents, “the square around which we built the rest of a program.” That grant was repeated annually until last year. Without that grant, Berg said, Family has turned to additional fundraising over the last two years and, owing to broad goodwill among the public, was able to raise the money from private sources to keep the program alive. But he worries about donor fatigue as well as the financial losses many would-be donors suffered in recent years, making them less able to donate.
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Harder times bring more need and more competition for funding. Berg said that last March, Family sought a grant for programs in juvenile justice and did not hear back until recently. He said the grantors noted they had received 1,460 applications of which only 26 were funded. And since it was a nationally competitive grant that included urban centers as well as rural areas, much of the money went to cities instead of small-population counties.
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“So it”™s daunting,” said Berg. “That doesn”™t mean we won”™t try, because it”™s important. And what other funding sources do you have? But it”™s daunting.”
The Children”™s Media Project is a different type of nonprofit in size and scope. With a budget of roughly $300,000 annually, depending on receipt of grants and other revenue, it has three full-time and three part-time employees operating from its Poughkeepsie facility.
The Children”™s Media Project runs a variety of programs: in-school and after-school programs that are free of charge and that provide education and hands-on experience in the likes of radio production, video, animation, graphic arts and self-publishing.
“We have a lot of different programs but our mission is to create an environment where artists, educators and especially children learn to interact with media both as creators and critical viewers,” Hewitt said.
“We really do it to support the community so most of our workshops are free,” said Hewitt. “And that”™s where we come into the issue of funding.”
The Project was founded 15 years ago. Hewitt was hired in 2007 and has been at alone at the helm for two years. She has seen both sides of the financial picture for nonprofits during her short eventful tenure.
“The year of transition was such a great financial year, we got so many grants it felt to me like it was going to be easy,” said Hewitt. Â However, the following year county funding was cut as the money for tobacco awareness and obesity awareness programs were depleted. From $110,000 of financial support from the county in the budget during her first year, Hewitt had to manage with just $60,000 in county funds during her first year as executive director and zero funding from the county her second year on the job.
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To make up the losses, the Project is developing new media products that can be used in educational settings and marketed to provide revenue to run the free programs, including educational games and media apps.
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“Kids respond to media and games and we can use that to help kids gain understanding,” Hewitt said. “All our games are educational in nature.”
One project is an application that can run on an i-Phone, for example, where a guided tour of the cities historic places and statues downloads as a satellite tracks location, so that a visitor in front of a particular statue might learn who is being honored and why and when the statue was erected at the site.
“We are working on marketing our programs more, really amplifying our efforts to market our production house,” she said. New products will include commercials, websites, graphics, augmented reality and videophone games.
The media project is also looking to produce videos for other nonprofits and public service announcements for government agencies.
She said that as sometimes happens, a problem solved leads to a new opportunity. In this case the new emphasis on commercial productions provides a chance for advanced students to work on professional sets in a hands-on capacity no classroom could match.
“We”™re really excited about it,” Hewitt said. “We have really been pushing it and are moving from word of mouth to marketing ourselves as a production company. And we really are doing it because that provides funds for the after-school projects we want to keep free.”