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Nonprofits should fight for federal funds

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[Editor’s note: A longer version of this article appeared in The Nonprofit Quarterly.]

Rick Cohen

Rick Cohen

Rick Cohen

The Obama Administration budget contains several programs of crucial importance for nonprofits, but it’s not all peaches and cream.

Some of the budget lines expressly dedicated to nonprofits are “bubkis,” Yiddish slang for “nothing.”

Nonprofits should not get lost fighting over next to nothing while the big dollars slide by their radar screens.

Even those items dedicated to the nonprofit sector — for “social innovation” or to replace the Bush-era Compassion Capital Fund — frequently give insufficient attention to the needs and roles of smaller and medium-sized nonprofits, the organizations that comprise the overwhelming bulk of nonprofits on the front lines of addressing social needs in America’s urban and rural communities.

And even with the otherwise friendly Obama administration, nonprofits have to watch out for specific agency agendas that undo the intent of hard-fought legislative victories and redirect funds away from nonprofits into discretionary agency budgets — with the result that nonprofits might not see, much less get, the resources they need.

Much of the nonprofit sector has focused on a handful of programs in the budget with the promise of money for nonprofits, including:

* $50 million for the Strengthening Communities Fund, on top of $50 million previously aimed at that fund in the stimulus bill.

* $50 million for the much-ballyhooed Social Innovation Fund

* Language referring to $5 million a year meant for the Nonprofit Capacity Building Initiative, authorized in the SERVE America Act but missing as a line item in the budget.

* Expansion of the various stipended volunteer programs, old and new, managed by the Corporation for National and Community Services.

All that spending is important to the nonprofit sector as indications or harbingers of the new administration’s approach to nonprofits, but there is more to the budget than these nonprofit-tagged initiatives.

Small nonprofits may look inefficient and inconsequential through the lenses of big organizations, but at the ground level, it is that cadre of small nonprofits that serves at the voice for and outreach to multiple constituencies that can’t get a scintilla of attention from many large foundations and large intermediaries.

Unless they are satisfied with lip service, smaller nonprofits and the networks that are truly dedicated to them have to be prepared to advocate, not as a special interest, but as vehicles for what’s often really effective — and innovative — in the nonprofit sector.

A quick glance at some 1,380 pages of the federal budget plus scores of agency-specific supplemental documents reveals many important programs in which nonprofits should envision themselves as key players if not implementors. To name a few:

* President Obama has slated $1 billion for the long awaited Housing Trust Fund, the first big new affordable housing production program in eons.

* The budget for the Department of Housing and Urban Development includes $8.1 billion for project-based rental assistance and $4.5 billion to fully fund the Community Development
Block Grant program, a distinctive change from the continuing Bush administration efforts to slice and dice the block grant program

* The Harlem Children’s Zone is the basis for the Department of Education’s Promise Neighborhoods program, designed to combat the effects of poverty and improve education and life outcomes      for children, from birth through college. Promise Neighborhoods represents the Obama administration’s recognition that the traditional model of foundation-supported experiments picked up,      adopted and replicated by government has a future after all.

* The budget proposal for the Department of Health and Human Services is a virtual repertoire of programs where nonprofits are clearly the primary implementors and advocates.

The challenge for nonprofits is not whether they are in line for the funds, but whether the funding levels are appropriate to the needs they see on the ground with their constituents and communities.

At the same time, it is clear that Obama is not shy about using the budget ax on programs that, without much thought, “look good” but may be short on outcomes.

President Obama’s 2010 budget proposal is an economic stimulus budget, without question, giving the Treasury Department a huge role in the revitalization of the U.S. economy in the wake of the nation’s economic and banking collapse.

That includes a big program for nonprofits through a $136.6 million increase in the budget for the Community Development Financial Institutions program, slated for $243.6 million in fiscal 2010, up from $107 million in fiscal 2009.

And while the policy imprint of the emerging Obama Administration feels urban, with strong emphases on initiatives that by the numbers lead to metropolitan if not inner-city concentrations, the rural development budget contains important program information for rural nonprofits.

The challenge for nonprofits is to ensure that they get the support needed to fulfill the roles that they can and should envision for themselves.

The challenge for the nonprofit infrastructure is to provide the support that small and medium sized community-based nonprofits need to get into the mix and not get left on the sidelines.


Rick Cohen is national correspondent for The Nonprofit Quarterly.

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