Published in The Bulletin
By Matt Grahn
Without extra government money during the pandemic, at least some Eastern Connecticut nonprofits would have been in the hole.
United Community and Family Services, with locations in Norwich, Griswold, Moosup, Colchester and New London, took in $34.1 million in revenue by the end of the fiscal year in June, but had $35.4 million in expenses, according to the organization's Healthcare 2022 Impact Report. The document states that leftover Paycheck Protection Program funds from the 2020 fiscal year prevented the healthcare nonprofit from being in the red.
Had it not been there, a deficit of over $1 million would have resulted in fewer services, as well as layoffs, as personnel constitutes 85% of United Community and Family Services’ budget, said President and CEO Jennifer Granger.
Madonna Place Family Support Center Program Manager Luan Cadahia organizes donations Tuesday. “It’s a cycle. If you’re not able to have the personnel, you’re not available to provide the services,” she said. “We would have had to do more (drastic job cuts) in order to stay solvent if it were not for the PPP dollars and other grant funds made available through the federal government.”
While the federally qualified health center has grant funds ordinarily, it’s proportionately small to what’s made from billable services. There were fewer of those during the pandemic, Granger said.
On an ongoing basis, costs for medical supplies, energy costs, and for employees are going up, and the rate of Medicaid reimbursements hasn't keep pace. For example, the rate for outpatient behavioral, dental and medical services rose by 2.1%, but health insurance costs went up 12%, and there were also salary raises across the board outpacing the increase, Granger said.
“Our rates are dictated to us, and we don’t have the ability to negotiate rates,” she said. “We also have to provide services regardless of anyone’s ability to pay.”
The organization received $6.3 million in Paycheck Protection Program funds. The money was meant to be used for fiscal years 2020 and 2021, but there was still enough for fiscal year 2022. These funds were used for staffing costs, Granger said.
There are other nonprofits who depended on those relief funds to make ends meet this year. Madonna Place, a Norwich-based nonprofit for families with young children, made use of state funds from the Centers for Disease Control and Prevention, received during the pandemic, to help serve Latino, Haitian, and other disadvantaged communities in the area, said Family Support Center Program Manager Luan Cadahia.
“We’re lucky to have secured that grant, and to have that grant renewed for another year,” he said.
Without the grant, there’d be fewer resources Madonna Place could give to families. It would have cut into the organization's budget for purchasing formula and baby supplies, Cadahia said.
Things would also be worse if the community wasn’t providing donations to meet community need, including supplies and volunteer time, Cadahia said.
More need and fewer dollars
It’s still a challenging environment to be a nonprofit. While things were improving the further out from the pandemic things are, inflation brought back more need in the community, said Dina Sears-Graves, president and CEO of the United Way of Southeastern Connecticut.
“Nonprofits do a great job stretching their dollars, and the system itself is very stretched, so were going to have to get a little more creative,” she said.
While the United Way of Southeastern Connecticut’s 2021 Annual Report, the most recent one, states it was in the green, it still benefited from pandemic funding, for both its food bank efforts and helping to fund other programs. Where those funds were taken in reflects a hole in support that the organization needs to work to fill to keep giving at the same level, Sears-Graves said.
The Community Foundation of Eastern Connecticut has just started the grant application process to the organization. Looking at other organizations serves as ”a clear signal” for how the nonprofit community is doing, said President and CEO Maryam Elahi.
Another common problem for nonprofits is retaining full staffing, as many people may receive more lucrative job opportunities from the state, Elahi said.
The Community Foundation of Eastern Connecticut decided to sit out getting these extra government funds, so other non-profits could get those funds directly. The Community Foundation of Southeastern Connecticut also has an endowment it was able to fall back on, Elahi said.
While some people are critical about how pandemic-related government relief contributed to inflation, Elahi contends that people and organizations needed the support to stay afloat.
“I don’t think people realize that if we didn’t have the (American Rescue Plan Act) funds, what shape we would have been in,” she said about nonprofits broadly.
During the pandemic, Madonna Place started distributing food from the United Way. At this point, there’s increasing demand for the food, alongside the baby supplies, especially wipes, formula and diapers in sizes five through seven, as families need to spend more on these things on their own, Cadahia said.
What does 2023 look like for Eastern CT nonprofits?
Despite these challenges, and an increasing need in the community, the nonprofit community is expecting 2023 to improve financially.
United Community and Family Services has American Rescue Plan Act funds lasting through the spring. The organization has pursued more grants and expects to collect more funds from billable services.
“We anticipate everything will be good by the time (the Paycheck Protection Plan) dollars are expended,” she said.
Madonna Place is “pretty close to reaching our 0s,” though the Family Support Center may run a little over budget, but the fundraising team is capable enough to make up the difference, Cadahia said.
However, the outlook from Elahi is less positive, given the staffing situation, and a need to work at a fuller capacity to address community needs. She is also critical of towns that spend American Rescue Plan Act and similar funds on smaller infrastructure projects, like sidewalks and parks, instead of needs like childcare and affordable housing for vulnerable populations.
“As a result, it means there is more pressure on the nonprofits who have not had a lift, that are trying to do more with less,” she said.
Here's how you can help Eastern CT nonprofits
People who want to donate to United Community and Family Services can go to the website, click on the “How to Give” tab under “About Us” and read the information on donating money or volunteering.
For Madonna Place, people can donate online or call the Madonna Place at 860-886-6600 to arrange a supply drop-off.
To support the United Way of Southeastern Connecticut, people can go on the website and look for volunteer opportunities or hit the donate button.
For any nonprofit, it’s important to have continued support all year long, not just during the holidays, Elahi said.