Nonprofit Study Finds Safety Net Holes, Recommends Grant Overhaul

A comprehensive review of the needs of Loudoun’s nonprofits has found the county falls short on its funding for nonprofits.

The report, prepared by the Virginia Tech Institute for Policy and Governance, found that accounting for population and cost of living, the county would have to increase its annual grant funding by $263,000 to $288,000 to catch up to other large and medium-sized Virginia localities. This year, the Board of Supervisors signed off on $1,090,700 in funding to 32 nonprofits.

According to the report, 14,257 Loudouners live below the federal poverty level—which this year ranges from $12,060 for an individual to $41,320 for a family of eight. By that measure, Loudoun wrote grants amounting to $76.50 per person living at or below the federal poverty level this year.

The report also found that county and nonprofit services fell short of the need in all areas of human services, particularly affordable housing, affordable child care, addiction treatment, immigrant services, basic life services, and transitional services for homeless youth. This is despite the survey measuring 364 nonprofits, although the report also found that many of those nonprofits are duplicative and do not coordinate well amongst each other.

Supervisors sent the report to the board’s finance committee to tackle its many recommendations.

Chairwoman Phyllis J. Randall (D-At Large) also recommended county staff come up with a definition for “life-sustaining” versus “life-enhancing” nonprofits, possibly leading to separating them into separate funding processes.

“Life sustaining is food, life sustaining is shelter, life sustaining—in my opinion—is literacy,” Randall said. “Life-enhancing is the symphony. It’s a great thing to have, but if you don’t have any food, you’re probably not going to go to the symphony.” She said putting nonprofits like the Loudoun Symphony in competition with food banks for county funding seems “illogical.”

Despite trepidation among some supervisors, the board approved that idea unanimously.

“Identifying them is one thing, but we have to be very careful, because everything comes out of the general fund,” said board Vice Chairman Ralph M. Buona (R-Ashburn). “It’s not like there are other pots of money.”

Supervisors did not, however, approve Randall’s idea to come up with ideas about how to establish direct county funding for some nonprofits that provide “core services,” which the county might otherwise provide itself.

“If the county is relying on a nonprofit as an extension of county services, then we shouldn’t ask that nonprofit to be in the competitive process for money, because without that nonprofit we’d be picking up that tab, and picking it up in a very robust way,” Randall said. In the past, she has contested the idea that in the strictest sense, nonprofits do not save the county any money, since the county provides all the services it is obligated to provide by law.

Still, other supervisors didn’t like the idea of direct funding. Buona worried the county would be picking “long-term winners that we’re going to fund automatically.”

Supervisor Ron A. Meyer Jr. (R-Broad Run) said he would like to see it discussed in finance.

“There’s been a lot of noble efforts to figure out a model for nonprofit funding, and those noble efforts, I would say have largely been of mixed success to put it lightly, and confusing to put it bluntly,” Meyer said. Loudoun has tried for several years in a row to reform its nonprofit grant making. The report recommends trying again after establishing a human services workgroup to help—an idea that Loudoun nonprofits have floated before.

In total, the IRS lists 1,617 nonprofits with Loudoun addresses. The consultants cut that down to 364 by screening for nonprofits with a variety of criteria such as checking for groups that provide direct services or administration, actually provide services in Loudoun in categories funded by the county government, and eliminating nonprofits such as horseback riding groups, homeowners’ associations, parent-teacher associations, and garden clubs.

The $263,000 to $288,000 figure catches Loudoun up to other jurisdictions’ per capita spending based on the number of residents making three times the federal poverty level. Counting people making three times the federal poverty level or less, Loudoun has 67,432 impoverished residents, 18 percent of its population. To reach the median grant funding level of 12 larger jurisdictions from across the state, accounting for cost of living and population, Loudoun would have to write $1,353,623 in grants.

rgreene@loudounnow.com
@RenssGreene

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