Shared Resources Grants

Analysis of Shared Resources Grants Program

Summary

Sharing resources can be a means to provide communities with high quality and sustainable services. Despite this potential, resource sharing, particularly co-location, is time-intensive to establish and requires reserves of cash and capital, presenting barriers to organizations.

To overcome these obstacles, in 2009 MMT awarded planning grants to eight projects totaling $177,113 to help them determine if any benefits could be achieved in implementing multi-tenant centers, shared services program, or fiscal agent.

The planning grants were highly strategic investments at critical times in the lives of eight organizations and their partners. In addition to benefits to grantees, MMT developed a deeper understanding the effectiveness of the request for proposals (RFP) process used for this endeavor, nonprofits’ use of consultants, and planning grants for sharing resources.

Background

In January 2009, MMT issued an RFP to organizations seeking to share facilities, equipment, staffing, program, and other resources, and who needed planning assistance to determine if any benefits could be achieved in implementing any particular shared resources model.

To submit a proposal, organizations were required to attend a one-day training workshop conducted by Tides Shared Spaces/Nonprofit Centers Network ( to understand the strategic issues involved in sharing resources and to assess their capacity to develop a project to respond to the RFP. Interest was high, resulting in the closure of workshop registration more than two weeks prior to the training.

Representatives from 63 organizations representing diverse needs from around the state attended workshops in Portland and Roseburg on February 24 and 25, 2009. The training was highly rated, with virtually all attendees reporting they were satisfied or very satisfied in the evaluations.

Twenty-four proposals were received from a variety of organizations throughout Oregon – large, small, government, arts, conservation, education, health, and human services, among others. In May 2009, trustees awarded $177,113 to eight organizations:

• Community Action Team, Vernonia, $25,000 for a project among human services oranizations
• Columbia River Businesss Alliance/Enterprise Cascadia, Astoria, $25,000 for a project with varied partners
• Committed Partners for Youth, Eugene, $20,000 for a project among human services oranizations
• Coos Watershed Association, Charleston, $24,988 for a project among conservation organizations
• Jackson County, Medford, $10,000 for a project among human services oranizations
• On Track, Cave Junction, $22,500 for a project among human services oranizations
• Oregon Rehabilitation Association, Salem, $25,000 for a project among public affairs organizations
• Wallowa Valley Arts Council, Joseph, $24,625 for a project among arts and culture organizations

Generally, all projects were on track with budgeted expenditures. As anticipated, partnerships among agencies contracted and/or expanded, and initial opportunities for sharing resources closed and new ones were being explored. Grant periods were extended for some projects given the complexity of the work involved.

Projects took advantage of the opportunity to thoroughly analyze and make highly informed decisions on whether multi-tenant centers or major resource sharing agreements had the potential to achieve actual financial and operational benefits. Of the eight projects,

• Five projects (Community Action Team, Coos Watershed Council, Enterprise Cascadia, On Track and Oregon Rehabilitation Association) continue to take small steps to build multi-tenant centers.
• Two were not feasible for varied reasons – Jackson County and Wallowa Arts Council. (We consider this to be a successful outcome.)
• For one project (Committed Partners for Youth), the initial opportunities for sharing resources closed, but a new one was implemented.

Key Learnings

1. Though well received, it is not clear that the workshop led to MMT receiving proposals of a higher quality. Should MMT issue another RFP requiring attendance at a workshop, we may receive stronger applications if we offer an introductory session to build knowledge, followed by vetting to help ensure the strongest proposals are forwarded. This could be accomplished by a less formal presentation in a town hall format educating the community about our intent and soliciting input.
2. Nonprofits did a good job selecting and managing the work of consultants. All technical consultants (i.e., architectural, engineering, geotechnical, legal, and business planning) provided strong services; fundraising consultants generally provided thorough and realistic analyses of feasibility of a capital campaign.
3. Supporting staff time and other agency expenses helped organizations address long-considered projects on the “back burner.” MMT’s modest support was a strong driver for organizations to take the initiative and prioritize planning activities over other demands.
4. There are significant pre-development expenses for establishing nonprofit multi-tenant centers – needs assessment, cost/benefit analysis, architecture, site surveys, business planning, legal matters, and risk management, to name a few. The bulk of nonprofit agencies do not have flexible funds to support these costs, and either tap into much-needed reserves or raise general operating support. Even in the best of times, such actions are challenging.
5. Nonprofits sharing resources, regardless of whether it’s a shared services program, multi-tenant center, or merger, will not generally provide immediate cost reductions. As noted above, there are additional out-of-pocket expenses that directly affect the bottom line. (Equally if not more important, there are opportunity costs of staff and board members’ time.) A case could be made that the net effect of nonprofits sharing resources is likely to be increased costs in the beginning, with the financial benefits, if any, taking longer to emerge.
6. The concurrent timing of this program and the economic downturn had an impact on most projects. The economic downturn was a significant motivator for every organization that expressed interest and participated in the program. MMT’s support for planning grants during a time of great concern about the economy heightened organizations’ awareness of the challenges for developing more sustainable, effective, and flexible strategies for meeting the needs of their communities in the future. Most grantees and their partners are (rightfully) being very cautious as they proceed in their projects.

Shared Resources Grants Interim Report

When the economic recession hit so hard in September 2008, MMT was already crafting a response to feedback from an earlier blog discussion on MMT's website indicating significant interest among nonprofits in sharing resources in order to reduce costs of operations and increase effectiveness. We provided free intensive training and access to resources from the Nonprofit Centers Networkto organization interested in exploring sharing resources. In January 2009, MMT issued an Request for Proposals up to $25,000 from organizations seeking to share facility, equipment, staffing, program and other resources for planning assistance to determine if there was a favorable cost/benefit ratio. MMT received 24 proposals and in May 2009, trustees awarded $177,113 to eight organizations:

• Community Action Team, Vernonia – $25,000
• Columbia River Business Alliance, Astoria – $25,000
• Committed Partners for Youth, Eugene – $20,000
• Coos Watershed Association, Charleston – $24,988
• Jackson County, Medford – $10,000
• On Track, Cave Junction – $22,500
• Oregon Rehabilitation Association, Salem – $25,000
• Wallowa Valley Arts Council, Joseph – $24,625

With the exception of Jackson County, all projects were planning grants for a “multi-tenant center" where individual organizations operate from one facility and share business systems, equipment, meeting space, and/or programs. Jackson Countyʼs project is an example of a “shared services” program involving shared volunteer management/information technology among youth-serving agencies.

As of March 2010, seven of the eight grantees have submitted interim reports. All are on track with budgeted expenditures for assessment, cost/benefit analysis, business planning, legal matters, risk management, and/or facility development. As anticipated, partnerships among agencies have contracted and/or expanded, and initial opportunities for sharing resources have closed and new ones are being explored. Evident throughout all reports is that MMTʼs grant has stimulated a planning process that has brought people together in a deeper level of civic engagement.

Projects are scheduled for completion on July 31, with final reports due September 15. We anticipate there will be a number of outcomes including organizations discovering their project is not viable; may be viable but requires additional work; or is strong, with organizations ready, willing, and able to take it to the next level. We consider any of these outcomes successful because the RFPʼs intent was to provide groups with the knowledge to make an informed business decision about engaging in new programs and partnerships.