Donna Murray-Brown – Detroit Bankruptcy: What’s the Impact to Nonprofits?

It was July 18th- I will always remember where I was the day Detroit filed for bankruptcy.  I was on business in Sault Ste Marie and remember feeling helpless because I was so far away from my hometown when I heard the news.  While I wasn’t surprised, I was saddened by the news initially because it gave the city of Detroit yet another undesirable distinction: largest municipality to file for bankruptcy.  Later, I remember the sense of anxiety I felt thinking about what this meant for the hundreds of nonprofits serving the needs of those in and around Detroit. What would the impact be of such a drastic and bold measure?

I immediately began doing a bit of research about the impact to nonprofits after the Jefferson County, Alabama filing and then the Stockton, California filing. Although these municipalities filed for bankruptcy, the scope and size of their debt was not comparable to Detroit’s $18 billion in debt.  I spoke with nonprofit leaders in state and out of state to get their opinions regarding their thoughts of what I should be concerned about.

Some of the things I was asked to consider were very logical, such as, if the city of Detroit is not able to pay it debtors, they may rely more heavily on the nonprofit sector to deliver more services than before.  This could be devastating for the sector which has already stretched itself thin from the demand in services from a high unemployment rate, the fallout from foreclosures and the reduction of city services over time.

Then there was learning more about the unsecured creditors.  Were there any nonprofits listed as unsecured creditors?  Detroit Economic Growth Corp was listed as a creditor for roughly $20 million of the debt.  I was certain there were many more nonprofits that were creditors that paled in comparison to the amount owed to DEGC, but would suffer still the same without payment from the City of Detroit.

Over time, things became a bit more complicated, when there were talks about seizing art from the Detroit Institute of Art to satisfy bad debt.  While this might be a viable option for generating cash for a cash-strapped city, it raised more anxiety about the scope of how deep and wide the filing of bankruptcy could be.  At the moment the assets of the DIA seem protected, however, the very threat of such an impactful asset to the community is enough to take the wind right out of its sails.

Being a statewide, nonprofit member-based organization, I was afforded the opportunity to survey members serving residents in the City of Detroit.  I was also able to ascertain some insight to nonprofits that contracted with the city of Detroit for Community Development Block Grant dollars which were unsecured creditors with no real means to extract their funds from the City to keep their programs and services intact.

I learned there was quite a bit of anxiety around the notion of difficulty associated with retrieval of CDBG dollars owed to the organizations.  Additionally, there was a need to advocate on behalf of the nonprofits who are unsecured creditors but may not have legal counsel on staff or available to them to attend the bankruptcy hearings and state their claim.

The prospect of having federal funds not being activated because the city is going through this process seems counterproductive to the outcomes the Emergency Financial Manager seems to be striving for.  While the financial challenges of the city are overwhelming, we in the nonprofit sector realize there needs to be a stronger partnership between public, private, and nonprofit sectors to reach a sustainable city.

So over the next several weeks, I plan to dig deeper and attempt to connect, with the help of others, with Kevyn Orr and his team in earnest.  My specific goal in doing this is to position the nonprofit sector as a partner, one that is used to adversity and has creative ideas to solve some of the challenges the city is facing.  This isn’t just a good thing to do, it is a more efficient and cost effective way of addressing a better financial path for the city.

There seems to still be a window of time to create a partnership that realizes everyone’s goals: a thriving, financially solvent Detroit.

ImageSubmitted by Donna Murray-Brown, President & CEO, Michigan Nonprofit Association

Statement from MNA President & CEO Donna Murray-Brown on the impact of Detroit’s bankruptcy filing on the nonprofit sector.

Below is a statement from MNA President & CEO Donna Murray-Brown on the impact of Detroit’s bankruptcy filing on the nonprofit sector. A longer statement will be forthcoming.

Donna Murray-Brown, president and CEO of the Michigan Nonprofit Association,  sees the bankruptcy as an opportunity “for not just nonprofit organizations but residents to really create the next Detroit” , Although Murray-Brown acknowledged that the demand for services will probably continue to rise, she’s optimistic. “Nobody wanted to be here, it’s a scary thing to be in a city that just filed for bankruptcy, but it’s also an opportunity,” she said. “Kevyn Orr wants to maintain services to residents. This is a time not to acquiesce but to be proactive and figure out the best role for nonprofits.”

Donna Murray-Brown

Statement by Donna Murray-Brown, President & CEO, Michigan Nonprofit Association

Mackinac Policy Conference Review

Last week, the Detroit Chamber of Commerce held its annual Mackinac Policy Conference at the Grand Hotel on Mackinac Island. Donna Murray-Brown and I were fortunate enough to attend the conference this year on behalf of MNA. One difference in the conference this year, was the lack of lawmakers. Michigan legislators stayed behind in Lansing to put the finishing touches on the FY’12-13 state budget.

This year’s theme was on making Michigan and Detroit a place for global competitiveness. To help attendees think about Michigan in a global setting, the Detroit Chamber had two very high-profile foreign affairs experts, Fareed Zakaria and Thomas Friedman. Both had very similar messages, Michigan and the United States can no longer think of itself as the sole “super power” on the global stage – both in foreign policy and economic progress. Both Zakaria and Friedman came to the same recommendations, improve US infrastructure (including wireless deployment), open up immigration policy, and invest in K-16 education. Detroit Public Television has both sessions on their website, you can view each of them here.

Fareed Zakaria and Thomas Friedman were not the only ones touting the need for Michigan to invest in the future. Numerous keynote speakers and panelists also reiterated the point: if Michigan is going to succeed, it must invest in the future.

One slightly low point of the conference was the “Fab Five” panel, where the leaders of Macomb, Oakland, Wayne, and Washtenaw counties, and Detroit Mayor, David Bing discussed regional collaboration. There was much more of the usual bickering around turf and who should pay for what, instead of broader discussion of a vision of what regionalism looks like for the Detroit area, which would have built upon what the other keynote speakers proposed. There is always next year…

 

Submitted by Christina Kuo, Senior Director of Public Policy and Public Affairs, Michigan Nonprofit Association

Students Helping Others Through Service

On March 24, 2012 the Fifth Third Bank and Detroit Red Wings service initiative, Students Helping Others Through Service (SHOTS), came to a close. SHOTS was a program that encouraged southeast Michigan high school students to invest their time, talent and treasure in their communities. Groups of up to 6 students and an adult supervisor registered for the project, committing to at least one service project between October and February. Each month, the groups could submit their project to a panel of judges, and a monthly winner was selected, receiving a pizza party and a chance at the grand prize – iPads and money towards future service projects.

On Saturday, five groups of students gathered from all over Southeast Michigan. Each group had a chance to present their project to the judges. Whenever a group returned to the ‘holding room’, the other groups cheered and greeted them, asking how everything went and learning about new service ideas. Suburban and urban kids, though there to compete with each other, found themselves building new, lasting friendships with students they may not have met otherwise. After all groups presented, the students enjoyed a pizza party, a ride on the Detroit People Mover, and ice cream. Once all the festivities concluded, the groups settled into their seats to watch the Red Wings 5-4 win over Carolina.

Each service project was unique, creative, and led by the students. The Interact Club at Airport High School (Carleton, MI) put together Thanksgiving care baskets for cancer patients. Fellowship of Christian Athletes at Southgate Anderson HS (Southgate, MI) sold colored lanyards to help raise money for breast cancer research, animal cruelty prevention and support for kids with leukemia. Detroit Edison Public School Academy Early College of Excellence (Detroit, MI) collected coloring books and crayons for Children’s Hospital and donated 590 pounds of food to Gleaners Community Food Bank. Students at Davison High School (Davison, MI) handmade 190 Valentine’s Day cards and held a Valentine’s Day party at a local senior residential facility.

But it was a group of young men from Detroit that secured the grand prize. The Loyola Leaders for Others group, based at Loyola High School, baked hundreds of homemade cookies, and distributed them, along with blankets and warm clothing, directly to the homeless in Cass Corridor in Detroit on Christmas Eve. Each student received an iPad, and the group as a whole received at check for $530 to use towards future service endeavors. Congratulations to this great group of young men and future leaders!

To encourage all of the finalists to continue their service efforts, Fifth Third Bank is giving each of the other four groups a check for $253 to help support their next projects. All in all, the 2011-2012 SHOTS program was a great success, and Fifth Third Bank, The Detroit Red Wings and The LEAGUE Michigan are excited to see what wonderful projects happen next year!

Submitted by Heather Jones, AmeriCorps*VISTA, The LEAGUE Michigan

Despite differences, education is central to both State and Federal Budgets

These past few weeks have demonstrated the challenges of creating sound, effective budgets at the state and national level. The Michigan and federal budgets, however, paint two very different pictures of the health of their constituents.

The recession over the past four years has not been kind, but there seems to be a glimmer of hope in Michigan. After several consecutive years of painful cuts, it appears the financial outlook is more optimistic with 2012’s budget surplus. Education funding increased by 0.2%, public safety funding is also set to increase, and the “Rainy Day” fund will grow by an additional $130 million, according to the State Budget Office. At the Federal level, by contrast, the deficit still weighs heavily on programs most Americans take for granted, but rely on – the President offered a 52% decrease in Education, a 35% decrease in Labor, and slight increases for Health and Human Services (3.7%) and the Corporation of National and Community Service (1.3%).

Still, there are some common commitments between the two budgets, such as improving performance and affordability of education. President Obama promotes a ‘Race to the Top’ and links financial aid to universities that keep their tuition under control. Governor Rick Snyder also wants to link increased spending in education to improved performance, best practices, and college tuition restraint. And they are politicians from two different parties.

Despite the other differing priorities of the two budgets, it is clear that superior education for future generations must be a priority for education beyond high school. Whether it is community college, traditional four-year, or vocational – higher education has become increasingly important to achieve personal financial security.

Submitted by Michelle Eichhorst, Public Policy Fellow for Michigan Nonprofit Association

Nonprofits Ready to Partner

Wednesday night, Governor Snyder gave his second State of the State address. As he talked about how far Michigan has moved forward in 2011, and his Administration’s priorities for 2012, he continually came back to two key ideas: collaboration and innovation. Collaboration brings with it a sense of community, inclusion, and hope for the future. With innovation, Michigan can creatively improve upon what is already great or throw out the bad. These are indeed keys to a successful future in Michigan and keystones to the good governance Gov. Snyder also advocates.

But you can’t talk about collaboration with just these two sectors (business and government) while ignoring the impact of nonprofits on many of the metrics on the MiDashboard. By including nonprofits at the table of this discussion from the beginning, alongside elected officials and businesses, Gov. Snyder would not only see a broader, more complete view of the impacts of his proposals, but also a better solution to the problems he has identified.

While Snyder’s agenda was positive and avoided controversy, he can no longer ignore the growing importance of nonprofits that are integral to achieving many of his goals for 2012. By championing his own values of collaboration and innovation, the state, nonprofits, and other key players can work together to achieve the desired results of a healthy and prosperous Michigan.

Submitted by Michelle Eichhorst, Public Policy Fellow for Michigan Nonprofit Association

I WILL: Part Two

This year for 9/11 National Day of Service and Remembrance MNA and its affiliates will be taking part in service projects on September 9, 2011. Although we know many are taking their own personal time to volunteer and remember, it is important to us as an organization to give back and remember in three distinct ways:

1. Purchase and collect supplies to include in care packages to send to our troops overseas. MNA is doing this through U.S. Troop Care Package and calling upon its affiliates, partners, and other organizations to take part in this collection.
2. MNA staff will be leading and participating in a Community Conversation specifically designed for 9/11 National Day of Service and Remembrance.
3. Each employee will be given the opportunity to fill out an “I WILL” card. Here they can pledge the number of hours they plan to volunteer in the coming year.

Has your organization registered their project yet? If not, head to www.911day.org to register and find useful resources such as toolkits, logos, and teaching tools to help make your project a success!

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What is in a mission?

“What’s in a name? That which we call a rose by any other name would smell as sweet.”
Shakespeare, Romeo & Juliet

What’s in a mission? That which we describe the work of a nonprofit by any other would “do good” just the same, right? Shakespeare might agree, but those in the sector know that a nonprofit’s mission is unique to the organization and the cause that it is designed to serve.

This is why strategic planning should always include a hard look at an organization’s mission and how that mission fits with the long-term outcome the work should accomplish.

The Michigan Nonprofit Association (MNA) invested more than 18 months exploring our mission, our vision, and our unique role in the nonprofit sector so that we might better understand ourselves, our community, and our future. Our journey included taking on a new way of thinking built around David LaPiana’s model of “Real-Time Strategic Planning” that forces an organization to continually understand and examine its identity, strategy, and advantages.

At MNA, we are proud of the work that we have accomplished in understanding ourselves and our work and invite others to explore our new vision, mission, and values and ask that you help us understand how we can better serve nonprofits to achieve their missions.


Submitted by Kyle Caldwell, president and CEO, for the Michigan Nonprofit Association.

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Peer-to-Peer: Challenges, the Obstacles of Our Generation

Detroit Edison Public School Academy is an advocate for the incorporation of service-learning into their school. The school was originally a K-8 school, which expanded its mission for the 2010-2011 school year by starting a high school with the addition of a 9th grade class. The administration has incorporated many initiatives into the 9th grades’ program to assist students in excelling as they move closer to their next phase in life. One initiative is a leadership group comprised of students who were selected by teachers and administrators who showed great leadership potential. This leadership group, will be created with every incoming 9th grade class, and will continue until their senior year. They are responsible for addressing the non-academic functions of their classmates by developing, not only lucrative social activities, but also opportunities to give back to their community through service projects.

In the planning for their May activity, the 9th grade group completed the “Whose Responsibility Is It?” lesson plan provided through the Learning to Give database. While moving through the different entities of the lesson plan, the leadership team stirred up the issues that surround the many “isms” (i.e. classism, racism, sexism, etc) that their generation faces today. They decided to address these issues by developing a forum that will allow them to discuss and educate their fellow classmates. The students of the leadership group felt the best way to grasp the attention of their peers during the forum was by creating controversial statements, these statements would force the students to have an open dialogue about the issue at hand. They decided to call them “I Am” statements and each of the twenty-two statements addressed one of the many topics selected by the leadership team. For example, an “I AM” statement on education would read, “I am a high school dropout, not because I cannot handle the academics, but because I had to take care of my home.”

The leadership group divided into three teams and developed two hour breakout sessions that included icebreakers, games, videos, pictures, skits, etc. where the overall goal was to have an effective discussion on each “I AM” statement. Everyone was very impressed with the leadership group’s ability to host an all day event for their fellow peers, all while engaging them in serious discussions to help challenge everyone as an individual. The leadership group felt a sense of accomplishment and they are ready to take it on again next year!

Submitted by Onjila Odeneal, The LEAGUE Michigan AmeriCorps*VISTA – Detroit

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