As the Covid-19 crisis spreads, nonprofits are continuing to provide critical health care services. Other nonprofits are also feeding and educating children, helping people and families struggling with illness or layoffs, and doing much more to aid millions of people newly in need of assistance because of the health and economic troubles spreading across the nation.
Most nonprofits are doing so while facing financial instability and diminished capacity within their organizations. Many are continuing to lean in even when the virus has touched them personally.
These nonprofit leaders are not making headlines, but they are critical responders during this public-health catastrophe. What’s more, they will be crucial providers in helping this nation emerge from health care struggles, joblessness, gaps in education, and other problems erupting on a scale America has not faced in recent memory.
For that to happen, we need nonprofit leaders to look beyond their work delivering services today and collaborate with organizations of all kinds to prepare for what’s ahead. We also need nonprofit leaders to engage in robust advocacy efforts to ensure that support flows equitably to those most in need.
Following Congress’s enactment of a historic $2.2 trillion package, here are some of the most urgent types of emergency relief that nonprofits and those they serve can gain access to soon.
Low-interest loans and forgiveness of repayment for nonprofits that don’t lay off workers. The Small Business Administration is already financing low-interest federal disaster loans, which many nonprofits are already eligible to obtain at 2.75 percent interest for up to 30 years. The stimulus measure signed into law last week greatly enhances the loans available to nonprofits by providing nearly $400 billion in payments and guarantees. The new law, which directs the Small Business Administration to implement this new provision within weeks, permits a nonprofit to borrow up to 2.5 times its monthly payroll. The loan has a 100 percent federal guarantee. To gain access to these resources, nonprofits of 500 employees or fewer primarily need to prove they existed and had employees as of February 2020. The federal government would pay the lender to defer all payments on the loan for up to six months.
Especially important for nonprofits, any organization that sustains full-time employment levels over the course of the coronavirus crisis could receive up to eight weeks of salary, wages, rent, and other operating expenses fully forgiven, converting a substantial share of the loan into a grant. Wages paid to an employee in excess of $100,000 per year would not be eligible for this funding. Competition may be intense for the loans, so nonprofits should move quickly.
Relief for Americans repaying student loans. In addition to providing direct funding to support colleges and universities, the Department of Education is suspending all payment on student loans through September 30, 2020, with no interest accrual or other penalties. Social-service organizations and other nonprofits can help Americans across the country take advantage of these provisions.
Nutrition assistance for vulnerable people. The relief and recovery bills cumulatively provide billions in new funding to combat hunger. The measure enacted last week provides an additional $8.8 billion for child nutrition, an additional $15.5 billion for the Supplemental Nutrition Assistance Program, an additional $450 million through the Emergency Food Assistance Program for food banks, and an additional $300 million for food distribution and other types of nutrition assistance. This is in addition to $1 billion provided for these purposes a few weeks earlier. The federal government has also waived the requirement that students must come in person to pick up lunches at school.
This aid will allow nonprofits to ensure that children, older Americans, and others in need weather this crisis. At the same time, they must continue advocating for structural policy changes to ensure nobody in America goes to bed hungry long after this crisis abates.
Flexibility for national-service participants and the nonprofits where they work. The new legislation allows people in programs like AmeriCorps and the nonprofits they work with to change their terms of service. They can extend their service for a year after the national emergency, or, if they must leave their positions early due to the crisis, they can still receive a full education award for their service term, which AmeriCorps members may use to pay for postsecondary education and training. School districts, government agencies, and nonprofits that depend on thousands of Americans engaged in full-time service can help ensure that those committed to service do not suffer additional adverse consequences.
The new laws also offer multiple opportunities for nonprofits to collaborate and provide critical expertise and support. Among them:
Resources for education providers. The measure enacted last week contains several provisions that provide additional resources for early learning, elementary and secondary education, and higher education, including: a Child Development Block Grant increase of $3.5 billion; additional funding for Head Start of $750 million; and the creation of an Education Stabilization Fund of $30.75 billion. The Education Stabilization Fund will provide grants to states; governors will have flexible discretion over 9.8 percent of this funding, while the remaining funding will largely be split between state and local districts and higher-education institutions.
The funding overall is flexible so that states, districts, and colleges can do what they need to, to help students at this time, which may include efforts to bolster distance learning and technology for students who are expected to spend the spring or longer learning at home. It will also support educators as they navigate the new reality caused by school closures, help provide social services that were previously offered directly to students and families in schools, and provide education leaders with resources to plan for emergency contingencies.
Nonprofits can help local school districts, universities, community colleges, and preschool and early-child-care providers take advantage of these new resources to ensure they can better serve students, children, and families during this uncertain time.
Regulatory waivers and flexibility for educators and students. The new law provides new flexibility in the rules that govern colleges, states, and districts. The goal is to help institutions support their students and provide distance learning and other assistance during this unprecedented time.
In particular, the bill allows a number of additional waivers, designed for instance to give schools, school districts, and colleges more flexibility to spend federal funding on their customized needs and response efforts in this unique moment, or to shift services and supports that typically must be delivered exclusively within schools.
Congress also enacted flexible rules for college students and their institutions, including waiving the match money states or colleges provide for campus work study programs and grants, and including additional flexibilities for institutions that educate large numbers of students who receive Pell Grants.
This increased flexibility will allow educational nonprofits to help colleges, schools, and families adapt to challenges and mitigate the worst problems. Many local nonprofits are already aiding millions of students in or near poverty, and they can play a vital role in ensuring that this crisis does not deny anyone the opportunity to earn a postsecondary credential.
Community finance, development, and human-services resources. Through a range of programs and approaches, the new law invests in community development, and provides critical additional resources to local governments and lower-income families.
The new law adds $5 billion in Community Development Block Grant funding to address the consequences of increasing unemployment and economic disruption, and an additional $1 billion for the Community Services Block Grant, which is now available to serve families at up to 200 percent of the poverty line, expanding the number of people who can get help.
The legislation also gives $1.5 billion to the Economic Development Administration for grants to help revitalize affected communities, provides $3 billion for housing-related assistance and rental-assistance protections, and creates a new $150 billion fund to help stabilize state and local budgets and support a variety of needs. What’s more, the new law extends the Temporary Assistance for Needy Families program through November.
These new resources reinforce the efforts of many nonprofits fighting to lower an expected dramatic spike in poverty resulting from this crisis.
Support for skills training to help everyone get a job. The legislation adds $345 million for emergency employment and training services for workers through the dislocated workers assistance national reserve. Nonprofits focused on training people for jobs, especially those jobs needed in an automated world, can use these funds to upgrade the skills of many Americans and help them get back to work.
The $2.2 trillion package enacted last week is the third stabilization bill that has passed into law, and several more could follow in the coming months. Nonprofits need to stay vigilant as new bills emerge that affect their communities, in order for them to advocate for their needs and the needs of the people they serve.
Even as we deal with the urgency of the moment, we need to look ahead.
One step is for nonprofits to do all they can to ensure a fair and accurate count in the 2020 census, which will drive allocation of enormous amounts of federal funding that advances the missions of many nonprofits. The census also plays a critical role in political redistricting, which could change the balance of power in many communities.
Nonprofits can play a crucial role as trusted messengers, explaining to those they serve why filling out the census forms matter. The Census Bureau and many nonprofits are offering tools that organizations can use to get the word out.
America’s health and economic crisis has made a profound impact on the most vulnerable in just a few short weeks, hurting children who were already in need by depriving them of educational opportunities, harming families that are losing jobs, and causing small businesses to endure enormous financial hardships.
These challenges are only likely to deepen in the months to come, and the pressure on state and local governments, districts, schools, and other providers to mitigate them will be enormous, particularly when schools and businesses reopen.
By spreading the word about the impact of the new federal legislation, and encouraging every group to leverage provisions that enable them to better serve their communities, we’ll strengthen nonprofits and help millions of families weather this storm. Doing so will also help prepare for a concerted advocacy push in the coming weeks and months for more structural policy changes needed to even the playing field for all.
