CANTON - A loan fund to assist small nonprofit agencies was approved Thursday by the Development Authority of the North Countrys board of directors.
To be launched this spring, the revolving loan fund will be made possible by a pool of funding donated by community foundations across the region. It will aid small nonprofits with upfront costs needed to secure state grant funding, said James W. Wright, CEO of the authority.
Community foundations from the north countrys seven-county region will be asked this spring to make contributions toward the fund, with the goal of raising $200,000, Mr. Wright said. DANC will administer the fund. The move was also endorsed this month by the North Country Regional Economic Development Council.
The fund will be similar to DANCs community development loan fund, which helps municipalities pay upfront costs when they receive state grants, Mr. Wright said. Nonprofits, like municipalities, often dont have enough free capital to pay those expenses, which are later reimbursed by the state when projects are completed.
Not-for-profits have to upfront the money, and many small not-for-profits dont have that, Mr. Wright said. So the idea is to have foundations pool funding together and make that available.
Thomas R. Sauter, DANCs deputy executive director, helped spearhead the initiative with community foundation leaders from across the region. Funding difficulties for nonprofits was a hot topic at a meeting held in November by the Adirondack Foundation at Tupper Lake that included foundation leaders from across the north country, said Mr. Sauter, a board member of the Northern New York Community Foundation and the Pratt-Northam Foundation. He said leaders agreed that small nonprofits often dont have sufficient upfront funding to get state grants.
There was a lot of discussion on how not-for-profits take part in the regional economic strategy, and the discussion bubbled up that a lot of small not-for-profits get funded, but then dont have enough cash to put on the barrelhead while waiting for the state reimbursement, Mr. Sauter said.
A communitys historical association, for example, could need funding to renovate a structure that houses its collection, Mr. Sauter said.
It might be a $20,000 to $25,000 project, and something important for the community that has a good economic benefit, he said. But sometimes groups just dont have enough money to put up.
Community foundations from across the north country will be asked this spring to contribute to the fund, Mr. Sauter said.
The goal will be to launch the fund before the state signs contracts this spring for projects awarded funding in 2013.
Leading the initiative to launch the fund is Cali Brooks, executive director of the Adirondack Foundation and member of the Regional Economic Development Council.