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Notice anything about these six thoughts? They should sound familiar. Why? Because not only are they best practice in the nonprofit field, but you are likely doing or at least working toward all these practices in your own business models.
You have also likely heard Foraker explore these practices many times and in a variety of ways over the last decade. These are not platitudes that we hold up to impress others – rather it is how we do our work in the sector. Why remind you of these now? Because our state’s economy is in a seriously precarious place and these six practices are the gift that we can offer to our partners in state government.
For the last five months, Foraker has been convening sessions around Alaska on the challenge facing our economy and the potential impact on the nonprofit sector. We have been accompanied by our partners at First Alaskans Institute and Rasmuson Foundation. On many occasions someone from the Alaska Department of Revenue joined us. Our conversations with nonprofit board, staff and volunteer leaders have focused on our current reality and have been enlightening. The sessions have explored how our sector can be part of the solution rather than continuing to accept the subtle and sometimes not so subtle message that we are part of the problem.
Our effort now must be focused on offering our perspective in a way that we are heard. Foraker is committed to raising the sector’s voice and calling on the legislature to take action. Our message: the nonprofit sector is a significant part of the Alaska economy and we call on the Alaska legislature to enact a long-term plan this session to address the state’s fiscal challenges. We will deliver this message as often as possible, knowing we will need to attach the right messenger to each effort. We invite each of your organizations to also raise your voice. You can do that in many ways. So let’s spend some time thinking about how we use a few of the practices mentioned above in our conversations with local and state policy-makers.
First, we have to be knowledgeable about the current reality. There are NO simple solutions. We invite you to do your homework. The Rasmuson Foundation is collecting data and information, which is available at the Plan4Alaska website. Our Alaska is a new and growing movement of young Alaskans who are also looking at the issues and potential solutions. Alaska Common Ground is hosting conversations. First Alaskans Institute is tackling this issue. There is no excuse for disregarding the facts. I assure you, the decisions that get made this legislative session will impact you and your organization in one way or another.
Next, we need to lead by example and understand our own budgets. A concept that has stood out for me as we’ve traveled around the state is something I have termed “values-based budgeting.” To understand this term, consider the way you budget for your mission. Every line item expresses an important value for your organization. We operate in a business with a double bottom line, always considering mission/values and money. We don’t, or at least we shouldn’t, do one without the other if we want to stay on solid ground. Values-based budgeting may be a new term, but it is not a new way of business for many of you. We can and should lead by example when we have conversations about our economy. First, that means that you need to understand your own budget. Then once you have asked the values-based questions of your organization, you can turn your attention to the current conversations about the state budget. Does it reflect your community values? Do the programs that support your organization reflect your values? How can you bring both the values and the money parts of the conversation to lawmakers? This isn’t about asking for more money – this is about putting the money in the right place.
Speaking of money, the next offering you can provide is to know what the potential budget cuts and new revenue plan will mean to your organizational budget, programs, and the community you serve. Maybe you don’t rely on local, state or federal government funding, but what about the community you serve? How will your programs need to adapt? What information do you need to know to make plans? What do you need to stop doing or start doing differently?
If your budget does consist of government funds, can you, with some amount of certainty, explain how those funds are leveraged to serve the community? Can you explain that for every dollar you receive from government it is multiplied by X amount of philanthropic dollars, volunteer time, and additional resources? If you haven’t done this math – now is the time. If you need support to do it, ask for help.
The simple message of “don’t cut us” won’t work, but neither will the premise that “we should do more for less.” If the governor or your legislator suggest a simplistic solution of taking a hatchet to the budget and cutting across every line item, you need to communicate that a scalpel approach will work better – actually saving money, providing more service and the most efficient use of funds. Equally, you need to be able to prove that if the service is simply cut, the results will be more costly to the state and local governments that rely on it. Part of the scalpel message can also be about cutting. You know what red tape keeps you from achieving more mission. You know what statutes or regulations keep you from working better with your other nonprofit partners. You know where inefficiencies exist in the system. Can you voice them? Can you get together with your peers and ask for those changes? What’s stopping you?
Your job is to take what is obvious to you, such as diversified revenue, focused purpose and results, and offer those concepts as possible solutions. In the forums I heard a lot of great ideas of ways government could be more efficient. I also heard a lot of possibilities about nonprofits coming together across sub-sectors to support one another in their messages to local and state officials. This brings me to another way we can be part of the solution: practice six – use our collective voice for change. Our power is in our collective voice. When we look at our economic impact as a sector it is profound. We are 12% of the workforce statewide and more than 50% of the workforce in rural and remote Alaska. We conservatively accounted for $2.5 billion in wages and helped to create 63,000 jobs. By comparison, the oil industry accounts for $6 billion in wages and 110,000 jobs and the fishing industry generates $1.6 billion in wages and 78,000 jobs. Surprising isn’t it? At the same time the workforce in the state rose 5.2%, our sector rose at 22%.
The nonprofit sector is an economic driver throughout Alaska. And yet, not a single economic report beyond our own analysis cites the sector’s contribution to the economy. We are not part of any economic forecast or talked about as the true economic driver that we are. Trust me, this isn’t because we haven’t presented the data. I think it is more likely because we are so used to dividing ourselves into sub-groups that we dilute our power to the point that we don’t even see ourselves as one sector. But we are. The nonprofit sector is diverse. We are the arts, the environment, the economic development efforts, healthcare, utilities, business associations, unions, human services, and more. We are all of those things, and together we have a voice. This is new thinking for some. But I see the conversation shifting in communities and groups that used to view themselves as having nothing in common and are now finding their strength as part of a larger sector. Where is your opportunity to broaden your message as part of the sector? How does the data inform your messages? Being part of the solution is more than a single organization’s ability to secure funds. If we are about serving our communities, our messages need to harness the power of our overall impact.
The bottom line for Foraker is to be a strong voice for the sector and to create new tools and new avenues to support organizations navigating the current and future challenges. The bottom line for you is to use your voice and use it now – not next week or next month, but now, while the momentum is growing to find a solution. You have strong practices – the six I offered and so many more. Let’s put them together to face our economic challenges. Doing nothing is not an option. The consequences of inaction are real. Don’t panic. Focus. Start inside with your team. Engage your board. Engage your staff and your donors. Know your strengths and find the strengths in others. This is the time to become knowledgeable, to take a values-based approach, to communicate the multiplier effect, and to come together.