‘It starts adding up’: SC nonprofits fear closure as COVID-19 drags on, costs mount
Nonprofits along the South Carolina coast are struggling to survive, and many worry they won’t last another six months without additional funding to stem COVID-19-related budget shortfalls, according to a new report.
The report includes 174 survey responses from nonprofits in coastal areas, including Beaufort, Charleston and Horry counties.
Twenty-three percent of the nonprofits say they can operate for only three more months without new funding, according to the report.
And 3% of the organizations say they are out of money now.
The report paints a grim picture: S.C. nonprofits — which run food banks, organize cultural events and staff child-care centers — are in danger of going under.
Edie Blakeslee, vice president of grantmaking and community leadership at the Coastal Community Foundation, said she always suspected COVID-19 would have a “crippling effect” on nonprofits.
Blakeslee’s organization commissioned the report, which is based on data compiled by the College of Charleston’s Joseph P. Riley Jr. Center for Livable Communities.
Even though the survey has a relatively small sample size, Blakeslee said it’s “indicative of where most nonprofits are.”
S.C. Gov. Henry McMaster recently took note of the problem, announcing new statewide grant programs for nonprofits and small businesses reeling amid the pandemic.
The $65 million initiative is funded by CARES Act money.
Making ends meet
Sixty percent of nonprofits in the report say cash is their single biggest need right now. They have to meet operating costs and make up lost revenue.
Of 99 organizations, 73 said they need about $186,721.58 on average to survive this year, according to the report.
More than three-quarters of survey respondents can stay afloat for only six months or fewer without additional funding, the report says.
Other takeaways from the survey:
Nonprofits that depend on fundraising events are struggling more than others.
Seventeen percent of respondents had to furlough staff this year, and 15% had to cut staff hours.
Some smaller nonprofits could maintain operations with $1,500 a month, while larger organizations might need millions of dollars to make up lost revenue.
Twenty-three percent of the nonprofits need more cash to meet increased demand and could use $86,411 per organization, on average.
The survey had one bright spot: Some organizations say the pandemic has given them time to realign priorities, focus on different projects or plan for the future.
“They have realized how flexible and adaptive they can be,” the report says.
Cinda Seamon, board chair of the Main Stage Community Theatre on Hilton Head Island, said she and other members recently reevaluated the nonprofit’s mission.
“This is a good time to rebrand and come up from the ashes renewed,” Seamon said.
Case in point: The organization, previously called the Main Street Youth Theatre, updated its Facebook page Thursday with a new name, Main Stage Community Theatre.
The group doesn’t rent office space and has no paid employees, so the economy hasn’t been as challenging for the nonprofit as it has been for others, Seamon said.
Community benefits
Veronica Hemmingway, the Coastal Community Foundation’s southern Lowcountry director, said entire neighborhoods and municipalities are affected by the health of nonprofits.
Take, as an example, a 501(c)(3) child-care center with a sliding fee scale. Hemmingway said a facility like that gives front-line workers the option to go to their jobs while their kids are attending a school’s virtual classes.
“Whatever supports (parents), and their essential work, impacts all of us,” she said.
Even if someone isn’t in line at the local food bank, they can still benefit from nonprofits, including those that promote arts and culture, said the Coastal Community Foundation’s Blakeslee.
Nonprofits are crucial to vibrant communities, she said, and assist government officials in providing social services.
‘I’m just trying to make my budget’
Hemmingway said she doesn’t know of any Beaufort County nonprofits in imminent danger of closing.
But many organizations remain concerned about their financial outlook as the year winds down, she said.
Kim Likins, unit director at the Boys & Girls Club of Hilton Head Island, understands that all too well.
Likins said the club’s annual gala was canceled this past spring. They couldn’t have 400 people packed together indoors, she said.
The gala typically brings in about one-fourth of the child-care center’s $1.1 million annual operating budget, she said. Without $250,000 to $275,000 in donations from that event, Likins was left scrambling.
“I’m just trying to make my budget,” she told The Island Packet and Beaufort Gazette, adding that she expects a deficit this year.
The Boys & Girls Club usually has staff members at the center 2:30 to 7 p.m. from September until the spring, she said.
Now, though, while offering a new program for local students to attend virtual classes at the building, the center is open 7:30 a.m. to 5:30 p.m.
That means extra staffing costs, Likins said, on top of the money spent for various coronavirus precautions like personal protective equipment.
“It starts adding up,” she said. “It’s definitely a challenge.”
This story was originally published November 9, 2020 at 4:45 AM with the headline "‘It starts adding up’: SC nonprofits fear closure as COVID-19 drags on, costs mount."
