A large new grant is an opportunity to expand and increase impact; however it also adds more complicated rules and other challenges. After the initial excitement, things can go awry quickly, especially if you do not have the right financial management structures and expertise. This is what happened to the Citizens League. Fortunately, after discovering the problems they quickly took action.

The Citizens League is an organization dedicated to the common ground for the common good, working to build civic capacity in Minnesota. As the state sesquicentennial approached, the Citizens League received approximately $750,000 to celebrate Minnesota's 150th year. In their enthusiasm for the project, they expanded too quickly and depleted the funds needed for the final stage. By the time the problems were discovered, their commitments exceeded their cash. As Sean Kershaw, Executive Director, recalls, "It was a very uncomfortable wakeup call. Luckily we were able to contact Nonprofits Assistance Fund and they helped us figure out what to do." The Citizens League had worked with Nonprofits Assistance Fund in the past, and Sean reached out to Janet Ogden-Brackett to help figure out why they were having financial challenges and identify solutions to move forward.

Janet helped the Citizens League understand the true costs of their programs and unpack some confusing accounting. She also identified important best practices, such as separating restricted and unrestricted funds, which the Citizens League could implement to improve their management. However, in order to stabilize for the long-term, the organization also needed to change their business model - generate more revenue and decrease expenses, while still delivering the services laid out in their grant. 

The short-term solution was credit. A loan was a way to access working capital while the Citizens League's staff and board implemented an ambitious fundraising plan and made other changes. Nonprofits Assistance Fund's loans and lines of credit are designed to meet this need. They are handcrafted, with flexible terms and structures, because different nonprofits have different organizational challenges and assets. Because the Citizens League had an engaged staff and board, clearly defined mission and programs, and strong community support, Janet believed that their fundraising plan would be successful. She approved their loan, signaling to Sean and his board that a trusted financial resource "had confidence in us and our ability to turn things around."

At Nonprofits Assistance Fund, it's more than a loan. Loan officers build a relationship with their clients, providing strategic guidance and assistance to help them strengthen their organization. One of the first steps was board training. By learning more about nonprofit financial reports and what questions they should be asking, the board enhanced their oversight and governance: "We didn't know what we didn't know. Janet was so straight forward and really helped us better understand what had happened and how to fix things."

Sean commended the board members for stepping up, increasing their commitment to the organization and making hard decisions: "The board emerged from the experience stronger and more focused. Because we worked through this together, there is such a strong sense of purpose and connection to our mission." The Citizens League's leadership assessed all of their operations and programs, looking for new ways to deliver their services. After trimming as many expenses as possible, they eliminated one major position and left another one vacant. Sean recalled, "We did not want to cut staff, but we realized that we had to. We couldn't ask our members to give more if we were not sacrificing." To make it work, they relied more heavily on remaining staff and tapped into their volunteer base.

For their turnaround plans to be successful, trust in the organization had to remain strong. With many major changes happening, the Citizens League was upfront and direct with their members and the community at large. Sean also communicated regularly with Janet, sharing monthly cash flow projections, financial statements, and other updates. These open lines of communication meant that everyone involved in the turnaround - staff, board, members, and allies like Nonprofits Assistance Fund and Barthe and Wahrman,CPA - knew what was happening. The Citizens League's decisive action; willingness to re-imagine their business model, operations, and programs; and commitment to transparency made this turnaround successful.

Sean reflected on what the partnership with Nonprofits Assistance Fund meant for the Citizens League: "They helped us sort through the fog. Nonprofits Assistance Fund understands nonprofit finance and they got our mission. They knew that were trying to do the right thing. They gave us credit when we needed it and helped us implement the solid systems we needed to be successful."