Two local foundations took stock of what challenges may have been keeping Orange County nonprofits from being more successful, and with that information in hand, the Samueli Foundation is investing $15 million to address some of the gaps.

The Samueli Foundation and the Orange County Community Foundation surveyed more than 600 nonprofits, which said leadership development, being able to finance projects and addressing harder-to-fund essential needs could support the sustainability of social services in the county. The foundations presented the assessment findings to nonprofit leaders on Tuesday, March 18, at UC Irvine.

“Thanks to the nonprofit leaders who engaged with the research team, this report provides an unvarnished look at the current needs of the nonprofit sector. It challenges our assumptions as a philanthropic funder,” said Lindsey Spindle, president of Samueli Family Philanthropies. “We intend to use the data-driven insights from this report to further transform our annual and longer-term giving – and we hope other philanthropists find the report useful in examining their giving practices.”

The funding will go toward several new initiatives to address needs:

A $5 million, five-year investment in Leading for Impact and Leadership Accelerator programs.
A $5 million annual Build OC Fund to support capital projects with grants of up to $1 million.
A $5 million annual grantmaking initiative, The Breakaway Fund, designed to remove financial barriers for nonprofits.

Staffing was one of the biggest concerns reported among nonprofits, especially because of the financial challenges around recruiting and retaining workers. For example, 70% of leaders with nonprofits surveyed said their staff were often asked to do work outside the scope of their roles, and nearly half of respondents said they couldn’t afford to pay competitive salaries to keep employees.

“If I could fix one thing as a foundational principle of the funding paradigm of public and private, it would be that staffing would not be considered overhead,” Shelley Hoss, CEO at the Orange County Community Foundation, said. “The mythology that you can somehow separate the program delivery from the people who are delivering the programs is the definition of insanity.”

The survey also reported that 86% of nonprofits that responded agreed that collaboration enhances impact, but structural and financial barriers limit those partnerships. And 82% of nonprofits found accessing multi-year funding to be “very” to “moderately” difficult.

Elizabeth Andrade, executive director for 211OC, the free service managed by OC United Way to connect residents to housing, food assistance and other resources, said she was surprised and “terrified” to learn that more than half of the nonprofits surveyed said they lacked cash reserves or lines of credit.

“To see that 50% of people who responded to the survey are in that position puts pressure on everyone,” she said.

But the number of nonprofits who want more collaboration is encouraging, she added. “Even though collaboration is hard, and even though it does take time, people see the benefit in it. We can do more with this.”

Madelynn Hirneise, CEO of Families Forward, said the study showed how the nonprofit community needs to reframe to see themselves as “for-purpose” organizations and operate more like a business.

“(The findings) were absolutely affirming and validating to some of the challenges that we experience in this space,” Hirneise said. “The demand to do a lot more with a lot less is very persistent in any nonprofit community, but you can see that in black and white.”

Whether it’s the families that her group serves or the general population, Hirneise said she hopes the data unveiled on Tuesday will help people see that for any mission to succeed, there has to be a strong infrastructure to support and drive change.

“I’m hoping there’s more awareness that nonprofits are businesses too,” Hirneise said. “I would implore every nonprofit to use this data to create key messaging for their board and their community. Staffing matters. Collaboration matters. Financial security matters. For us to do the work in the mission that we’re driven by, we need to invest in all of these areas.”

Andrade said if she were a beneficiary of the services provided by the many nonprofits in Orange County, she would be encouraged to see so many people fighting to improve the nonprofit ecosystem.

“Today in Orange County there is hope,” she said. “During so much uncertainty right now with the changes we’re seeing in the new administration, some of the efforts that are rolling through, we looked around and said, who is going to step in when government steps out? And today we saw that the foundations, (Orange County Community Foundation) and the Samueli (Foundation), are locking arms and walking forward together.”

Related Articles