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Profiles in Bridge Finance: How $50k in loan capital helps hundreds of elderly Latinos during COVID


Imagine running a successful nonprofit for over 40 years that provides direct services to vulnerable seniors and caregivers in your community – but for reasons outside of your control, you will struggle to meet payroll this month.

That was the situation facing John Beleutz, the Executive Director of Health Projects Center (HPC), based out of Santa Cruz County.

HPC has held contracts with state and federal government since its founding in 1980 and was successful just last year in negotiating an increase in its annual contract with the state of California. Unfortunately, there was a mix up in payments and the state continued to reimburse at the old rate – causing a cash shortfall for HPC. While clarifying the situation, HPC needed to meet payroll. And then the COVID crisis hit. Not only did HPC need to make payroll but they had to reinvent how they provided their services.

American Nonprofits (AN) provided a $50,000 Bridge to Bridge Loan to enable HPC to meet its immediate financial obligations. AN’s Bridge to Bridge Loan Fund offers up to $50,000 for Bay Area nonprofits seeking capital for cash flow or growth. [Click here to learn more about AN’s Bridge to Bridge program, contribute to the fund, and/or apply for funding.] This is a classic form of bridge financing: a simple short-term financial instrument that provides critical support to businesses, especially in times of crisis. Traditional financial institutions rarely make this type of support available to the nonprofit sector; meanwhile, the COVID crisis has only magnified the huge need for this type of capital. HPC provides health-related and social programs to health professionals, older adults and caregivers. The Multipurpose Senior Services Program helps older adults maintain their independence at home versus going to a skilled nursing facility. The average age of participants in the program is 82, with income of less than $900 a month. The majority of the participants are female and over 50% Latino – a very vulnerable population during the COVID crisis. Clients are anxious and unsure about having people in their homes but still need assistance with daily living tasks. Home visits needed to be coordinated with telephone calls or on-line meetings with clients and their families. Ensuring that clients are safe and not feeling isolated has become even more important during this uncertain time. In addition to payroll concerns, it became clear as the COVID crisis unfolded that there are new issues to be addressed regarding the workforce and health of the nonprofit itself. All staff worked from home during the initial shelter-in-place period of the crisis. It took time to transition to a remote workforce; ensuring that internal processes could still be performed in a timely manner meant rethinking how things got done. HPC realized that the process of getting their state billing out on time was impacted by mail service delays, which in turn led to delayed payment by the state. All of these lessons had to be learned “on the fly.” “Our local foundations have been terrific,” states John Beleutz. “One referred us to American Nonprofits. Without the AN loan we may have found ourselves in a position where we would have had to furlough staff. Needless to say, that was not something we wanted to do.” HPC’s annual caregiver conference for the Del Mar Caregiver Resource Center program also had to be postponed. Much of the training provided at the conference will now be available on-line. Prior to the COVID crisis, HPC was on target to have a strong operational year. Along with the rest of the nonprofit sector, there will be some challenging times ahead. “We were lucky enough to work with our local bank and [were] approved for an SBA loan and told that the funds would be coming shortly. We have also reached out to our local credit union to increase our line of credit just in case. In the past, trying to discuss a possible loan with a standard bank went nowhere. They just don’t understand nonprofit financials and were not willing to loan based on the contract with the state,” stated Beleutz. “My advice to funders right now - open up your pockets and trust people.”

AN’s Bridge to Bridge Loan Fund offers up to $50,000 for Bay Area nonprofits seeking capital for cash flow or growth. To learn more about the program, contribute to the fund, and/or apply for funding – click here.

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