Report #5:
Financial Health Across Types of Community Economic Development Organizations
Financial Health Across Types of Community Economic Development Organizations is the fifth and final report in the Money Meet Community series.
It builds on the fourth report, Community Economic Development Organizations & Their Financial Health, which found that about half of organizations are in excellent or good financial health. Only about 18% appear financially fragile. This new report digs deeper into those numbers, exploring how the financial health varies by organizational size and lines of business.
Our goal is to give funders, policymakers, and technical assistance providers the information they need to effectively support the unique needs of each type of organization. When community development organizations have a meaningful surplus of revenues over expenses, they can invest in program improvement, develop staff skills, and track the quality of their community outcomes.
Findings
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Nonprofit real estate developers, managers, lenders, social services providers, and planning and organizing groups each face different challenges. For example, real estate development organizations in precarious financial health more often falter due to lack of unrestricted assets. Social services organizations are more likely to face financial shortfalls because of low liquidity.
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Different types of organizations still have roughly similar financial health ratings. This similarity is partially due to the fact that health ratings are benchmarked to each peer group. However, the findings make clear that size differences matter more for financial health among some groups than others.
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Larger organizations tend to be more financially healthy than smaller ones. This finding relates to all types of community development organizations. Preventing fragile financial health among the greatest number of organizations could best be accomplished by attending to the needs of smaller organizations.
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Bolster your advocacy and fundraising efforts by sharing this report and others in the Money Meets Community series with your networks. Check out our Grounding Values in Research webpage for more resources.
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