As small businesses and nonprofits continue to face their own unique challenges during the pandemic, the Michigan Economic Development Corporation (MEDC) is launching a program to provide additional support.

The state of Michigan allocated $100 million from CARES Act funding to MEDC to create The Michigan Small Business Restart Program (MSBRP) that will provide capital to Michigan nonprofits and small businesses for payroll, rent, mortgage payments, utilities and other expenses.

Due to the multi-pronged crisis our communities are facing, many nonprofits are navigating a myriad of challenges in capacity as well as a lack of human and financial capital.

In addition, many nonprofits have canceled major in-person fundraising events, in many cases losing opportunities to attract their typical donations. Roger Bandeen, director of Veterans Serving Veterans in Cadillac, estimates that by canceling their in-person fundraising efforts the organization has lost out on nearly $150,000 in annual revenue.

“We’re doing everything we can to keep the lights on,” Bandeen told the Cadillac News. “All this has sure made it hard for charities.”

Doreen Lanc, executive director of the Cadillac Area Community Foundation told the Cadillac News that $450,000 will be allocated from the MSBRP to nonprofits in Wexford and Missaukee counties to help fill gaps.

“This grant opportunity is going to be huge for 501(c)3s,” Lanc said. “Much of 501(c)3’s operational costs are typically covered by (fundraising events) golf outings, lunches and dinners, which had to be canceled. Unfortunately, the levels of resources for emergency shelter, food and utility assistance are still in demand and this federal CARES Act funding is greatly needed to continue the work of these organizations.”

The Michigan Nonprofit Association (MNA) cites other difficulties for nonprofits during this time.

“COVID is causing nonprofits to adjust greatly,” Joan Gustafson, external affairs officer at MNA said. "Some that were delivering educational programming had to pivot to cover basic needs because that is what their clients needed at the time. Some are struggling to recruit program participants because receiving services digitally just isn’t as impactful as in-person.”

To help mitigate some of those concerns for both small businesses and nonprofits, MEDC has partnered with economic development organizations (EDOs) that work in all 83 Michigan counties. The EDOs will distribute grant funding to qualified businesses and nonprofits that can show substantial revenue loss caused by the pandemic.

To qualify, businesses and organizations must be based in Michigan, have 50 or fewer employees and demonstrate a need for operational funding due to a loss of income because of the pandemic. Furthermore, at least 30% of funds are reserved for businesses owned by women, people of color and/or veterans across the state.

“We are very pleased that nonprofits are included in this funding opportunity and we hope that the regional economic development organizations that are distributing the funds reach out to nonprofits,” Gustafson said. “Many organizations are working hard to sustain operations while they serve the needs of the most vulnerable in their communities.” 

Gustafson said strong partnerships with nonprofit partners is crucial during this time.

“Partner with the nonprofits you serve, use connections you have to help them navigate specific challenges and questions,” Gustafson said. “More challenges are likely coming soon, such as addressing issues of diversity, inclusion, equity and justice and considering potential partnerships, mergers and closures. It will be very challenging for nonprofit leaders to thoughtfully consider all these critical issues and decisions if they are struggling financially.”

Throughout the pandemic, many CMF members have adapted their policies, procedures and work with their nonprofit partners to create flexibility and increase their support during this time. CMF, along with more than 20 of our members have also signed on to Philanthropy's Commitment During COVID-19 Pledge to ensure flexibility in grantmaking and in work with nonprofit partners.

In CMF’s Resource Central we have a robust list of examples of how CMF members have approached these changes with their nonprofit partners. As reflected in our webpage of CMF members’ response and relief funds, many members deployed response funding and immediate support to nonprofits.

Most recently, the Consumers Energy Foundation announced $135,000 in grants to 12 nonprofits across Michigan to support nonprofits during the pandemic.

“We want to do our part to help people, businesses and communities that will continue to feel the pandemic’s effects for months,” Brandon Hofmeister, president of the Consumers Energy Foundation said in a press release. “These nonprofits are meeting some of the most critical and urgent needs of Michigan’s people and communities hit hardest by the impact of COVID-19.”

Want more?

Read more on the Michigan Small Business Restart Plan.

Read MNA’s Resources for Nonprofits During COVID-19.

Check out In the Time of Coronavirus: What is the Risk to Nonprofits Nationwide? from the Johnson Center for Philanthropy.