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As a lawyer, I wasn’t prepared to be poor, Black, and ashamed. But just three months into my career as a police misconduct attorney, I received an endless stream of debt collection calls. Agents hounded me to make student loan payments that I could not afford. For over a decade, I remained in public interest while placing my hope in the federal government’s public service loan forgiveness program.

President Joe Biden’s Temporary Expanded Public Service Loan Forgiveness program (TEPSLF) has been critical for borrowers like me who work at nonprofits and carry a heavy debt burden. Instead of backing down from this transformative program, which expired on October 31, 2022, the administration should make its changes permanent—and expand them.

Achieving Financial Security  

During my first three years practicing law, I worked multiple jobs so that I could afford housing, healthcare, food, and student loan payments. Everything changed when I landed a government position. The civil sector provided me with stability and a livable wage—as it does for many Black Americans. And importantly, I was able to pay my student loan bills and stop the calls from collections.

Cancelling student debt is in our greater public interest—and it’s vital for racial equity and justice.

More than a decade later, in July 2022, I received notice that my $103,000 student debt had been canceled through the limited Public Service Loan Forgiveness program (PSLF). After years of making regular payments, I finally had a zero balance. At last, I was released from my shame. I felt freer knowing that debt would no longer influence my career choices. The hard truth of the legal aid sector is that many attorneys struggle to pay their bills; we feel that we must pursue high-paying jobs at corporate firms—as opposed to lower paying public service jobs—in order to pay off our loans and still make ends meet.

Indeed, this public service brain drain is a key reason why student debt cancellation matters. It’s not just individual borrowers who benefit. Cancelling student debt is in our greater public interest—and it’s vital for racial equity and justice. Legal aid attorneys like me work to ensure that millions of low-income people of color stay in their homes, are paid fair compensation, expunge faulty criminal records, and access immigration relief. We must be afforded simple, comprehensive pathways to cancel our debt.

The PSLF Program: Dreams and Disappointment

As Marian Conway observed recently in NPQ, the federal student loan market is incredibly opaque. Unsurprisingly, confusion quickly dampened the hope generated by PSLF when it was first introduced by President Obama in 2007. Program applicants were denied relief outright or faced heavy tax bills. In 2019, a federal watchdog review found that during the expanded waiver program’s first year, 99 percent of applicants were turned away—mostly due to a bureaucratic technicality. This year, the Biden administration addressed some of the original program’s flaws, insisting, correctly, that reducing student debt is critical to closing the racial wealth gap.

When the PSLF program’s limited waiver ended, thousands of borrowers found themselves out of luck. They included debtors who weren’t aware of the program, those who hadn’t completed the application process, and potential applicants who were thwarted by last-minute changes to the program. The end of PSLF will have an especially devastating impact on public-interest attorneys and their clients.

The Biden Administration’s three-part plan for student loan debt relief offers some reprieve. Under this new plan, announced in August 2022, up to $20,000 of a borrower’s student loan debt can be cancelled.

This plan is under threat, though. Republican special interest groups have attacked the initiative since its launch. On October 21, a federal appeals court put a temporary administrative hold on canceling loans. Then, on November 10, a US District Court judge in Texas vacated the program, deeming it “unlawful”—just weeks before payments are due to resume in January. The Biden Administration must fight back because the student debt relief program will benefit millions of borrowers.

That said, $20,000 is a drop in the bucket for public-interest lawyers—many of whom accrue six figures of debt—and that’s why we must have a pathway to total forgiveness.

The Need for Legal Aid  

Upon graduating from law school, lawyers of color have a stark choice: pursue a lucrative corporate career or enter public interest law and live with the economic instability that public service law often entails.

Public interest lawyers are among the lowest paid in the US legal industry but provide critical aid to underserved populations. A recent study indicated that low-income Americans did not receive adequate help for 92 percent of their civil-legal problems. In California, the state where I practice, more than half of the population experiences at least one civil-legal issue per year, and 85 percent received little or no legal assistance. Most under-resourced individuals who struggle to access legal help are Black, Indigenous, and other people of color. We need more public interest lawyers, not fewer, to provide people with the legal services and representation they require. Given that student debt heavily influences law students’ career choices, an expanded PSLF program and other forms of debt relief would be of tremendous help in recruiting more graduates to this vital role.

Although the federal government’s loan forgiveness program is race neutral by design, it also advances racial equity. Black Americans are more likely to borrow than students from other racial and ethnic groups pursuing similar degrees, and they are more likely to borrow relatively large amounts. Upon graduating from law school, lawyers of color have a stark choice: pursue a lucrative corporate career or enter public interest law and live with the economic instability that public service law often entails.

It’s easy to discuss student loans as a race-neutral educational resource, but such a narrative is flawed. In 1972, less than a decade after the civil rights movement’s March on Washington, Congress founded Sallie Mae, formerly known as the Student Loan Marketing Association, a for-profit company created to increase the federally insured student loan market. The decision makers involved in its creation—among them President Richard Nixon—were all white men who benefited economically and politically from decades of Black disenfranchisement and the exploitation of Black and Brown labor. This reality underscores the need to reframe current conversations about student loan debt. Such debt upholds race (and gender) inequities because it limits the job mobility of debt holders, including the ability of people from our communities to enter public interest law.

Making Legal Aid Affordable

We need our political leaders to end the scams that keep communities of color impoverished and deprive people of comprehensive legal help.

I entered public interest law to seek justice for communities of color—and I can remain in this field because of the relief I obtained from the TEPSLF program. As the executive director of one of the largest free legal-aid providers in California, loan forgiveness allows me to continue to focus on building a culture that financially and professionally takes care of our staff who, along with the clientele they serve, are largely Black and Brown women. Providing these women with legal services is crucial because when women of color thrive, whole communities benefit.

We need our political leaders to end the scams that keep communities of color impoverished and deprive people of comprehensive legal help.

Instead of ending the waiver program—or making only some of its changes permanent, as the US Department of Education announced it would do on October 26—the Biden administration should expand the PSLF program so that more public interest professionals benefit from loan forgiveness. Such action is crucial to ensuring low-income people can access critical legal aid. Communities of color already bear the burden of increased police budgets, reckless COVID-19 policies, an eviction crisis, a stacked Supreme Court, and stagnant immigration reform. The last thing our communities need amid such injustices is to be denied access to legal representation.

This article originally appeared in the Nonprofit Quarterly. See the original article here.

President Joe Biden’s recent decision to cancel up to $20,000 of student debt for certain borrowers marked an important first step in acknowledging and repairing the United States’ broken higher education infrastructure.

Of course, Biden’s executive order is presently stalled in court. But let’s assume that the Biden administration ultimately prevails. Even if Biden’s debt cancellation plan goes through as planned, this action alone will not fix the problems that originate from the US higher education system’s reliance on individual debt financing.

Student debt cancellation advocates like the Debt Collective know that. Canceling debt, they rightly point out, is only one step on the path to tuition-free college. Now is the time to take the next step. Advocates must build on the momentum gained through the debt justice struggle by advocating for free college to replace the existing student-funded financing model that limits college access, exacerbates racial wealth inequities, and absolves the government of responsibility for higher education.

Understanding the student debt crisis as a policy failure that harmed millions of Americans and required remediation to prevent further harm was key to the success of the campaign to cancel student debt. But while cancellation is an important acknowledgement of and fix for past mistakes, it does not increase access to higher education going forward. Americans believe that a college education is essential to achieving prosperity, but it’s not clear if they think the federal government can reduce college costs. A movement for free college can change that.

This is not the moment to retreat to policy patches. We must rethink the financial underpinnings of the higher education system more broadly and demand free public college. Americans should have a right to free higher education. It is the government’s responsibility to ensure it.

A Flawed Model 

The failures of US higher education stem from the adoption of a financing model that mixed state funding with federal student aid, largely in the form of loans. Instead of providing free public higher education (as has long been standard for K-12 education), the federal government attempted to foster access to higher education through public financing options for individuals. As a result, we have become mired in an inequitable marketized higher education system, where income and wealth determine access to college education, and household debt is expected to compensate for decades of economic exclusion.

We have become mired in an inequitable marketized higher education system, where income and wealth determine access to college education, and household debt is expected to compensate for decades of economic exclusion.

These trends have been exacerbated by decades of sharp cuts to public higher education funding, especially by state governments. As states reallocated revenue-starved budgets toward other uses, higher education institutions looked to tuition—supported by generous federal student loans—to make up the difference. Tuition at four-year public colleges increased by 82 percent between 2000 and 2020 and by 159 percent between 1990 and 2020, even after adjusting for inflation. Higher tuition led to $1.7 trillion in student debt held by more than 43 million Americans.

The growth in tuition as colleges’ primary funding source hurts students and the institutions that serve them in inequitable ways. With costs shifted onto individual students, borrowing rates rose astronomically, with Black and Brown students taking on the most debt. Due to systemic racism, Black college graduates tend to command a lower wage than their white counterparts when they enter the workforce, making their debt more of a long term drag. Research shows that 12 years after entering college, the average Black borrower still owes more than they borrowed. The median white student, on the other hand, has paid off about 40 percent of their loan. At the same time, schools that served a disproportionate number of low-income students, first-generation students, and students of color were more likely to experience severe funding cuts as the result of slashed state budgets, often resulting in larger class sizes and fewer tenure-track faculty.

The Failures of Financial Aid

But what about financial aid or other affordability measures? The truth is that current college affordability measures merely tinker around the edges—by capping tuition costs, for example, or expanding Pell Grants. These measures fall far short of what is needed to solve the larger structural problems that stem from the nation’s marketized higher-education system. What’s more, simply urging higher education institutions to cut tuition without addressing underinvestment could cause institutions to further cut back on funding for faculty and staff.

Deploying public power is the only path to addressing the flaws of the broken US higher education system. The federal government has historically invested in higher education by providing funding support to students, but outside the realm of research grants, it has yet to significantly fund universities themselves. Nonetheless, it has the capacity to implement a new financing model for public universities that offers sustained, direct federal funding of colleges and universities in return for free universal access and improved educational quality. This idea is not novel. Since President Barack Obama’s 2015 State of the Union, some federally backed form of free higher education has been a feature of countless policy proposals, appearing in most of the 2020 Democratic primary candidates’ platforms.

A federal plan for free college must start with the understanding that the federal government is investing in higher education not because Americans are consumers in the market for higher education, but because they should have a right to access such education. The College for All Act of 2021 does just this. Introduced by Representative Pramila Jayapal (D-WA) and Senator Bernie Sanders (I-VT), the bill would make a direct federal investment in that right by covering 75 percent of the cost of eliminating tuition at public institutions, with states picking up the rest. There are many other models that could be deployed.

A significant increase in federal funding should create opportunities for other reforms. Institutions receiving direct federal funding should have to meet labor, educational, and equity standards and offer more transparency around their operations. Stable employers and engines of economic development, universities have historically anchored communities. Federal investment in the free college model should be designed to help restore this role for higher ed.

The Path to Free Public Higher Education: Lessons from Student Debt Organizers

After a proposal to guarantee free, two-year community college was cut from the Build Back Better bill a year ago, free college has largely fallen out of public discourse, but we should recognize debt cancellation for what it is: an acknowledgment that the higher education system is broken.

It is obvious that student debt will start ticking up once again—unless free college is implemented. Of course, this effort will encounter resistance, but the accomplishments of the student debt cancellation campaign have provided both lessons and organizational infrastructure that advocates can build on to guide a new movement for universal free public higher education.

Free college could serve as a kitchen-table issue that revives trust and public confidence in our nation’s institutions.

The student debt cancellation story has raised consciousness about our higher education system’s failures. President Biden and others have repeatedly said that a college education should be a ticket to a middle-class life but that college debt is a lifelong burden that prevents many people from accessing college altogether. Further, advocates have highlighted that student debt is a racial justice issue. Most people understand that higher education can enable economic mobility but that student debt can block that potential. This understanding, in the context of the pandemic and the racial reckoning of 2020, built momentum for student debt cancellation.

But such cancellation has not permanently solved any of the issues that created unsustainable levels of student debt in the first place. Higher education remains expensive, and the cost still falls particularly hard on Black and Brown students. Meanwhile, Americans are, if anything, only more price sensitive in our current inflationary moment. With 77 percent of Americans today finding it difficult to afford a college education, free college could serve as a kitchen-table issue that revives trust and public confidence in our nation’s institutions.

Ultimately, making college affordable requires a more comprehensive answer than affordability measures such as expanded financial aid. Fortunately, student debt cancellation has shown that actions to fix higher education access and funding are popular because most Americans (66 percent) believe that student debt is a significant financial burden.

Free public higher education is also popular. A year ago, the Pew Research Center asked Americans whether public higher education should be free—63 percent of respondents said yes.

It’s the job of advocates and policymakers to explain that student debt cancellation was an important first step toward creating a progressive higher education system, one that builds on the tradition of free public education established by Horace Mann and extends this tradition to include higher education in order to meet the educational needs of today’s society.

This article originally appeared in the Nonprofit Quarterly. See the original article here.

This article concludes the Community Strategies for Systemic Change, a series co-produced by the Local Initiatives Support Corporation (LISC) and NPQ. In the series, urban and rural grassroots leaders from across the United States share how their communities are developing and implementing strategies—grounded in local places, cultures, and histories—to shift power and achieve systemic change.

The Cihuapactli Collective (CC) began seven years ago in Phoenix, Arizona, in response to the call of a mother, CC’s co-executive director, Maria Parra Cano.

The collective took shape two months after Parra Cano gave birth. Her mother had recently passed away, and she was experiencing the baby blues. In response to her call, 14 founding CC members began meeting in coffee shops to discuss healing ourselves. Conversations regarding womb health and parenting in an urban Indigenous setting led to the development of community workshops that centered women’s and partum health. Over time, CC began to be recognized for its work, and the organization expanded to serve BIPOC families in Phoenix from womb to tomb.

During its first three years, CC members focused on healing our tight-knit Native community. Many of us had known one another for decades; we were part of the same community, spiritual, and organizing circles. Now, in our baby making and child rearing years, ancestral knowledge took center stage. Every member brought to the collective cihuapactli, or women’s medicine in the traditional language Nahuatl of the Aztec/Mexica. Just as many of us had done before, we worked in the community and as a community.

We possessed ancestral knowledge from a variety of nations. Most founding members hailed from tribes in the present-day nations of Mexico and Guatemala, such as Mexica/Aztec, Texcocatl, Yaqui/Yoeme, Purepecha, Raramuri, Tarahumara, and Maya. Tribes from Colombia, the Philippines, and the Caribbean were also represented. CC also has members from northern tribes such as O’odham and Lakota. Nearly seven years after its founding, CC has served and represented upwards of 55 Native nations across the globe, while navigating a system that does not always recognize us as being Indigenous enough.

Walking in two worlds

As a nonprofit, CC’s organizational structure was influenced by ceremonial and Indigenous values. Our board of directors and officers draw on CC’s elders’ advisory council in addition to the organization’s founders.

The concept of walking in two worlds—a settler-colonial world and a Native world—is central to CC’s structure. For CC, neither certificates nor government designations are needed to certify the group’s ancestral knowledge. Despite this understanding, the founders—who included stay-at-home moms, social workers, journalists, chefs, and women with doctorate degrees—must negotiate between the two worlds and strategically make decisions regarding how to open doors for the communities we serve.

For its first five years, CC ran largely out of the Parra Cano household. From this location, women and their children filled packages and tote bags with seeds and medicines to mail to the attendees of our annual ancestral womb wellness gathering (AWWG). We created shifts for womb care and massages. As folks walked past the kitchen table on the way to the treatment room in the house, those who lingered laid the foundations for the nonprofit.

The first AAWG, launched with the humble goal of helping us to heal ourselves, attracted over 200 people. This event builds on longstanding community traditions. For years, women would host potlucks and what we call comadre brunches. A comadre—which translates literally into English as co-mother—is a family friend who cares for the family and takes on household chores. When one of us in the community gave birth, we would support the new mother for 40 days in this manner by bringing food. When a baby passed on, we would check on and check in with one another, something so simple, yet elemental.

During founders’ meetings, we discussed how we hoped to define and describe our organization and implement the Indigenous values that so many of us seek to pass on to our offspring. For the first four years, this labor was unpaid; our events were self-funded.

We sensed that mothers and families in our community likely lived with similar experiences to us and similar Indigenous values—and had limited support. The concept of serving families from womb to tomb came to be.

COVID-19 compels change

As it did to so many organizations, the COVID 19 pandemic shifted CC in unexpected ways. It impacted the local food system in South Phoenix, and many food-based businesses faced closure. Maria Parra Cano’s family business was among them.

Prior to the pandemic, the business, Sana Sana Foods, was thriving, with a well-known food truck. Its mission to “feed the people” was well received as the family centered ancestral foods in the vegan Mexican cuisine they served.

Because the Parro Cano family owned Sana Sana Foods and participated in CC, the two entities often collaborated. During the pandemic, they merged in order to attract philanthropic funding and for economic survival. Importantly, their missions overlapped, for food justice and maternal health are connected. And indeed, the benefits of the merger extended far beyond financial survival. Most importantly, the link between food justice, land restoration, and birthing work became readily apparent.

In an ironic development, just as many nonprofits were abandoning physical offices, CC for the first time acquired one. Located in Central Phoenix, the new office also became home to an urban garden.

As we grew herbs for postpartum care, it became clear that food is fundamental to all aspects of healing and that there was a broad public need for this knowledge to be disseminated. As the pandemic raged on, we found that the ancestral earth-based knowledge and Native science that we provided had become practical information and skills that were widely requested by community members and the media.

Deepening the vision

Our community began to read articles that provided practical nutritional information and receive our nutrient dense Indigenous food packages. We are touched when community members share stories about how the food that we serve reminds them of their grandmother or recipes from childhood.

The conversations as we handed food bags into the driver-side windows of cars on our makeshift driveway often went something like: “Oh wow. It’s heavy! Thank you! I didn’t know you all got an office. I didn’t know that the collective did food work. I think of you all as providing postpartum care.”

We would quickly catch up through car windows and masks. These conversations with our community helped us to weave together a narrative in which postpartum care, food, and land restoration are inextricably linked. Increasingly, our birthing, food justice, and land restoration work occured in tandem and became a fixture of CC’s strategic plan. As we witnessed the growth of our humble garden, the regenerative aspects of the gardening process reminded us that the land is restored through these ancestral land practices—and the ways that individuals and communities reconnect to their lineages, family recipes, and traditional ways began to resurface.

When birth work, food justice, and land restoration occur in tandem, the womb can be a place to heal from generational trauma. This work is at the root of CC’s efforts towards systemic change. Simply put, it dawned on us that something as simple as restoring ancestral practices of food cultivation could not only increase nutrition, but also reduce generational trauma.

If parental ancestral wisdom and healing can be activated through food, if neural pathways for peace and tranquility instead of stress and trauma are created in the womb, then maybe the next generation can be born without the markers that predispose them to mental health challenges, like anxiety and depression, and disease, such as hypertension and diabetes.

And what could accomplish this? An Indigenous food pack, grown on Indigenous land, by BIPOC farmers. We were being reminded of the importance of sovereignty, the ability to determine and meet your own and your community needs by having control over your body, your choices, and a small bit of land.

Although these connections may seem lofty and loosely connected, epigenetics, the study of how behaviors and environment can change the way our genes work, highlights the impact of generational trauma on DNA. Science is revealing that chronic stress impacts hormones, mental health, and disease expression. Science is also confirming the value of ancestral knowledge. In our understanding, ceremony, and living off the land are critical tools that empower community members to heal from intergenerational trauma.

With this inspiration and fire in our belly, the organizational vision deepened. An emphasis on systems change brought CC and its communities back to the importance of land sovereignty, working the land in community, addressing family from conception, and revitalizing community connections to land.

Decolonizing our community

Eurocentric frameworks place birth and death on a linear timeline. In precolonial systems, birth and death are two points of a circle that constantly brush up against one another. This ancestral knowledge was easy to understand and live out in the birthing space, but now, those circles—seasons and transitions overlapping and meeting one another in growing cycles—add more layers and textures to the rich landscape that CC is cultivating. If we consider a healthy birth a critical starting point to living healthy lives, then growing food is a complementary starting point. We are reminded of the value of cultivating a harmonious connection between humans and land.

CC began as an organization dedicated to education and cultural revitalization. Although known for birth work—specifically, postpartum care—our work and the needs of the community span every reproductive phase and outcome. Our work also focuses on birth justice and birth equity. Because of our experience in the birthing space and the attention that CC has begun to receive, we are now being called into spaces of advocacy and consultation. And the final and fourth focus of our work—food justice and land restoration—completed CC’s mission, even if took a pandemic to connect these dots. Those overlapping points became our sacred bundles, our pillars, and the foundation of our organization.

The value of coalitions

CC’s dream time and prayers continue to guide and surprise us.

Poised to receive seven acres of land in South Phoenix, a historically Black neighborhood, we are responding to calls from the land. Building relationships has also always been a cornerstone of CC’s foundation.

The acreage is home to the Sotelo-Heard Cemetery, an abandoned cemetery established when the land was part of Mexico. The housing development company that has owned the land for many years did not want to disturb the cemetery. Vice Mayor Carlos Garcia has proposed a land swap between the owners, the city, and CC. We expectantly wait to receive the deed to the land, as we are anxious to build a wellness center, food forest, and teaching kitchen with our community, partners, and friends on the property.

CC maintains its strong sense of identity, but now we work in collaboratives with sister and brother organizations that serve our Black and Indigenous relatives. Once again, the land brought us to this iteration. Land restoration is incomplete without Black liberation, and said liberation is incomplete without Indigenous sovereignty and the restoration of right relationship to the land. The call from these seven acres is deep.

Like the mother of a newborn begins to hone her ears to the cues of a baby, CC members are honing our hearts to cues from the land. We are honing our ability to work from a multisector approach, where community partners can dream and build with us while maintaining their organizational sovereignty. We continue to make mistakes and build relationships, maybe not in that linear order, but with two points of a circle, constantly brushing up against one another.

This article originally appeared in the Nonprofit Quarterly. See the original article here.

When schools and daycares shuttered, when food and other supply chains broke, who delivered baby supplies to parents juggling virtual work and young children? Who opened emergency childcare centers for the frontline workers who didn’t have the luxury of working from home? Who brought food to housebound elders?

It wasn’t for-profit companies. The nonprofit sector, along with community-based mutual aid networks, stepped up to meet immediate needs. If we want nonprofits to support us in the next crisis, they must have sufficient resources. And to know what nonprofits need to do their jobs effectively, we must ask them directly.

To that end, the Nonprofit Finance Fund conducted its ninth national State of the Nonprofit Sector Survey in the first quarter of 2022 to ask nonprofits about how they were faring and their resource needs during this once-in-a-generation moment.¹ We sought to understand the financial situation of nonprofits writ large during the pandemic and racial reckonings, focusing on organizations led by people of color. We gathered a sizable national sampling of 374 BIPOC-led organizations, 719 white-led organizations, and 75 organizations whose leaders’ racial or ethnic identities spanned multiple categories, none of the presented categories, or was unknown.

Disaggregating by race allowed us to do a meaningful comparison when answering questions like, “Did organizations have the resources to meet changed community needs? Were they able to keep up with service demand? Did all organizations have equitable access to funding?” Some of the results surprised us in a positive way; others did not.

Strong communities need strong nonprofits

Government, philanthropy, and community members all relied on nonprofits during the COVID pandemic. Among survey respondents, 71 percent saw an increase in service demand during the pandemic. Nonprofits organized food drives and distributed other necessities to people who were sick or at risk or had lost jobs due to the pandemic.

As a result of the pandemic, 88 percent of survey respondents developed new or different ways of working that led to positive outcomes.

Nonprofits pivoted nimbly when needed during the past two years, adapting to rapidly changing client needs. As a result of the pandemic, 88 percent of survey respondents developed new or different ways of working that led to positive outcomes. Just over half (51 percent) of respondents think these changes could be permanent. For example, a Boys and Girls Club chapter in upstate New York opened its doors to students who could not attend school virtually because they couldn’t afford internet access or there was no adult to stay home with them. The organization also instituted mobile school supply delivery.

Another infant development organization typically conducted home visits for new mothers and babies. When the pandemic hit, they used newly unrestricted funding to purchase sturdy strollers for participating mothers so that the organization could continue its programs outdoors, with the added benefit of fresh air and exercise. These adaptations opened the organizations to new ways of engaging with the community and conducting their work that continue today.

What factors facilitated nonprofit responsiveness?

Funding restrictions often limit nonprofits’ flexibility. As such, we were pleased to see many funders release restrictions and fund quickly and generously during the crises of the last two years. While we recognize the potential for survivor bias in who was able to respond to our survey, it was gratifying to see that 70 percent of survey respondents saw their funding increase during the pandemic from 2019 levels. Nonprofits were given more freedom to choose how to spend money and were less burdened by application and reporting requirements: 57 percent of nonprofit respondents reported that since March 2020, foundation funders have been more flexible with how they distribute funds. Indeed, in fiscal year 2021, 36 percent of survey respondents received more than half of their funding in unrestricted funds, including general operating support.

Many nonprofits not only survived the pandemic, but have emerged in a relative position of financial strength.

In addition to increased foundation giving, community development financial institutions (CDFIs), including Nonprofit Finance Fund, also stepped in, partnering with government and philanthropy to quickly make low- or no-interest loans to nonprofits through special set-aside funds, such as the New York Forward Loan Fund and the NYC COVID-19 Response & Impact Fund. Additionally, the Paycheck Protection Program offered forgivable loans (de facto grants) that helped nonprofits shore up finances damaged by the pandemic. In a sector that often must fight for a 10 to 15 percent indirect cost rate reimbursement from government, this was a wonderful change.

Racial injustice persists in nonprofits 

Thanks to such infusions of cash, many nonprofits not only survived the pandemic, but emerged in a relative position of financial strength. That said, not all nonprofits have benefitted equally from this unexpected gain in financial stability, and racial disparities remain significant.

In 2020, the murder of George Floyd (and Breonna Taylor, among countless others) and the mass uprisings that resulted sparked widespread calls for justice. Anti-Asian attacks in places like Atlanta and San Francisco ignited the Stop Asian Hate movement. Many nonprofits were on the frontlines of these movements for racial justice and equity. While their presence drew promises of support from corporations and corporate philanthropy, many of those promises have yet to be delivered on.

The data from our survey confirm notable disparities in the financial health of organizations along racial lines. For example:

• Unrestricted funding: While 41 percent of white-led survey respondents received half or more of their 2021 funding as unrestricted funds (including general operating support), only 26 percent of BIPOC-led organizations did.
• Nonprofit financial health: Nearly two thirds (66 percent) of white-led organizations in our survey ended fiscal year 2021 with a surplus, as did 64 percent of AAPI- and Latinx-led organizations. But only 49 percent of Black-led organizations ended FY2021 with a surplus.
• Corporate donations: Despite corporate pronouncements, only 58 percent of BIPOC-led nonprofits received corporate donations, compared to 71 percent of white-led nonprofits.

Resource inequalities run deeper. White-led nonprofits were more likely to receive revenue than BIPOC-led nonprofits in each of the following: sales income (23 versus 11 percent); federal contract income (46 versus 32 percent); and investment income (33 compared to 16 percent).  Such data is symptomatic of systemic racism in the nonprofit funding system that must end—immediately. 

Moving from equity commitments to action 

In our years working in the nonprofit sector, we have never seen more awareness of and commitment to social justice and racial equity. Now is the moment to replace the old funding system with a better one that eliminates racism and power imbalances between those who hold the money and those who spend it in service of social good.

A few things that funders and government can do to lead us on that positive path are:

• Direct funding to leaders with lived experience. Funders should seek out organizations whose leaders have deep knowledge about the communities they serve, for people closest to a community are most knowledgeable about what is needed to help that community reach its aspirations and address its challenges. In our survey, 57 percent of BIPOC CEOs/EDs have lived experience that is representative of one or more of the communities their organization serves, compared to 18 percent of white CEOs/EDs.
• Increase funding duration and flexibility. Funding is a constant stress for most nonprofit leaders. Eighty-two percent of BIPOC-led organizations reported long-term sustainability as a top challenge, as did 69 percent of white-led organizations.

If a funder believes in an organization’s work and impact, trust the organization. Let them make decisions about how to use their funds to achieve impact. This means providing multi-year funding so that community organizations can spend more time delivering services and less time chasing funding.

• Pay for the full cost of doing the work you want done. If you walked into a restaurant and said, “I’ll only pay for the portion of my meal that covers the meal ingredients,” staff would tell you to take your business elsewhere. Nonprofits rarely have that luxury. They pay rent and salaries, just like a restaurant does. And when they don’t get paid full cost for the services they provide, nonprofit workers suffer. Paying full cost translates to frontline workers receiving a living wage and contributes to nonprofits’ overall impact.
• Listen to nonprofits—and the communities that they serve. For funders, this means bringing nonprofits and/or community members into the grantmaking process. And funders should not be extractive; this means paying nonprofits and community members for their time. This is the best way to reach newer, community-centered nonprofits—especially BIPOC-led ones that have often been excluded from traditional funding networks—and to structure funding in ways that support community needs and desires.

For government officials, it is imperative to listen to nonprofits’ experiences of the government contracting process. Is it working well, or not?

Some specific questions that officials can ask themselves include: Is the government agency making payments to nonprofits to cover costs up front, or does it require cash-strapped nonprofits to front all the costs? Are nonprofit contracts paid on time? How many administrative hoops do nonprofits have to jump through, and how much paperwork do they have to fill out, to be government contractors?

When governments fail to listen to nonprofits and address such concerns, they leave out smaller, grassroots nonprofits that can’t afford to surmount resource/financial obstacles. This, of course, reinforces racial and economic injustice.

Moving forward

The COVID pandemic laid bare inequities in the nonprofit funding system. As a result, the field saw some changes to these inequitable practices. But there is still much work to do.

One important step is to consolidate and make permanent these recent changes, rather than reverting to the old ways of doing business. It is also important to accelerate efforts within the nonprofit sector toward racial equity.

In a system defined by racial injustice and imbalances of power, failure is certain. However, with strong, equitable nonprofits supporting vibrant communities, gains in social well-being become possible.

Notes

1. We are grateful to our survey partners: Ambit 360 Consulting, EVITARUS, and the Bank of America Charitable Foundation.

This article originally appeared in the Nonprofit Quarterly. See the original article here.

This article concludes NPQ’s series on Community-Driven Philanthropy. In this series, movement leaders explore what’s possible if philanthropy adopts a reparative model—one in which it supports the leadership of BIPOC communities, not just by writing grants, but by shifting assets and control over resources to frontline communities.

The movement for reparations in the United States—a Black-led movement that began even before slavery’s end—is making unprecedented strides forward, and governments across the country are beginning to act. In October 2020, California became the first state to initiate an official task force to study and develop a reparations plan for Black Americans harmed by slavery and its legacies. In March 2021, the city council in Evanston, Illinois, approved the Local Reparations Restorative Housing Program to address racial discrimination in housing. In April 2021, HR 40 was voted out of committee for the first time in its 32-year history. If passed, the bill would establish a commission to study the negative effects of slavery.

These initiatives represent just a few of the many forms that advocacy for reparations can take. Other activities include grassroots power-building, research, narrative change, and stakeholder mobilization. There is an enormous amount of work to be done, and it needs real investment to be successful.

A new philanthropic model, in the form of asset transfers coupled with a comprehensive racial repair framework, would deepen investment in Black communities while reflecting the reparations movement’s goals. In addition, it would move the philanthropic sector into a liminal space (ie, a transitional opening for social change) that could decrease the need for philanthropy in the first place.

A New Philanthropic Model

The engine of philanthropy runs on hoarded wealth. Many—if not most—foundation benefactors earned their fortunes through the exploitation of people, land, and resources. Once accumulated, this wealth is maintained—often in perpetuity.

If foundations spent the money currently locked away in endowments, it might be possible to transform the systems that create the societal problems that foundations are dealing with.

As is well known, foundations with endowments generate returns by investing those endowments, whether in the bond or stock markets or through hedge fund placements in private equity. They usually limit their giving to the federally mandated minimum of five percent of overall assets and have boards of trustees who make investment decisions but are far removed from the problems those investments aim to solve.

Many within philanthropy contend that limiting giving in this way is important to ensure that foundations can continue to finance mission-driven work. However, this approach has downsides. If foundations spent the money currently locked away in endowments, it might be possible to transform the systems that create the societal problems that foundations are dealing with. In short, while foundation leaders believe that preserving foundation assets in perpetuity serves the public interest, movement leaders involved in systems change hold a different view.

What if philanthropy wasn’t just about financial investment, but also about reckoning with the systems that created concentrated wealth in the first place, and understanding how to transform those systems to make them more just for all?

The US is seeing a resurgence of white supremacist rhetoric and violence, and despite many efforts, the racial wealth gap is not closing—it is widening. Our criminal justice system continues to target Black people, and Black communities have been hit hardest by the pandemic and a slowing economy. A new model of philanthropy is needed to address this at scale and with speed.

What would it look like if, instead of grants, philanthropy took the form of asset transfers that shift funds to reparations movement organizations to spend or steward as they see fit? What if the power dynamic was dramatically flipped, and reparations movement organizations didn’t have to worry about sustainable funding? And what if philanthropy wasn’t just about financial investment, but also about reckoning with the systems that created concentrated wealth in the first place, and understanding how to transform those systems to make them more just for all?

Rooting the new model in repair

We believe that a culture of repair must be embedded into all institutions we create—including philanthropy—to ensure Black people can thrive.

At Liberation Ventures, we define repair as an iterative, cyclical process with four components: reckoning, acknowledgment, accountability, and redress. This framework was developed through a study of frameworks across disciplines—from transitional and restorative justice, to prison-industrial complex abolition, to psychology and religion. It is a living framework; as more individuals and organizations try it out, it will evolve in tangent with our lived experiences. It can apply to all sectors, but here we use it to ask: what might a comprehensive philanthropic approach to repair look like?

We can begin with the obvious—financial redress. MacKenzie Scott has received a great deal of attention for giving a ton of cash to many incredible Black- and Indigenous-led organizations. What she has not done is shifted her assets—or given movement leaders control over whether to invest those assets or spend them down as informed by their proximity to the challenges at hand. Such a move would mean sharing not just cash, but power.

Control of money is important, but it is not the only component of repair. The choice to shift assets stems from an understanding of the unjust systems that enabled a privileged few—including donors and foundations—to amass great wealth while depressing the wealth of so many others, especially Black and Indigenous folks.

Public acknowledgment of this reckoning process models the process for others. Acknowledgment makes reckoning visible, which changes culture—and, in the process, helps communities that have been harmed feel seen. While donors like Scott may have important reasons for wanting to stay out of the limelight, sometimes donors’ public presence can upend the status quo by setting a new example for their peers.

Finally, holding donors accountable to grantees’ needs ensures that Black-led organizations and their communities control the narrative. Scott has shifted her approach from announcing grantees, to creating space for grantees to share the news on their own terms, providing one example of what accountability to communities looks like.

What else might accountability involve? Some possibilities include organizing peers to make similar commitments and, as Evanston’s aforementioned restorative housing program demonstrates, establishing local governance structures that create a new example for the field.

A Journey—Not a Destination

Trauma and theft at the scale of chattel slavery require time to heal. The redistribution of assets, paired with a reparative framework, would help bring more choice, freedom, and long-term sustainability to movement groups.

First, asset transfer would give reparations movement leaders control over how and when to invest or spend resources. When conditions are unfavorable to progress, movement leaders can use endowments to ensure sustainability; when conditions change, they can spend down to leverage windows of opportunity to create the most impact possible. This would enable those who are closest to the issues—and who have the clearest view of what is needed to win—to modulate levels of investment in the movement with more flexibility, agility, and speed.

Second, such an approach would enable movement organizations to upset the existing power dynamic, which favors philanthropists over those receiving funds. Giving movement leaders the choice to use endowments as a strategic tool would enable them to engage in long-term planning without worrying about funds being withdrawn due to a change of philanthropic fashion. This type of financial sustainability and security would result in widespread mental health benefits and increased organizational impact, and it would allow groups to operate from an abundance mindset rather than one of scarcity.

Third, asset transfers would help BIPOC-led organizations build durable infrastructure that prioritizes healing and wellness, instead of getting bogged down by short-term challenges and burn-out. In short, asset transfers make possible a baseline level of capital that leads to a more sustainable and flexible strategy for movements.

Asset transfer, paired with the ongoing work of comprehensive repair (reckoning, acknowledgement, accountability, and redress), could provide a framework for large-scale, flexible resourcing that heals our communities and benefits us all.

Finally, asset transfer could contribute to building trust across lines of racial and class difference. Such trust-building creates healing for those who have historically been harmed by unjust systems and for individuals who have long benefited but who also need to heal from these systems. As James Baldwin reminds us, “It is entirely up to the American people whether or not they are going to face and deal with and embrace this stranger whom they maligned so long. What white people have to do is try to find out in their own hearts why it was necessary to have a [n-word] in the first place…. The future of the country depends on that.”

Towards a Liberated Future

We want a liberated future: a just, multiracial democracy and an economy that values people and our planet over profit. Repair is the pathway to this future, and all of us—especially Black and Indigenous communities—deserve it.

New models of philanthropy are critical to bringing this vision to fruition. We need philanthropists who are willing to share power. Asset transfer, paired with the ongoing work of comprehensive repair (reckoning, acknowledgement, accountability, and redress), could provide a framework for large-scale, flexible resourcing that heals our communities and benefits us all.

This is only one step toward a world where philanthropy is unnecessary because our economic and democratic systems create just outcomes for all. In this world, wealth isn’t hoarded; it’s invested in ways that meet all people’s needs. A reparative model of philanthropy creates the liminal space needed to move closer to this new world.

This article originally appeared in the Nonprofit Quarterly. See the original article here.