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The Government Shutdown: How It Could Effect Your Nonprofit

We could sit here forever going back and forth on our opinions regarding the shutdown.  It won’t change the current situation, so we will instead move forward. One thing is certain, it will effect your organization – but how? The two big initial effects:

501(c)3 Status Delayed

If the IRS scandal wasn’t enough… add a government shutdown on top of it.  Man, your new organization can’t catch a break!  If you did not get your approval letter before the shutdown most likely you won’t see that lovely piece of paper for awhile.  The last shutdown in the mid 90’s was for 5 days and caused organizations to be delayed up to 8 weeks on all government processed files.

Grants delayed

If you depend on federal grants for a large quantity of your working budget, you will see revenue dry up if the shutdown extends too long. Nonprofits who provide social services, such as food and shelter, will likely see an increase in need from clients deprived of federal programs.

What Can You Do?

Keep motivated

  • It’s easy to get deflated.  Don’t do it.  Allow you and your staff a mini-pity party.  Then roll up your sleeves and make a plan of action (if you haven’t already).  Find ways to motivate each other.  If you are dispersing staff make an extra effort to reach out to them during the shutdown.
  • Don’t allow yourself to become passive or lethargic towards your work.  You know what they say, once you get comfortable… The last thing you want is to have done nothing and be BEHIND when the shutdown ends!

Be Financially Alert

  • Keep scrupulous records of the money spent/lost during the shutdown time.  If you have to send staff home, keep track of their hours lost.  Not all money was refunded in last shutdown but if you have organized data at hand you stand a better chance of receiving your shot.

Keep organized

  • Be aware of what items can wait, what items are needed and what items are wanted.  Can you cut back on a specific supply that would save you a large amount over the next 4-6 weeks? Is there a program that needs to be put on hiatus?  Be alert and aware, now more than ever, how each dollar is spent.

Use the ‘down time’ effectively 

  • If you are in the process of applying for grants, keep writing, editing and researching potential grants.  Now is the perfect time to research other funding possibilities.  When the shutdown lifts you can be ready to hit the ground running.
  • What’s in your  I-need-to-do-that-but-never-have-time pile? Take some time and pick one!

While this isn’t what any of us want or need… it’s here and we have to deal with it.  We can do it! If you have any other tips or thoughts please sound off below, we would love to hear.

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