Nonprofit housing relies on a lot of donations, grants, and other money that comes in from special programs. If your nonprofit has a donation campaign, you want those who see it to become regular donors to help your programs. However, people aren't going to donate blindly; they want to know where their money is really going. Your donation campaign materials should contain enough financial information to allow donors to answer two key questions.
How Much Goes to the Core Need and Basic Administrative Services?
Any nonprofit will have administrative costs, salaries, and so on. These things aren't run by volunteers in donated space. But there's a limit to what nonprofits can shuffle towards admin and related costs because donors might question very high percentages that go toward salaries, for example. To help donors understand how you're dividing up donated money, let them know what percentages go to each category and why.
How Much Goes to Construction vs. Occupation Services?
Getting people into housing requires two main things: housing that has been built and that is ready for occupancy, and then the help needed to actually begin living there — setting up utilities, getting furniture, dishes, sheets, and more. If someone is moving into nonprofit housing after being in a shelter or on the streets, for example, they're not going to have many belongings of their own. The housing nonprofit may supply furniture for the housing and give money to the new occupants to buy an extra blanket, plus food, for example.
One of the controversies that have emerged in some efforts to create nonprofit housing is the cost of housing construction. This ranges from consultant and lawyer fees to the actual work building the housing. In California in 2020, an investigation by the Los Angeles City Controller found that building housing to house the homeless was more expensive in many cases than building luxury units in for-profit, regular buildings. This can turn off many donors who don't want their money being squandered on what they perceive as unnecessary features or processes.
Make sure your nonprofit housing donation campaign shows a breakdown of where the money goes when it goes toward actually getting people housed. In other words, instead of just saying X percent goes to administrative costs, Y percent to salaries, and Z percent to housing, break down that Z percent. Show that you're spending the money on actually getting people into housing instead of bureaucracy.
Contact Family Care Housing Development for more information.
