Budgeting Challenges – Rely on the Mission

April 6, 2011 at 11:26 AM | Posted in Class, Community, Community Partners, Development, donations, Donors, ESOL, Finances, Staff, Volunteers | Leave a comment
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Watching the Federal Government struggling with budgeting challenges isn’t easy, but quite honestly it isn’t easy in any organization.  This is the time of year when the Literacy Council of Northern Virginia is developing the fiscal year 2011- 2012 budget (July 1, 2011 – June 30, 2012), and we are making similar very difficult decisions.  In a small non-profit educational organization, such as LCNV salaries are the largest part of the budget.  Without the teachers, program support professionals, and administrative support, the organization would not function.  Non-profit salaries are considerably lower than public and private sector salaries for similar positions, and yet we need to be competitive to attract qualified candidates who live in this Northern Virginia region.  So, to keep expenses down, LCNV uses the support of AmeriCorps members, functions with a number of part-time positions, and supplements with volunteer office support as much as possible.   Program books and materials are a necessary expense and LCNV will not sacrifice the number of books, the quality of the materials, or the variety necessary to meet the need s of the range of adult learners in our programs.  This, too, is a large portion of our operating budget.  Then there are the operational costs like telephones and technology, building maintenance, printing, supplies and equipment, mailing . . . items that need to be paid to successfully run an educational service, but seem to add up to too much too quickly.  Where can we cut the budget?

Like the Federal Government, we also look at the revenue side.  Where does the money come from? In the case of the LCNV, it is primarily fund-raising income.   All of our grants, including state and local government funds are annual competitive grants, meaning every year we start from scratch raising necessary operational funds.  There are no guarantees in fund-raising and often private foundations or corporate giving programs change their funding priorities, or in a difficult economy, cut back their grant awards.  We do charge fees for volunteer training and fees for our adult learners (though scholarships are available for those in need), but added together those fees account for less than 5% of the operating budget.  Creating the income side of the budget requires strategic guessing, taking risks, and having faith in the kindness of others.

How do we balance the growing needs of the organization, fairly compensate the small staff, make sure our educational programs are cutting edge and responsive to the needs of adults in our community, while depending upon revenue that’s based on strategic guessing?  In some ways it’s a lot like the Federal Government:  there is considerable discussion and compromise.   For the most part, though, at LCNV we rely on the strength of the mission.  We believe there is no better cause than giving the gift of reading to an adult.  With the basic skills of reading, writing, speaking and understanding English, adults have the tools to launch a whole new future.   The LCNV budgeting process is to manage the expenses as close to the edge as is fairly reasonable, and talk about the importance of the mission over and over and over until the money follows.

-Patti Donnelly, Executive Director

 

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