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Posts Tagged ‘economy’

According to the U.S. Department of Labor, Labor Day is a creation of the labor movement and is dedicated to the social and economic achievements of American workers.  It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country. [1]

As we approach the Labor Day holiday, I can’t help but to think about how blessed I am to be employed.  I would consider myself a “modern-day employee” in that for much of my career history, I sought out opportunities to expand my skill set either through a new position with my present employer, with a new employer or through entrepreneurship.  With this strategy, I have been blessed to have gained a wide variety of experiences, with a primary focus on community and economic development.  Nevertheless, there have been times when, unfortunately, I did not receive a steady paycheck or the entrepreneurial pursuit did not turn out as I expected.  Through it all, God provided for me and my family and I thank Him for that!

I, also, can’t help but to reflect on those who are unemployed or underemployed.  As of this writing, the unemployment rate in the U.S. stands at 9.1% (August 2011).  There are more than 13 million people who are seeking full-time employment, but have been unsuccessful for a number of reasons (e.g., jobs moving to lower cost locations, skills mismatch, etc.).  This has implications for all areas of the economy, including homeownership, meeting basic needs, obtaining the training needed for today’s jobs, and others.  With the current direction of federal and state governments to reduce spending at all costs, the work and mission of nonprofits become even more important.  Nonprofits have to become even more efficient in their operations and programming to address the ever-increasing needs of its target population, constituency and community.

Do not become discouraged in the present state of affairs, but rather use this time to be more creative in meeting the need and more emboldened in requesting and securing assistance for your efforts.

Please pray with me that the unemployed, employers, government leaders, nonprofits and other willing participants will work together to improve our economy and increase meaningful opportunities!

Be strong and be blessed!

[1] – U.S. Department of Labor (http://www.dol.gov/opa/aboutdol/laborday.htm)

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We’ve all heard the expression “if you fail to plan, you plan to fail” …and this is certainly true when it comes to the operations of your nonprofit organization.  As in your personal life, planning for your organization’s fiscal health is a vital element in making sure that, for example, your expected revenues exceed your expenses.  In addition to determining how much money you REALLY need, a budget can help you in the execution of your organizational plan in general (e.g., how many employees do I need, should I buy or rent office space, etc.).

Before going further, it would be good to highlight some general terms that are often used [1]:

  • Fund Accounting – Nonprofit organizations aren’t in the business of making a profit (thus, it’s name :)), so they use an accounting system called fund accounting.  Fund accounting groups financial data together into funds or accounts that share a similar purpose.
  • Revenue – The amount of money that is brought into a company by its “business” activities (e.g., grants, income from programming, contributions, etc.).
  • Expense – Any expenses incurred in the ordinary course of business (e.g., salaries, office space rental fees, taxes, etc).
  • Operating expenses – A category of expenditure that a business incurs as a result of performing its normal business operations.
  • Non-operating expenses – An expense incurred by activities not relating to the core operations of the business (e.g., interest charges or other costs of borrowing funds).
  • Cash-flow – The cash generated from the operations of a company, generally defined as revenues less all operating expenses, but calculated through a series of adjustments to net income.  NOTE: It’s cash flow that pays the bills (“cash is king”)!

The financial statements for nonprofits relate to for-profit statements in the following way [2]:

Business Financial Statement Equivalent Nonprofit Statement
Income Statement Statement of Activities
Balance Sheet Statement of Financial Position
Cash Flow Statement of Cash Flows

Back to developing your budget…   It is recommended that the following steps be taken to methodically develop your budget [3]:

  1. List your monthly nonprofit operational expenses.
  2. List your monthly salaries and wages for each employee (if applicable).
  3. Identify and list your monthly expenses for your specific programs.
  4. Identify your monthly revenues.
  5. Assess the difference between your monthly revenue and expenses.

Please make sure that you are realistic and practical in your planning so that expectations are not set too high.  As with a for-profit business, sometimes an organization can get overwhelmed if it grows too fast too soon!

For more help in developing your budget, contact me or click here.

Be strong and be blessed!

[1] Source: Investopedia.com
[2] Source: http://tinyurl.com/3vyre8h
[3] Source: eHow.com

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We’ve discussed a number of topics over the past few months pertaining to community economic development (CED) – from identifying key partners to embracing fundraising to recognizing the important role of the legal profession.  However, we must not forget that at the end of the day, community economic development is a “people business”.  It takes knowledgeable people to create and implement policies and procedures that positively affect communities.  It takes observant people to see how local decisions and regional trends will affect them and their communities.  It takes a giving person to look beyond themselves and see how they can help improve their communities.  In other words, the basic infrastructure for successful CED is made up of the development of the people who live in that community.

I will be the first one to admit that I am not a psychologist, sociologist or have any other expertise in the study of people.  However, I believe there are a number of ways that individuals can prepare themselves physically, mentally and spiritually for the work of CED.  A few are listed below:

  • Gain knowledge – We’ve all heard that “knowledge is power”, and this is especially true when it comes to CED.  Individuals must become knowledgeable about issues such as available resources, trends in the economy, who to contact for assistance, and new laws that can affect your work.  The more people who have relevant knowledge, the better.
  • Get control of your personal finances – The issue of debt is something that people generally don’t discuss because it’s so personal and, sometimes, embarrassing.  I’ve experienced personally how excessive debt can be an “albatross around your neck”!  It can, for example, hinder your ability to support local businesses, one of the building blocks of CED.  If you have better control of your personal finances, you will be in a better position to buy a home, expand your education or even start a business.  For many years, Black Enterprise Magazine has led a campaign to encourage individuals and families to improve their financial status and has recently initiated a Financial Fitness Contest.
  • Give – I believe that a person (and a community) that is focused on giving will generate not only goodwill, but increased resources as a result.  The Bible speaks about giving numerous times throughout the text.  Examples include the following:

–  “Give, and it will be given to you. A good measure, pressed down, shaken together and running over, will be poured into your lap. For with the measure you use, it will be measured to you” (Luke 6:38 NIV).
–  “‘Bring all the tithes into the storehouse, That there may be food in My house, And try Me now in this,’ Says the Lord of hosts, ‘If I will not open for you the windows of heaven and pour out for you such blessing that there will not be room enough to receive it'” (Malachi 3:10 NKJV).
–  “But this I say: He who sows [plants, gives] sparingly will also reap [gather, gain] sparingly, and he who sows bountifully will also reap bountifully” (2 Corinthians 9:6 NKJV) [Comments added].

In short, a discussion of the “macro” issues of CED should begin with a discussion of what it takes to improve the health and wellbeing of those on the “micro” level – its people.

Be strong and be blessed!

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Even before programs such as the Community Development Block Grant (CDBG) program was enacted by Congress in 1974, the federal government had been intricately involved in creating policy and funding programs that benefitted low-, medium- and moderate-income individuals and families.  These programs sought to address many of the social and economic challenges of these populations such as blight, poverty, unemployment, lack of affordable housing, etc.

However, another vital piece of the puzzle that is often overlooked is the important role the legal system plays in shaping and implementing CED.  From the NAACP and other civil rights organizations to public and private practices to university-based law clinics (talked about more below), these organizations work to address a wide variety of issues that affect CED, including family law, poverty law, government benefits, homelessness, housing and legal assistance to the poor.

CED Law Clinics – There is a wide array of law clinics throughout the U.S. that focus on community economic development.  Even though each may have a different focus (e.g., affordable housing, entrepreneurship, etc), they are all dedicated to improving the economic conditions of low wealth populations through the law by providing direct services as well as specialized training for future lawyers.  Some examples of CED law clinics include the following (for a more complete list, click here):

If you have legal questions regarding your small business, if your landlord has treated you unfairly or have other issues affecting your economic wellbeing, contact your local CED law clinic for assistance.

As you can see, CED and the legal profession are “joined at the hip”.  The community must ensure that the legal profession continues this service without bias that benefits ALL people.

Be strong and be blessed!

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Just before the federal government was scheduled to shut down, a deal was struck to keep the government “open for business”, while implementing a spending package that has been described as “historic”.  I applaud the Herculean efforts of President Obama, House Speaker Boehner, Senate Majority Leader Reid and staff members in getting a deal done before the shutdown deadline.

I have to admit I have mixed emotions.  On one hand, I’m happy for the hundreds of thousands of federal workers that would have been furloughed during a shutdown, including many of my colleagues.  Talk that a prolonged government shutdown would have hindered the country’s economic recovery has been put on the shelf.  Services that many people rely on for everyday survival will continue (I hope!).

On the other hand, I’m cautious because as of the writing of this blog entry, few details of the spending plan have been made public.  What programs are included in the $38 billion “cut” package?  Who will bear the burden of these reductions?  Will the economic recovery of those who are most in need be hindered?  How will the faith-based and non-profit communities be affected?

As we’ve all heard before, the “devil’s in the details”.  Oh, by the way, these discussions are only the beginning – negotiations on raising the debt ceiling and the 2012 federal budget loom just around the corner.  It will continue to be interesting times – stay tuned!

Be strong and be blessed!

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Unless you’ve been “living under a rock” (ala GEICO), events in Libya, Egypt, and Japan as well as other areas in the Pacific are rocking the world in profound, historic ways.  Each have at least one thing in common – there was very little warning to the average person of the events that occurred and the speed at which change happened.  For example, it was reported that the waves from the tsunami resulting from the Japan earthquake traveled at more than 600 miles per hour – faster than a commercial jet – and reached the west coast of the United States within a few short hours!  I pray that democracy and peace prevail in the Middle East and that the rescue and recovery efforts go smoothly in Japan and elsewhere.

However, there is a “tragedy” that’s brewing in the halls of Congress and other seats of power in the United States.  The difference between this “tragedy” and the ones mentioned above is that we are being warned of what may occur.  At this time, programs that assist those who are most vulnerable economically are being considered for massive budget cuts – programs such as the Community Development Block Grant (CDBG) program, Neighborhood Stabilization Program (NSP), and others.  In North Carolina, funds that help support organizations that work within majority-minority communities are on the “chopping block” – not just for budget cuts, but are being “zeroed” out!  This comes at a time when foreclosures continue to rise, unemployment rates are high and stagnant, and overall costs are rising (how much more are you spending to fill your car up? :().

I recognize the need for all of us to “tighten our belts” during times of scarcity and that the burden and sacrifice should be borne equitably.  However, it is a shame that programs such as the ones mentioned above and the communities they serve tend to bear the brunt of the burden during lean AND prosperous times (e.g., urban renewal in the ’60s and ’70s).  I encourage you to learn about what’s being considered and discussed at your local, state, and national government levels and get involved to make the change you want to see!

I hope that cooler heads prevail in that as budget talks proceed, that a disproportionate amount of sacrifice is not borne by those who can least afford it.

Be strong and be blessed!

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Welcome to New South Blog.

Hello, everyone. My hope is to use this medium to share my experiences in community/faith-based economic development as well as to learn from the many practitioners that work in this “space”. I look forward to engaging the economic development community in important discussions for the benefit of disadvantaged and disenfranchised communities throughout the country.

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