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Impact Mar 14, 2024
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The city of Riverside has launched a new $2.8 million loan program for local nonprofit organizations, officials announced Wednesday.
The Riverside Non-Profit Resilience Fund is a collaboration between the Inland Empire Community Foundation and the city with the mission to give organizations financial stability that otherwise can be a daunting challenge. According to the city’s announcement, leaders from over a dozen Riverside-based nonprofits said the opportunity to get loans through the new program “could mean the difference between thriving and not surviving in an organization’s early years.”
The federal American Rescue Plan Act, or ARPA, will fund the “self-sustaining” loan program, officials said. Municipalities must “encumber” the ARPA funds by this year’s end and spend them by the end of 2026 — otherwise cities and counties must give the money back to the federal government.
“The Riverside Non-Profit Resilience Fund can be a lifesaver for an organization that is doing great work,” Mayor Patricia Lock Dawson said in a statement. “The beauty of this approach is that, as the loans are repaid and the fund refreshed, even more organizations will be helped.”
The loan program is geared toward aiding nonprofits that struggle to acquire capital needed to provide essential services to members of the community that are not offered by any other agency, city officials said. Often banks or other financial institutions may be apprehensive about issuing loans to nonprofit organizations, which at times get funding from county, state or federal governments many months after funding agreements are approved.
In actuality, the slow delivery of government funds can make it impossible for a nonprofit to acquire or renovate a workspace, buy or upgrade equipment or acquire necessary supplies, officials said.
“Without those critical early steps, nonprofits can struggle to obtain larger grants needed to ensure self-sufficiency,” according to the city.
“These funds will play a key role in supporting non-profit organizations as they serve and assist some of the most vulnerable members of our Riverside community,” Mayor Pro Tem Steve Hemenway said in a statement. “We look forward to the positive benefits this program will have for many years to come.”
Loans issued through the new Non-Profit Resilience Fund would vary according to the needs of individual applicants, but officials said loans likely will range between $150,000 and $200,000. The Community Foundation will seek additional funding from noncity sources to combine with the seed funding from the city of Riverside to grow the fund and make it more impactful.
During the next 90-120 days, the city and the foundation are tasked with teaming to develop a legally binding agreement between the two entities that will outline how the loan program will fulfill its goals, officials said. Expected completion for that effort was this fall, with the first loans distributed near the end of this year or in early 2025.
