Nonprofit organizations in San Bernardino County will have access to $3 million fund for revolving loans in an effort to fill possible gaps in state and federal funding.
A county investment to the Inland Empire Community Foundation established the program that offers “flexible, affordable loans” to local nonprofits, officials said. The loans seek to address the financial stress organizations often experience when traditional funding is difficult to acquire.
Established by a one-time allocation from the county, the IECF will manage the revolving loan fund that will start with $2.5 million for loan capitalization and $500,000 for startup and administrative costs during the initial two years, according to the county. After the first phase, interest earnings and loan repayments will replenish the fund to sustain it as a lasting resource for local agencies.
“The revolving loan fund represents an exciting opportunity to empower local nonprofits and significantly enhance their ability to serve our communities,” Dawn Rowe, San Bernardino County Board of Supervisors Chairman and 3rd District Supervisor, said in a statement. “Because these funds revolve back into the program, we can continually reinvest in even more organizations, magnifying the long-term positive impacts across our county.”
According to the county, nonprofits often face difficulty getting timely funding because of delays in reimbursement from state or federal grants. As a result organizations often have to postpone facility upgrades, equipment purchases or the hiring of critical personnel.
The revolving loan fund provides a financial buffer that can enable nonprofits to quickly qualify for larger state and federal grants by providing the upfront capital needed for matching-fund obligations or to do “necessary capacity-building projects,” according to the county statement. As a new perpetual resource, organizations’ loan repayments to the loan fund create new lending opportunities that sets the stage for continuous growth and resilience in the nonprofit sector.
“By directly investing in our nonprofit community, we’re ensuring critical services reach residents when and where they’re most needed,” Board of Supervisors Vice Chair and 5th District Supervisor Joe Baca Jr. said in a statement. “These loans will allow organizations to expand and improve services, creating stronger communities throughout San Bernardino County.”
Loans will be awarded based on an applying organization’s operational strength, financial stability and repayment capacity, officials said. Priority goes to nonprofits that significantly improve the delivery of services and address pressing local challenges, particularly in underserved and low-income communities. The funding priority is for services to the county’s most underserved “vulnerable populations,” such as seniors, children 5 years old and younger, foster children and youth, people experiencing homelessness and residents of low-income communities.
“We are delighted and grateful that the county has approved this investment for our nonprofits,” Inland Empire Community Foundation CEO and President Michelle Decker said in a statement. “A revolving loan fund for working capital to help nonprofits grow is an innovative idea and new for the Inland Empire, so the board has done something special and we look forward to partnering with county to help build nonprofit capacity to meet more needs of county residents.”
The county will also provide technical assistance to loan fund applicants and loan borrowers, officials said.
The IECF intends to actively market the loan fund in an effort to attract further private investment to make the fund more robust, according to the county.
Information on loan terms, how to apply and other loan details were not immediately available.
The IECF was founded in 1941 and is the oldest philanthropic organization serving Riverside and San Bernardino counties.
