On Tuesday, MCF hosted an Economic Roundtable for its members. The presenter was Jim Schowalter, Minnesota’s state budget director. He presented an overview of the American Recovery & Reinvestment Act (ARRA) and shared information about the overall implications of the stimulus package and what it means for Minnesota’s philanthropic and nonprofit sectors.
At the risk of over-simplifying this complicated topic, here are my take-away points from his presentation.
The motto for distribution of funds is: “Do it right, do it fast, provide unprecedented levels of transparency and accountability.” The federal government is adamant that all three goals be met.
The amount of stimulus money flowing to Minnesota is equal to 8.2 percent of our state budget; however, our state is facing a 15 percent budget deficit. This stimulus funding provides a one- or two-year bump to hopefully get us through the recession, but it is not enough to resolve our budget deficit.
While the dollars involved are many, they are not significant enough to create new areas of funding or expand programming, and may not even be enough to stave off cuts to balance our state’s budget. Much of the money will be distributed using existing infrastructure and pipelines and will go to backfill gaps created by budget shortfalls.
Given this, Schowalter advises nonprofits that if areas of involvement and funding streams didn’t fit for an organization or weren’t consistent with a group’s mission previously, they probably will not make sense now, and pursuing them may not be a good use of a nonprofit’s resources.
Some resources:
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Minnesota Management and Budget website: This overview website also contains a “Stimulus Summary,” a reference guide to Minnesota programs that may receive stimulus funding; the program management of these is being done by state agencies. This 190-page PDF document also contains program descriptions.
- Rep. Tim Walz (DFL – MN), 1st District, has published a shorter version of this reference guide; it’s available on his website.
- Visit the MCF website for more resources on the Economy and Philanthropy.
- Chris Murakami Noonan, MCF Communications Associate
