February 2008 Brown Bag Minutes

In this Brown Bag, presenters addressed the following topic, "Are There Ways to Leverage Non-Financial County Resources in Hard Times?" and explored three interesting possibilities.

• Leveraging the county government’s purchasing power in high cost areas such as gas, office supplies, etc.
• Making specific county government services available to nonprofits
• Advancing payments to nonprofits, with due diligence safeguards, as soon as a contract is signed
  

Presenters included:
Phyllis Courlander, Assistant Director, Top Banana Home Delivered Groceries
Craig Dowd, Director of Re-Entry, Clarksburg Correctional Facility
MaryAnn Holohean, Director, Nonprofit Montgomery!

Nonprofit Montgomery! (NPM!) and
Montgomery County Office of Community Partnerships (OCP)
Brown Bag Lunch
February 13, 2008

Panel topic: “Are There Ways to Leverage Non-Financial County Resources in Hard Times?”

Welcome
MaryAnn Holohean welcomed the participants to the February Brown Bag meeting and directed their attention to the list of revised dates for the 2008 meetings. Participants were asked to complete the evaluations found in their information packets.

Panel Presentation

Phyllis Courlander - Assistant Director, Top Banana Home Delivered Groceries

• How to make the small dollars work.
• Top Banana, operating from Brandywine, has their own vehicles that are used to service clients in Washington D.C. and Prince George’s County and parts of Charles and Montgomery Counties.
• Top Banana began looking for ways to stretch their dollars when the increasing cost of gasoline put a strain on the organization.

§ Knowing that the County had a bulk contract for gasoline that avoided the station overhead costs, Top Banana began seeking information from the Office of Procurement on a potential piggy-back on the contract.

- There is a 25-50 cents per gallon difference in what the County is paying for bulk gasoline opposed to what everyone else is paying at stations. This equates to a savings of $2,800 per year.

o This would save an organization like Manna, that is on the streets daily, $7K per year.
o Top Banana, a twice a week service, would realize a savings of $2K per year.

- Section 11B-49 of the County Procurement Code states that “If goods are needed to perform a contract with the County, a nonprofit organization that is exempt from taxation under Section 501(c)(3) of the United States Internal Revenue Code but which is not a public entity may:”

o purchase goods under an existing County requirements contract;
o engage in cooperative procurement for the goods with the County; or
o purchase the goods from the County if it is in stock and not otherwise
needed.

As a part of a required report, the Procurement Director “must provide information on use of this subsection by nonprofit organizations in aggregate dollar amount, type of purchases made, significant purchasers under this subsection (as determined by the Director based on dollar amount), any identified additional cost or cost savings to the County, and any other relevant information.”

- Organizations wanting to piggyback must have a site that can accept bulk gasoline deliveries; they would not be allowed to pull up and use County pumps.
- Specific commodities with invoices are easier to track. Gasoline is more complicated.

§ What can the County do?
- Issue a card to participating nonprofits that is acceptable at County pumps.
- Fleet Management was asked by a solid waste contractor to use the County gas pumps and was told no by the County Attorney.

§ The Office of Procurement wants to work with the nonprofits.
- What are the top items nonprofits would like to procure under County contracts? Having this list would allow for a more effective investigation.
- Compile a survey to collect the top five big ticket items.

§ It would be helpful to nonprofits to know how the County handles procurement of services.

Craig Dowd – Director of Re-Entry, Clarksburg Correctional Facility, Department of Correction and Rehabilitation (DOCR)

• The emphasis in the DOCR is on rehabilitation as well as incarceration.

§ It costs $31K/year and $3K/72 hours to house a person.
§ The Clarksburg facility teaches the detainees, most of whom have never had a structured job, work habits and work skills.
- People come from all over the country come to tour the facility.
o Leadership Montgomery brings all their classes for a tour.
- The Alternative Community Service Program is also run out of the Clarksburg facility.

• The Clarksburg facility provides two services:

§ Photocopying (black and white), collating, mailing
§ Digital imaging
- All news articles on the County’s website
- Blueprints used by Permitting Services
- In the future, may digitize 40 years of Gazette newspapers.

• The fees are minimal – supplies and materials.
• All work is done inside the facility. Give some lead time for a rush job. The facility does not take on more than they can handle.
• The DOCR will come and pick up the job and deliver it directly to the Post Office.
• Win-win situation – the nonprofits get work done at minimal costs (those with operating budgets under $500K only pay for materials/supplies) and the detainees really benefit from the work experience and being able to give back.
• Question – How can DOCR claim money from the State’s realignment of current resources?
  § Montgomery County will not have a shot at this money. DOCR is self sufficient – it does not receive money from the state.
• How do nonprofits access this resource? Contact Craig Dowd – 240-773-9798.

MaryAnn Holohean – Director, Nonprofit Montgomery!
Nonprofit Cash Flow

• Cash flow is the life blood of all nonprofits.
• It is Important to understand and manage the cash flow.
• Cash flow is important to the government sector as well.
• Most government agencies work on the MBA approach – never make money available before the service is received.
• The average nonprofit lost $10K last year to lines of credit fees.
• Under the former Comptroller William Donald Schaeffer, the State of Maryland stopped all advanced payments.
• Those organizations who received grants from the Meyer Foundation were permitted to borrow money against front-in and pay it back when the County funds were received.
• Circular argument – nonprofits are asked to be more business like, but are hamstrung on cash flow.
• Examples of the way in which government agencies handle advance payments on contracts to nonprofits:
  § Loan funds, set up within government or in collaboration with an operating or a community foundation;
  § Exceptions granted under specific circumstances;
  § Advances made available during a specified time period, usually in response to a systems breakdown in contract management with the government agency and coupled with a mandate for immediate major systems improvement with the government; and
  § A general advance payment policy.
• These examples are part of an effort by Nonprofit Montgomery! to identify ways in which nonprofits contracting with the county government may be able to improve cash flow by accessing advance payments once a contract has been signed.

Discussion/Questions

• The County should be able to upfront money to nonprofits with which they have ongoing relationships/conversations.
• County Executive, County Attorney, Finance and Procurement must work together to change the procurement language. Truly make them grants.
  § Because the current process is a contractual one, there must be insurance which eats into the grant amount.
  § Nonprofits are seen as vendors, and this will probably not change during this budget crisis.
• Procurement process does not preclude the upfront payment by the County, but “for the good of the County” prevails.
• A clear picture needs to be painted as to what happens when the money is not given upfront- what services are not given.
• The money cannot be used before a certain time and must be used by a certain time – the window between the two can be very small.
• How to tap into Leadership Montgomery alumnae to serve on boards and volunteer in communities?
  § Leadership Montgomery still has a beggar picture of nonprofits.
  § Need to make clear the impact that nonprofits have.
  - Beyond Charity Report
  § The nonprofit sector is the fasting growing employment base.
• Greater DC Cares has a volunteer alert that focuses on young professionals.
• What is the County doing to advertise to their employees about volunteering and recognizing those who do volunteer?
  § Reed Dewey and the Volunteer Center team are working on how to encourage and promote volunteering county-wide; getting nonprofits to identify and work better with volunteers.
  § Federal government workers cannot volunteer during business hours.
  § During the County Charity Campaign, the emphasis should be on not only giving money, but time.
• There is a motor fuel refund from the State through the Comptroller’s Office – there are some restrictions – must be a nonprofit.
  § Some organizations are getting 23-24 cents/gallon from the State through the motor fuel refund.
• Is there a model of nonprofits buying together?
  § Nancy Hall, Maryland Association of Nonprofits could provide information on what is going on around the country.
  § Center for Nonprofit Advancement which serves Montgomery County would also be a resource.
• Can the nonprofits cut their own deal with gas station owners?
• Lutheran Social Services serves as a source for other nonprofits to receive printing services at a discounted rate.
• Items that nonprofits would like to buy/obtain in bulk or cooperatively if possible:
  § Health benefits
  § Qualified Childcare providers
  § Rent
  § Office equipment (telephones, copiers, furniture, etc.)
• It would be helpful to have a list of County contracts.
• Avoid bureaucracy by putting in contracts “giving nonprofits ‘best price.’”
  § Small and large organizations partner to keep bureaucracy down.
• Rent/lease sharing
  § The Trawick Foundation and Catholic Charities are looking for small nonprofits to lease space.
  § Jewish Council for the Aging is looking for a space to consolidate all of their programs. They may have space to lease to smaller organizations.
  § Cultural issues have been a problem when sharing space.
  § Nonprofit Village – Council has a grant application from the Nonprofit Village.
  § How to get the information out regarding what lease space is available for nonprofits.
• Nonprofit Montgomery! will begin a blog in March.
• Professional services such as lawyers, accountants, human resource consultants, etc. are needed.

§ Has NPM! ever tried to work out a deal to have paperwork filled out professionally?
§ The Volunteer Center’s Pro Bono Consultant Program is a great avenue for obtaining professional services.
§ Where do you go for a bundle of services?

-Different levels of services that are needed and difficult to obtain for a startup nonprofit.
§ Ask the Chambers of Commerce for referrals.
§ Maryland Nonprofits has a job posting service.
- What is the fee to join the association?
§ infoMontgomery has a section on their website (http://www.infomontgomery.org/) that promotes nonprofit dialogue. This is a good way of posting and sharing best practices.

• How to follow up on Top Banana’s work with procurement?

§ Get a list of contracts from the Procurement Office.
§ MaryAnn Holohean, Phyllis Courlander and Maureen Herndon to prepare information regarding nonprofit procurement needs to present to David Dise, Director, Office of Procurement.
-Utilize SurveyMonkey.com to create a survey.
§ Invite someone from Procurement to one of the next Brown Bag meetings (David Dise or Pam Jones).
§ Maybe to April’s meeting – Procurement Office is working with limited staff.
§ Not an end, but thrilled there is a beginning.