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The Honolulu Advertiser
Posted on: Sunday, February 15, 2009

COMMENTARY
Directing private funds for maximum impact

By Kelvin Taketa

Hawaii news photo - The Honolulu Advertiser

Kelvin Taketa | President, Hawai‘i community foundation.

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THIS WEEK

Editorial and Opinion Editor Jeanne Mariani-Belding puts Rob Robinson, co-founder of Kolohala Ventures and founder and convener of Hawai'i Angels, on The Hot Seat — and lets you ask the questions — during a live blog chat on Hawai'i's high-tech tax credits Wednesday from noon to 1 p.m. Join the conversation at Honoluluadvertiser.com/opinion

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Each week Editorial and Opinion Editor Jeanne Mariani-Belding hosts The Hot Seat, our opinion-page blog that brings in elected leaders and people in the news and lets you ask the questions during a live online chat.

On The Hot Seat last week was Kelvin Taketa, president and chief executive officer for the Hawai'i Community Foundation.

Here is an excerpt from that Hot Seat session. To see the full conversation, go to The Hot Seat blog at http://www.hotseat.honadvblogs.com.

Diane K.: What nonprofits do you think will be most successful in this economy? Is Hawai'i's landscape different from other parts of the Mainland?

Kelvin Taketa: I think the groups that will fare well in this economy are the ones who have a clear focus on their mission, can demonstrate success or impact and have strong financial discipline.

If they depend on fundraising, the organizations that have cultivated "true believers" who will stick with them and continue to provide generous support will do fine.

Our landscape is similar to the Mainland in terms of depending on government funds primarily. Individual support provides between 25 to 35 percent of total revenue, with much smaller amounts coming from foundations and businesses.

Vaitele: What advice do you have for someone looking for help through nonprofits? I know someone who lost his job and needs help with some of life's basics.

Taketa: It depends where your friend lives, where he can access services and support. A good starting point is to call the 211 line at Aloha United Way during regular business hours, and they can help point your friend in the right direction.

There are a number of government agencies, churches and nonprofit organizations that are available to help your friend, so please encourage him to not feel ashamed or afraid and go ahead and ask for help. It can be complicated at times, so be patient. Everyone understands the plight of our neighbors in these tough times and are looking to help.

JohnK: What does your organization do, and how are you funded? What is your budget?

Taketa: The Hawai'i Community Foundation works with families and individuals throughout our state to help direct private funds to make the largest impact possible. We have more than 500 different funds that focus on a wide range of interests such as kids, elderly care, the environment, scholarship programs and even medical research.

Last year, we helped administer more than $38 million dollars in grants and contracts on behalf of our donors and clients. This year, we are trying to maintain the same level of funding into the community, recognizing that it is needed even more now.

We have staff throughout the state and our operating budget of more than $6 million comes from administrative fees on the funds we manage, as well as contract revenue from clients and partner agencies.

Olivere: Are you expecting funding or help from the Legislature this year, or is all your funding coming from private donations?

Taketa: We do not depend on government funding. We do administer several programs that come from government sources, and we are hoping to preserve these funds as they flow from us back into the community almost immediately.

The Legislature and the governor face tough decisions ahead, and we are hopeful that they will recognize that cutting services provided by nonprofit organizations will be a double whammy: Not only will the community suffer from losing those services, but we will lose employment from a sector of our economy that represents about 10 percent of all the non-ag jobs in the state.

Makahaside: What can nonprofits do to stay afloat?

Taketa: First, they need to be clear about what they do well and be sure to focused on that. Obviously, everyone will need to tighten their belts and to look for cost cutting as well as other strategies like increasing volunteer support. Also, now is the time to reach out to your donors and the community to be sure they understand the importance of your work and ask for their continued support.

Finally, all nonprofits need to look for ways to partner with others, share costs and even consolidate operations to ensure the maximum benefit for the dollars spent.

Tina: Will (President) Obama's stimulus package affect nonprofits at all?

Taketa: There are funds in the stimulus package at this point that will flow through different departments as block grants to existing programs. How that "trickles down" to Hawai'i nonprofits remain to be seen. There were efforts to add nonprofit support in the stimulus package on the grounds that a package aimed at supporting the middle- and low-income Americans should bolster nonprofits serving those communities and because of the employment base of the sector (larger than steel and auto in the U.S. combined).

One such idea was a $15 billion loan fund so that organizations that are reimbursed by government agencies for services would have a lifeline while the time it takes to be paid is not extending in some case past six months. It does not appear that they are currently on the table.

Lisa: With school budget cuts under way, are any of the nonprofits helping out the schools during this difficult time?

Taketa: I don't know of any thing specific, and I think most organizations and foundations are waiting on specific information regarding cuts before taking action.

Keone: What is the strategy at the Capitol for these nonprofits to try to get grants? Is there no lobby effort?

Taketa: It is pretty clear that grants from the Legislature is not likely to happen.

There is a concerted lobbying effort by PHOCUSED, a group dedicated to health and human services concerns, as well as HANO, which represents the larger nonprofit community. They are working to have input in funding decisions mostly around program and direct service contract cuts.

What is clear is that most nonprofit organizations in Hawai'i are well run and manage very efficient operations. There is no "fat" to cut and the amount of funding cuts that might be contemplated cannot be made up by private sector contributions (it is just too large). Everyone needs to understand that these cuts will affect programs and services to some of Hawai'i's most vulnerable citizens.

Craig: Do you favor no tax on food and medicine?

Taketa: I have no idea! It would still have a budget impact that would mean further cuts of some sort so it needs to be weighed against that.

Ladyluck: I realize some nonprofits have duplicate services. Do the nonprofits "talk" to each other? Maybe there's a way to streamline the services.

Taketa: While there may be duplicate services in a big-picture perspective, nearly every group out there believes they are serving a particular niche or are doing it in a unique, more effective way. HCF has spent years bringing nonprofit organizations together in various forums, and I can tell you that there is a higher degree of collaboration and talking than ever before.

Still, we all need to look hard at the question of overlap as well as whether there are other creative solutions to cut costs or increase services such as shared staff, facilities and systems or ways to work together. For example, the Youth Symphony has partnered with the Boys and Girls Club to provide music classes on club premises. Good idea!

Carol: How can ordinary citizens help some of our nonprofits get through this period? I'm not rich by any stretch of the imagination, but I do want to help if I can.

Taketa: Thank you, Carol. It is people like you that give us all hope. I have two suggestions. First, to the extent that you have been providing support to organizations you care about, I hope you will continue to do the best you can this year. Second, I would ask those organizations if they could use any of volunteer time you have to offer and start there.

Also, don't forget that so much of the aloha spirit is found outside the nonprofit sector as well. It is in the neighbors we invite over to dinner who have just lost their job or the extra chores we cover for others who may need help.

Reach Kelvin Taketa at (Unknown address).