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The City and County of Honolulu recently publicized a relief program for Hawaii’s nonprofit organizations. This recognizes the indispensable role community-based organizations play in meeting critical community needs.

Mayor Rick Blangiardi is to be applauded for his dedication to increase the capacity of local community-based organizations at this time. Community-based service providers are some of the most resilient organizations in Hawaii. The sector pivoted to meet the most disruptive challenge to Hawaii in our generation, the coronavirus pandemic.

Funding support is always welcome and greatly needed. Community-based nonprofit organizations historically and currently are underfunded in covering the rising costs of doing business and meeting a growing demand for services.

The city’s relief program, though well-meaning and welcome among many in the sector, is only a temporary reprieve from the underlying structural factors that destabilize operations and diminish service quality over time.

The reality is that all levels of government — federal, state, and county — employ funding methods that strain a nonprofit’s finances and very survival. Government contracts, including those using the cost-reimbursement method, require community-based organizations to provide the service in advance of getting paid.

Under this approach, the community based organization must front large sums of money to provide the service, making prompt service delivery almost impossible. To make matters worse, government agencies are often slow to reimburse, creating serious cash flow problems.

Government contracts often do not adequately fund overhead costs which must be covered too. Overhead is capacity. It is the building where business is conducted, it is the software used to track outcomes and expenditures, it is the truck and the gas used to deliver food, and, most importantly, it is the people that coordinate all the support functions that make the outcome possible.

Needs are mounting and funding is not keeping pace with costs.

The most damaging trend has been that government funding of community-based organizations has been shrinking for years, simply by allowing contract amounts to stay stagnant or imposing budget cuts while still requiring the same level of services. Government funding is not indexed to inflation, and as such, the contracted nonprofit cannot cover market salary changes and cost increases of utilities and supplies.

Prior to the pandemic, local community-based organizations were already experiencing a slow and steady suffocation. All the parts of the safety net were engaged, meeting community needs of those harmed by abuse, those becoming homeless, laid off, living with hunger, and unable to receive medical treatment for health conditions. Those needs have not diminished and are in fact mounting, and funding is not keeping pace with costs.

Hawaii’s community-based organizations are ready and willing to contend with the challenges going forward as reliable partners to government. The systems and infrastructure of government do not adequately support the kind of social compact needed by community-based organizations to address the myriad of complex social issues that plague Hawaii.

A new, collaborative model of contracting and grant-making is needed, where resources are directed toward the fiscal, practical, and operational solutions that ensure real success, high quality services and community wellbeing. Community based organizations gladly join with partners in government to work on those solutions together.

Editor’s note: The following are co-authors of this Community Voice — Phil Acosta, Aloha Harvest; Rachelle Chang, Samaritan Counseling Center Hawaii; Sunny Chen, Healthy Mothers, Healthy Babies; Joni Chun, Susannah Wesley Community Center; Rona Fukumoto, Lanakila Pacific; Shawn Malia Kanaiaupuni, Partners in Development; Ryan Kusumoto, Parents and Children Together; Heather Lusk, Hawaii Health and Harm Reduction Center; Angelina Mercado, Hawaii State Coalition Against Domestic Violence; Noriko Namiki, YWCA of Oahu; Venus Rosete-Medeiros, Hale Kipa; Rob Van Tassell, Catholic Charities Hawaii; Greg Waibel, YMCA of Honolulu; Tracey Wiltgen, Mediation Center of the Pacific; Jessica Yamauchi, Hawaii Public Health Institute; and Deborah Zysman, Hawaii Children’s Action Network.