Lawmakers fail to make $200 million COVID funding offer for nonprofits

Minnesota nonprofits failed to seek special COVID-19 assistance from the legislature at this hearing, despite their plea for $200 million in one-time pandemic relief.

The Minnesota Council of Nonprofit Organizations, which led the lobbying effort, said the state’s nonprofits — which make up about 14% of Minnesota’s workforce — continue to combat rising costs while getting less government support from the public and private sectors.

After the regular session ended last week, Governor Tim Walz did not announce a special session to wrap up legislative work. Despite the state’s projected budget surplus of about $9.3 billion, a lack of funding for nonprofits is among the many issues lawmakers have left unresolved.

“I am deeply disappointed that there is no COVID relief for nonprofits,” said Mary Ellis, director of public policy at the Council of Nonprofits. “There is a real human cost to not getting the legislative work done.”

Hunger Solutions Minnesota paid $8 million for food racks, food banks, and meal programs and $15 million for capital investments, such as expanding food shelves. Neither proposal passed, leaving more than 350 food racks in Minnesota and seven food banks without additional help from the state despite inflation that has driven up food costs and new customers.

“You will feel like a [funding] “It’s kind of the perfect storm. … the need is real. He can’t wait,” said Leah Gardner, director of policy at Hunger Solutions.

More Minnesota residents visited food shelves in 2020 than in any other year on record. Visitors to food shelves fell 5% in 2021, approaching pre-pandemic levels. But a survey by Hunger Solutions found that 70% of food shelves are seeing or expect to see an increase in visits this year as special federal coronavirus assistance ends.

“It’s a roller coaster, and we’re going uphill,” said Jason Viana, CEO of Open Door Pantry, an Eagan-based food rack. “My expectation is that every food shelf that depends on this funding is going to feel the pinch.”

In Burnsville, more than 500 families use Open Door’s food distribution each week. The nonprofit serves twice as many people as it helped before the pandemic. Plus, food costs have doubled in the past year. With pandemic-inspired generosity waning and no additional state funding in sight, Viana is scrambling to find other donations — and is considering buying less food.

“It really feels like our legislation is devaluing our community,” he said. “Usually in a world of partisan bickering, the provision of basic necessities should be a safe and agreed-upon thing.”

The Brooklyn Center’s CAPI food rack is serving three times as many people as it did before the pandemic, including several Asian and Hispanic families. It provides culturally specific food, but that means it has to buy more expensive items instead of relying on free food donated by grocers, said Ekta Prakash, CEO of CAPI.

Prakash said nonprofits have been on the front lines providing resources to those in need throughout the pandemic and the turmoil after police killed George Floyd and Dawn Wright.

“Non-profit organizations play a vital role in supporting the community,” she said. “You need to invest in these organizations.”

Other nonprofit legislation failed to pass, such as Republican-backed restrictions to strengthen oversight of nonprofits—including preventing newly formed nonprofits from taking state funds, a measure the Council of Nonprofit Organizations opposed.

But so did the $200 million Nonprofit Relief Fund that would have prioritized funding for culturally specific nonprofits, human services and small nonprofits, especially those outside the Twin Cities. Nonprofits have been largely excluded from state and federal aid, Ellis said, with only about 4% of all forgivable Federal Paycheck Protection Program loans going to nonprofits.

Any additional federal assistance received by the Phyllis Wheatley Community Center in Minneapolis is ending, and Executive Director Susan Fuller Borks is seeking institutional grants and other funding that can help support its increasing operating costs.

“I don’t know if the legislature really understands the impact of COVID on our entire organization,” she said. “We are talking about the basic needs of people.”

No international school meals

The nonprofit also lobbied the Capitol to fund free school breakfasts and lunches for all Minnesota children, which supporters said would remove racial gaps, reduce the stigma of seeking help and ensure all students have access to food. Gardner was upbeat when Walz included more than $180 million in his budget for comprehensive school breakfasts and lunches. But that also failed in the legislature.

During the pandemic, federal aid has paid for free school meals to all students. But that program is set to expire at the end of June, leaving more than half a million children at risk of losing access to meals, according to Hunger Solutions. Families should be eligible for free or reduced-price school meals, Gardner said, but many families struggling to get a paycheck miss out on qualifying for meals.

“This was just a very difficult legislative session to get a bipartisan agreement on anything,” Gardner said. “It is very disappointing.”

Leave a Reply

%d bloggers like this: