At a time of heightened need across the region, the GoATL Fund (GoATL), an initiative of the Community Foundation for Greater Atlanta, has launched an innovative program for nonprofits to accelerate access to federal stimulus and other public contract funding. In collaboration with local Community Development Financial Institutions (CDFIs) and private and family foundations, the Community Guarantee Pool (CGP) provides credit enhancements that free up capital for nonprofits, thus infusing dollars for critical services including rapid rehousing, rental assistance and mental health counseling.

GoATL’s CGP is a pooled fund used to support multiple guarantees that allow nonprofits to more rapidly receive federal funding, which dramatically improves their ability to provide critical community services. “The CGP is the first of its kind in our region, and as it takes hold it has the potential to unlock up to $20 million in public subsidies that would otherwise go unused,” said Mark Crosswell, managing director of social impact strategies at the Community Foundation for Greater Atlanta. “Providing this service to our nonprofits across the region helps fulfill our commitment to advance racial equity while driving systems change at the local level.”

CGP has launched with an initial $1 million in capital that will be used to issue guarantees to CDFIs in order for them to free up loan capital for nonprofits in metro Atlanta. The GoATL Fund will work closely with nonprofits and CDFIs to identify opportunities to improve the flow of federal funding to communities in need. For example, Project Community Connections, Inc. (PCCI), a nonprofit that implements solutions to permanently rehouse people experiencing homelessness into appropriate, affordable homes as efficiently as possible – often within 30 days – has recently taken on a $7.7 million government contract to support the transition of 450 families out of homelessness. In partnership with Reinvestment Fund and GoATL, the CGP will improve PCCI’s ability to perform on this contract.

The CGP targets nonprofits that rely on substantial federal subsidies, including the funding made available through the American Recovery Plan. These federal funding subsidies are typically administered by local municipalities, which routinely experience administrative delays in making payments to nonprofits, causing severe cash flow shortages and hindering nonprofits’ administration of vital services. Also, for many government programs, the nonprofit must provide services (fronting all costs), then submit for funding reimbursement. The COVID-19 pandemic has exacerbated these issues due to an incredible surge in demand for nonprofit support.

“The pandemic has caused thousands of metro area families to face homelessness or the threat of eviction, with thousands more experiencing unemployment. Demand for mental health services, quality food and rental assistance has outstripped supply. Our local nonprofits are ready to serve these families, but when the public subsidies are unduly delayed, they can’t fulfill their contracts to meet community needs. The Community Guarantee Pool was created to streamline the process, helping our nonprofits deliver while providing time for the government to provide the funding,” said Crosswell. “Alongside five CDFIs and several local foundations, we have structured this unique pilot to solve the problem through bridge funding. Along with hopes that our public partners respond by improving their processes to ensure that funding is flowing to where it’s most needed, we expect to see more sustainable funding soon.”

Since 2018, the GoATL Fund has invested $12.25 million in local initiatives that seek to generate measurable social outcomes along with financial returns. GoATL’s investments are structured as flexible, cost-effective debt that provide impact investors a modest return while achieving social outcomes in affordable housing, job creation, education and well-being.

The GoATL Fund invests in initiatives that address racial inequities including access to healthcare, affordable housing, economic inclusion and education. To create efficiencies and leverage even more capital, GoATL often collaborates with intermediaries like CDFIs that have the knowledge and expertise to structure larger investments to support solutions addressing critical needs across our region.

“Many of the organizations providing services such as emergency shelter and mental health counseling are facing operating challenges during the pandemic, with increased costs and decreased revenues,” said Christina Szczepanski, managing director, southeast for Reinvestment Fund, a CDFI that brings financial and analytical solutions to community challenges. “Having the Community Guarantee Pool provide credit enhancements helps moderate risk as we make working capital loans to nonprofits providing these essential services.”

“When awarded 70% of the City of Atlanta’s CARES COVID-19 Emergency Solutions Grant (ESG) funding in November 2020, PCCI did not have the cash on hand to execute the contract,” said Margaret Schuelke, co-CEO for PCCI. “PCCI is glad to be the first nonprofit benefiting from the Community Guarantee Pool. We hope other nonprofits are able to take advantage of the program and alleviate their financial concerns.”

Participating CDFIs include Access to Capital for Entrepreneurs (ACE), Atlanta Neighborhood Development Partnership (ANDP), Enterprise Community Partners, LISC Atlanta and Reinvestment Fund. Alongside the Community Foundation for Greater Atlanta, the Wilbur and Hilda Glenn Family Foundation and The J.B. Fuqua Foundation have made commitments to the CGP. If any other foundations are interested in supporting this effort, please contact Mark Crosswell.