NYC to increase lending to nonprofits: mayor
NEW YORK (Reuters) - New York Mayor Michael Bloomberg on Monday proposed increasing bridge loans to nonprofits by 150 percent and expanding the city's revolving loan guarantee program to nonprofit borrowers.
New York City has more than 40,000 cultural, health and social service nonprofit groups that employ nearly 500,000 people, or 15 percent of the city's work force, Bloomberg said in a statement.
Bloomberg outlined 10 initiatives to help the city's nonprofit organizations cope with an increase in demand for services while the recession creates cash flow problems and erodes operating support.
He proposed that the New York City Returnable Grant Fund be increased to $20 million from $8 million for the next two fiscal years. The mayor also proposed increasing the amount of organizations the loans can be extended to and the conditions under which they would qualify.
Following up on an initiative announced last fall, Bloomberg said the city will partner with nonprofit lenders to provide revolving bank loans.
The city has contracted with a group of lenders specializing in nonprofit lending and revolving lines of credit. The group includes Nonprofit Finance Fund, Citibank, Accion, Brooklyn Cooperative and Seedco.
The city will continue with a pilot program in which separate nonprofit organizations will collectively purchase goods and services in order to preserve cash.
The mayor said joint purchasing of information technology will begin for all nonprofits this summer and a plan for insurance purchasing will be in the place by the end of the year.
The city will also speed the process for nonprofits to show they comply with the city's charity regulation and post all contract information online so organizations can easily check their status.
Bloomberg will also assist nonprofits by teaming up with philanthropists Blair and Cheryl Cohen Effron and Gretchen and Jamie Rubin to create Greater NY, a program aimed at pairing business executives with nonprofit executive directors in two-year one-on-one partnerships.
More than 30 business executives have agreed to volunteer for the program.
(Reporting by Tom Ryan; Editing by Jonathan Oatis)
