Statement on a state memorandum limiting access to coronavirus funding for nonprofits

July 20, 2020

Statement from Gian-Carl Casa, President & CEO of CT Community Nonprofit Alliance, on a state memorandum limiting access to coronavirus funding for nonprofits:

“The Department of Developmental Services today notified nonprofit community providers that they are ineligible for federal coronavirus relief funds if they received Paycheck Protection Program (PPP) loans, and under a new state policy, providers will be required refund money to the state, a decision that if implemented, will financially devastate providers across the state.

“The PPP loans, for those nonprofits eligible, were emergency funds, limited in amount and usage. They do not cover the cost of personal protective equipment (PPE), for example. Additional state funds were to cover these and other extraordinary costs. While some of the PPP loans may be forgiven, the federal rules have changed repeatedly and nonprofits may need to pay them back.

“Meanwhile, nonprofits have been on the frontlines, providing mental health and substance abuse treatment, residential services for people with developmental disabilities, shelter and other frontline healthcare services throughout the shutdown. Our members have struggled to find PPE to protect staff and clients, revamped technology to provide telehealth services, reconfigured offices to allow for safe social distancing, purchased additional cleaning supplies and increased costs for food — all unbudgeted costs that are not covered by PPP or current state funding.

“It appears this policy will be applied to every state contract. But, we must be clear — if nonprofits are arbitrarily denied federal and state support during this pandemic, regardless of revenue losses or other increased costs due to COVID because they got federal loans to pay their employees, they will not be able to make ends meet. Nonprofits that provide vital human services will close their doors and the state will lose its safety net.

“Community nonprofits urge the Governor not to implement this recoupment for any providers. The people who will be hurt are Connecticut’s most vulnerable and those who serve them.”

Read the referenced memorandum here.