7 Small Nonprofit Groups Split Funds

How do you draw water from a well that may be starting to run dry?

If you’re a nonprofit neighborhood group trying to raise money from increasingly cash-strapped philanthropic organizations, you look for a way to prime the well’s pump.

That’s how operators of seven small grass-roots groups found themselves in the Dunbar Hotel in South-Central Los Angeles on Monday.

The seven were there to divvy up $4 million donated by a new self-help project called the Neighborhood Turnaround Initiative.

The cash will be used as seed money to help the seven groups launch more than $74 million worth of affordable housing and retail construction projects.

Scattered from Central and South-Central Los Angeles, East Los Angeles and Little Tokyo to Venice, the small-scale projects would create 500 jobs and add 700 new housing units once they are finished.

In the past, funding for such projects has often been easy to come by through combinations of government and private grants and loans.

But tighter government spending and reductions in corporate charity are making it more difficult to get new proposals off the ground. Stock market fluctuations, bank mergers and cutbacks among active donors such as Arco are blamed for the corporate decline.

“It’s becoming an increasingly competitive situation,” said Mike Woo, a former city councilman who heads Los Angeles’ office of the Local Initiatives Support Corp., the nonprofit national fund-raising organization that has started the neighborhood turnaround program.

The $4 million awarded by Woo’s organization will be used by the seven community groups for such things as acquisition of land, soil tests, architectural services and hiring project managers. Those steps demonstrate to potential donors that a project is viable.

Additionally, the Local Initiatives Support Corp. will look for new funding sources for the community groups: “drugstores, the larger fast-food outlets, sectors we haven’t gone after before,” said corporation program officer Van Scott.

Monday’s recipients include a pair of community economic development groups from South-Central Los Angeles that plan a supermarket-anchored shopping center, 120 housing units, a neighborhood “cyber cafe” and a health center along Central Avenue, near the historic and recently refurbished Dunbar Hotel.

Others sharing in the money are a group planning a shopping center on the southwest corner of Vermont and Slauson avenues; a group that intends to renovate four Estrella Avenue apartment buildings near USC, and an organization hoping to build a gymnasium and recreation center and a 75-unit condominium complex near Little Tokyo.

Also receiving funding is an East Los Angeles group that intends to convert an old union hall into a child care center and turn six “nuisance buildings” in Boyle Heights into 88 affordable housing units; a skid row group that will beautify part of downtown’s 7th Street and build a community center, and a Venice organization that intends to create 100 affordable housing units, a child care center and a youth job training center.

“It’s getting harder to get money. It’s getting to be a struggle,” said Manuel Bernal, whose East L.A. Community Corp. is planning $3 million in work in Boyle Heights.

Bud Hayes, whose Single-Room Occupancy Housing Corp. needs to raise $5 million, added: “There’s less money and more organizations chasing it. The sophistication of new nonprofit groups is increasing.”

The money contributed by Woo’s organization is evenly split between grants and loans that the seven groups must repay.

Woo said $300,000 of the grant money was donated by the 83-year-old California Community Foundation--the oldest public charity in Los Angeles.

That foundation’s president, Jack Shakely, was at the Dunbar Hotel to praise the seven projects and voice his concern that Los Angeles is losing affordable housing faster.

His comments prompted one final request from Juanita Tate, head of one of the South-Central groups hoping to build more than $25 million worth of new projects.

“I hope,” Tate said wistfully, “that Jack Shakely never runs out of money.”