Two nonprofits team up

The weakening economy is pummeling organizations that help people when their services are in greatest demand, but two groups in DeKalb County have found a defense against dwindling revenues: a merger.

Senior Connections, whose popular meals program feeds as many as 2,000 seniors a day, is joining forces with a smaller group that also serves an older demographic.

“It’s getting increasingly difficult for smaller nonprofits to be able to get grants and sponsorships,” said Christi Sizemore Behrend, executive director of Life Enrichment Services near Decatur. Her group has begun a merger with Chamblee-based Senior Connections because “it makes sense during this economy to combine resources.”

Sizemore Behrend’s Toco Hill-based group offers home improvement courses and recreational trips to retirees. When times were good, the group kept fees down by using free classroom space offered by partner churches. Some churches even donated money.

Then, the churches began feeling the pinch of the economy. Donations dwindled, and churches took back their space for their own revenue-generating programs, Sizemore Behrend said.

She knew she needed to get creative. A conversation with Debra Furtado, the chief executive officer of Senior Connections, led to the merger idea.

Both groups serve a similar age group, so why compete for resources and pay extra for overhead?

The larger group, Senior Connections, is absorbing Life Enrichment Services in a merger that should be complete Monday.

Sizemore Behrend can use the larger office staff at Senior Connections to handle payroll and bookkeeping rather than paying an outside provider. And Senior Connections, which also offers home improvement courses, can access Life Enrichment Service’s customer database. The bigger organization is in a better position to market classes and other revenue-generating services to the largely middle-class clientele for those classes, both Sizemore Behrend and Furtado said.

Plus, the two organizations won’t be competing for donations.

“We were both going after the same funders,” Furtado said. “I think you’re going to see more and more nonprofits looking to merge or acquire others, and I think they should.”

A foundation that has sponsored both groups agrees.

“I think they may be at the leading edge of something that we will probably see more of in the next 18 to 24 months,” said Alicia Philipp, president of the Community Foundation for Greater Atlanta.

Her group matches wealthy donors with nonprofits. People with money are giving more during the economic downturn, Philipp said. But private donors can’t make up for heavy losses from two other major sources of nonprofit support: the government and foundations that rely on investments.

Stock market losses have forced many foundations to reduce their giving, and governments are cutting back as their own tax revenues dwindle, she said. “These are tough times.”

Phillip said she expects an uglier financial picture for nonprofits next year. That’s why mergers make a lot of sense now, she said.