It’s the classic nonprofit story – launch as a grassroots effort, achieve major policy and programmatic milestones, move to a neighborhood undergoing significant revitalization, experience a surge in growth. Grappling with how best to manage a newly expanded organization is often when nonprofits take stock of their financial sustainability and long-term facility needs. And that’s exactly why the Chicago Artists Coalition (CAC) participated in the IFF-administered MacArthur Arts and Culture Loan Fund.
“We had grown very rapidly from 2010 to 2014, we had reached these new heights, and the question from our funders was – How are we going to stay here? Can we prove that our model is financially sustainable?” said Caroline Older, Executive Director of the CAC. “At the same time, our lease was coming due, and I knew we’d have to consider a move. But moves can be significantly challenging for any organization, especially a medium- to small-sized nonprofit like us. We knew we needed to be prepared.”
CAC was one of 18 arts organizations from Chicago that recently completed the MacArthur program’s intensive four-month training on financial management, and one of 11 groups to receive an operating line of credit from IFF after completing the program. Participating organizations included dance companies, theaters, youth orchestras, art galleries, and cultural organizations.
“For those of us who run smaller nonprofits, we don’t have the luxury of having someone with an accounting background on our team. Often times, financial forecasting can be very abstract. It feels like a huge leap for a nonprofit that relies on donations – not sales of a product – to have any kind of debt,” Older said. “But these classes were phenomenal and, believe it or not, fun. The environment was friendly and enabled participants to learn from one another. Additionally, it was important and helpful that we used CAC’s real numbers. The training prepared us to take out a line of credit and pay it back.”
CAC is conducting a capital campaign to cover the costs of renovations, but many of the three-year pledges will trickle in over time. The IFF line of credit smooths out their cash flow so they can move to their new space with confidence – and without interrupting operations or programming, which includes exhibits, professional development, residency programs, and other resources for artists.
CAC’s new home in the Kinzie Industrial Corridor feels very similar to the way the West Loop felt when CAC moved there about a decade ago – a lot of warehouses spaces and a lot of new development taking place around a planned new El stop (the Morgan Green Line stop opened just after CAC moved to the West Loop, and the Damen Green Line stop near their new home is planned for 2020).
“The arts are known for trailblazing new neighborhoods,” Older said. “The West Loop has been fabulous to CAC, but it’s gotten very expensive. It feels like the right time to move on to our new neighborhood, which has a really interesting range of businesses – from Metric Coffee to Goose Island to a brandy distillery to special events spaces to metal fabricators.”
The new space is about the same size as the old space – actually, a bit smaller. But the new configuration will allow CAC to use the space more efficiently and effectively. First, it’s all on one floor, instead of half in a garden basement. Second, it’s a new build-out so they can design the space to suit their needs – including space dedicated to their professional development. Third, the new space will be ADA compliant – the old 1920s warehouse building was not – which helps CAC meet its commitment to reducing barriers to entry for all artists. Finally, there’s room for growth, as their 7,000-square-foot space is inside a 55,000-square-foot building with a variety of flexible units.
“From a financial standpoint, what makes me really happy is that we don’t have to bite off more than we can chew right in the beginning,” Older said. “Sometimes when you move, you feel like you have to choose between the size you can afford at that moment and the size you think you’re going to need a few years later. What’s so great for us is that we can take the 7,000-square-foot space and settle-in, knowing that we still have the opportunity to go to the 10,000-square-foot space in a few years if we’re ready to do so.”
CAC gained access to their new space on March 1st and expects it to open by the end of June. They are holding their annual fundraiser in the new space – aptly named “Work In Progress” – on June 7th.
Tags: : Arts and Culture, Capital Solutions