Several large California nonprofits have recently had to reorganize and/or declare bankruptcy in order to keep their doors open. Effective July 1, 2010, American Red Cross chapters in Stanislaus and San Joaquin counties folded into the Sacramento-Sierra regional organization in order to continue providing services. Offices in Modesto and Stockton are still open and operating as normal. The consolidated chapters will still continue to offer emergency assistance to individuals and families as needed, but any unnecessary expenses have been cut drastically.
Additionally, two support non-profits tied to Yosemite National Park have also folded into each other to save money. The Yosemite Association and the Yosemite Conservancy will now work together on fund-raising efforts and educational efforts. Even the Stanislaus United Way is considering collaborating with other offices to reduce expenses as an alternative to closing. Other nonprofits, such as the Modesto YMCA, have simply had to shut down due to financial constraints. Still other businesses, such as the Fresno Metropolitan Museum, have filed for bankruptcy in an effort to get back on their feet.
Filing for Commercial Bankruptcy
Non-profits have many expenses to meet, including payroll, benefits and tax filings. Just like any other business, these costs can become overwhelming in times of economic crisis. If your non-profit business is struggling to make ends meet, you may consider contacting a commercial bankruptcy attorney who can advise you on your options. Chapter 11 bankruptcy is designed to reorganize commercial finances and sell off assets in order to pay off outstanding debts. Non-profits can also file for Chapter 13 bankruptcy in order to reduce debts and get on a 3 to 5 year repayment schedule based on financial capability.
