FOR IMMEDIATE RELEASE: February 9, 2017
Nonprofit Bridge Loan Program Hearing on Feb. 14th
Sen. Kagan seeks to eliminate cash flow troubles
for nonprofits with government grants or contracts
Senator Cheryl C. Kagan
District 17 (Rockville & Gaithersburg)
Annapolis, MD: Nonprofits provide vital services to our communities, addressing needs like hunger, homelessness, health care, and illiteracy. Many of these organizations operate on government grants or contracts that reimburse them for costs rather than providing the funding up front. Meanwhile, the nonprofits still have to pay rent, staff, utilities, and other expenses– resulting in short-term cash-flow problems.
Sen. Cheryl C. Kagan (District 17, Gaithersburg & Rockville) has introduced legislation, SB465, to create a “Nonprofit, Interest-free, Micro-Bridge Loan” (NIMBL) program to solve this problem. The revolving fund would allow nonprofits to borrow up to $25,000 interest-free. The loans must be repaid within 60 days of receiving the pledged funds.
Kagan’s bill, drafted in cooperation with Maryland Nonprofits and with insights from her Nonprofit Advisory Group, is co-sponsored by an impressive 44 of her 46 Senate colleagues and will be heard in the Senate Finance Committee on Tuesday, February 14th at 1pm.
“Nonprofits are an integral part of Maryland’s economy, with 10% of Marylanders employed by the sector,” said Senator Kagan, adding that, “taking care of nonprofits is an essential aspect of taking care of our most vulnerable populations.“
* * * *
About Senator Cheryl C. Kagan: Senator Kagan (D) represents District 17, Rockville and Gaithersburg, in the Maryland General Assembly. First elected in 1994 to the House of Delegates, Kagan served two terms before stepping down to work in the non-profit sector. In 2014, Kagan returned to elected office, winning her first term to the Maryland State Senate. Kagan serves on the Education, Health and Environmental Affairs Committee, Joint Audit Committee, and Joint Committee on Federal Relations and is the Senate Chair of the Joint Committee on the Management of Public Funds.