Greetings—

Community based development organizations (CBDOs) work to revitalize, develop, empower, and reinvest economically in disadvantaged communities. However, a new Urban Institute study of CBDOs' financial well-being finds that despite overall sector growth, clear signs of financial distress threaten their ability to serve their missions.

This study is the first of its kind to provide a sector-specific financial sustainability assessment to help CBDOs better understand where they stand financially and demonstrates how funders and investors can better target supports to meet the needs of underinvested communities.

Key findings include:

The CBDO sector has grown steadily in revenues and assets, but there are signs of financial stress including shrinking operating margins and declining net incomes over time.
Vulnerabilities within the CBDO sector point to the need for increased supports such as resources and technical assistance to sustain and grow the sector’s financial health.
A small number of large organizations hold most of the sector’s resources, but even they can be financially vulnerable.
Small CBDOs make up a majority of the sector and are in a more precarious financial position than large ones, having fewer assets and experiencing more financial disruptions.

Our collection page on the topic includes a series of fact sheets identifying CBDOs' financial health trends across the United States with additional regional focus on the West, South, Northeast, Midwest, and states and metro areas.

I hope you find this information useful in understanding the financial well-being of this pivotal sector. Please email me at [email protected] if you would like to connect with the research team.

Sincerely,