New revenue mix has Meeting Street on solid ground

BOOK SMART: Meeting Street President and CEO John M. Kelly reads a book with children in the Bright Futures Early Learning. From left, the children are: Mia, Cameron and Eloise. /
BOOK SMART: Meeting Street President and CEO John M. Kelly reads a book with children in the Bright Futures Early Learning. From left, the children are: Mia, Cameron and Eloise. /

We’re always trying to walk a fine line, to focus on staying lean without being too lean,” said John M. Kelly, president and CEO of Meeting Street in Providence. “We always have to remember what we’re here for: to support services, not the other way around. The business of Meeting Street is serving kids.”
The nonprofit directly serves more than 3,000 children annually, while an estimated 12,000-15,000 family and community members are impacted as well. Bright Futures Early Learning Center (infant-pre-K), The Grace School (K-eight grade) and The Carter School, a life-skills and vocational educational program (grade nine-age 21) are housed in attractive buildings constructed 10 years ago on an eight-acre campus. Ancillary programs reach out to both adults and children in the community.
The Eddy Street location, visible from Interstate 95, was chosen in part to help revitalize an urban neighborhood where many of the children it serves resided. Forty percent of the campus is dedicated to green space; a soccer field and playground encourage children from surrounding communities to engage in outdoor activities.
“Meeting Street School was founded in 1946,” Kelly explained. “And one of the things we were founded on was to be a national model. It was the first school in the country to have clinicians and educators working with the disabled and focusing on infant mental health, early intervention and early learning.”
Today, Grace School is the only school in the country educating children with severe and profound needs side-by-side with children enrolled in a standards-based curriculum. “One-third have special needs; two-thirds don’t,” Kelly said. “There are individual-needs plans for all learners.”
Marking the innovative program’s success, all of the third-graders in the general curriculum scored “proficient with distinction” or “proficient” on the 2009 NECAPS.
But to keep these and other programs viable and growing, Kelly said, “In March 2009, we realized that we would have to change, change significantly, and do so quickly – in six to eight months. For some of us it was incredibly painful. But we came out incredibly strong.
“When you’re running a program that’s very good to begin with, when someone questions the way you’re doing things it’s not an easy conversation,” Kelly continued. “In nonprofit organizations, if you talk about money, it’s dirty. But if there’s no money, there’s no mission.”
Meeting Street’s revenue in fiscal 2009 was more than $12.5 million; in fiscal 2010, more than $15.2 million; projected for fiscal 2011, more than $16.8 million.
The statewide fiscal crisis had a major impact. In 2009, the organization experienced “significant delays” of up to a year in getting paid by school districts. Two of the delinquent districts sent the highest number of students. The delay threatened Meeting Street’s cash flow, and forced the nonprofit to increase its line of credit. Finances were further threatened by plans in some districts to start keeping special-needs children within the district and attempting to service them there.
At Meeting Street, the issue was clear: increase funding. The goal was easy enough to state: Change the revenue mix. But that would take a lot of creativity and plenty of hard work. Historically, in addition to school districts, Meeting Street had relied on state funds, insurance companies and donors. “Funding was not a high priority,” the administrative team admitted.
In response to the bleak economic picture, the school implemented three strategies: Seek out and obtain federal funds, improve operational efficiencies in early intervention and increase charitable giving by becoming a “charity of choice.”
All of them were successful.
Meeting Street hired a professional to apply for federal funding, ultimately pursuing more than $12.5 million. As a result, the school went from zero federal revenue to nearly $2.9 million for four different programs, including:
• A $900,000 grant from the U.S. Department of Education established Project PRIME – Preparing Rhode Island’s Most Vulnerable Children through Meeting Street Excellence. Annually, the program will serve at least 75 children prenatal to age 6 to prepare them to enter school healthy and ready to learn.
• $1.4 million from the Office of Head Start is being used to begin Early Head Start, a program for 72 low-income children from birth to age 3, and pregnant women.
• A $223,000 grant establishes a mentor-coaching program for 40 educators working with low-income children in home-based and classroom programs, impacting at least 180 children in the first year alone.
• The U.S. Department of Education granted $374,000 in federal stimulus funds that were used to improve efficiency in Early Intervention services.
The second core financial strategy was to increase fees for service in the Early Intervention program. Revenue is derived from billing third-party insurance companies, including commercial entities, RIte Care and Medicaid.
Employee productivity was targeted, along with operational efficiencies. At the end of 2009, Early Intervention reported a loss of $290,000; in fiscal 2010, the operating loss was eliminated. Further, increased marketing resulted in more demand for services. This, in turn, eliminated a waiting list and enrolled more than 1,000 families in fiscal 2010.
Finally, despite a downturn in the economy, Meeting Street increased its charitable-giving goal. Aiming to become the “charity of choice” among its donor base, the organization closed fiscal 2010 by raising $130,000 more in general operating support than in 2009.
As a result of these strategies, Meeting Street increased total agency revenue by 10.4 percent, increased Early Intervention revenue more than $818,000, did not access its line of credit at all, created 24 new jobs and increased the average gift by 21 percent.
Significant to donors everywhere is how much money goes toward administrative costs in any nonprofit organization. In advising potential donors, nonprofit watchdog groups recommend that no more than 30 percent of a total budget go toward administrative costs. Meeting Street blows that figure away, ensuring that at least 85 percent or more of revenue goes directly to services. This goal has not only been met in the past four years, but was exceeded last year, when a whopping 87 percent went to services and only 13 percent to administrative costs.
“Small contributors are our lifeblood,” Kelly said. “Most give $50 or less.” Meeting Street counts a donor base of 6,000, and is also dependent on corporate sponsors and a 27-member board of trustees. These supporters are variously involved in a wide range of activities, including golf tournaments, fundraisers, special events and equipment donation. Annually for 34 years, the Meeting Street Telethon airs for four hours on WPRI-TV Channel 12, sponsored by Cardi’s Furniture Superstores.
Meeting Street will celebrate its 65th anniversary in 2011. Its enthusiastic president and CEO heads the cheerleading, touting unique programs for unique children. “One of the phrases we hate – well, hate is a strong word, but – one of the phrases we most dislike is ‘a typically developing child.’ That kid is normal?” Kelly asked rhetorically. “I’ve never met a typical adult. I’ve never met a normal adult. Why should kids be different?” •

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