UCLA

During the Great Recession, nonprofits experienced unprecedented financial strain while demand for their services increased (Anheier, 2007; Golden et al., 2009; Johnson, 2011). This research focuses on nonprofit housing development organizations (NHDOs) in California during the years 2000-2010. NHDOs typically develop and manage housing, in addition to providing social services for low-income persons. Over the past 20 years, many NHDOs have struggled to maintain adequate capital and operating reserves to preserve their affordable housing stock (Bratt et al., 1998). For NHDOs, these financial issues were exacerbated by the housing and economic crises, in addition to the recent elimination of the State of California Redevelopment Agency funds in 2012. A few researchers have studied the effects of the economic crisis on the nonprofit sector, but none have systematically analyzed outcomes for NHDOs.

This dissertation is divided into five chapters: Chapter 1: Literature Review, Chapter 2: Research Methods, Chapter 3: Bivariate and Multivariate Analysis, Chapter 4: Qualitative Interviews, and Chapter 5: Analysis of Findings. My dissertation addresses the research question: how were nonprofit housing development organizations affected by the Great Recession that began in 2007? It quantifies the effects of the housing and economic crises on NHDOs regarding survival and revenue. This mixed-methods research has: (1) a quantitative component with bivariate and multivariate analyses from Internal Revenue Service (IRS) 990 tax form data of about 800 nonprofit housing developers, and (2) a qualitative component with findings from 18 interviews of executive directors and managers of nonprofit developers and housing associations to assess how and why these organizations experienced variations in survival and revenue.

In many ways, the factors that determined a NHDOs’ sustainabilty and performance were similar to for-profit and other nonprofit entities. For example, older and larger organizations with more staff and revenue tended to fare better during this ten-year time period. Other factors were unique to the affordable housing sector. The region and type of housing developed by the nonprofit affected outcomes. For example, NHDOs who were predominately general housing developers (rather than specialists in senior or rental housing) were less likely to survive. NHDOs in urban areas, such as the Los Angeles and San Francisco regions, had higher survival rates. In contrast, NHDOs in exurban and rural areas, e.g. the San Joaquin Valley region, were less likely to survive. An unexpected finding was reliance on government funding was negatively associated with NHDO’s survival and revenue. This may be an indicator of how government funding decreased or was unstable during this time period. With funding cutbacks on all levels of government (federal, state, and local), NHDOs had to strategically manage their housing development pipeline, real estate portfolios, staffing levels, programs, and services. Organizations that survived and performed well exhibited the following characteristics: (1) diversified funding sources, (2) benefited from agglomeration effects, (3) implemented adaptive management, and (4) established partnerships, joint ventures, and mergers. The lessons and management tactics learned from these NHDOs inform other organizations about how to survive and thrive during tough economic times.