Well folks, I'm here at the Habitat for Humanity office on Olympic Highway North with David Brandt, who's the executive director here, been on board for about a year, but you have experience with Habitat, helping out, building things and things like that. Yes, yes. You emailed me the other day and you said you wanted to talk a little bit about a situation going on here at Habitat that folks are gonna start maybe hearing about in the public and you kinda just want to go through what's going on here, which is, before we start, what you're gonna hear about is not an uncommon situation when it comes to non-profits and especially ones that work with housing and big ticket items, I guess, kinda like what this is.
So explain to me a little bit about and the email you sent me. All right, so Habitat is having a cash flow liquidity problem. It is short-term and it's not uncommon.
We are, in a sense, usually always, quote-unquote, chasing our closing to our low-income buyers because we are self-funded. Habitat is fortunate in Mason County that the way it's set up, we've always been community-funded. We haven't really taken advantage of big grants and big funders.
We are a rural county and we just don't have those big corporations that really, a lot of them that operate within the county. And so we started out very small, very local with Thrivent and the Lutheran Church and some church groups. And we have grown and we've done great things.
But the simple fact is is that we are community-funded and we manage all our builds. As cash comes in, cash goes out. And a house didn't close as planned in December.
And so it's caused us to be just cash tight for this probably about six weeks, yeah. So it's not a budgeting issue. It's not an asset holding issue.
It's the fact that as you plan out your year, you plan for, well, this house number, whatever, is going to sell. The profits and proceeds from that are going to help pay the staff and the payroll. And as that dwindles down, we're on pace for the next house to sell.
And then it just repeats and has repeated for what, 40 houses now? I mean, you guys are- We're actually building house, we're just completing house 41. And 40 of those have been sold to low-income families. We are selling our house 40 on the open market.
It has a view of the water of the inlet facing Shelton looking at the mill. And so when that sells, the idea was to sell it on the open market and that would perpetuate our funding and actually create more funding for us so that we can do more. We've traditionally built about one and a half, one and three quarter houses a year.
But I'd like to be a little more aggressive. Maybe we could do three. We could do three.
And we're on track to probably do close to three this year with funding. But so, yeah. So each house essentially funds the operations.
We self-build it, self-fund it. And by the time we get to the end of it, money tends to get tight, just like most people do with their budgeting and finances. At the end of the month, things get tight.
Well, when we get close to the closing, things are tight. Unfortunately, we didn't close on time. We had a homeowner change, which caused a delay in the financing of the house, which caused the delay.
And so we are cash-strapped until we sell this house. Which should be first or second week of February. So in that interim from now until then, what has happened? And I guess then too, what likely are people going to hear about the ripples of that? Right, right.
So I've been pursuing institutional funding from lending institutions. And so we do have an opportunity to possibly, or we can get institutional funding. And we've also had a private, a community member also step up and say that they would make a short-term loan as well.
So the board will choose between one of those. But the institutional funding is gonna take three weeks to get finalized. And by then, I'll only be a couple weeks away from actually closing the house.
So I don't know what the board's gonna choose or what their decisions are gonna be. But funding is gonna be coming in for us. Not as soon as I necessarily would like, but we'll be able to continue to pay all the ANP, all our bills.
We do have those offers. But in the short term, I am laying off our employees. I'm laying off everybody at Habitat for Humanity, even myself.
We need to operate on a volunteer basis for the short term, probably six weeks. It will allow us to generate revenue within our stores, which will still be open and operating. And it will also reduce our financial obligations because I won't have the payroll to pay, which is most organizations, their biggest expense.
So once again, as we're talking about this, it's, I think, important to reiterate again too that this isn't some sort of budgetary oopsie or some sort of mismanagement here. You were telling me you've done budgets and you understand budgets for your whole working career before you got here. But it's the ebb and flow of the selling process, which caused a speed bump this last house, this end of this last year.
And now you're at that point where normally you would see the proceeds from that house sale in the bank and sustainable until you get to the next house sale. So when folks are thinking about this, they're like, well, how can this be? You guys talk about all the houses. You've got the two stores.
You've got people in there. Nonprofits are notoriously tight on their budgets and their margins. I mean, you can't overspend.
That's kind of part of a nonprofit mantra there. There are ways in the short term now too to support Habitat for Humanity. Again, you can visit the store here in Shelton, also the Belfair store.
You can make donations. You can buy things. You can donate funds.
You can just spread the word that this is a temporary issue that will be fixed as soon as the house close. What are some other things? As always, we always use volunteers. We've been open for 29 years.
And in those 29 years, we've accumulated over 78,000 volunteer hours. That's people within the community, you and I who go out and volunteer or do work. We've built 40 houses that we've sold to low-income families.
We've done over 370 home preservation projects whereby we help seniors, disabled, veterans, low-income families with their exterior maintenance of their house, decks and ramps, and painting the house, broken windows. I mean, anything exterior, but a lot of exit and egress, ramps that people need. Yeah.
And we've donated $2.6 million to date back into the community. So all the funds that come in, people shop at our stores. So you can definitely donate, definitely volunteer.
You can donate in kind if you have something that you no longer need or want to get rid of. If it's usable, if it's in good condition, we can resell it. You can donate in kind to the stores.
If you have a lot of that stuff or you just don't have a pickup truck to bring it to us or whatever you may need, we do offer a pickup and delivery service if you buy things or you want them picked up if you can't deliver them. You can donate financially to support Habitat in addition to those in-kind donations. And Habitat is a Christian organization.
You can definitely pray for us. I mean, that's not gonna hurt at all either. If you have other questions or something is not sitting right with you, you said you talk with people through and say, be as transparent as you can to show that this is a thing.
Another thing I think you told me was kind of an interesting part of this is the unfortunate fact that you had to lay everybody off but those folks are back today. This happened yesterday, but they're back today, still working, but as a volunteer basis. Yeah, it's humbling.
I made the announcement to the staff in Shelton yesterday that I was gonna have to lay them off. And it's probably one of the hardest things I've had to do in my business career because these people, I mean, they're great people. We have a great staff.
We have great people here. As I'm sure most of you know. So we had the meeting.
I told them what they needed to do. We're gonna offer them all their jobs back probably around February 15th. But as we left, to a man, every one of them says, well, okay.
Then they says, how can we volunteer? And I told them there's a volunteer signup sheet. And so every one of them went out front and volunteered their work schedule. So they're all here working.
They're all here volunteering their work schedule, not getting paid just because they support Habitat and this community. And it's pretty humbling and incredible. And I think that kind of also goes to show folks who may be wondering what's going on.
You hear things on social media without getting the full story. This is it from the director's mouth to your ears right now, hearing what's going on, the continued support and buy-in from the staff who are on the front lines of facing what's going on here. And over my time at the radio station, I have talked countless numbers of times about the goodwill given by the Habitat for Humanity folks, conversations on all the groundbreakings and the ceremonies and the different, the wall raisings and all the people that have come over the time to support the community at a time now when you can support Habitat for Humanity in those different ways that we talked about.
So I think it important to get that information out there. For sure, short term, it's gonna be fixed here soon, depending either on board action shortly or the closure of that house in the beginning of February or so, and things will get right back to normal. Yeah, most definitely.
And if you have any questions, any concerns, and I mean, nonprofits books are always open. Usually it's about a year late during financial audits. We had one, we're just finishing one now.
We have an unqualified financial audit, which means we're in good standings and meet the generally accepted practices for operating business. So I have no issues. If somebody has any real concerns, I'll bring you in and show you our budgeting, our profit and loss, our balance sheets.
It's just the fact that short term, we're in a cash liquidity crisis. Show them all those things and then give them a volunteer form. Yes, a volunteer would be great.
David Brandt, the executive director here at Habitat for Humanity, both in Shelton and Belfair. Thank you.