Principled financial guidance for mission-driven organizations facing difficult decisions.
Non-profit organizations face financial distress with an added dimension: a mission that stakeholders, donors, and communities depend on. Lighthouse has served as assignee and operational advisor to non-profits, managing wind-downs and closures with the transparency and sensitivity that board members, regulators, and the communities they serve expect.
When a non-profit is in financial distress, the board faces questions that for-profit directors rarely encounter like obligations to donors, restricted funds, regulatory oversight, and a public trust that demands full transparency. We bring financial discipline to the process without losing sight of the mission.
Lighthouse served as Assignee over the Minnesota Counsel on Crime and Justice, a non-profit operating many community programs, with a focus on the legal and justice systems.
Challenge: The Minnesota Counsel on Crime and Justice was unable to pay its debts as they became due and was seeking a way to wind down operations and satisfy its creditors.
The Solve: The board of the non-profit executed an Assignment for the Benefit of Creditors, appointing Lighthouse as Assignee. Lighthouse worked with board members and employees to evaluate assets for possible sale or transfer. Lighthouse ran a claims process to determine the creditor pool and eventual distribution of available funds. Lighthouse agreed to work pro bono, in order to maximize the recovery of the limited assets.
The Outcome: Lighthouse ended up transitioning some community programs to other non-profits, when it was determined that the programs had no monetary value, but could still offer services to the community. Lighthouse distributed the available funds to creditors, per the court-approved claims process which Lighthouse had conducted.
How we support non-profit organizations.
1. Financial & Governance Review: We evaluate the organization's financial position, fund restrictions, grant obligations, and board governance to understand both the distress and the fiduciary landscape that governs resolution options.
2. Stakeholder Communication: We manage communication with donors, grantors, regulators, staff, and the communities served, maintaining transparency and trust throughout the process.
3. Restricted Fund & Obligation Management: We ensure that restricted funds are handled in compliance with donor intent and applicable law, managing the legal and ethical complexities that distinguish non-profit wind-downs from commercial ones.
4. Orderly Transition or Closure: We execute an orderly transition of programs, assets, and obligations whether that means transferring operations to another organization or managing a disciplined closure and final accounting.
The best outcomes start with early action.
The sooner we're at the table, the more options remain available. Reach out for a confidential conversation with our team