Unnatural Disasters: Can Nonprofit Governance Promote Recovery in Detroit and Flint?

by Davia Cox Downey

Over the past two years, my research partner, Sarah Reckhow of Michigan State University and I have explored the concept of disaster, whether natural or man-made, to examine how these types of events impact collaboration between local government and nonprofit organizations and governing capacity post-crisis. We examined the activation of the nonprofit sector in response to crises that were augmented by political failure. Our questions were critical but straightforward: Can meaningful nonprofit engagement in crisis response rebuild local government capacity? Or does this “swooping in of support” supplant local government?

We began this research by diving in to two nationally recognizable municipal crises that happened to have taken place in our home state. In Detroit, years of declining tax bases and financial mismanagement resulted in the nation’s first municipal bankruptcy during the summer of 2013. The crisis threatened the pensions of public servants, critical public services, and many priceless pieces of art held at the Detroit Institute of Art. This culmination of events prompted local grant makers to step in to help the city resolve its cash flow problems and move forward towards solvency. In Flint, the public health crisis that unfolded after the state of Michigan switched the water supply from the Detroit water system back to the Flint River in early 2014 quickly overwhelmed the local government, which had been stripped down to bare bones operations by several emergency managers. The nonprofit community, including several philanthropic organizations, stepped in to assist in resolving this crisis.

Our study used a combination of nonprofit surveys in both cities and philanthropic grant data to ask — and attempt to answer — three simple questions:

  • What kinds of resources, support, or leadership did nonprofit organizations provide to the recovery process in each city?
  • Did these “disasters” provide an opportunity for nonprofits to improve the futures of local governments in distress?
  • What comparisons can be made about the interactions between nonprofits and local governments in the area of disaster recovery?

In our findings, we discovered that, regardless of the nature of the disaster and the composition of the nonprofit sector in each city, in both cases philanthropy had a direct, positive impact on local governance capacity. In Detroit, nonprofits and foundations provided the essential support the city needed to stem the financial crisis, and since the conclusion of the Grand Bargain1, these organizations have mostly been able to resume their previous roles and scopes. In Flint, the intensive collaboration and coordinated efforts of the nonprofit community were integral to providing direct aid to city residents. As a result of this investment, there has also been a significant amount of program development within nonprofits in the city which promises to have long-lasting, positive impacts on local communities. In both cases, nonprofit organizations were reliable partners throughout each crisis.

…the long term financial and governing challenges that Michigan cities face will not be resolved by nonprofits and foundations acting alone.

When asked if local governments were reliable partners, survey respondents from nonprofits and foundations had vastly different responses in each city. In Detroit, nonprofits viewed the city as one of their most important partners throughout the bankruptcy crisis and Grand Bargain, while in Flint, nonprofit organizations reported instability in local government and state government, which hindered their ability to gain a clear picture of how to proceed with creating plans to respond.

Overall, we observed that nonprofits were able to fill gaps in service quickly and were more nimble in rapidly changing environments. However, these findings should be viewed, in our opinion, with caution. In Detroit, the infusion of resources from the Grand Bargain provided a lifeline, but the city still faces many of the underlying challenges related to population growth, reduced tax base, and vacant properties that contributed to the crisis in the first place. Nonprofits are playing a role in addressing these challenges but the scope of the issues are significant. Time will tell if the operations of local government in Detroit can continue to be self-sustaining.

In Flint, nonprofit organizations of all shapes and sizes provided much of the “boots on the ground” response to the water crisis and continue to do so today. Yet the City of Flint continues to have weak capacity due to the long term consequences of emergency management and the loss of tax base. We hope that these new pathways of public-private collaboration continue to grow as the city recovers.

In the state of Michigan, public sector capacity and issues of financial solvency plague the local governing environment. We note that while nonprofits and foundations should be lauded for their herculean efforts in stabilizing both cities during times of crisis, the long term financial and governing challenges that Michigan cities face will not be resolved by nonprofits and foundations acting alone. State and local policymakers must address these local government capacity challenges in cities with a weak local tax base — a stronger local government will be more capable of partnering with local nonprofits to address broader policy challenges. These findings inform the debate over third sector collaboration in the public sector and provide a fascinating snapshot of how nonprofits can work with local government organizations to create new opportunities for coordination when extraordinary events occur and, hopefully, develop long term solutions for governing as a result.

Photo: Davia Downey
Davia Cox Downey, Ph.D.
is an associate professor and M.P.A. coordinator in the School of Public, Nonprofit, and Health Administration at Grand Valley State University. Dr. Downey is also the most recent recipient of the Russell G. Mawby Fellowship in Philanthropic Studies. The full report of her findings, co-authored with her research partner Sarah Reckhow, Ph.D. of Michigan State University and produced with support from the Mawby Fellowship program, is available here: “Unnatural Disasters: Can Nonprofit Governance Promote Recovery in Detroit and Flint?”

  1. For more on the Grand Bargain, see: https://independentsector.org/news-post/detroits-grand-bargain-and-the-partnership-that-propelled-it/

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