In February 2019, record-setting rains flooded Chilhowee Park and forced the closure of The Muse Knoxville, the interactive children’s discovery center at the park’s western edge.

The coronavirus pandemic is a double whammy for social service agencies.

While its doors were shuttered for a month, the center dipped into its reserves to continue to pay its staff. 

“We thought, ‘This is exactly what our reserves are for,’” said Ellie Kittrell, The Muse’s executive director. “We took a huge hit on our savings. We were thinking we would build this back over the next few years. And here we are.”

Where The Muse is now, of course, is closed again — this time for a lot longer than a month, with prospects for reopening uncertain as the novel coronavirus pandemic continues.

“We made the decision pretty quickly to shut down,” Kittrell said. This time, she has had to lay off most of her staff. Of her 27 full-time and 24 part-time employees, only four full-time and four part-time remain on the payroll. For now, they are providing educational resources for children and families online.

The Muse is far from alone among nonprofit organizations across Knox County. The impacts of the pandemic vary widely depending on agencies’ services and funding sources. But the efforts to contain the spread of COVID-19 and the economic fallout from those measures have shut down sites, forced changes in service models and blown holes in budget projections for both this year and the next. 

“We're all looking at what the impact is in the fourth quarter,” said Jerry Askew, president of the Alliance for Better Nonprofits, which provides resources to organizations across East Tennessee. “Some of us have reserves. So we can use those reserves now to get us through the crisis. But how do we make up for the lst opportunity to generate income?”

A Double Whammy

In a joint video interview Wednesday with Matt Ryerson, president and CEO of the United Way of Greater Knoxville, Askew said many organizations are simultaneously facing an increase in demand and a hit to their funding sources. 

“In many cases, particularly children- and youth-serving agencies, senior citizens’ agencies, the agencies dealing with those who find themselves in homelessness, all of those kinds of organizations are being asked to provide a much higher level of service — at the same time that they're having to postpone at best and cancel at worst their primary fundraising operations,” Askew said.

The timing was particularly bad because many nonprofits hold major fundraising events in the spring.

United Way and the Alliance for Better Nonprofits teamed up to distribute a survey this week to about 400 local organizations. As of yesterday they had already received nearly 200 responses. Ryerson said among the clearest initial findings was that many agencies — about 68 percent — reported they had had to cancel or postpone major fundraisers.

United Way of Greater Knoxville, which collects and distributes donations to nonprofits, quickly established a COVID-19 Response Fund to provide immediate resources to agencies that have had to increase their services because of the pandemic.

“Any nonprofit that is expanding or increasing services related to the COVID-19 crisis are who we want to target with this fund,” Ryerson said. “Because those are unbudgeted expenses.”

For example, he cited the Boys & Girls Clubs of the Tennessee Valley, which typically offers after-school programs. It has restricted its youth services only to children of people deemed “essential employees” who still have to go to work and has imposed physical distancing guidelines, but it has expanded its hours to run from 6 a.m. to 6 p.m.

As the pandemic and the recovery from it drag on for what is expected to be many months, Askew said many nonprofits will be faced with difficult decisions about staffing and services. Some may reduce their scope to focus on one or two essential programs. Others, he thinks, will look for collaborations and maybe even mergers.

“It may very well be that some of our groups that serve children, or some of our groups that work in the environment, or some of our groups that are in animal welfare, or some of the groups in the arts, might really have to think about ‘How do we consolidate in a way that enables us to reduce the administrative expenses so that we can really focus our efforts on our mission?’” he said. 

“Those are hard conversations, but I think we’re going to see those. And frankly, we’re going to  encourage those conversations and make ourselves available to assist with the facilitation.”

Ryerson said fundraising will be a challenge for many organizations, particularly if the economic slowdown extends through the rest of the year or longer. Many major donors might take a financial hit from a slumped stock market. And United Way, which relies on paycheck contributions from employees at local companies and institutions, expects an impact from rising unemployment.

“We're adjusting what our expectations are in what we call uncollectible pledges, meaning people that are unable to pay what they had committed to the previous year,” Ryerson said. “And simultaneously, how does this affect our fundraising coming this fall, with the unexpected consequences of the economy?”

Staying in Touch

Like most nonprofit directors, Brent Waugh has seen dramatic impacts on both the service and financial sides of his organization. Waugh is CEO of Big Brothers Big Sisters of East Tennessee, which matches adult volunteer mentors with at-risk children. It serves about 850 kids, with about 650 of those in active matches.

“We fairly early on recognized that this would affect our programming,” Waugh said. “It’s about relationships, and so much of that is built on in-person time.”

The organization relies on face-to-face meetings between mentors and kids — what it calls “Bigs” and “Littles” — both during the school day and outside of it. As those kinds of meetings became untenable, Waugh and his staff devised plans for mentors to maintain contact via phone and online devices, depending on what the children and their families had access to.

“Probably what we see the majority of would be through FaceTime calls,” Waugh said.

His staff usually calls each family they serve once a month just to check in on how the match with the mentor is going. If the family expresses a need for social services, the staff makes referrals to other agencies.

“Typically, we make five referrals a week,” Waugh said. “In the first week of COVID, we made 317 referrals.”

Those were mostly for food and rental assistance, and as school closures were extended the agency has also been fielding requests for educational resources.

Waugh has not had to lay anyone off — his staff is all working remotely, and like many other nonprofits he has applied for federal assistance through the Paycheck Protection Program established by the CARES Act.

But he is not sanguine about the agency’s finances. He already postponed its signature spring fundraiser, Bowl for Kids’ Sake, and anticipates having to do the same for an upcoming golf tournament.

Waugh is estimating an $85,000 budget shortfall in this fiscal year, which ends in June, and up to a $500,000 deficit by the end of the calendar year. He is hoping for a combination of government and foundation grants to help fill the gap.

Still, he said, the agency is continuing to enlist new volunteer mentors, who can be given orientation and training online. 

“For the first time in the 50-year history of our (local) organization and the 100-year history of Big Brothers Big Sisters, we are now doing virtual matches,” Waugh said.

Remote services have also assumed greater significance for Positively Living, which serves several thousand people in Knoxville, Chattanooga and Memphis who are dealing with HIV/AIDS, homelessness, addiction, and mental and physical disabilities.

Kim Lauth, the agency’s chief operating officer, said Positively Living had invested in a telehealth system over the past few years which had not yet been widely embraced by its clients, who prefer in-person interactions. But as the pandemic forced precautionary closures of its clinics in March, that system came to the forefront.

“People are scared,” she said of the agency’s population, many of whom are immunocompromised. “People don’t like going out. That’s part of the reason we’re really focused on finding different ways to meet people’s needs.”

At the same time, her staff social workers and therapists have been careful to keep in touch and make sure mental health needs are met.

“Many of the people we see have really personal relationships with the people who work here,” Lauth said. “This is where they get their support system and in some cases it’s where they get their social interactions.”

Her agency’s funding is relatively protected, since it comes mostly from government grants and foundations. But the population it serves is likely to be negatively affected by the pandemic through loss of jobs or access to other supports.

Lauth is also thinking ahead to how its in-person services will be able to resume in the future while also respecting ongoing physical distance guidelines.

“Part of the challenge of our clinic right now is just that the space is so small,” she said.

Finding New Ways

The question of reopening also looms for Kittrell. The Muse packs a lot of activities into relatively small indoor quarters. Even when it is able to resume services, which she thinks might not be until this fall, Kittrell isn’t sure how comfortable people will be bringing their kids back.

“Do we take temperatures as people walk in the door?” she asked. “Booties? Air purification systems? What are some of the extra steps we can take to help create that confidence with families?”

In the meantime, the staff she has been able to retain are providing a stream of content under the banner of “The Muse at Home” on social media and through the museum’s website. 

One unexpected bright spot came through The Muse’s annual spring lunch, which is its largest fundraiser of the year. The planned event had to be scrapped, but Kittrell wanted to do something to at least keep in touch with her major supporters.

Through one of her board members, Brandon Bruce, she was introduced to a Knoxville-based tech company called LunchPool, which specializes in creating “virtual events.” Kittrell sent out invitations for a virtual lunch to Muse supporters, who logged in from their homes.

“We had 80 people attend, which I was blown over by, and we raised as much money that day as we have in any of our years past,” Kittrell said. “I could not believe that. It speaks to the generosity of our community.”

Lauth said she also thinks the challenges of the coming months will force her agency to find innovative ways to serve its mission, which it can use in the future.

“We will be doing a lot of things differently and I think better for all of this,” she said. “I hesitate to say there’s a bright lining, but I do think there’s a learning opportunity here.”

Askew said that’s typical of the resilient attitude he’s hearing from nonprofit organizations of all kinds. 

“Sure, there are people who are afraid of what the future holds,” he said. “But very quickly, the conversation shifts from, ‘Yeah, we had to cancel a fundraiser, I don’t know how we’re going to make payroll’ to ‘We were able to house this many people, we were able to feed this many people.’”

Askew added, “I don’t see a lot of licking wounds, I hear virtually no self-pity. I hear what I would call responsible concern, but they’re never taking their eyes off the ball.”