HandsOn Greater DC Cares files for bankruptcy

September 26, 2013

HandsOn Greater DC Cares, a nonprofit known for its large-scale Districtwide community service volunteer projects, has filed for bankruptcy after recent financial distress.

“With the downturn in the economy over the last several years, our nonprofit has found itself poorly positioned to sustain the funding necessary to support programs across the community,” the organization said in a note posted on its Web site.

Documents in the Chapter 7 bankruptcy filing list $530,964 in liabilities and $34,698 in personal property assets. The largest creditors are Bank of America, which was owed $162,370 on a line of credit, and Lipman Hearne, a communications firm serving nonprofits, which was owed for $161,765 for an office lease.

Former employees say that in 2010, the organization had doubled its staff to about 25 and relocated to a new office space that underwent renovations. But by the following year, when it reported $1.1 million in revenue, the organization struggled to pay bills and employees, and staff was cut to about three full-time staff members, according to former employees.

“The business model they chose was not sustainable for them,” said Emily Gilliland, executive director of HandsOn Network, the national parent organization of Greater DC Cares. She declined to comment further about the bankruptcy.

The 24-year-old nonprofit connected 40,000 community volunteers to more than 700 nonprofits in the region each year, and organized major events such as the Martin Luther King Day of Service and the 9/11 Day of Service.

The news came to the shock of some funders that were unaware of the financial trouble.

“We had just done a project with them,” said A. Scott Bolden, managing partner of Reed Smith’s D.C. office. “Doing projects with them provided our team with a ready-made opportunity to do service that was already managed. They made it simple for us.”

Corporate sponsors listed on their Web site included Deloitte, Accenture and Fannie Mae.

Vanessa Small covers philanthropy and nonprofits for Capital Business. She also spotlights newly appointed executives in the New at the Top column, which chronicles their journeys to the top. Small was raised in Orange County, Ca. and graduated from Howard University.
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