Pittsburgh-Area Nonprofits in 'Merger Mode'

Although the U.S. economy is showing signs of improvement, nonprofits in the Pittsburgh area continue to consider mergers and partnerships as a way of cutting costs and boosting their revenues, the Pittsburgh Tribune-Review reports.

Since 2005, the Forbes Fund, a branch of the Pittsburgh Foundation, has worked on thirty-two nonprofit restructuring projects, and requests for its assistance have increased 44 percent over the past two years; other nonprofit consultants in the region report similar demand for their services.

In a tough fundraising environment, the arguments for merging or restructuring can be compelling. Since the Fort Pitt Museum, which used to be administered by a state agency, merged with the Heinz History Center in 2010, annual attendance has risen more than 50 percent, to 19,000 visitors a year. Similarly, the local affiliate of United Cerebral Palsy, a $30 million organization, was able to trim its back-office expenses after it merged with the Western Pennsylvania Chapter of the Multiple Sclerosis Service Society.

Yet another factor behind the increased interest in mergers has been the aging of baby boomer executives. "As baby boomers retire, it makes it much easier for groups to consider merging or close alliances because you don't have to fire somebody or negotiate paying two executives' salaries," said Peggy M. Outon, executive director of the Bayer Center for Nonprofit Management at Robert Morris University.

Still, the best reason for merging often is the most overlooked. "Our main goal," said Cassandra Williams, executive director of Naomi's Place, an East Liberty group that provides for women recovering from drug addiction, "is to build [our] capacity...so we can serve more people in the community."

Bill Zlatos. "Museums, Other Nonprofits Join Forces to Survive Economy." Pittsburgh Tribune-Review 07/05/2011.