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Short-Term Cash Flow Loan Program Now Open

The Ann Arbor Area Community Foundation’s Short-Term Cash Flow Loan Program makes short-term (up to 180 days) cash flow loans of $5,000 - $50,000. The loans will be made on a rolling basis from a revolving fund of $500,000. This program has been initiated as part of AAACF’s philanthropic response to the COVID-19 health pandemic and economic crisis and complements AAACF’s grantmaking to support COVID-19 response, relief, and recovery efforts. Since the crisis began in mid-March, AAACF has granted over $475,000 to local nonprofits in support of response and relief efforts and will continue to do so throughout 2020 and beyond.

AAACF believes the local nonprofit sector plays a critical role in supporting the whole of Washtenaw County. To that end, loan applications will be assessed on a rolling basis in terms of financial feasibility (future ability to repay the loan) and the degree to which an organization can contribute to long-term recovery in our community.

AAACF will modify this loan program as other financing sources become available to the local nonprofit sector. Currently the loan program will focus on up to 180 days of operational cash needs to bridge nonprofit operations through this crisis and to reliable revenues sources (either new or historical).

We have now distributed 6 loans to the following organizations:

  • Ballet Chelsea
  • Friends In Deed
  • Jewish Family Services
  • Michigan Theater
  • The Women's Center of Southeast Michigan
  • Therapeutic Riding, Inc.


To be eligible for a short-term cash flow loan, an organization must be a 501(c)3 nonprofit organization based in or primarily serving Washtenaw County, MI.

Program Details

Loans are interest-free. Loans can be used to meet cash flow needs of the organization for a period of up to 180 days. The repayment period begins 90 days after the cash flow period has concluded. Repayment period can be up to 12 months. Loan repayments will be made in equal monthly installments.

Example loan use and repayment period: (1) April 1, 2020 - Nonprofit receives loan for 90 days of cash flow. (2) July 1, 2020 - Nonprofit has 90 additional days of a grace period before loan repayment begins. (3) October 1, 2020 - Nonprofit begins repayment on loan. (4) September 1, 2021 - Nonprofit makes final installment of loan repayment (assuming a 12 month repayment period is in effect).

All recipients who honor the terms of the loan may return to the program for additional funds; however, there is a limit of one short-term cash flow loan per calendar year.

The following criteria will be considered in approving a short-term cash flow loan:

  • The existence of any of the following: legally binding grant contract(s) (governmental or foundational) currently in effect that are not at risk for defunding or nonpayment; booked pledge(s) by reliable donors; and a history of predictable revenues (whether seasonal, earned or contributed). 
  • The ability to repay, as evidenced by the organization's recent financial health and its projected cash flow during the repayment period
  • The degree to which an organization will contribute to the long-term recovery of our community

Additional considerations:

  • Whether the organization has received an AAACF general operating support grant in the last five years
  • Whether the organization has a nonprofit endowment fund at AAACF and consents to use current and future payments from the fund as collateral for the loan

Application Procedure

Step 1: Contact Amina Iqbal, Senior Community Investment Officer (aiqbal@aaacf.org) by email to make an initial inquiry and to discuss whether a cash flow loan application makes sense for your organization’s particular situation.

Step 2: Staff (Amina Iqbal and Jillian Rosen) will then assist you in completing an application packet. An application packet consists of the following materials:

  • Short-Term Cash Flow Loan application form (PDF sample application here)
  • Annual organization budget for current fiscal year (prior to COVID-19 crisis)
  • Projected organization budget and cash flow (next 12 months)
  • Most recent audited (if available) or unaudited financials
  • Guidestar Financial Health Analysis Report (AAACF staff is responsible for retrieving this document and will share it with applicants)

Please send all requested materials to loans@aaacf.org.

Step 3: After your application packet is submitted, staff may request a phone or video meeting with your organization's board chair and executive director. Loan decisions are made by AAACF staff in consultation with the AAACF Impact Investing Committee.

Step 4: Staff will notify your executive director of the loan decision, and, if the loan is approved, the amount and repayment date of the loan.

Step 5: An officer of the board and the executive director will sign a promissory note (electronically). Upon receipt of these counter-signed documents, the loan funds will be released by check or wire to the organization.

Step 6: Loan recipients are required to check in quarterly with staff to share updates about the organization’s financial and operational position.

Anticipated Questions (as of 3.30.20):

Is AAACF grantmaking to local nonprofits in addition to loans?
Yes. Since the COVID-19 pandemic began affecting our community just two weeks ago, AAACF has granted $475,000 to local nonprofits to aid in their response to this crisis.

What is the anticipated application and approval timeline?
We anticipate a 10 - 14 day review and approval period. It may take longer. Staff will keep in close contact with your organization during the review period.

Will AAACF collect interest on this loan?
No. AAACF is making interest-free loans through this program.

Are there penalties for not making a payment during the agreed upon repayment period?
There are no financial penalties for late payments. However, a loan recipient that misses a scheduled repayment will be categorically ineligible for any new competitive grants from AAACF until back on schedule.

Can my organization apply for and receive competitive grants from AAACF during the period of an active loan?
Yes, as long as the organization remains on schedule with repayments.

What are the reporting requirements of this loan?
Your organization will be required to check-in quarterly with AAACF staff with an update on the organization’s financial and operating position. A brief written report (one page) will be required at the end of the loan period sharing how the loan impacted the mission, finances, and operations of the organization. Staff can provide support on the final report. AAACF may administer surveys to learn how we can improve on our loan-making as well as impact of the loan—it will be optional to participate in this survey.

What if my organization requires a longer payback period beyond what is being offered?
AAACF will consider longer payback periods on a case-by-case basis.

What is the GuideStar Comprehensive Financial Trends Analysis Report?
This report uses IRS Form 990 data to provide a comprehensive overview of the selected organization’s financial performance and condition, according to Nonprofit Finance Fund’s (NFF) philosophy and analysis. It aims to demystify nonprofit finance, helping users understand what financial data matters most and how to interpret the information. It can be used by nonprofit leaders, board members, funders, consultants, and other stakeholders to plan for the future, communicate resource needs, and inform financial, program, and strategic decisions.

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