How Nonprofits Can Foster More Meaningful Virtual Engagement With Their Employees

By YW Boston

2020 was a year that many nonprofits experienced a new and unexpected transition into partially remote or completely remote work. As we continue to face the COVID-19 pandemic and grapple with increasing social unrest, including the recent violent insurrection at the U.S. Capitol, it is as important as ever to prioritize practicing empathy with our employees and colleagues. As we begin the year 2021, it’s important for organizations to re-examine their expectations for employees to continue conducting business as usual. Leaders must allow time for employees to process the impact of such uncertainty in their lives. When having any work-related virtual meetings, nonprofit leaders and supervisors can adjust their practices to foster more meaningful virtual engagement. Keeping employees engaged in online spaces is critical to staying socially connected while physically distant. Here are some things to consider when interacting with your employees using digital mediums.

Redefine (virtual) employee engagement

Employee engagement has transformed in the virtual space. First, let’s define what we mean by “virtual engagement.” Virtual engagement refers to all and any employee interactions that occur online, whether those are “live” and synchronous, such as video conference or voice call, or asynchronous, such as chat or emails.

Account for, and normalize, distractions

In the online realm, active and passive engagement appear a bit differently. It’s important not to confuse passive engagement with active resistance. While someone may have their camera off during a video call, for instance, that does not mean they are not fully engaged. As employees juggle new variables such as sharing their remote workspaces, increased caregiving responsibilities, and other challenges arising from working remotely during a pandemic and political crisis, employers must remain flexible and empathetic during this time.

Continuously gauge engagement and adjust accordingly

Measuring virtual engagement is a necessary step for readjusting and making modifications that will improve the quality of your interactions. As a meeting facilitator, check in with participants to see how they are feeling, what their energy level is like, and to learn whether they feel prepared for the meeting or virtual presentation they are about to participate in. If you are providing new information, be sure to check for understanding. And at the end of the meeting, check in again to see if people’s disposition or feelings have changed, and to see if they want to provide any feedback. Make note of your own observations, such as how many people participated, how often did people participate, did anyone seem to dominate the conversation, and so on.

Practice and improve your virtual facilitation skills

As a leader or supervisor, you have a responsibility to foster more meaningful engagement during virtual meetings. It’s a good practice to familiarize yourself with virtual platforms before facilitating or participating in a meeting. As much as possible, avoid troubleshooting during a meeting or presentation. If necessary, host a practice run, review a tutorial, or identify a virtual assistant who can help you. You must also commit to facilitation and be present by minimizing as many distractions as possible. Turn off email and other notifications, silence your phone, maximize the virtual meeting to full screen, etc. Practice active listening. Acknowledge people when they speak, make “eye contact” by looking at your webcam, nod or provide reaffirmations via chat, etc.

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About YW Boston

As the first YWCA in the nation, YW Boston has been at the forefront of advancing equity for over 150 years. Through our DE&I services—InclusionBoston and LeadBoston—as well as our advocacy work and youth programming, we help individuals and organizations change policies, practices, attitudes, and behaviors with a goal of creating more inclusive environments where women, people of color, and especially women of color can succeed.

As part of that work, we are helping organizations prioritize Diversity, Equity & Inclusion and become socially connected while staying physically distant. During this time, YW Boston is providing organizations with digital workshops and resources to help them better understand the challenges faced by their employees. For more information, please contact Sheera Bornstein at sheera@ywboston.org.

Nonprofit 411: Best Practices for Data Security with a Remote Workforce

Nonprofit 411 KPM-minBy Dan Keleher, Executive Director, KPM Consulting

In response to the COVID-19 pandemic, many nonprofit organizations made significant changes to their operations, systems, controls and the way their employees were working.  Many employees were moved to a remote environment for the first time, and as things changed rapidly, data security may not have received the attention it deserved. Now that the initial rush is over, and many nonprofits continue to operate remotely on a part- or full-time basis, this is the time to revisit whether these changes may have compromised your data security.

Remote Employees

  1. Be aware of phishing and social engineering schemes. Employees should remember to always check the sender’s email address, look twice before clicking any attachments, and when in doubt call or email (starting a new thread) the person you think sent the email to confirm that the request is legitimate.
  2. Encourage employees to revisit their password security. Consider using passphrases instead of smaller passwords. A passphrase is a phrase that is easy for the user to remember and then you can add complexity by capitalizing letters or adding numbers. Remember to use a unique password for each system you use.
  3. Remote employees should never use public wi-fi connections when working with sensitive data. Ideally, employees should use a VPN to access company systems. Multi-factor authentication is also highly recommended for validating access to the VPN.
  4. Employees should only use company-provided devices for work purposes. They should also consider physical security of these devices and documents. When not using a device, make sure you lock the screen. Additionally, consider collecting work documents and moving them out of sight when not in use.

New Technology

  1. In the initial rush of moving to a remote work environment, many employees installed new applications or software in order to assist with completing their jobs. Organizations are now faced with the question of whether these applications have all been properly vetted by the IT department. It is critical to make sure that IT reviews security controls and configurations for any tools that employees continue to use.
  2. Organizations should also ensure that employees have received adequate training on new technology. Security settings are not always intuitive and employees should be trained on how to prevent introducing security risks to the nonprofit.
  3. Were new controls adopted to address operational changes? If so, management needs to ensure that documentation has been updated accordingly so the nonprofit remains in compliance with any regulatory requirements.

Although your organization may be operating partially or fully remotely, it’s important to remember that the same data security processes and policies should be in effect as if you were working normally from the office. Cybercriminals look to exploit any weakness, so nonprofits must remain vigilant no matter the work environment. Following the guidelines above will help to ensure the security of one of your most important assets – your data.

Congress Passes Additional Federal Relief

On Monday, December 21, Congress passed a stimulus package to provide additional relief related to the COVID-19 pandemic. Important provisions for nonprofits were included in response to coordinated national nonprofit advocacy. Key nonprofit provisions include:

  • Second draw PPP loans: The bill provides $284 billion for Paycheck Protection Program (PPP) loans. Nonprofits may qualify for an additional loan of up to $2 million if they 1) employ fewer than 300 people; and 2) experienced a decline in gross receipts of 25% in one of the four quarters in 2020 compared to the same quarter in 2019. The bill expands the list of eligible loan expenses to include personal protective equipment, facilities modifications, and other worker protection expenditures, and simplifies the forgiveness application process for loans up to $150,000.
  • Unemployment insurance forgiveness: The bill extends the 50% federal financial forgiveness of unemployment insurance costs for self-insured nonprofits through March 14, 2021. As a reminder, the FY21 state budget extended the payment deadline for these costs owed to the Commonwealth to June 30, 2021.
  • Charitable Giving Incentive: The bill extends the federal $300 above-the-line charitable deduction through 2021, and includes a $600 deduction for couples filing jointly. The bill also extends for one year the previous stimulus law’s increased limits on deductible charitable contributions for individuals who itemize and for corporations.

In addition to these important nonprofit provisions, the bill also included $600 stimulus checks to individuals and $1,200 to couples, an additional $300 per week in unemployment benefits through March 14, extend the moratorium on evictions for one month, and provide critical funding for childcare, nutrition assistance, rental assistance, and funding for vaccine distribution. With questions or for more information, please contact MNN’s Director of Government Affairs, Danielle Fleury.

Governor Baker Signs FY21 State Budget

On Friday, December 11, Governor Baker signed a $45.9 billion budget for the remainder of the fiscal year, which will cover state finances through June of 2021. Throughout the budget process, MNN worked with legislative leaders to advocate for the following nonprofit relief provisions:

  • An extension of the payment deadline for employer unemployment insurance costs: The final FY21 budget included a 6-month deadline extension for nonprofit employers that self-insure for their unemployment costs. Without this deadline extension, nonprofits across the Commonwealth were facing large balloon payments owed for unanticipated COVID-19 layoffs that occurred from March to December of 2020. As a result of the delay – which was written into the budget as Outside Section 81 – self-insured nonprofits will now have through June of 2021 to financially plan and secure the resources necessary to make their unemployment insurance payments.
  • Support of charitable giving incentives: This year, MNN continued advocacy at the federal and state levels for policy incentives that support charitable giving. The FY21 budget adopted a one-year delay of the state charitable tax deduction, which was scheduled to be restored for contributions made in 2021. The one-year freeze means that without further legislative action, the deduction would become available for contributions made in 2022. MNN continues to advocate for the restoration of the deduction in order to support individual giving to nonprofit organizations.
The FY21 budget also included an additional $5 million to Community Foundations across Massachusetts to support local giving to individuals and charitable nonprofits. See this summary for an overview of the funding levels for key priorities across education, health, human services, arts and culture, economic development, and more.

With questions or for more information, please contact MNN’s Director of Government Affairs, Danielle Fleury, at dfleury@massnonprofitnet.org.

Nonprofit 411: How to Budget During a Pandemic

Nonprofit 411 NPCM-minBy Brian Kindorf, Managing Director at Non Profit Capital Management

Did any non-profit accurately predict what was going to happen in 2020? I suspect none did, so how will predicting 2021 be any easier? Most non-profits use the static budgeting method. This type of budget is often developed by management, voted on by the board of directors, and locked in place for the next twelve months. But how can management and a board predict what’s going to happen twelve months into the future of a pandemic?

The key to success in budgeting during any period of intense change- like an unprecedented global pandemic- is to embrace the uncertainty with a more dynamic budgeting process.

There is no rule that a budget must stay the same all year. In a dynamic budgeting process, the changing environment is constantly monitored and a new forecast is produced as information becomes available. It need not be a twelve-month budget or even conform to the non-profit’s fiscal year.

Rather than presenting the Board of Directors with a set of final numbers, management might consider presenting a set of inputs that are influenced by the pandemic. These might be the number of clients served, the number of volunteers recruited, the number of visitors, etc. Based on how those inputs move up or down, corresponding revenues and expenses move with them. Create different scenarios if you find your inputs are highly sensitive to the pandemic. Those might involve the ability for people to travel, or the opening of school, or the opening of other businesses around you.

The ability to run events and attract new donors is harder than ever, but many creative non-profits are finding ways to engage with their supporters in smaller, more intimate settings, or online. Evaluate your organization’s traditional supporters to see how they might be impacted by the pandemic. Are they business people in the finance sector? If so, they might be doing very well. Are they local business owners forced to closed? If so, they may not be able to sponsor the organization this year. Thinking through what pandemic inputs will impact your largest supporters will be critical to forecasting charitable revenue.

Sold on the concept of a dynamic budget? Start with the following steps:

  1. Break your expenses & revenues between fixed and variable. Fixed items are those that are not influenced by the pandemic. While most revenues and expenses have some degree of variability, this group is the line items with the least variability.
  2. Go through each of the variable lines and identify the input that influences them.
  3. For inputs that are highly influenced by the pandemic, create several scenarios that go out as far as your timeline.
  4. Each reporting period update those inputs based on your new information.

There is no “silver-bullet” to budgeting during a pandemic, but updating your forecast and not focusing on a static budget will allow your organization to better understand its own risks and opportunities.

Nonprofit 411: Demystifying Mergers

Nonprofit 411 H&B-minBy Eleanor Evans, Counsel at Hemenway & Barnes

In these uncertain times, many nonprofits are exploring mergers as a possible sustainability strategy.

What’s a “merger”? Generally speaking, a merger is the combination of one nonprofit’s programs, assets or entire organization with another’s by one of various methods, such as a formal merger, a parent-subsidiary relationship or a program transfer.

What can we achieve by merging? The ultimate goal should be to further your organization’s mission. This could mean expanding the number of people it serves, delivering new types of services or serving existing constituents more effectively and efficiently.

When should we begin thinking about a merger? Now, when your organization has strengths it can bring to the table – and before it finds itself in crisis. A particularly good time to initiate merger conversations is when the executive director is planning to depart or has just left.

What should we look for in a merger partner? An organization with a similar mission, compatible culture, contiguous service area or a menu of services or client base that complements your nonprofit’s will often make an attractive partner. Each partner should bring assets – resources, relationships, experience or skills – to the merger.

How do we find a merger partner? Start by reaching out to organizations with which your nonprofit, its executive director or board members have existing relationships. In some cases, it may be helpful to hire a consultant to help identify potential partners and facilitate conversations with them.

What lessons have other nonprofits learned from their experience with mergers?

  • Ensure that the merger furthers each partner’s mission. It’s important for each partner to identify how the merger will help it reach its strategic, mission-related goals. Each partner should initially assess its strengths and weaknesses, clarify what it hopes to achieve by merging and determine whether merging makes more sense than other alternatives. Both partners should examine the decision to merge from the perspective of those they currently serve and hope to serve in the future.
  • Articulate a shared vision. The partners should identify and agree on the results they hope to achieve and the impact merging will have on those they serve. This vision can be employed to get buy-in from stakeholders, rally board and staff members when obstacles arise, communicate with the public about the merger, and measure the merger’s success.
  • Identify merger champions who are passionate about and can help convince others of the benefits of merging and who will see the merger through to completion. Lining up advocates from each organization’s board early on is key to getting the boards to buy in and to fulfill their oversight role.
  • Conduct thorough due diligence. Each partner should conduct a thorough investigation of the other’s operations, assets and liabilities to identify issues that could affect how the merger is structured, require negotiation or derail the merger altogether. Experienced legal and financial professionals can be invaluable in this process.
  • Communicate with funders to ensure continued post-merger support.
  • Prioritize organizational culture. Assess each organization’s culture and identify and address areas where culture conflicts could impede effective integration. Take proactive steps to build a new organizational culture within the merged entity.

A merger is a fundamental organizational change that should not be undertaken lightly. Ultimately, its success will depend on the time and effort invested to identify and build trust with a compatible partner.

How Nonprofit Leadership Can Foster a More Inclusive Workplace Following the Election

By YW Boston

MNNNovember2020-min

With the election this month, it is expected that nonprofit employees’ attentions have been on the results and its effect on areas related to their mission. Nonprofit leaders may be wondering, “Should we be discussing the results within the workplace? If so, how?”

During a recent YW Boston DEI Community of Practice meeting, the team of DEI professionals shared their questions, concerns, and strategies for supporting inclusive workplaces during a contentious election season. Here is a summary of this discussion along with additional resources.

Fostering an inclusive workplace demands a commitment to digging deeper, creating an environment conducive to open and honest communication and to the challenging issues or conversations it can surface. To do so effectively, a senior leader must build knowledge and understanding of implicit bias and how it functions, particularly in regards to race; explore methods to interrupt this bias through building awareness and new habits; and apply this learning through small group activities.

Here are a few questions to consider following the election:

  • How explicitly do we address this?
  • Do we issue an internal statement? An external statement?
  • How might the election results impact our employees?
    • For example, if protests erupt after the election, how might that impact employee’s commutes? Their ability to focus on work?
    • What would it look like to try to mitigate these issues?

As leaders in your organization, you have formal authority. It is important to keep in mind that what and how you communicate sets the tone for others. Communication can feel perilous at times when it is unclear what to say, but hesitance to start critical conversations has its own pitfalls; employees and stakeholders do and will remember a lack of communication too. Effective communications will tie the messaging to organizational values, focus on the effect rather than the result of the election, name the concerns people may have, and address them.

Following the election, leaders can remember to:

  • This election season, alongside COVID-19, has brought deep disruption and uncertainty.
  • Acknowledge that employees may be feeling uncertain or finding it difficult to focus.
  • Recommit to core values of DEI, trust, respect, and shared focus of the work.
  • Consider conversations that employees can opt-in to.

There are many forums that can foster community and provide space for staff voices. Digital message boards, technology, messaging applications such as Slack, virtual employee resource groups, affinity group spaces, structured meetings, opt-in spaces, or facilitated conversations and town halls are all options that offer the opportunity to connect. With the proper framing, norms, and community agreements, you can help curate a space that continues to build community and understanding.

A town hall with the CEO or other senior leaders provides an opportunity for open dialogue across a whole organization, and for leadership to centralize messaging. If planning a town hall, the following considerations should be made in an effort to effectively hold space:

  • Be clear in the purpose
  • Protect time, town halls require a lot of preparation
  • Understand what questions are likely to be asked beforehand
  • An honest assessment of whether the leader has the skills and emotional intelligence to do it.

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About YW Boston

As the first YWCA in the nation, YW Boston has been at the forefront of advancing equity for over 150 years. Through our DE&I services—InclusionBoston and LeadBoston—as well as our advocacy work and youth programming, we help individuals and organizations change policies, practices, attitudes, and behaviors with a goal of creating more inclusive environments where women, people of color, and especially women of color can succeed.

As part of that work, we are helping organizations prioritize Diversity, Equity & Inclusion and become socially connected while staying physically distant. During this time, YW Boston is providing organizations with digital workshops and resources to help them better understand the challenges faced by their employees. For more information, please contact Sheera Bornstein at sheera@ywboston.org.

How Can Nonprofits Ensure More Successful Diversity, Equity, and Inclusion Initiatives?

By YW Boston

MNNSectorNewsSharedSectorOctober2020-min

As more nonprofits make organizational commitments in response to demands for greater diversity, equity, and inclusion (DEI), YW Boston has compiled a list of things to consider when ensuring a more successful implementation of these DEI strategies.

  1. Consider a dedicated DEI role within your organization

There is a lot of work to be done to improve diversity, equity, and inclusion within organizations. And so, one way for organizations to set themselves up for success is to have an internal role that is solely dedicated to DEI. This does not necessarily have to involve a new external hire. The important thing to remember is to build sufficient capacity, don’t just add additional DEI responsibilities to an existing employee’s job description. Be intentional and consider what a new DEI role could look like within your organization, and how it could either be filled by shifting someone’s role internally or hiring specifically for this role.

  1. Provide robust support to your DEI staff

That said, it’s important to set your organization’s DEI role up for success. If your organization already has a dedicated DEI staff member, this might mean growing your DEI team or finding additional ways to support them. One important aspect when it comes to supporting DEI staff is to have a deep understanding of what your organization’s needs are and what you would like your DEI staff to help you achieve. Clarity about your organizational goals will help DEI staff develop more effective assessments and workplans.

  1. Avoid creating silos between your DEI initiatives and the rest of your organization

The work of DEI professionals is to evolve the organization’s culture to a place where DE&I is centered in every initiative and department. To do this, you must ensure DEI staff have access to other departments and projects. Every department might have different perspectives on what DEI means to them, or even different readiness when it comes to embracing the work. By limiting your DEI staff’s reach, your organization risks limiting the amount of success your DEI initiatives can achieve.

  1. Encourage organization-wide participation

Having dedicated DEI staff within your nonprofit is just one part of organizational DEI strategy. An important part of fostering greater organization-wide acceptance and engagement is to encourage and model participation. This could mean sending internal DEI updates, encouraging staff to ask questions about new initiatives, building relationships between all-staff and DEI staff, or implementing processes for giving feedback about DEI efforts.

If you would like to access more resources about diversity, equity, and inclusion at work, refer to our Racial Justice and Diversity, Equity, and Inclusion Resources.

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About YW Boston

As the first YWCA in the nation, YW Boston has been at the forefront of advancing equity for over 150 years. Through our DE&I services—InclusionBoston and LeadBoston—as well as our advocacy work and youth programming, we help individuals and organizations change policies, practices, attitudes, and behaviors with a goal of creating more inclusive environments where women, people of color, and especially women of color can succeed.

As part of that work, we are helping organizations prioritize Diversity, Equity & Inclusion and become socially connected while staying physically distant. During this time, YW Boston is providing organizations with digital workshops and resources to help them better understand the challenges faced by their employees. For more information, please contact Sheera Bornstein at sheera@ywboston.org.

Nonprofit 411: Top Five Things Every Nonprofit Leader Should Know About Finance

Nonprofit 411 Night Heron-min

By Ellen Sturgis, Principal of Night Heron Consulting

People don’t get involved in nonprofits because they love finance! It’s about the mission right? But Executive Directors and Board members still hold fiduciary responsibility to ensure that resources are managed, protected, and used well. Here is my list of the questions you should ask about five key financial reports.

  1. Balance Sheet: The easiest number to understand is the cash balances, right? But what’s the right amount for your organization? A simple test: Divide your annual expense budget by 12. Divide your cash balances by that number. The result is the value of the months’ cash on hand. Is it under 6 months? That may be a concern. Look back to last year to observe cash fluctuations. This is your short term insurance against unforeseen events.
  2. Operating (P&L) Statement: Income. Understand where your revenues come from. Compared to last year, are you seeing a similar pattern of, for example, 50% donations and 50% grants? How likely are you to get the same grants every year? If there is a concentration in one area, how reliable is that year to year? I worked with one organization that depended on their annual Gala for over 70% of their annual revenue. Not good, especially when a pandemic forces the event’s cancellation.
  3. Operating (P&L) Statement: Expenses. As a leader of the organization, get comfortable with the general mix of expenses. Most nonprofits reflect a people-heavy budget: 70% in personnel and related costs isn’t terribly unusual—so don’t freak out. If you’re used to a commercial business, it may look odd, but it’s okay.
  4. Cash Flow: For many nonprofits that don’t have a cash reserve, this is the most critical report, and you may not even get one. Based on the income mix, are there certain months that are flush with cash (often December with year end appeals, for example)? Are there tight months (often summer) where expenses continue but revenue does not? Ask to see a monthly summary, from the previous year or two. Is that cash balance calculated above enough to get you through tight months?
  5. Budget: Most nonprofits have and vote on an annual budget. But remember, this is your roadmap to meeting your mission: no resources = no growth. If your organization wants to start a new program, is now the time if you’ve had losses in the last two years? Are new funding sources available? Will you have the cash or need a line of credit? These are the questions to consider, not just “do we break even”.

A PS about your annual audit—this isn’t just a requirement, it’s a terrific opportunity to get an independent assessment of your financial operations. Whether a review or full audit, two key suggestions: make sure the Board meets with the auditors without staff present, for a frank conversation. And I suggest changing audit firms at least every five years, especially if your staff stays the same.
 

A final word about all this in the time of COVID. When it comes to finance, the key concern should be the separation of duties. Talk to your auditors for suggestions. If only one person is opening and depositing donations, are you finding other ways to protect your organization’s gifts? Scanning and recording all documentation is critical. This protects everyone involved.

Nonprofit 411: How Third-Party Ownership Helps Nonprofits Benefit from Solar

Nonprofit 411 PowerOptions-minBy Walter Gray, Solar Program Manager at PowerOptions, a nonprofit energy organization in Massachusetts

Taking advantage of the financial benefits from purchasing and installing solar PV projects is relatively straightforward for homeowners and for-profit businesses – there’s an upfront capital cost of the project which pays off over time via three primary revenue sources: free electricity, state-level incentives, and federal-level tax benefits.

For a nonprofit, the federal tax benefits are wholly or mostly inapplicable because nonprofits have little or no federal income tax liability with which to monetize the tax benefits. And these benefits are significant.

For nonprofits to take advantage of these federal tax benefits and extract the most value out of a solar installation, the “third-party ownership” model has emerged as a popular method for nonprofit solar financing. There are a variety of business models around the third-party ownership concept, but the most common is the “Power Purchase Agreement” or “PPA”.

What is a Power Purchase Agreement?
Under a standard PPA, a solar developer will design, engineer, finance, construct, operate, and own the system for the term of the contract – typically 20 years. The host pays zero up-front cost, and agrees to buy the electrical output of the system for the term of the contract at a cost per kWh that is lower than the cost of buying grid-delivered electricity. This arrangement provides immediate savings to the host nonprofit, as well as a long-term hedge against the volatility of the energy markets.

What about the tax benefits?
The tax benefits accrue to the system owner – under the PPA this would be either the developer or an outside financier who transacts directly with the developer. Ownership of the system is like a home mortgage – the system may be sold to different owners over its lifetime, but the developer usually remains as the “servicer” throughout the term. As a for-profit entity, the system owner can efficiently monetize the tax benefits which provide a large part of the system payback, allowing them to charge a lower per-kWh rate to the host for the electrical output.

What does this look like in practice?
From the customer’s viewpoint, the tax monetization strategy takes place behind the scenes. The customer can shop for PPA proposals which will offer some high-level system specifications along with a per-kWh price for the electricity. The obligation to buy the output is the main commitment for the customer – the developer does all the planning and work including permitting and interfacing with the local utility, and delivers a turn-key project. The host has no operations or maintenance responsibilities aside from some typically benign obligations around not disconnecting or damaging the system.

Getting Started
We would start, as would any other developer, by asking for some information about your site (e.g. rooftop, parking lot) and requesting a copy of a recent electric bill. With this information, providers will be able to provide you with a free, no-obligation proposal to see whether it’s something you’d like to explore further.

As we always say at PowerOptions – a price is only as good as the contract terms behind it, so we encourage interested organizations to request template PPA contracts in order to evaluate different solar offerings.

It’s important to remember that solar incentives – both state and federal, decline over time so if you’re considering solar we encourage you to start the process as soon as possible.