To our valued clients, funders, partners, and stakeholders,

The board of 501 Commons is pleased to share encouraging news: Thanks to the generosity of our community supporters, we have secured sufficient funding to resolve the cash flow crisis that recently threatened our operations. As a result, we are able to continue delivering essential services to Washington State’s nonprofit community.

To some of you, this news will come as a relief. To others, this may be a surprise.

On August 25, faced with a severe cash flow crisis, the board made the difficult decision to initiate dissolution of 501 Commons. This action was not taken lightly. It reflected the seriousness of our financial challenges, including delayed payments, audit recovery costs, funding shifts, GiveBIG decline, and mounting obligations that exceeded our reserves. We acted quickly with a reduction in force, program adjustments, freezing nonessential expenses, and increased requests to the funding community for general operating support. Despite these measures, it became clear that without immediate relief the organization could not continue operating responsibly.

In the days that followed, the response from our community was extraordinary. Supporters stepped forward with commitments that changed our outlook, including:

• A $150,000 challenge grant from an anonymous donor.
• $50,000 in matching gifts from board and community members.
• Invitations to apply for grants totaling $330,000 from both corporate donors and foundations.

We are deeply grateful for the trust and commitment shown by our donors, funders, partners, and clients. We also want to acknowledge the concern and disruption this situation may have caused, and we sincerely apologize to our clients and team members.

You can help 501 Commons by making a donation at wagives.org/501-commons or clicking the button below. We want to thank every donor who has given us a gift to help alleviate our financial stresses. Any donation, no matter how big or small, will help us remain solvent in 2026 and forge a better path forward.

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The potential loss of 501 Commons’ services would have had serious consequences for the nearly 2,000 organizations we serve annually—especially those that rely on our fractional HR, finance, and technology support, offered at accessible rates of $400–$1,200 per month. These services are more critical than ever as nonprofits face increasing financial pressures.

Our mission remains at the heart of every decision we make. It is what inspired the board’s fundraising efforts and our renewed commitment to the organization’s future. We will continue doing everything in our power to ensure 501 Commons remains a vital resource for the nonprofit community.

We appreciate your continued confidence in our ability to deliver high-quality, responsive services—and we hope you’ll stand with us as we move forward. 

Additional background on the dissolution decision and our path ahead is provided below, with more details to follow in the coming days. Additionally, we will be hosting a virtual town hall meeting that is open to clients and funders to allow direct interaction with the board. We will let you know when that will happen soon.

Thank you for your unwavering support.

Warm regards,
Richard Starnes 
On behalf of the 501 Commons Board of Directors

Frequently Asked Questions

Q. What is the background on the dissolution decision?

In 2025 significant reductions in donor/foundation and government funding, plus unanticipated costs and disruption in income from clients, led to declining cash flows. In a board meeting on August 25, which closely reviewed the cash position and possible options, it was determined that the only way to have an orderly wind-down of 501 Commons’ operations was to pass a motion to dissolve the organization so we could meet our contractual and fiduciary responsibilities.

Q. How has the community responded?

In the days following the announcement of this decision, there was a strong outpour of support from donors. An individual donor made a $150,000 challenge grant donation. Board and community members have come forward with $50,000 to meet the challenge. 

Three giving entities have also requested applications for a total of $330,000 in general operations funding.

Q. Why reverse the decision to dissolve?

After a briefing on budget projections and the fundraising campaign at a board meeting on September 5, the board rescinded the dissolution. It was determined that the organization had secured the working capital needed to continue operations and that the likelihood of additional grant funds would take 501 Commons beyond the minimum that was determined to be necessary and provide a larger working capital reserve.

Q. What is the path forward?

The organization has decreased expenses by 12% this year, in part because the organization ended a state grant. 501 Commons also decided earlier this summer to sunset the Data Solutions program. The dedicated staff of this program has provided excellent services to nonprofits since 2011, but in the current environment, organizations are canceling larger Salesforce projects, so the program is no longer viable.

To ensure financial stability and organizational resilience, our next steps include:

• Focusing on core services such as HR, Finance, and Nonprofit Advisory Services, while winding down programs that are not sustainable.
• Rebuilding a balanced financial model that includes both earned revenue and increased philanthropic support, including clear board fundraising commitments in 2026 and beyond.
• Strengthening leadership and accountability by sharing responsibilities across staff and board committees.
• Embedding equity to ensure services are accessible and relevant to the communities we serve.
• Building new partnerships with aligned funders and organizations that expand our reach and create shared solutions.

We anticipate these steps will help us rebuild trust, improve resilience, and ensure that 501 Commons remains a vital partner to the nearly 2,000 nonprofits we serve each year.