The mission of the home-building organization Habitat for Humanity International, drawing on volunteer power and private funding, is to “eradicate substandard housing and to offer lower-income people a ‘hand up’ rather than a handout,” according to Lisa Farris. As CFO of the New Orleans-area affiliate, one of 1,600 separately filing 501(c) units that are part of the 34-year-old Atlanta-based nonprofit, Farris has seen a lot of substandard housing — much of it destroyed by Hurricane Katrina in the summer of 2005.
Today, the annual home building of New Orleans Area Habitat for Humanity is still more than five times the pre-Katrina annual total of 10 to 12 houses, but far below the peak of 119 in the June 30, 2009, fiscal year. (Qualifying families buy houses with no down payment and 0% interest mortgages, but invest “350 hours of sweat equity in a partnership agreement with us,” says Farris.)
If the five-year total of 300 homes built seems impressive, the challenge of replacing housing lost to Katrina remains almost impossibly daunting. “Of course, eradicating substandard housing is an unreachable goal,” says Farris. Meanwhile, potential donors are turning their attention from Katrina’s devastation to the needs arising from more-recent catastrophes, particularly the BP Gulf oil spill just offshore.
Still, New Orleans Area Habitat brings in more than $2 million annually, and is just now receiving its first federal grant aid. It is also attracting new volunteers (and funds) through a “service day” program, in which employees attending conventions in New Orleans can pitch in on home-building projects, with their employers covering the fee.
This week CFO talked with Farris, a New Orleans native who has headed the finance operation at New Orleans Area Habitat since May 2008. An edited version of the interview follows.
Five years after Hurricane Katrina, what has been the role of Habitat for Humanity in rebuilding New Orleans?
Habitat has been the largest home builder in the city. But the housing lost was in the hundreds of thousands. We’ve put back 300, and we’d like to continue at that kind of a pace — 55 to 60 a year.
How closely tied is your affiliate to the Atlanta parent?
Not very. International does do internal audits of the affiliates, but we’ve only had two since the storm — and that was because so much funding went through International to us. They just wanted to make sure we were recording it properly.
When you started at Habitat in 2008, what were your biggest challenges?
The biggest was that as the organization went from [building] 10 houses to 50, 60, or 70 houses, it didn’t have the [necessary] financial systems in place. It was concentrating on getting the houses built and the families in. My first goal was to bring in an integrated system. It streamlined the operation and helped us increase the number of houses built. In fact, my department went from eight people to four, and the purchasing department went from four people to one. You have to run this like a business, although our first objective is to accomplish our mission.
In the first year after Katrina, you received $20 million in donations. What is your funding like today?
It has substantially decreased. Part of it is that we’re five years out, and the other part is the economy. Even the foundations don’t have the income to come through with grants. From getting $20 million in that one year, now we’re down to $2 million to $3 million.
Why did you wait so long to seek government funding?
International doesn’t like to turn to government. But after Katrina, International said we could apply for government grants. And government funding is not just a pick-up-the-phone kind of thing. It’s a long process and a lot of paperwork.
How many volunteers do you have around this time of year?
We have fluctuations in volunteers, and a lot of that is based on the weather. Nobody wants to be out there in August, and I’m one of them. We did get 300 volunteers a day for the fifth anniversary [of Katrina], but that’s unusual. September is a slower month because of school starting, but in October we’ll see an uptick in the number of volunteers to about 100 a day, and more than that on the weekend.
Tell us about the volunteers you attract from conventions.
The New Orleans convention business is back to where it was the year before Katrina. A lot of the conventions contact us and do a service day, either the day before the conference or the day after. If they bring in 5,000 people, they’ll sign up some to volunteer with us. Right now we have [employees from] Gap and Anheuser-Busch volunteering.
There is a fee for volunteering. If Gap wants to send 200 volunteers, [the company pays Habitat] $50 a person. Individuals may want to contribute, too.
How much income does that generate?
Last year our income from that source was probably $300,000, including student volunteers. But all our volunteers get to stay in New Orleans and have a great time, and they do great work.
What’s your view of New Orleans’s future?
It’s bright, and we’re happy with Habitat’s part in that. The musicians are coming back, along with tourism. Everybody’s favorite restaurants are back — in fact, we have more restaurants now than before the storm. I’ve even started to eat seafood again. Like everybody else, I’d stopped after the Gulf oil spill. And, we’re still celebrating the New Orleans Saints football championship.