In keeping with our commitment to operational transparency, Modest Needs publishes an annual report which is freely accessible to the public at large both via our website or in hard-copy.

The purpose of this annual report is to update interested persons on our prior year's program service achievements and to report on other significant accomplishments by Modest Needs throughout 2010.

Our Mission Statement

At Modest Needs, we work to prevent otherwise self-sufficient but low-income households from entering the cycle of poverty. We do this by offering three specific grant types:

  • The Self-Sufficiency Grant: Our Self-Sufficiency grant is our hallmark grant and helps low income workers to afford short-term emergency expenses that would otherwise pose an enormous burden to the applicant;

  • The New Employment Grant: Our New Employment grant is designed to assist who do not meet our self-sufficiency standard but are attempting to return to work by helping them to afford expenses that will allow them to pursue new employment, or to begin a new job that the applicant recently has been offered.

  • The Independent Living Grant: Our Independent Living grant is designed to assist persons who cannot meet our self-sufficiency standard because they are permanently unable to work with the cost of medical or assistive equipment not covered by Medicare, Medicaid, or other types of insurance.

In addition to these grant types, Modest Needs offers a Non-Profit grant that is designed to help small non-profit organizations to afford the kinds of program expenses which will strengthen the services they provide for our communities, but are so small that they would not be considered a priority for conventional grant makers.

Modest Needs in 2010: Learning to do More with Less

Like nearly all non-profit organizations operating in the United States, Modest Needs finally felt the impact of the Great Recession - to which we had been largely immune - in 2010. In this year, for the first time ever, we saw a decline in overall fundraising, primarily because many people who had been our donors in years past suddenly found themselves out of work and unable to continue their support for Modest Needs.

It has become a commonplace to say that, as a result of the Great Recession, all non-profit organizations have learned to do more with less. This was certainly true with Modest Needs in 2010. But we took the opportunity that we had been presented to work within 'the New Economy' to carefully consider how we could streamline our programs, reduce our operating costs, and invest in key aspects of the organization that would allow us to move towards self-sustainability, even as we were learning to work within what has been called 'The New Economy.'

With these goals in mind, Modest Needs' 2010 milestones included:

  • Revision of Our Programs and Services to Better Meet Our Applicant's Needs at a Lower Cost;

  • The Adoption of Cost-Cutting Measures Designed to Bring Modest Needs Closer to Self-Sustainability; and

  • Investing a New, 'State of the Art' Website

Revising Modest Needs' Programs and Services to Better Meet Our Applicant's Needs

Modest Needs was designed from its inception in 2002 to fill a critical gap in the 'safety net' offered by more conventional charitable organizations - the 'loophole' that prevented low-income households but normally self-sufficient households to receive assistance when faced with a short-term emergency.

Since that time - and this will come as no surprise to anyone - we have found more 'gaps' in the safety nets provided by conventional types of social service and charitable organizations than we would ever have imagined to exist. To that end, prior to 2010, we had consistently raised the maximum grant available to our applicants each year, and we had even introduced grant programs, like our 'Bridge Grant' and 'Independent Living' grant, that were designed more to patch the holes in this 'safety net' than they were to fulfill Modest Needs' primary mission as described above.

As a result of these decisions, throughout 2009 and the early months of 2010, Modest Needs received an overwhelming number of grant applications from persons who, strictly speaking, were not the low-income but normally self-sufficient workers Modest Needs was founded to assist, and the cost to fund an 'average' grant application increased from approximately $500.00 in 2008 to well over $1,000.00 by mid-2010, and at a time when contributions to Modest Needs had declined somewhat due to the recession.

By July of 2010, we came to accept the unfortunate reality that Modest Needs would not reach self-sustainability if we persisted in our attempt to be all things to all people. For this reason, we made the decision to revise our grant program offerings primarily by:

  • Eliminating the 'Bridge Grant': Introduced in 2009, the Bridge Grant had been designed to help persons who were not working due to the recession (and who therefore did not meet our self-sufficiency standard) to afford a month's rent or mortgage while they were actively seeking employment. As much as we agreed that, in principle, the Bridge Grant did work to fill a gap in our social service safety net, we ultimately concluded that we did not have the funding to offer this grant on a continuing basis. We therefore discontinued the 'Bridge Grant' in July 2010.

  • Introducing a 'Floating Maximum' Grant: Prior to July 2010, our maximum grant had been fixed at $1,000.00. After careful consideration, we found that this relatively high maximum grant amount had the effect of encouraging applicants to apply for more assistance than was actually required to resolve their immediate crises, and did not take into account the higher costs of living in major metropolitan areas (a person living in Chicago, Los Angeles, or New York City, for example, would've had a great deal of difficulty applying for help to afford a month's rent - Modest Needs' most common type of application.

    To better provide for the needs of our applicants, in mid-2010, Modest Needs introduced a 'floating maximum' grant. This floating maximum is set by our system for each household that applies for assistance from Modest Needs and is the greater of $750.00 or 3.75% of the household's verifiable annual income for the Self-Sufficiency grant, and fixed at $750.00 for our Independent Living and New Employment grants.

    Our movement to this floating maximum grant model had the immediate effects of encouraging people to apply for assistance only for help they really needed (thereby reducing the cost to fund most applications); opening Modest Needs' program services to people living in major metropolitan areas; and increasing the number of grant applications Modest Needs was able to fund, even on a reduced budget. Overall, this was perhaps our most significant advance in 2010 with respect to the administration of our program services.

  • The elimination of our Application Processing Fee In 2009, Modest Needs began charging an experimental, fully refundable application processing fee in the amount of $7.50. We made the decision to begin charging this experimental fee to see whether such a fee would help us to control against inappropriate applications for assistance to Modest Needs, of which there have been many hundreds of thousands over the years.

    By mid-2010, we examined the results the results of this experiment and discovered that, while the fee did not necessarily prevent us from receiving inappropriate applications, it did have the effect of discouraging persons who might otherwise have been terrific Modest Needs grant candidates from applying for our assistance.

    Under these circumstances, in August 2010, we did away with this experimental fee, having refunded the fee to all persons who paid it and otherwise qualified to receive assistance from Modest Needs.

Thanks in large part to these and other measures we took to streamline our grant program offerings in 2010, Modest Needs was able to reach approximately as many applicants as had been possible in 2009, despite the substantial decrease in available funding that largely defined our actions in 2010.

Moving Towards Self-Sustainability

In 2010, so that we might fund more of the applications for assistance that we received despite a decrease in overall funding from both foundations and individual donors, Modest Needs adopted substantial 'cost-cutting measures' designed to trim our management and fundraising costs to the very lowest level possible while allowing us to actively maintain our program services. Specific measures taken included:

  • Reduction of Staffing and Salary Levels: In 2009, Modest Needs had approximately 12 full time employees, most of whom worked to process the applications for assistance that we received.

    While most of Modest Needs' staff members worked directly with our applicants,once we had introduced software that would allow for automated pre-screening of our applications, we found that this level of staffing simply was no longer necessary.

    For this reason, Modest Needs dramatically reduced its staff size in 2010, primarily by not rehiring to replace persons who left the company for one reason or another.

    By the end of the year, Modest Needs was operating with a staff of just six full-time employees (including one new hire, discussed below). It is also of note that, in light of the organization's reduction in revenue, the President of the organization voluntarily requested and received a substantial reduction in salary (but not a corresponding reduction in workload), beginning in July of 2010.

  • Elimination of Travel and Related Budgetary Line Items: From 2007 to 2009, Modest Needs had incurred substantial travel and meeting costs primarily related, first, to our partnership with Loews Hotels and then with the maintenance of our San Francisco office.

    Modest Needs had already reduced travel and related costs substantially in 2009 with the elimination of our partnership with Loews Hotels and the closure of our satellite office in San Francisco. But in 2010, Modest Needs adopted a resolution very significantly limiting the circumstances under which business-related travel and related expenses could be incurred by the organization.

  • Renegotiation of our Vendor Contracts: Throughout 2010, we aggressively and very successfully renegotiated our vendor accounts with an eye towards lowering the costs that could not otherwise be eliminated. We were very successful in this endeavor.

  • Elimination of Nearly All Fundraising Costs: In years' past, and particularly in 2007-2009, Modest Needs had experimented with a number of fundraising efforts.

    A careful cost / benefit analysis of these efforts revealed that, while these fundraising efforts had been generally successful, they often had not been worth their cost to us. In 2010, Modest Needs eliminated or suspended virtually all fundraising efforts in deference to what we know best - working with donors via our website.

As a direct result of these efforts, Modest Needs was able to reduce its combined management and fundraising costs in 2010 by well over $100,000.00, all of which we re-routed directly to our program services. We are extremely proud of this achievement.

Investing in the Future of Modest Needs

Even as we were cutting costs in 2010, Modest Needs was carefully considering what grant-funded investments in our future we could and / or should be making. Ultimately, we determined that our focus should be on two areas that we had neglected for far too long: our Social Media presence, and our Website.

With regard to Social Media, Modest Needs had long maintained a presence on Facebook, Twitter, and other major social media outlets but had not ever really attempted to leverage those platforms to publicize the availability of our programs and services or to introduce prospective donors to our work.

Finally, in 2010, we determined that it was most certainly in our best interests to become an active part of these communities. To ensure that, when we did step into the social networking arena, we didn't immediately put our collective feet into our mouths, we authorized just one new hire in 2010: a social media expert who had known about Modest Needs since its inception and was, in fact, the first person ever to hired to maintain a newsroom 'blog' for a major network affiliate.

We had to do quite a bit of work to recruit this new hire, but the work paid off. We hired our Director of Outreach in May 2010, and by July 2010, we had gained thousands of Twitter followers and Facebook fans, all of which served to significantly expand our reach to persons who probably wouldn't have discovered Modest Needs otherwise.

Secondly, and more importantly, after years of reading correspondence from people who indicated that they loved our work but found our website extremely difficult to navigate or use effectively, we determined that any movement towards self-sustainability would need to include a complete overhaul of Modest Needs' current website, with an emphasis on simplicity, user-friendliness, and sporting a new, more attractive, more engaging design.

With this goal in mind, and given the enormity of this project, in 2010, the directorship of Modest Needs Foundation opted to outsource the ongoing maintenance and development of Modest Needs' website. After considering bids for the project, the Board of Directors opted to engage for this purpose the services of a web design firm for which the president of the organization had worked on a part-time basis for a considerable period of time. Modest Needs' Board elected to engage this firm specifically because:

  • The bid submitted by the firm selected by the Board of Directors to complete this work was among the lowest received in response to the board's call for bids on this project; and

  • The Board of Directors believed that, because the president of the organization had been primarily responsible for the design of Modest Needs' current system, his part-time association with this firm would provide continuity of development and significantly lessen the time necessary to complete this massive project.

The cost of the contract into which the Board of Directors entered with this firm, which we anticipate will be funded in full or in large part by grants made to the organization for this purpose, includes:

  • The estimated cost of a complete redesign of Modest Needs' website (which currently spans more than 400 pages and contains well over two million lines of code) over a period of two years; and

  • The estimated cost of ongoing maintenance of, adjustments to, and technical support for both Modest Needs' current and new websites for a period or three years.

Important Disclosure: Prior to consideration of bids for the project, the president of Modest Needs disclosed his association with the firm that was ultimately selected by the Directors of Modest Needs to complete this project and recused himself from any discussion or consideration of bids for the project itself.

Further, during the course of our FY 2010 audit, Modest Needs' external auditors carefully reviewed the aforementioned transaction and determined:

  • That both the president and the organization's Board of Directors adhered meticulously to the organization's Conflict of Interest Policy in engaging this firm to perform the work described above; and

  • That given his limited involvement with the firm ultimately engaged by Modest Needs' Board of Directors to complete this work, no material 'Conflict of Interested' existed with respect to the transaction.

After working with the web development firm to complete the aforementioned website redesign project on a paid basis for approximately six months, the president of the organization resigned his part-time position with the firm that Modest Needs' Board of Directors had engaged to complete this project to focus more fully on the duties associated with the day-to-day operation of Modest Needs Foundation. However, in the interest of completing this project as quickly as possible, the president of the organization has agreed to continue to provide consulting services to this firm on a pro-bono basis for the duration of the project.

The total amount of additional compensation received by the president in conjunction with his paid, part-time work on this project in 2010 was $13,283.61.

We are extremely confident that, when completed, Modest Needs' new website will make it possible for us to reach more persons in need of our help than ever before and are looking forward to its launch, which is scheduled in time for our tenth anniversary, on 21 March 2012.

--Dr. Keith P. Taylor, President / Executive Director, Modest Needs Foundation (30 December 2011; updated 4 February 2013)

2010 Financial Information at a Glance

Income and Expense Categories Amount
Income from Direct Public Support $1,928,397.00
Other Program Service Income $24,998.00
Other Income $33.00
Total 2010 Income $1,953,428.00
Program Service Expenses (89.48%) $1,727,478.00
Management / Administrative Expenses (6.70%) $129,368.00
Fundraising Expenses (3.82%) $73,655.00
Total 2010 Expenses $1,930,501.00
Revenue over Expenses for FY 2010 $22,927.00
Net Assets & Fund Balances, Beginning of Year $488,595.00
Net Assets & Fund Balances, End of Year $511,522.00

You may view a breakdown of the functional expenses listed above by accessing either our FY 2010 Form 990 or our 2010 Independent Auditor's Report. Links to both in PDF Format are below.

Notes Concerning 2010 Administrative and Fundraising Expenses

In 2010, all of Modest Needs' management, fundraising, and employee-related expenses - including officer and director salaries - were paid in full by grants made to the organization specifically for this purpose.

Thanks to the generosity of our major funders, Modest Needs' individual donors bore absolutely none of responsibility for the management and fundraising costs incurred by Modest Needs in 2010.

Supporting Financial Documents for 2010

Please note: all documents below are in PDF format and can be viewed via the free Adobe Acrobat Reader.

Would you like a hard copy of our 2010 Annual Report?

If you do not have regular internet access but would like to receive a hard copy of the Annual Report above, along with accompanying materials, please send your request to:

Modest Needs Foundation
115 E 30th St, FL 1
New York NY 10016

Alternatively, you may request a hard copy of this report by calling us at (212) 463-7042, x114.