Over the past few years, I’ve noticed a clear shift across human service organizations, particularly in behavioral health, housing, and developmental disability providers.
More agencies are stepping into large-scale capital projects, often out of necessity rather than choice. At the same time, traditional financing has become more difficult. Between rising interest rates, liquidity pressures, and tighter lending environments, tools like conventional debt and tax-exempt bonds are not always viable on their own.
As a result, many organizations are turning to non-traditional capital strategies, including tax credits, to meet their strategic and growth needs.
Programs like the Low-Income Housing Tax Credit, New Markets Tax Credit, and Historic Tax Credit are opening doors for projects that simply wouldn’t be possible otherwise.
But there’s an important reality that often gets overlooked: These are not just financing tools. They are complex, resource-intensive undertakings that require significant organizational commitment.
If your agency is considering this path and isn’t sure where to begin, it’s helpful to hear directly from those who have gone through it.
I recently spoke with two nonprofit CEOs, Janine Robitaille, Chief Executive Officer of Interfaith Partnership for the Homeless (IPH), and James Button, President and Chief Executive Officer of Citizen Advocates. Both leaders utilized tax credits to advance their missions and shared their experiences, including both the opportunities and the challenges.
What Was the Motivation for Tax Credits?
For both organizations, the decision to pursue tax credits was driven by mission and necessity. Janine Robitaille initially pursued historic tax credits to close a capital gap on a building project that had grown beyond available grant funding. “The project was becoming larger than what traditional funding could support. Tax credits made it possible.”
For James Button at Citizen Advocates, the motivation was more explicitly strategic. The organization used the Low-Income Housing Tax Credit to expand into housing as part of a broader “housing first” model. “Housing is a critical social determinant of health. This allowed us to expand our mission and better serve the communities we support.”
Despite different starting points, both projects shared a common reality: Without tax credits, the projects likely would not have happened.
The Tradeoff: Financial Opportunity vs. Organizational Demand
While the financial benefits were clear, both CEOs emphasized the significant internal investment required. Janine described the process as all-consuming, “Your life becomes about the project. Other work has to take a back seat.”
Her team participated in weekly calls with attorneys, investors, consultants, and contractors, often navigating highly technical discussions.
Similarly, James highlighted the level of coordination required, “It involved significant complexity with financial, legal, and regulatory. Multiple team members had to develop a working understanding of the structure and risks.” Even when the workload felt manageable, the level of sophistication required was not typical for most nonprofit organizations.
Complexity of Tax Credit Projects Is Often Underestimated
Both leaders pointed to complexity as one of the most underestimated aspects of tax credit projects. Janine recalled sitting through meetings filled with legal and financial terminology that felt unfamiliar, “At times, it felt like they were speaking another language.” Her project involved layered financing structures, numerous legal entities, and extensive reporting requirements after completion.
James echoed that sentiment from a different angle, highlighting the number of stakeholders involved, “We were working with multiple state and local agencies, investors, and partners. In many cases, we were building those relationships from scratch.”
Risk Management
Both CEOs emphasized that tax credit projects meaningfully change an organization’s risk profile. From a financial standpoint, James noted increased debt and more complex borrowing structures, “It introduced heightened scrutiny from lenders and impacted our access to capital.”
Janine pointed to compliance and operational risk, particularly around meeting expectations tied to the credits. In her case, external factors like COVID-19 disrupted original assumptions about how the project would operate, adding further pressure.
There is also reputational risk, especially for projects requiring community support. James emphasized that success depended on building broad external backing, “This wasn’t something we could advance alone. However, once the community aligned behind it, the project became unstoppable.”
The Importance of the Right Team for Tax Credit Projects
If there was one area where both CEOs were unequivocal, it was that you cannot do this alone.
Janine credited experienced advisors, such as tax credit consultants, legal counsel, and banking partners as critical to completing the deal. “You need people who know what they’re doing and you have to be willing to ask for help.”
James similarly highlighted the importance of external partners and added another key insight, “If we were to do it again, we would engage a peer organization that has already completed a project like this.” That peer perspective, someone who understands both the technical and practical realities, can be invaluable.
Governance & Alignment
Both organizations relied heavily on their boards throughout the process. Janine’s board was supportive and trusted her leadership to assemble the right team and move the project forward.
James took a more deliberate approach, “We pursued unanimous board support. That required time, but it paid off.” Once aligned, his board became an active partner, leveraging community relationships and helping build external support.
The Human Cost: Time, Stress & Focus
Beyond financial and technical considerations, both CEOs acknowledged the personal and organizational toll. Janine described sustained stress, long hours, and constant pressure:
“There was always something that could derail the deal. You just couldn’t let the ball drop.”
At the same time, she was managing a capital campaign and navigating community challenges.
James framed the cost in terms of organizational focus, “It requires a significant level of commitment and sustained attention.” He also noted a positive outcome; an evolving relationship with investors, “It started as compliance-driven, but as we built credibility, it became collaborative.”
Understanding how investors evaluate risk and progress became one of the most valuable takeaways.
So…Was It Worth It?
Both leaders were clear. Janine was candid: “I would do it again. But you have to know what you’re getting into.” James echoed that sentiment, “The benefits clearly outweighed the costs. It allowed us to deliver something that would not otherwise have been possible.”
Key Considerations for Human Service Organizations
Tax credits are not just a financing decision, and they are certainly not a simple capital project. They are an organizational commitment that impacts leadership, finance, operations, governance, and overall capacity.
Organizations considering this path should keep the following in mind:
- Build the right team early: Engage experienced consultants, legal advisors, and financial partners.
- Ensure full organizational alignment: Leadership and board commitment are critical.
- Be prepared for complexity: Expect a steep learning curve and multiple stakeholders.
- Understand the true cost: Consider internal capacity, opportunity cost, and leadership bandwidth.
- Stay persistent: These projects often involve delays and multiple attempts before success.
About the Leaders
Janine Robitaille is Chief Executive Officer of IPHNY, located in Albany, New York, whose mission is to support homeless and at-risk community members in the Capital Region and surrounding areas.
James Button is President and Chief Executive Officer of Citizen Advocates and its affiliates, whose mission is to strengthen access to high-quality mental health and addiction services, physical health, developmental disability services, housing, and other supports that promote individual heath in communities across Upstate New York.
If you have any questions or are interested in learning more, we are here to help. Please do not hesitate to reach out to discuss your specific situation.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
