Benefits Data Trust failed to find a partner to take over its work, will close Aug. 24
The closure will put about 270 people out of work.
Benefits Data Trust confirmed Tuesday that it will close Aug. 24 after failing to secure a deal with another nonprofit to take over the organization’s work helping people sign up for government benefits.
“In the past few weeks, BDT met with many possible partners and funders to discuss any possible means of continuing BDT’s mission‚” founder Warren Kantor said in a statement. “As of yesterday, it became clear that we had exhausted all avenues and would not be able to find a sustainable way forward for the organization in the time remaining.”
Kantor thanked funders — the Bill & Melinda Gates Foundation, Ballmer Group, the Rockefeller Foundation, Robin Hood Foundation, Gitlab, the Pew Charitable Trusts, and others — for their help in trying to find a solution for BDT’s cash crunch that led to the abrupt decision to close.
The recent turmoil at BDT started in early June, when the organization replaced CEO Trooper Sanders. Two weeks later BDT said it would close in 60 days. The organization has provided no details about how deep its financial hole was.
As of October, Benefits Data Trust was on track to report a $9.8 million loss for 2023, but it was expected to bring in enough revenue to break even in 2024. The cash crisis arose after some grants were delayed.
Kantor founded BDT in 2005, based on the call-center model used in the credit card industry, where he had a long career.
Historically, much of the organization’s revenue came from government agencies, such as the Pennsylvania Department of Aging, which relied on BDT for help getting seniors to apply for a discounted drug program.
“The cost to deliver this service was not entirely covered by the revenue provided by the contracts, and BDT has always needed to rely on philanthropic giving to fill the gaps,” Kantor’s statement said.
Because call centers are expensive to operate, especially after the pandemic caused wages to rise throughout the economy, BDT has been spending heavily to develop digital tools that would be more efficient at helping people sign up for benefits.
It’s not clear what will happen to the existing BDT technology.