Lutheran Social Services of North Dakota announces closure due to drained finances

Local News

Lutheran Social Services of North Dakota announced they will be suspending their programs and begin the process of closing. And filing for bankruptcy if necessary.

Lutheran Social Services has touched the lives of vulnerable individuals and families in need. Now, they’re needing help to transition smoothly so none of their clients fall through the cracks.

Bob Otterson, CEO of Lutheran Social Services says, “Last year Lutheran Social Services of North Dakota provided healing, help and hope to more than 24,000 people across the state. They are affected, the families of our 283 employees are affected.”

For 106 years, Lutheran Social Services provided services to children and adults needing treatment for things like substance abuse, gambling, or housing assistance. And recently, the LSS Housing affiliate drained the resources of the larger agency creating financial pressure.

Otterson says, he never saw the shut down coming.

Bob says, “The agency had some financial challenges that I was aware of when I came in the door. I would not have predicted this outcome 51 days ago. I would not have predicted this outcome 10 days ago.”

And it wasn’t necessarily the pandemics’ fault. In 2009, when the housing program began, the oil boom created the need for affordable housing in the western part of the state. Since finances and oil stopped rolling in LSS began to feel the pressure.

Bob says, “This nonprofit established a budget for the current fiscal year of approximately $19 million dollars in both revenue and expenses. However, certainly, the pandemic affected the ways in which individuals could deliver their services. Secondly, a decrease in oil production during the last year put yet more stress on the housing system and the ability for our people to deliver our services around all of that became compromised.”

Since then, Lutheran Social Services has relied on several state organizations to help take on some of the program services during this transition. The North Dakota Department of Human Services is one of them.

Chris Jones, the Executive Director of North Dakota Department of Human Services says, “In some ways, these are some of the most vulnerable individuals in the state. And we contract with a number of different agencies to provide these services so A lot of the services provided for the clients that LSS served just don’t have access to the basic social determinates of health.”

Jones says these services provide clients from going into deeper crisis and, in some ways are an early intervention so people can be successful. Both men agree there is hope for the clients, hope for the families, and hope for the employees.

Jones says, “We have to stay focued on the positive and treat this as an opportunity to continue to evolve.”

Over the course of the next few weeks, state agencies will help contribute to the transition of hundreds of LSS employees and thousands of clients.

Copyright 2021 Nexstar Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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