Republic file photo Family Service Inc. logos that have been used throughout the years are shown.
Local leaders say the closure of a decades-old mental health counseling agency in Columbus is a “big loss” for the community and a reflection of an increasingly “fragile environment” for nonprofits nationwide — one that could force other local organizations to close this year.
On Monday, Family Service of Bartholomew County announced in a news release that it had started winding down services after nearly six decades and planned to cease operations by Feb. 20, citing “stark financial realities.”
United Way of Bartholomew County President Mark Stewart characterized the closure of Family Service as a “big loss” for the community. Family Service is a United Way partner organization.
“Family Service has been a part of this community for over 50 years, and they really did provide valuable service to our community to a group of people who often would have went without mental health services,” Stewart said.
However, the organization “always had a difficult business model,” Stewart said.
“The therapists that they employed were highly qualified, and the rates that they were able to pay to therapists were not at kind of market level, if you will,” he said. “…But there are a lot of not-for-profits right now that are struggling. We are in a very difficult time right now for not-for-profit organizations.”
Family Service did not specify the nature of its financial difficulties in the news release, and its executive director, Sue Lamborn, said the organization had no further comment at this time.
Records with the Internal Revenue Service show that Family Service reported a net loss of $73,295 in 2024, compared to $141,902 in net income in 2023. The organization also reported net losses in 2022, 2019, 2017, 2016, 2015, 2014, 2013 and 2012.
Details of Family Service’s financial positions in 2025 were not yet available.
The closure of Family Service comes as officials say many nonprofits across the country — including in Bartholomew County — are facing growing financial pressure driven in large part by funding uncertainty, changes in funding sources, slowdowns in government reimbursements, reductions in government employees, decreased fundraising, among other factors.
“It’s not just Columbus either,” Stewart said. “We’re seeing this across the state and across the nation, just a more and more difficult environment for not-for-profit organizations.”
When asked whether similar pressures could force additional local nonprofits to close this year, Stewart said, “Yes, absolutely.”
Recent shifts in federal and state funding illustrate some of the instability nonprofits are facing, with service providers, state agencies and beneficiaries reporting abrupt changes in grant support, The Associated Press reported.
Last month, for instance, the Trump administration cut nearly $2 billion in substance abuse and mental health grants only to reverse course the following day. Nonprofit leaders told the AP that the pattern of uncertainty has made long-term planning nearly impossible.
“It’s not always that the funding has gone away, but oftentimes there are much fewer people at the state or federal level that are administering those grants, and so payments can be delayed, and just getting questions answered can become delayed because of the staff reductions at the state and the federal level,” Stewart said.
Another area facing severe strain is child care, officials said.
In October, a coalition of local leaders sounded the alarm over state funding cuts to child care and early learning, warning that the reductions could strip hundreds of Bartholomew County families of financial assistance, disrupt the local workforce, force child care providers to reduce staff and limit access to programs critical for school readiness.
The cuts include what the coalition described as “significant reductions” to Child Care Development Fund (CCDF) vouchers and the On My Way Pre-K program, which provide child-care assistance to low-income families, according to a joint statement released in October.
The coalition includes leaders from Heritage Fund – The Community Foundation of Bartholomew County, the Community Education Coalition, Bartholomew Consolidated School Corp., Flat Rock-Hawcreek School Corp., United Way of Bartholomew County, the city of Columbus, Cummins Inc., Toyota Material Handling, Columbus Regional Health, Greater Columbus Indiana Economic Development and the Columbus Area Chamber of Commerce.
Children Inc. said in October that it would be laying off 15 teaching staff and close six classrooms due to the changes. Additionally, local officials said another child care site that they declined to name will be closing altogether due to the cuts.
Stewart urged local residents to get involved with local charities to “understand some of the dynamics that are going on right now in the current not-for-profit environment.”
“I would encourage people to get involved,” Stewart said. “I think Columbus has always had a very strong not-for-profit sector, and I think sometimes we take that for granted.”
