As donations fall at some nonprofits, charities are trying to find ways to make ends meet.
As donations fall at some nonprofits, charities are trying to find ways to make ends meet. iStockphoto.com
Charitable giving declined last year, along with the economy. But it didn't go down by as much as some people had thought, according to a new report out Wednesday.
Charitable giving in the United States dropped 2 percent in 2008 from the year before. Even so, people gave more than $307 billion, which begs the question: Is this good news or bad news?
"I think $300 billion-plus — two years in a row — is great news," said Nancy Raybin, chair of the Giving Institute, whose Giving USA Foundation reports annually on charitable trends.
She said that after the stock market tumbled last September, people expected the worst. "People expected that as the economy tanked, charitable giving would tank along with it," Raybin said. "And that didn't happen. It may have happened to some organizations, but it didn't happen to every organization across the country."
She added that it helped that giving was pretty strong in the first three quarters of last year.
In fact, donations to religious groups went up more than 5 percent last year. So did giving in a category that includes groups, such as United Way, that collect donations to give to other nonprofits. Raybin said the category also includes voter registration drives, which spiked significantly last year.
But not everyone did well. Giving to the arts, health, environment and education organizations dropped at least 5 percent. And the biggest decline — almost 13 percent — affected human services groups providing aid to the disadvantaged.
How Groups Are Coping
"We heard from our members that they saw two things," said Glen O'Gilvie of the Center for Nonprofit Advancement, which represents hundreds of nonprofits in the Washington, D.C., area. "One was an increase in need. All of our homeless shelters and food programs saw longer lines and waiting lists. They also saw a direct decline in giving."
O'Gilvie added that about a third of the groups had to cut programs and staff. They also started to look for new ways to save money.
His organization is providing something called Back Office In a Box, where members can get a group rate on accounting and other financial services. He has advised nonprofits to find more ways to collaborate and share costs.
Mary Funke is executive director of N Street Village, which helps homeless and low-income women in Washington, D.C. She said she's talking to another nonprofit about providing medical care to her clients in exchange for office space at her facility.
"We are having conversations with a few organizations in saying, 'Where can we align to provide better services and be more efficient in delivering services?' " she said.
Funke added that she's also using more social networking tools, such as Facebook, to communicate with donors and help raise funds. The good news is she's starting to see a turnaround.
"So for example, our gala, which was held in March — we surpassed the gala goal by $85,000," she said. "We grossed somewhere around $680,000."
Funke said she thinks the next year or two will still be tough. She plans to try harder to let potential donors know what N Street Village is doing. That, said Raybin, is her advice to all nonprofits: The best way to keep donations from dropping again this year is to go out and tell their stories.