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11/30/10 at 09:45 AM 0 Comments

Philanthropy Survey results may signal promise for nonprofit fund raisers

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An end of the year survey conducted in October 2010 finds the nonprofit funding drop off experienced in 2008 and 2009 may be leveling. Whereas 51 percent of survey responders experienced decreased funding in 2009, only 37 percent reported a decrease in funding in 2010.

In 2006 and 2007, before the economic downturn, the amount of respondents reporting decline in contributions was below 20 percent. This year, almost the same proportion of respondents reported experiencing an increase (36 percent) as respondents experiencing decrease (37 percent).

This likely means that the worst is over for the nonprofit sector, though only time will tell for sure. The Nonprofit Research Collaborative conducted the survey online between October 19 and November 3, 2010, polling 2,356 public charities and 163 private foundations.

The survey divides respondents into eight subcategories based upon the type of service the organization provides. The eight subcategories are: Arts, Education, Environment/Animals, Health, Human Services, International, Public-Society benefit and Religion.

In four of the eight subcategories, Arts, Education, Environment/Animals and Human Services, the percentage of respondents experiencing increase and the percentage experiencing decrease are nearly equal.

The Health, Public Society benefit and Religion categories experienced a larger percentage of respondents reporting a decline in contributions. Only one subsector, International, experienced a larger percentage of organizations reporting increase than those reporting a decrease. This likely reflects emergency disaster relief in Haiti and Pakistan.

The survey finds larger organizations are more likely to experience an increase in charitable gifts. 46 percent of organizations with budgets exceeding $20 million reported an increase in gifts. Only 23 percent of organizations with budgets less than $25,000 reported increases.

Of nonprofits reporting a decline in philanthropic giving, most say this is a result of fewer gifts from individuals, or that individual contributions were small in size. This response is consistent across organizations of all size. After individuals, nonprofits point to a decrease in foundation grantmaking and corporate support. The least common reason for decline is decreased government funding.

Around half of organizations reporting a decrease in funding say they experienced a drop in foundation grant money. Some organizations cited smaller grants or non-renewed contracts. Likewise, 55 percent of organizations experiencing decrease say they experienced a decline in corporate giving, either in amount of gifts received or the discontinuation of corporate gifts.

2010 marks the first time since 2006 that organizations found an increase in demand for their services over the previous year. 68 percent of respondents experienced an increased demand for services in the first nine months of 2010, up from 62 percent in 2009. Demand for services rose across all subsectors. Human Services reflected the highest increase in demand, with 78 percent of Human Service respondents reporting increase in demand. Around 70 percent of organizations in the Health and Public-society Benefit categories reported increase in demand for services.

With such an increase in need, it is no surprise that the survey also found between 40 and 50 percent of respondents in every subcategory, except International, expect budget increases in 2011.

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