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Tuesday, January 23, 2018

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Are Donors Giving Again? Giving responds despite down economy
Marion Lee

September, 2012

One of the most significant questions we face as nonprofit counsel is: “Has the donor sector recovered from the recession?” and “Are we there yet?”  Our answer is predicated on regional indicators as well as the complete Giving USA report  published annually by the Giving USA Foundation.

The Giving USA –Annual Report on Philanthropy is a public service initiative of the Giving Institute and is the longest running, (1985) most comprehensive report on philanthropic trends available in the United States.

Now, I am a glass half full kind of woman and the numbers for 2011 show a ray of sunshine.  In 2011,

  • We, the people, gave $298.42 billion dollars to the charitable sector
  • That amount is up approximately $8 billion from 2010
  • Globally, individual giving increased 2.7 percent
  • Corporate giving increased by 10.6 percent. 
  • Charitable bequests also rose 18.8 percent.

All of this data is cause for minor celebration.  The American public continues to give and responds well in a down economy.  The recovery is steady.  My concern focuses more on where the philanthropy is going and is based not only on national data, but also on empirical information gleaned from clients in Texas.

According to Giving USA, giving to human service organizations and religious organization declined after inflation.  The decline would have been greater in human services had not the disaster relief funds for Haiti not continued into 2011.  

The decline in funding to these organizations is the crux of a long-standing fear of mine.  For decades, human service organizations have relied on funds from local, state and federal sources with back up from private foundations.  Human services are also receiving substantial support through volunteer efforts and financial gifts from churches and religious organizations. 

We are now seeing the effects of a “triple whammy” within social and human service organizations in Texas. 

  1. Government funding has been cut substantially to many organizations providing basic needed support to our communities. 
  2. Churches and religious organizations are struggling to gather funds to support basic operations and do not have the support for mission based work. 
  3. And, human service organizations have failed, for the most part, to recruit, train and maintain board members who can and will help them bridge the gap in funding from the most lucrative funding sources – you and me. 

According to Independent Sector there are more than 1.1 million nonprofit organizations in the United States with an additional 380,000 religious congregations.  272,000 nonprofits lost their exempt status due to failure to comply with IRS reporting or just plain went broke.  50 percent of these were human service organizations. 

It is time--time for the leaders within these organizations to take a hard look at their revenue sources and their culture of board governance, and to take action to diversify revenues.    When a human service organization falls on hard times, the people it serves suffer and suffer in ways that affect their lives-their food, housing, clothing and safety.

We encourage you to review the Giving USA Foundation report and not to just chalk it up to a “bunch of numbers” but to be reflective on what those numbers mean to your organizations.  Then share them with your boards.  As the legendary rock group Bon Jovi sang, “Bang a drum, bang it loudly…



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