Survey Says Nonprofit Giving Has Declined 10% due to Economy

In order to keep an eye on my chairites from time to time I review research and statistical informatio n to post on my website http://www.roccobasile.net/. According to survey findings released by the Foundation Center, giving will likely decline by more than 10 percent since 2008. The survey is the result of interviewing and obtaining the responses of 600 foundations. What’s more, continued reductions are expected throughout 2010.

The year has suffered declines in overall consumer demand and our country’s highest unemployment figures in a quarter century, so it is no surprise that the future outlook for the nonprofit community has been impacted by the recession. The field of philanthropy will become more strategic as a result of the economic crisis.

The majority of experts believe that the nonprofit sector will emerge stronger but agree that ultimately there will be fewer organizations. U.S. foundation giving suffered an estimated 22 percent drop in foundation assets in 2008. Earlier this year, the Foundation Center estimated that 2009 giving by the nation’s more than 75,000 grant making foundations would “decrease by around eight to 13 percent, and at this time, it seems as if it is likely the decline will be even more.

The economic crisis has forced nonprofits to adjust their operating costs. More than two-thirds of respondents to the September 2009 said they have in some way reduced operating expenses since the beginning of the economic crisis, even those that still have endowments. It seems that some nonprofits are trying to preserve the value of their endowments, so that they will not permanently diminish grant making capacity, while others have determined they will be smaller institutions going forward and are making necessary staffing and expense adjustments.

How are they cutting back? Many have reduced operating expenses since the onset of the economic crisis, by reducing staff travel and salaries. Two-thirds of the respondents that cut expenses reported reducing staff travel budgets and/or limiting staff to attend conferences. A little over one-third indicated that they had also reduced staff training and professional development opportunities.

A larger share of respondents expect that their giving will be lower in 2010 (26 percent) than higher (17 percent). Larger foundations, those giving over $10 million, are more likely than smaller foundations to reduce their giving further next year. While asset averaging generally limits the impact of modest economic fluctuations on annual giving, the extreme 2008 asset losses will not be balanced out by 2007 asset growth and the 2009 turnaround in the market.

Finally, the impact of the economic crisis on foundations has been twofold. 1) There is a clear expectation among grant makers that the field of philanthropy will become more strategic as a result of having weathered the economic crisis. 2) The long-term impact of the crisis on their own foundations are forcing engaging in “more robust strategic planning,” “more focused use of the foundation’s capabilities,” and being “more focused and disciplined in executing our strategy.” The focus of other types of long-term changes cited by survey respondents ranged from governance to grantee relations to investments.

The Foundation Center’s next Foundation Giving Forecast Survey will be conducted in January 2010, with results released in the March 2010 edition of Foundation Growth and Giving Estimates.

The annual Foundation Giving Forecast Survey and made it available to approximately 5,000 large and mid-size U.S. community, independent, and corporate foundations.

-- Rocco Basile
Source: Foundation Center, 2009 http://www.foundationcenter.org/gainknowledge/research/pdf/researchadvisory_economy_200911.pdf

Fundraising in Economically Challenging Times

Industry experts say that shock ads are becomming worse than ever. Are they working when it comes to shocking people into contributing to the latest charity cause? Possibly...

But rather than shock ads for charities focused on drinking and driving or drugs, why not focus on charities with a more positive outcome? Like children's education, students and parents in need?

I work with several charities include Children of the City in Brooklyn, and the Joe Dimmagio committee, and my educational website (http://www.roccobasile.net/) details the latest trends in these charities.

We are making such amazing strides in these organizations, and all that is needed at this point is recogition. Once people heard that Gweneth Paltrow was part of our "Champions of Hope" annual fundraiser this last year, the doors open.

If you are interested in learning more so you can help us, go to my website at http://www.roccobasile.net/

Race to the top for Education Reform - Competition Opens

If you haven't heard about the "Race to the Top Fund" and competition that is being organized by the U.S. Department of Education, then stay tuned. It is all part of the way our government can improve our country's educational accessment and improve math and reading skills, provide teachers with more useful instructional information, and then measure their effectiveness and how well the students are performing.

The Department has officially applied, as of today, for more than $4.35 billion from the Race to the Top program, which was established under the American Recovery and reinvestment Act. This will reward those states that have rasied student performance in the past and have the capacity to accelerate achievement by using innovative reforms. Every state is different of course.

Of the funds, $350 million will be reserved to help states create assessments that are alligned to a common set of standards, and the remaining $4 billion will be awarded in a natioanl competition. Ergo the name Race to the Top.

The final application also requires multiple measures to evaluate teachers with a huge emphasis on the growth in achievement of their students. It also reinforces that successful applicants will need strict teacher/principal evaluation programs, to inform what happens in the schools.

I enjoy my charity work for both Children of the City and the Joe DiMaggio Committee, which raises money to provide a good education for children of financially challenged families. Our fund raising event, the Joe DiMaggio Award Gala, benefits Xaverian High School, my alma mater. You can read more about it on my website at http://www.roccobasile.net/

It seems that Xaverian has already figured out a great system, that could serve as an example for the rest of teh country's "Race to the Top" program. This school offers the best secondary education for students with learning disabilities. Its Ryken Program serves as the model for the New York State Regents for all such endeavors. Xaverian has a tradition of serving young men from disadvantaged backgrounds, boys with learning disabilities and students that are in financial need.

In the meantime, let the race begin. Our country's youth deserve Race to the Top.

--Rocco Basile