by Robert Powell
Last month, Virginia Business stopped adding up stock options and started tracking charitable donations. We substituted The Generous Virginians Project for the Virginia 100, an annual feature dating back to 1989 that attempted to calculate the fortunes of 100 of the state’s wealthiest residents.
The switch was timely. The General Assembly recently slashed the state budget by $4.6 billion, including $360 million in reduced funding for health and human services. Nonprofit agencies throughout Virginia told us they expected to see soaring demand for help as a result of state cutbacks.
Since the June issue went to press, two national studies have emerged that shed additional light on many concerns raised in the story.
A study by Alexandria-based Catholic Charities USA found that its agencies faced an alarming jump in requests for services in the first quarter. “For millions of hard-working Americans, the crisis is only beginning,” the Rev. Larry Snyder, the president of Catholic Charities, said in releasing the report.
In addition to the poor and homeless showing up at the agencies’ doors, the number of middle-class families seeking assistance rose 61 percent.
These pleas for help appear to be tied to the economy, with 89 percent of agencies seeing a sharp rise in unemployment. Many families are turning to charities for food and money to help pay their rents and mortgages.
Echoing trends we saw among Virginia nonprofits, Catholic Charities says that, as demand for assistance has increased, the agencies’ resources have dwindled. To cope, they are collaborating with other nonprofits and using volunteers to stretch their budgets. Nonetheless, some have been forced to cut programs, lay off staff and turn people away.
The second study reveals why so many nonprofits are struggling but offers a glimmer of hope for a turnaround in their fortunes.
Giving USA Foundation, an Illinois-based philanthropy research institution, estimates that charitable contributions from American individuals, corporations and foundations totaled $303.8 billion last year, a decline of 3.6 percent.
The foundation’s study shows that giving dropped for a number of nonprofit categories, including churches and religious groups (down 0.7 percent), schools (3.6 percent), and arts and cultural organizations (2.4 percent). Nonetheless, giving to these nonprofits still represents a huge share of total contributions. The $100.95 billion donated to religious organizations, for example, represents a third of total giving, while contributions to educational institutions, $40 billion, accounts for another 13 percent.
Despite the decline on total giving, corporate contributions rose 5.5 percent last year to an estimated $14.1 billion, near the level of donations seen before the recession.
The most heartening statistics in the report, however, concern contributions to human services and health organizations, which actually rose 2.3 and 3.8 percent, respectively last year to a combined $49.5 billion, making up 16 percent of total giving. Much of that money likely came late in the year, as the stock market rebounded and stories about problems facing many nonprofits appeared in the media, Giving USA said.
This positive pattern is consistent with the changes that Virginia nonprofits are seeing among donors. “They’re rethinking their giving and targeting the basic needs: food banks, emergency shelters, health care,” Deborah Oswalt, executive director of the Virginia Health Care Foundation, said in our cover story.
As that generosity continues, we expect to chronicle the rebound of the commonwealth’s charities next June.Tweet
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