According to the 2010 State of the Nonprofit Sector, a new survey from the Nonprofit Finance Fund, only 18 percent of more than 1,300 nonprofit leaders who participated in the survey expect their organizations to have a surplus of funds for 2010. This is despite the fact that 35 percent of the respondents reported a financial surplus for the previous year.
Fifty percent of the survey’s respondents, in fact, believe that their organizations’ financial outlook for the year will be more difficult than in 2009. The NFF study also indicated that 80 percent of these organizations expect to see a rise in the demand for the services they provide.
Part of this lack of funding is being blamed on congress’ failure to pass legislation to correct the expiry of the federal estate tax which was scheduled on January 1. Data from the Internal Revenue Service (IRS) shows that as the estate tax was reduced from 2001 to 2007, the percentage of wealthy decedents that left part of their inherited estate to charity declined along with it. The tax-lapse could actually be hurting charitable efforts and non-profit organizations.
Local governments are also said to be hurting non-profit organizations by reducing the budget on essential services and leaving non-profits to take up the slack. Some local governments are also reportedly holding off on payments contractually owed to non-profit organizations for delivering services.
According to a report by the National Council of Nonprofits, this in combination with the recession has “pushed many nonprofits to the brink.” The council also reports that non-profits “operate as invisible yet indispensable economic engines.”
The power of philanthropy is much more considerable than most perceive it to be. Philanthropists have a great responsibility to take care of society and humanity.
View a previously written post by Mouli Cohen about Philanthrophy.
In the Washington, DC metropolitan region, nonprofits have faced an uphill battle to receive adequate funding.
As Mouli mentioned, local government are trying to drastically cut critical services funding in order to balance their budgets.
Two organizations, the Nonprofit Roundtable of Greater Washington and the Center for Nonprofit Advancement, have created a nonprofit advocacy campaign to fight for continued service to those in need.
The “Think Twice Before You Slice” campaign has helped mobilize nonprofits in the region, delivering a unified message to city, county and state officials in the District of Columbia, suburban Maryland and Northern Virginia. So far, thanks to campaign efforts, nonprofits in Loudoun County, Va., have decreased proposed funding cuts. We are making strides in other jurisdictions as well. To read more about our campaign, visit http://www.thinktwicecampaign.org.