Nonprofits' budgets down, need up

By Christopher Quinn

The Atlanta Journal-Constitution

Local nonprofits are unimpressed by economists' prognostications that the recession is ending.

Donations are falling, and agencies are looking for creative ways to find new donors and dollars. If they don't succeed, half think they will have to cut services when people are needing it most. Seventy percent of them reported requests for help are up in a recent poll by the Georgia Center for Nonprofits, while 61 percent said donations were down.

In the economic scramble, many nonprofits are seeking  new ways to raise money, such as through Web sites and electronic social networking, and they are trying to find more grassroots donors to  give small amounts.

United Way of Metro Atlanta, for example, will hold a new tennis tourney fund-raiser Nov. 7 featuring Pete Sampras, and it is pushing to connect online to hundreds of thousands of potential donors who don't work in the large companies where the nonprofit conducts its annual drives.

"We have created what I call the coffee cup strategy," said Milton J. Little Jr., United Way's Atlanta CEO.

"Many people are thinking that if I can't give a big gift of money that it won't make a difference. We let them know something as modest as $5 a week [the cost of a daily cup of coffee] will make a difference."

United Way had to cut some community grants to nonprofits earlier this year, and it missed its $82 million fund-raising goal in 2009 by $1.5 million.

Lauren Welsh, a vice president with the Community Foundation for  Greater Atlanta, said local nonprofits are trying to be more efficient to make up for the financial losses that most are feeling. She pointed to a grant the foundation gave to help organizations serving girls in Atlanta work together on common goals.

"In addition, mergers are still a popular possibility for nonprofits in the region," Welsh wrote in an e-mail.

She pointed out Inner Harbour and Youth Villages, who help young people, merged recently, and that Samaritan House is working on a merger with American Enterprise Communities to better serve the homeless.

Timothy Seiler, the head of the fund-raising school at the Center on Philanthropy at Indiana University, is also hearing of nonprofits trying strategies such as cutting expensive mail appeals and going after loose change by putting small donation boxes near cash registers  in cooperating retailers.

He said nonprofits hunting cash are splitting their efforts on large and small donors. Even though corporations give grants in the hundreds of thousands of dollars, small donors such as families still give about 75 cents of every dollar donated in the U.S.

Wayne McMillan, CEO of the Bobby Dodd Institute, which trains and places the disabled in jobs, said everybody is trying the same strategies as competition for the available dollars gets tougher.

"And there just not money there," he said. "Some [nonprofits] are really suffering. It's hard."

Corporations and foundations are hearing the cries of pain from nonprofits and are also getting creative. Some are looking for ways to make their donations stretch further.

Wachovia, recently bought by Wells Fargo, implemented a new grant program in Atlanta. Next week, it will give 208 grants of $1,000 each to grassroots nonprofits across region.

Jerome Byers, the Atlanta regional president, said he wanted local bankers to choose charities they know are doing good work in their communities.

"Our strategy was getting into those local small foundations who do good things,that we don't have time at my level to visit and get to know," Byers said.

McMillan said, "It is the toughest economy since the Great Depression."

"I  believe there will be some casualties along the way. So, now is a good time to make even a modest contribution and not to give up on it. Times are tough, but still, a couple bucks here and there will make a difference."

Going Down

The Georgia Center for Nonprofits polled 130 local nonprofits about their second quarters of 2009:

70% reported requests for services increased.

53% reported corporate gifts were down.

43% reported cash donations of less than $1,000 were down.

23% report no operating reserves.

29% reduced staff.

About this story
The Atlanta Journal-Constitution is joining Channel 2 Action News, NewsTalk 750 and United Way to examine how the economy has effected the lives of people in metro Atlanta. We will share with readers and viewers occasional personal stories that show how residents, local charities and businesses struggle to survive financial and natural disasters. Today’s AJC story looks at how non-profit agencies are finding creative ways to raise funds as donations fall more than 60 percent.