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Tampa Bay area nonprofits see surge in demand, drop in donations

In recent days, I've heard the lamentations of both Rich Engwall, an executive at the nonprofit Pinellas Education Foundation, and United Way of Tampa Bay spokesman Doug Arnold. They cite the bad economy's double whammy. It's squeezing their nonprofits' abilities to attract donations just as their groups face rising demands for help from the local community for their services.

In Tampa, Melinda Chavez of the Tampa Bay Business Committee for the Arts told me the recession is forcing a "brave new world" even for a lean, two-person nonprofit like hers. Support is off 40 percent from the first quarter of 2008, even as the TBBCA prepares to offer six $2,500 arts scholarships for area high school students.

That sharp decline strongly reflects the findings of a new Conference Board survey, called How the Economic Downturn Is Affecting Corporate Giving, that says support of the arts will be most vulnerable to cuts in giving in 2009.

"When will this turn around, and what do we do until then? And how many nonprofits will survive?" poses Arnold at the United Way, whose funds help support 68 community organizations in Pinellas and Hillsborough counties. "This is one of the key questions you don't necessarily hear in the conversations about the economy."

This recession favors no piece of the economy. Businesses that want to support nonprofits are cutting back just as their employees, who typically give via payroll deductions, are tightening their own wallets. Corporate matching of employee donations is also slipping.

Heavy layoffs — witness the ever higher 9.7 percent unemployment rate for the Tampa Bay area unveiled on Friday — are creating havoc with nonprofits. They see a growing gap between donations pledged by area workers and actual donations that never materialize because more workers have lost their jobs.

Many profit-pressed companies also are demanding more bang for their philanthropic buck. Rather than give without reserve to nonprofits, businesses want to know how donations will help their own bottom line.

The economic crisis came late enough in the year that it had minimal impact on 2008 giving budgets. But 45 percent of companies surveyed in the Conference Board poll already are cutting their 2009 giving budgets and 16 percent are considering it. Other companies plan to make fewer or smaller grants in 2009.

In the Tampa Bay area, recession-hit industries from financial services to manufacturing and retail are contributing less to nonprofits. Late last month, the United Way of Tampa Bay took the unusual step of publicly asking for $1.3 million to reach its annual goal of $23 million. That figure's remained flat for the past several years after a decade of growth. The nonprofit spends only 15 cents of every dollar it collects on administration and fundraising, leaving 85 cents to pass on to needy organizations.

Arnold expects his nonprofit to make its financial goal because people are generous, he says. The group last year trimmed its staff by 10 percent to 60 and could cut more this year.

At the same time, he is starting to see struggling people seeking nonprofit services who were recent United Way contributors.

One of United Way's funding weapons has been its high-impact Toqueville Society. In the Tampa Bay area, that's a group of 150 wealthy and generous contributors who donate at least $10,000 a year — and some give much more — to the nonprofit.

Funding from that elite group is off 20 percent.

Robert Trigaux can be reached at trigaux@sptimes.com.

Tampa Bay area nonprofits see surge in demand, drop in donations 03/07/09 [Last modified: Monday, March 9, 2009 11:33pm]
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