Posts tagged ‘contributions’

October 12, 2018

As Giving Lags, Alarm Bells Sound. Should You Worry?

While the story at some individual charities might be different, charitable giving in the sector for the first half of 2018 is lagging behind the first six months of 2017, both in terms of the number of donors and the amount donated. That’s according to a recent report from the Fundraising Effectiveness Project.

As I write this post, the stock market has just taken a two-day beating with the Dow Jones Industrial Average down 1,378 points.

I won’t blame you if you’re feeling a bit pessimistic about philanthropy these days. However, I will respectfully suggest that you shouldn’t be overly worried. As I wrote in the current issue of Advancing Philanthropy, the official magazine of the Association of Fundraising Professionals, there are actually plenty of reasons for us to be optimistic about the current fundraising environment.

In my article for AFP, I show you how you can be your own fundraising superhero with six tips that will help you control your fundraising destiny. I also detail nine reasons for you to be upbeat about the current philanthropic environment as you seek year-end gifts. However, for now, I’ll just highlight some of the reasons why you should be upbeat about fundraising as year-end and the start of a new year approach:

1. Stock Market Growth. Despite the hit the stock market took this week, it remains above the 52-week level. An adjustment was expected. While volatile, the stock market is likely to stabilize somewhat and even continue to grow.

2. Dire Predictions Really Are Not that Dire. Some have predicted that the new federal tax code will negatively affect philanthropic giving. While it’s too soon to draw a firm conclusion, we do know that even if the worst-case prediction comes true, overall philanthropy will once again be approximately two percent of Gross Domestic Product, where it has been for decades.

3. Economic Growth. GDP growth for the first half of the year has been strong. If economic growth continues, as the Federal Reserve believes it will, this will likely have a positive effect on charitable giving. Remember, there’s a long correlation between philanthropy and GDP.

4. New Tax Code. For both individuals and corporations, a reduction in taxes makes more money available for charitable contributions. For example, many corporations (e.g., Wells Fargo, Southwest Airlines, JP Morgan Chase & Co., Best Buy, BB&T, Apple, Ally Financial, and others) have announced commitments to significantly increase corporate giving.

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June 14, 2016

Happy Days are Here Again … for Now

Charitable giving in the USA reached a record high for the second year in a row, according to the newly released Giving USA 2016: The Annual Report on Philanthropy for the Year 2015, a publication of Giving USA Foundation, researched and written by the Indiana University Lilly Family School of Philanthropy.

While the news is good, storm clouds are gathering on the horizon. You need to hear both the good and the troubling news. I’ve tried to distill the most relevant, overarching information for you and provide you with some tips to help you be more successful moving forward. While I would normally advise against sharing lots of statistics, I nevertheless think you’ll appreciate these numbers.

Source Pie Chart_June 13 2016Researchers estimate that giving totaled $373.25 billion in 2015.

That new peak in contributions represents a record level whether measured in current or inflation-adjusted dollars. In 2015, total giving grew 4.1 percent in current dollars (4.0 percent when adjusted for inflation) over 2014.

The revised inflation-adjusted estimate for total giving in 2014 was $359.04 billion, with current-dollar growth of 7.8 percent, and an inflation-adjusted increase of 6.1 percent.

Charitable contributions from all four sources — individuals, charitable bequests, corporations, foundations — went up in 2015, with those from individuals once again leading the way in terms of total dollar amount, at $264.58 billion. This follows the historical pattern seen over more than six decades.

Giving to eight of the nine nonprofit categories studied grew with only giving to foundations declining (down 3.8 percent in current dollars, down 4.0 percent adjusted for inflation).

Giving to the category of International Affairs — $15.75 billion — grew the most (up 17.5 percent in current dollars, up 17.4 percent adjusted for inflation).

Giving to the category Arts/Culture/Humanities — $17.07 billion — grew the second most (up 7.0 percent in current dollars, up 6.8 percent adjusted for inflation).

While the numbers are terrific, the story is really about more than that. Giving USA Foundation Chair W. Keith Curtis, president of the nonprofit consulting firm The Curtis Group, says:

If you look at total giving by two-year time spans, the combined growth for 2014 and 2015 hit double digits, reaching 10.1 percent when calculated using inflation-adjusted dollars. But, these findings embody more than numbers — they also are a symbol of the American spirit. It’s heartening that people really do want to make a difference, and they’re supporting the causes that matter to them. Americans are embracing philanthropy at a higher level than ever before.”

While the 2015 giving news is certainly positive, there are four points that indicate that the good news might be short lived:

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April 15, 2016

Will #CharitableGiving Suffer Because of the Election?

[Publisher’s Note: This post is part of a series highlighting some of the sessions from the 2016 Association of Fundraising Professionals International Fundraising Conference. This week, I focus on “Giving in an Election Year – How Political Giving Impacts Nonprofit Support” which was presented by Chuck Longfield, Senior Vice President and Chief Scientist at Blackbaud, and Sally Ehrenfried, Blackbaud’s Community Relations Manager.]

 

Since the end of February 2016, the US Presidential candidates and their allied Super PACs have raised close to $1 billion. Some pundits believe that the candidates could spend up to $5 billion before the November General Election. And that’s just looking at the Presidential candidates. Candidates for other offices will also raise enormous sums of money.

The question for the nonprofit sector is this: Will charitable giving suffer because of the election this year?

Democratic Donkey and Republican Elephant by DonkeyHotey via FlickrBlackbaud researched the question and presented the findings of its report in the session “Giving in an Election Year – How Political Giving Impacts Nonprofit Support” at the 2016 AFP International Fundraising Conference.

The study examined the giving behavior of over 400,000 donors during the 2012 campaign year when Barack Obama and Mitt Romney battled for The White House. Researchers looked at giving data about those who did and did not contribute to political campaigns in 2012 and compared the information with charitable giving information from 2011.

Chuck Longfield, Senior Vice President and Chief Scientist at Blackbaud, observes:

Fundraisers have long debated whether or not political fundraising affects charitable giving and, for decades, important fundraising decisions in election years have been based largely on the conventional belief of a fixed giving pie. The study’s overall assertion is that political giving during the 2012 election did not, in fact, suppress charitable giving. Donors to political campaigns continued their support of charitable causes.”

According to the study, donors who gave to federal political campaigns in 2012 gave 0.9 percent more to charitable organizations in 2012 compared to 2011. By contrast, donors who did not give to political campaigns reduced their giving to charities in 2012 by 2.1 percent. These data findings held true across all sub-sectors as well as the demographic segments of age range, household income, and head of household gender.

The report acknowledges that the data paints a picture of 2012 without providing a prediction for 2016. More research is needed. Nevertheless, based on the Blackbaud report and multi-decade data from Giving USA, it’s likely that political giving will not negatively affect the nonprofit sector this year.

In the Foreword to the report, Andrew Watt, President and CEO of AFP, wrote:

What we are looking at is the giving of individuals who prize [civic] engagement — who see community action as a positive and who are interested in the full political and social spectrum of how we go about achieving change.”

The report supports Watts’ point:

We would expect that nonprofits involved in missions and programs touched by prominent campaign issues would benefit from political discourse on those themes. We would also expect that nonprofits focused on public policy advocacy would benefit most. These expectations are fulfilled in the increased giving to Public and Society Benefit, and Environment sub-sectors.”

However, increased giving was not limited to those two sub-sectors. Most other sub-sectors also saw gains, though those gains were not as large. This is a positive sign for the nonprofit sector in general.

For 2016, the report offers five key recommendations for the nonprofit sector:

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