Thursday, February 17, 2011

Contemplating The Outlook For Charities In 2011

Elizabeth Boris is the director of the Center on Nonprofits and Philanthropy at the Urban Institute located in Washington DC. Nonprofit Times caught up with her and she took some time to share her insights regarding the outlook for the nonprofit sector in 2011, particularly as it relates to planning. Boris feels that 2011 is going to be a difficult year for a large number of charities. This is especially true of nonprofits that have any government grants or contracts because the budgets of many states are in very poor shape.

A sharp decrease in state funding
Human service providers who rely on state funded grants will face some of the toughest times in the year ahead. Boris feels that nonprofits need to have contingency plans in place if they are to survive the times ahead with as little loss as possible. Conserving resources as much as possible is key, as well as learning from these circumstances and building up as many reserves as possible in the future that will enable them to weather similar storms which they may yet have to face. The challenge facing nonprofits is three-fold; contributions are down, demand is on the increase and government grants are in decline.

Nonprofit mergers on the increase
Boris expects that a number of charities will go out of business in 2011, and that there will also be an increase in mergers in the nonprofit sector as charities seek to pool their resources in an attempt to ride out these difficult economic conditions. Nonprofits need to be making an investment in fundraising and grant-writing, and with any luck, they can observe improvements in the economy towards the end of the year.

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