Nonprofit Network Blog

Fund Development Insights from the Grinch

Thursday, December 19, 2019 3:52 PM | Tracey Wilson (Administrator)

The last six weeks of the calendar year can be the last opportunity for nonprofits to meet their annual budget.  In fact, by some accounts, 30% of ALL charitable gifts made in the United States are made in December.

However, there are trends the wise nonprofit needs to be aware are happening.  Those who acknowledge this trend, consider modifications to their fund development efforts and take action could possibly avoid a nonprofit ill wind.

My blog title references “The Grinch” because the trend is one of declining contributions and specifically a trend to give differently during this six week period of the year. A scholar named Amy Schiller recently wrote an article that speaks to the impact of the new tax laws and the report by Giving USA that tracks donations on an annual basis.  I want to share some of the wisdom from these sources.

One note of caution: Due to the timing of data collection, we might be farther into this trend than the numbers tell us.  If that is so, taking corrective actions sooner rather than later may be that much more important.  (The 2019 Giving USA report analyzes donations made in 2018).

So here’s the bad Grinchy news:  We know individuals give nearly 70% of all charitable gifts.  Except for one single category, all domestic giving by individuals across all recipient categories IS DOWN.  Total individual giving was down 3.4%.  Within recipient groups these declines ranged from, -3.9% to Religious Organizations (the largest recipient annually), -6% to Public Benefit like United Ways, -9.1% to Foundations, -3.7% to Education and -2.1% to Arts and Culture.  The sole domestic recipient that saw ANY increase was a +1.2% increase to the Environment/Animals.  And this giving is within the backdrop of one of the hottest economies the US has experienced for a while.

Schiller also reports the trend of a decline in universal small gift giving.  She opines this universal giving my many has given way to what she refers to as “megadonors” giving extremely large gifts to fewer entities.  She shares that after the 2017 tax cuts, which raised the individual standard deduction to $12,000 removed some incentives for donors whose deductions didn’t reach that level.  The share of taxpayers who took the charitable deduction went from 24% of the taxpayers to just 8.5%.

As you already know, this is a complex issue and requires a thoughtful deliberate action plan to address it.  The steps to address it will be varied from one nonprofit to another.  The solution will be one of knowing your donor base and possibly the courage to implement changes to your fund development approaches.  One tool available to you is your Nonprofit Network membership.  It entitles you to regular phone consultations with an expert.  If you need a thought partner on your next steps, give us a call to discuss it.

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