Philanthropy overwhelmingly favored short-term, project funding during economic downturn
WASHINGTON, Nov. 2, 2012 /PRNewswire-USNewswire/ -- Multi-year funding dipped and general operating support for nonprofits remained stagnant during the past several years. These are the findings of two new studies released today by the National Committee for Responsive Philanthropy (NCRP; www.ncrp.org), the country's independent watchdog of philanthropy.
According to "The Philanthropic Landscape: The State of Multi-Year Funding" (http://www.ncrp.org/files/publications/PhilanthropicLandscape-StateofMultiYearFunding-Revised.pdf), which examined new data from 2004 to 2010, reported multi-year grantmaking in 2009 fell 21 percent to $5.5 billion during a time when total grantmaking declined only by 13 percent. If the Bill & Melinda Gates Foundation, the nation's largest grantmaker, is excluded from the analysis, the drop becomes pronounced at more than 33 percent.
General operating support (or core support) from 2008 to 2010 fared slightly better. In "The State of General Operating Support" (http://www.ncrp.org/files/publications/PhilanthropicLandscape-StateofGeneralOperatingSupport.pdf ), NCRP noted that reported core support dollars increased 34 percent but the share of such grants remained unchanged at 16 percent of total giving compared to a similar analysis of data from 2004 to 2006.
"As philanthropy seeks the latest innovative program and best impact measurement, let's not forget two very basic but effective ways to strengthen grantees," said Aaron Dorfman, executive director of NCRP. "Unrestricted, multi-year grants are the lifeblood of strong, successful nonprofits, and they're in very short supply. There was a lot of talk about how foundations should give greater flexibility during the economic downturn, but the data show that didn't really happen."
Other key findings noted in the studies include:
- Ninety percent of sampled foundations either do not provide multi-year grants or don't report them.
- Multi-year grant dollars comprised as much as 75 percent of the total giving of those foundations that reported providing such support.
- General operating support increased as a share of total giving among family and operating foundations, and among foundations based on the West coast.
- General operating support increased as a share of total giving most among foundations granting between $5 million and $10 million.
- Most funders reported less than 10 percent of grant dollars as general operating support.
The top multi-year funders by amount for multi-year giving in 2009 were the Bill & Melinda Gates Foundation, Ford Foundation and The Robert Wood Johnson Foundation.
The three foundations that awarded the highest percentage of their giving as multi-year grants in 2009 were The William T. Grant Foundation, the James S. McDonnell Foundation and the Richard M. Fairbanks Foundation, Inc.
The largest general operating support funders by amount in 2008 to 2010 were the Gates Foundation, The William and Flora Hewlett Foundation and Ford Foundation.
The Robert W. Wilson Charitable Trust, The Richard and Helen DeVos Foundation and The American Art Foundation were the three largest foundations that reported 100 percent of grant dollars as general operating support.
NCRP also notes the benefits of unrestricted, long-term funding to nonprofits, including the ability to respond to crises and opportunities, invest in organizational leadership and capacity building.
Earlier in September, NCRP recalled a previous version of The State of Multi-Year Funding after learning of a programming error from the data source. This revised edition of the study more accurately reflects recent trends.
"The State of Multi-Year Funding" and "The State of General Operating Support," written by NCRP research and policy director Niki Jagpal and research associate Kevin Laskowski, are available for free on the NCRP website at www.ncrp.org.
About "The Philanthropic Landscape"
The Philanthropic Landscape (http://www.ncrp.org/campaigns-research-policy/the-philanthropic-landscape) is a new series of fact sheets that analyzes the most recently available data for the latest giving trends. Don't miss these and forthcoming reports from NCRP; sign up to receive Roundup (http://www.ncrp.org/take-action/signup) in your inbox today!
The National Committee for Responsive Philanthropy in Washington, D.C., is a national watchdog, research and advocacy organization that promotes philanthropy that serves the public good, is responsive to people and communities with the least wealth and opportunity, and is held accountable to the highest standards of integrity and openness. Visit www.ncrp.org.
SOURCE National Committee for Responsive Philanthropy