by Max Marbut
Staff Writer
It’s no secret the ramifications of the economic downturn have affected virtually every type of business. Nonprofit organizations are not only no exception, the current climate may be affecting them more than others.
With the topic, “Philanthropy in Tough Times,” the Rotary Club of Jacksonville invited a panel of nonprofit executives to its meeting Monday to gain some insight into what’s happening to local charities.
“A recent study of nonprofit organizations revealed that only 4 percent said it’s business as usual in the world of philanthropy,” said Rena Coughlin, president and CEO of the Nonprofit Center of Northeast Florida, an organization that serves other nonprofits.
Each panelist agreed that no matter how their organizations are funded or operate, the changes in the financial markets and business in general have affected how they have to do business.
When asked the “Business as usual?” question, Community Foundation President Nina Waters replied, “Yes and no. It is in that we continue on the course we had, but we’re doing it on a different scale.”
The Community Foundation awards grants to nonprofit organizations following an evaluation of proposed programs. Waters said there isn’t as much money to go around now and that may not improve in the foreseeable future.
“This year, we will give 5 percent less to organizations than we did in 2008,” said Water. “In 2010, it could be 30 percent less than in 2009. We have also changed our focus from new initiatives to funding (organizations’) operating costs and this is the first time we’ve done that. We have done it relying on the business people on our board for guidance.”
The economy has also affected the United Way of Northeast Florida, said Vice President of Marketing and Communications Janet Owens. The organization currently supports 99 programs at 68 agencies. She said she thinks things could be worse.
“We’re still tallying the 2008 campaign,” said Owens, “But it looks like contributions will be 4 or 5 percent lower than in 2007. We’ve been fortunate because our business partners have stepped up, but obviously it will have an impact. Last week we notified our agency partners there is a possibility of funding decreases, but they won’t be across the board. We’ll be looking at measurable results and which programs are able to leverage dollars.”
Sherry Magill, president of the Jessie Ball duPont Fund, pointed out the organization she leads operates with a different business model. Founded with a $40 million bequest from duPont’s estate nearly 40 years ago, the organization makes grants based on investment income.
“We’ve had our ups and downs over the years,” she said. “We lost more than $100 million in the fourth quarter of 2008. It’s the second time we have seen this. The fund was also eroded by more than $100 million between 2000 and 2002.”
The fund is required by federal regulations to grant a minimum of 5 percent of its assets per year. The economy has led to changes.
“This year we threw out the 5 percent rule,” said Magill. “We took the 2008 budget and made it the 2009 budget, so we will probably overspend the 5 percent minimum. We’re also helping 501(c)(3)s with their operating costs, especially if they provide people with shelter, food and clothing. And we’re encouraging organizations to control their administrative and operating costs.”
Magill said the fund’s “cash position is very healthy” and “we have 18 months in reserve. We operate on investments. We don’t receive gifts or donations and nobody wants to sell something in a down market. It’s a very challenging climate but we have been here a long time and we’ll be here for the long term.”
Prior to the panel discussion the club presented a Paul Harris Fellowship to Jacksonville University in recognition of the institution’s contributions to the education of two Rotary Ambassadorial Scholars. The Rotary Foundation contributed $58,000 in tuition and JU made an in-kind contribution of living expenses totaling more than $10,000.
“We’re very proud to receive this honor,” said JU President Kerry Romesburg. Then he added, “But the honor is yours for what you have done in this community and around the world.”
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