Have you noticed more requests from charities? If you read their letters or emails, you will recognize a familiar plea: Giving is down, needs are up. This has held true for most charities, but the news is not all bad.
Giving USA recently released overall charitable-giving numbers for 2011. Giving increased 4 percent in 2011 to $298.42 billion in contributions (but only an increase of 0.9 percent when adjusted for inflation). Let’s take a closer look.
Per the norm, it is giving by individuals that made up the lion’s share of charitable giving. In 2011, giving by individuals in all of the various forms accounted for 88 percent of all giving, and that’s to the tune of $217.79 billion.
Giving by bequest increased by 12.2 percent to $24.41 billion. Charities, take note: Legacy giving is the ultimate expression of one’s commitment to a charitable cause. Talk to your loyal supporters about this simple way to make a difference.
Giving by foundations increased 1.8 percent to $41.67 billion, but that amount is actually a slight decline when adjusted for inflation. Foundations accounted for 14 percent of total giving.
Giving by corporations held steady at $14.55 billion, providing 5 percent of total giving.
As has been the case in recent years, corporate giving is largely characterized by in-kind donations of goods and supplies.
How did the different charitable sectors fare? Giving to religion was down, although still receiving 32 percent of all charitable dollars. Giving to education, human services, arts health and welfare organizations increased. The largest increase was in giving to individuals (largely medications programs) and next was to international affairs organizations. Giving to foundations was down.
As you can see from these numbers, it’s a big world of charities out there. But it has narrowed slightly. There were 1.08 million nonprofits registered with the IRS in 2011 – a decline of 15.6 percent from 2010. This decline is largely due to new federal registration requirements, which resulted in 200,000 organizations losing their tax-exempt status last September, many of which may have already been out of operation.
The big picture? We are in a slow recovery. Charitable giving remains 11 percent down from 2007. Patrick Rooney, executive director of the Indiana University Center on Philanthropy, which compiles the Giving USA report, was quoted in the June 19 edition of the Chronicle of Philanthropy as predicting that a full recovery in giving may not occur until 2022.
Locally, organizations are reporting mixed results. Christian Appalachian Project, a regional human services organization that is based in Kentucky but receives a significant portion of its contributions nationally, reports they held steady over the last three years and only recently experienced a decline. Last fall, they were hit with a 4 percent decline. It was a delayed reaction that other charities have likewise noticed. This spring and summer, giving has picked up and included two major bequests. Guy Adams, CAP’s president and chief executive officer, reports their online giving totals continue to increase and he is cautiously optimistic over the recent uptick.
Bill Farmer, president of United Way of the Bluegrass, acknowledges the impact of the slow economy on people and giving, but reported that last year was the first time in nearly a decade that United Way of the Bluegrass did not decrease funding to the community over the prior year. He noted that United Way has sought to diversify its fund development base to deal with the challenging marketplace.
Where are the most generous donors and the most charitable places? Charity Navigator just released its annual U.S. Charity Checkup and found that of 30 examined cities, Houston ranked first in charitable-giving growth and in charitable activity overall. New York City has the highest number of large charities, followed by Washington, D.C. Miami held the top spot for highest contributions, at $5.58 million, trailed by Detroit, then Denver. The lowest? Portland, Oregon.
Detroit’s charities offer the best bang for your buck, devoting 86 cents out of every dollar for programs. Indianapolis charities bagged the bottom spot of the cities reviewed by using 78 cents out of each dollar for programs. These figures are all based on medians.
As you contemplate these giving statistics, remember that giving isn’t just numbers.
It comes from the heart. Just don’t forget to do your research. Make sure the charity you wish to support is doing the job you think they are. Think about how much you can give and what is the best way to make your gift. Involve your legal, tax or financial advisor. Finally, talk to the charity about your interests and how your gift will be used by the charity. Maybe if we all try hard enough, giving in 2012 will beat 2011 levels and we will all be winners.
Anne E. Nash is an attorney and principal/owner at My Giving Advisor, LLC, a philanthropic advising firm in Lexington Ky. www.mygivingadvisor.com.