And that half-time United Way position they thought might go full time, well it won't. And even though the Missoula nonprofit is cramped, with a lease that's up in March, it will remain in the tiny former gas station up on north Higgins Avenue.
“In these tough economic times,” said Susan Hay Cramer, “nonprofits are really going to take a hit. We as an organization are asking ourselves, what kind of United Way does Missoula County need in this time of economic upheaval?”
“And you know that's not because the community's needs are any less,” said Cramer, the group's chief executive officer. “It's a very, very narrow line between those who can give and those who need help, and it's getting narrower.”
Indeed. People who used to donate to the local food bank now are customers there.
It's an unfortunate but unavoidable reality, Cramer said, that in times of tight economics people can't afford to donate as much to nonprofits - while that same tight economy means more people need the help of nonprofits.
“You have less ability to give and more need,” she said. “It's not a pretty picture.”
Not for Missoula, or for the rest of the nation.
Eric Kessler, founder of Arabella Philanthropic Investment Advisors, wrote recently in the Chronicle of Philanthropy that America's nonprofits are facing “a perfect storm of bad omens for philanthropic giving.”
Add to the sagging economy a string of floods and hurricanes and now national elections, and people are pinching their pennies.
In July, Arabella's quarterly report indicated that “foundations, individual philanthropists and corporate donors are struggling to respond to greater needs for support at a time when their own assets are shrinking.”
This month, Arabella's quarterly report predicted that philanthropy “is expected to decrease as foundations' assets dwindle because of the financial crisis,” adding that “one foundation lost more than $1 billion in assets” during the recent stock market reversal.
Programs for families have been hit, as have nonprofits working on behalf of social and environmental causes. Even scientific field research is threatened.
Famed paleontologist Richard Leakey, speaking to reporters last week, predicted the economic downturn would prove “devastating” to scientific research, which often is funded by grants and endowments.
Big donors, such as the William and Flora Hewlett Foundation, are meeting to discuss how to tighten their belts and still meet nonprofit needs in 2009.
The nonprofits themselves are choosing not to hire new staffers, not to expand programs, not to embark on new endeavors, “and I think that's wise,” said Dori Gilels. She's executive director at the Missoula-based Women's Voices for the Earth, where “clearly we're talking about how to prepare for the pinch that's coming.”
Much of the nation's public resources are caught up in overseas wars, she said, and unemployment is on the rise. Global credit markets are in disarray, and a liquidity crisis has stifled economic investment. Housing prices are collapsing, basic food prices are increasing, energy and fuel prices are fluctuating wildly and, generally, upward. The Dow Jones industrial average is on a slide, and investment portfolios - from which foundations make their grants - have in some cases been cut by more than half.
The last time the economy slumped, and big donors reeled in their giving, was seven years ago, following the Sept. 11 terrorist attacks. Ted Turner, a sometimes Montana resident and generous philanthropist, was caught in that fallout, and actually cut off all new philanthropy for a year.
In fact, during the past 100 years philanthropic giving has declined substantially only two times - once during the oil embargo years of the early 1970s, and then again after the attacks of Sept. 11, 2001.
Those were, Cramer said, “two historic moments.” Today's economic slump is a third.
At the Turner Foundation, the answering machine delivers the new message: Don't call us, we'll call you.
“Your best bet is to have a diversified donor base,” Gilels advised, and not to rely too heavily on one or two big foundations. Her group, for instance, was hit hard by Turner's year of abstinence, and since has worked to cobble new partnerships.
Many of those alliances, surprisingly, have been with business and industry, “because there's a real movement toward green business,” she said.
But even that's not a sure thing, as businesses themselves constrict, laying off workers and delaying new projects.
The wealth may not be trickling down, but the bunker mentality certainly is percolating up.
The short term, Nick Roberts said, “will be hard.” The long term, he added, “is pretty darn scary.”
Roberts is development director at Missoula Food Bank, where he's working in what he calls “a whole new era.”
“We've definitely had people who used to come in and drop food off, and now they're coming in to pick food up,” he said. “They've gone from giving to needing.”
That's Cramer's thin line not just getting thinner, but getting erased.
Record numbers are using the Food Bank, Roberts said, at the same time that donors are tightening purse strings.
“We first started seeing it last spring,” he said, “and it really felt like it was fueled by fuel, and by people's inability to balance basic needs.”
The question: to fill the refrigerator, or to fill the tank so you can get to work to earn the money to fill the fridge?
“That's easy,” Roberts said. “There's no Gas Bank.”
So now he's looking at cost savings - examining how the Food Bank distributes, how it purchases, how it plans.
He hopes to fare better than other nonprofits, “because this isn't about luxury.” But Roberts admits everyone is competing harder for far fewer dollars.
“I guess I just have to keep asking,” he said.
Which is exactly what Aaron Brock's doing over at Missoula Aging Services. He's development director there, managing popular programs such as Meals on Wheels.
Volunteers delivering meals to shut-ins burn thousands of dollars in gasoline each month, Brock said. And while many once contributed the fuel, “more and more are asking for reimbursement. One of our biggest pushes right now is to find the money to do that.”
He's also preparing for increased food costs, once his current three-year contract expires.
“The financial downturn is going to cost everyone,” he said, “but it's really hardest on those living closest to the margins. If the stock market doesn't turn around, then we're going to have to make some real changes.”
Already, he said, he's talking with donors who say this year isn't a good time to give, because their portfolios have been decimated.
“But I'm an optimist,” Brock said. “I'm not going to stop trying.”
In fact, there are bright spots on the philanthropic horizon for those willing to get creative. Last summer, Roberts teamed his food bank with local investment banks, and raised a quick $10,000 without much fanfare.
More recently, Montana philanthropists gave nearly
$2 million to the Montana Community Development Corp., financing for local entrepreneurs who can't secure a loan. The Missoula nonprofit then used the money to leverage an additional $3 million in institutional donations.
But such success stories are increasingly “the exception,” said Jacqueline Hud, of the Bozeman-based Keystone Conservation environmental group. “I think we're all going to be very heavily hit by all this.”
Her nonprofit exists in a specialized niche - donors who value the Rocky Mountains' remaining large carnivores.
“We count on them,” she said of her members, “and we're probably going to have to ask them to do more.”
But most don't have more. They have less.
Still, she doesn't have much choice, as half of Keystone's funding comes from foundations, “and the word on the street is a lot of foundations are looking to cut way back.”
It's especially daunting for small groups such as hers, which has just 1,600 members. One of her board members lives on the East Coast, where she “has already seen smaller groups folding.”
So Hud, like others, has been holding strategy sessions, discussing what the future might look like. Perhaps they'll pull in their focus, funding only Keystone's strongest programs. Perhaps they'll partner with similar groups, to reduce overhead.
Already, two fulltimers have been cut to parttime.
“Everything's on the table,” Hud said. “It's a very scary time.”
Scary even in Missoula, where “people are extremely generous,” Cramer said from the tight quarters of the United Way offices. “We're counting on that to continue, but realistically, everyone is in this bind together.”
“I don't know of anybody,” Cramer added, “who is just sitting back and saying, ‘Well, it'll be OK. Let's just ride it out.'
“Everybody is feeling the squeeze. And the consensus is, a year from now things are really going to get tough.”
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Brooke wrote on Oct 19, 2008 11:10 AM: