Economy challenges businesses used to donating
Companies, foundations reassess contributions
Businesses and foundations have always been a major supporter of nonprofits, but as their bottom lines continue to suffer amid the economic downturn, some are struggling to remain generous.
"If it were just the banks, that would be the easy part," said Nancy Hall, senior adviser for the Maryland Association of Nonprofit Organizations, which includes more than 1,700 members. "Some organizations made commitments at the beginning of the calendar year, so they will have no impact as of yet. Others could be a different story."
Hall said she expects donors to aim more of their available contributions toward poverty and domestic violence services because they are most in need during hard times.
"We are laser-focused on talking with the business community. We're telling them that now more than ever, they have a responsibility to step up," said Glen O'Gilvie, executive director of the Center for Nonprofit Advancement in Washington.
O'Gilvie cautioned that nonprofits can have anywhere from 30 percent to 100 percent of their budgets come from donations.
"All of our businesses, large and small, are working very hard to keep their commitments," said Georgette "Gigi" Godwin, CEO of the Montgomery County Chamber of Commerce.
Safeway, whose Eastern division has headquarters in Lanham, had said it may have to cut back on its smaller contributions, although it will stick with its major community events such as the Feast of Sharing in Washington, said Craig M. Muckle, public affairs manager for the division.
"Small operations where we might have given money in other years are going to have to be evaluated," he said. "Some are going to get lost in the mix this year."
Pepco has also said that although it will also review its annual donations in January, it has a long history of community service and wants that to continue. The company provided $2.7 million to various local organizations, including in Prince George's and Montgomery counties in 2007, said spokesman Robert Dobkin.
Biotech MedImmune in Gaithersburg has almost reached $2 million in charitable grants for 2008 and expects to keep that level in 2009, said spokeswoman Liz Huntley.
"MedImmune recognizes the important role that nonprofit organizations play in our local communities, and we look to align ourselves with groups and causes that produce the greatest impact," she said.
The Barnes & Noble bookstore in Bowie Town Center has set up a system in which customers can buy extra children's books and donate them to the Prince George's Child Resource Center. The center has received 350 books so far.
Lockheed Martin, the Bethesda national defense and aerospace giant, has even pledged to increase its charitable giving in 2009, which supports education in engineering and math, communities and causes of importance to customers, said spokesman Scott Lusk.
"It's just part of us being good corporate neighbors," Lusk said.
Foundations also must dig deeper as their endowments plummet by 25 percent and more as their stock holdings plunge. Regulations require foundations to grant at least 5 percent of their assets annually, although some give more, depending on their situation.
"We're working with members to understand how the downturn is affecting them," said Betsy Nelson, executive director for the Association of Baltimore Area Grant Makers. "Some have multi-year commitments so they have fewer uncommitted dollars to offer."
She said some foundations are going on hiatuses while they decide if they can give money, while others are placing priorities on the organizations and programs to which they grant funds, choosing to support general operation costs rather than individual projects.
"Frankly, who knows what's going to happen?" asked Jean Shaughnessy Hodges, executive director of The Freeman Foundations in Olney, which provides money and capacity-building support to mid-Atlantic nonprofits.
Although her foundations granted $3.5 million in the last 18 months, primarily in Montgomery County, much of this was given to projects in the memory of the foundation's chairman, Joshua M. Freeman, who died in 2007. Previously, the foundation operated solely in the spirit of Freeman's father, Carl M. Freeman.
Hodges said her foundations are still working with nonprofits, but also helping some organizations come up with creative ideas for other funding.
Local community foundations, such as The Community Foundation of Frederick County, are doing their own part to aid nonprofits. The foundation recently announced the creation of the 2009 Family Relief Fund, which will dole out quarterly grants to county nonprofits that provide food, health care, job training and counseling services.
Betsy Day, president of the foundation, said she expects the foundation to continue giving its $2.4 million in grants — an amount boosted by a new allowance for $300,000 in discretionary funds — plus $340,000 in scholarships.
"We in the foundation world understand that market downturns are an expected part of investing. We are based on the long-term, and when you keep that long-term focus, your investment policy can weather these times," she said.