Funding Cuts

Jacksonville’s Nonprofit Organizations

Companies have laid off employees, gave pay cuts and even put holds on projects due to the budget crisis. Many people have used the budget crisis to their advantage by buying distressed real-estate. It’s disturbing to know that the businesses that took advantage of unknowledgeable real-estate buyers are now having troubles, and they are the ones receiving help. Nonprofit organizations have also taken the heat from the budget crisis.

Demand for services are increasing as the economic conditions are deteriorating, and this is bringing intense pressure for all nonprofit organizations. Almost all nonprofit organizations have increased enrollment in one way or another, whether it is people looking for a place to stay, medical care or even a meal for the family. Nonprofits in Jacksonville are experiencing funding cuts from the federal government, the State of Florida, the City of Jacksonville and the Duval County School Board.

Duval County’s nonprofits are expecting to see a drop in government funding at the end of this year. The expected loss is averaged at $25 million. The majority of funding loss is a result of state funding cuts, and this is where $16 million of the $25 million loss comes from. The other $9 million loss is divided between federal funding cuts and local funding cuts. To make up for the estimated reduction of funding to these nonprofit organizations, they would have to experience a 39.9% increase in income from contributions and gifts than they did in 2007.

Medicare and Medicaid reimbursement reductions, Head Start and related USDA funding, State of Florida Pre-K funding, the anticipated loss of Mayor’s Literacy Program funds and other city grants to nonprofits are experiencing reductions which has driven the funding cuts. It’s very difficult for the nonprofit organizations to replace the loss of government funding. In fact, the only way for these nonprofits to make up for the losses would be to raise fees and charges, or generate more private contributions. Since neither option has high potential for large sums of money, and because the economy is the reason for the initial funding cuts, it is difficult to rely on other resources.

Michigan’s Nonprofit Organizations

With our nation’s automakers having difficulties, it has triggered a financial concern for some charities in Michigan. GM, Ford and Chrysler provided an average of 40% of the overall giving last year through workplace fundraising pledges to the United Way for Southeastern Michigan. This years funding goal has been set at 35% due to the troubles automakers are experiencing.

This year, United Way’s local 211 has received five times the volume of calls than the previous year, needing assistance for housing aid. In conjunction with Michigan, the United Way in Central Ohio had an increase of 14% for demand of groceries at local food banks.

According to USA Today, the Catholic Charities USA reports that January-to October contributions fell to $7.6 million, down 4% or $300,000 from the same period last year. The Meals on Wheels Association of America says roughly two-thirds of its members surveyed recently reported drops in both corporate and individual donations. Programs in Texas, Minnesota and California were forced to close this year. The Salvation Army reports its western territory suffered a 9% drop in overall fundraising since August alone. Data for the organization's other territories weren't available. Goodwill Industries International says public support from cash donations, bequests and special events fell 2.3% for the first eight months of 2008 in comparison with the same period last year.

In closing remarks…Almost everyone is experiencing rough times in this economy. As our great ancestors held together in years past, we too must keep strong for the upcoming generations.