In this week’s news, Crain’s NY Business published an article entitled, “Large foundations plan to cut back giving. Move comes on heels of big losses in their endowment funds: nonprofits to feel the pain”
According to a survey of 1,243 foundations conducted by the Foundation Center and released yesterday, nearly 2/3 of the largest foundations say they expect to either cut the number of grants they give our or reduce the dollar amount of those grants. Many will have to reach into their endowments to pay out grants, instead of just spending income, which is the usual practice.
The article talks about foundations trying to find other ways to help their grantees through meetings, conferences, technical assistance and help with advocacy.
My sense is that most nonprofits would really prefer the money, and while it’s nice to offer that extra assistance it won’t keep the lights on or preserve jobs for staff and services for people in need.
Link to research advisory put out by the Foundation Center:
http://foundationcenter.org/gainknowledge/research/econ_outlook5.html
As the survey reports, “As the ongoing economic crisis reaches a scale and duration not seen in the post-war period, foundation behavior during past downturns may become a less precise predictor of how funders will cope with current reality. In other words, right now no one knows what the future looks like. So the more diversified a non-profit’s revenue sources can be – this means both contributed and earned revenue – the better they will weather the economic storm.
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