• October 31, 2014

America’s Top Charities Struggle to Recover From Downturn

Biggest Charities Expect Flat Giving in 2012 1

Ashoka

An Ashoka fellow aids needy children in India. Ashoka is No. 386 in the 2012 Philanthropy 400.

Enlarge Image
close Biggest Charities Expect Flat Giving in 2012 1

Ashoka

An Ashoka fellow aids needy children in India. Ashoka is No. 386 in the 2012 Philanthropy 400.

Many of America’s biggest nonprofits have officially left the Great Recession behind, but the slow economic recovery continues to dampen results at even the most sophisticated fundraising organizations.

The 400 groups that raise the most from private sources achieved a median 7.5-percent gain last year, the third straight year of median gains for nonprofits in The Chronicle’s Philanthropy 400 rankings. That’s much better than for the rest of the nonprofit world: “Giving USA” said charitable giving over all grew less than 1 percent last year.

But the outlook among the top 400 charities is far less optimistic for 2012, with nonprofits forecasting a median gain of less than 1 percent.

The Philanthropy 400 is a bellwether of giving trends because the charities on the list collect $1 of every $4 donated by individuals, corporations, and foundations.

It ranks the 400 groups that raised the most money from private sources in 2011. The rankings include both cash and product donations as well as stock, land, and other gifts from individuals, corporations, and foundations.

Better Than Before

The enormous variation in who’s emerging from the downturn and who’s still struggling can be seen just by looking at the top of the Philanthropy 400 rankings. Eleven of the top 20 are raising more money than they were before the financial crisis erupted in 2008.

Among those that are not yet at that point: the top organization on the list, United Way Worldwide.

Donations grew 1.2 percent in 2011, but the $3.9-billion the organization raised last year is 8 percent below what it was collecting before the recession, after adjusting for inflation.

“It’s still difficult times,” says Rick Belous, vice president for research at United Way. “We’re certainly nowhere near back in the 1990s, with double-digit growth.”

Among the most striking gains was achieved by Fidelity Charitable, the organization that houses more than 52,000 donor-advised funds.

Donations to Fidelity jumped 31.3 percent, to $1.7-billion, last year, allowing it to take second place in the rankings because it raised more than any other organization except United Way Worldwide. And the fund says it chalked up an 85 percent gain from 2011 when it closed the books on its 2012 fiscal year in June.

Fidelity says it is benefiting from the growing number of wealthy people who have chosen to skip setting up their own foundations and instead rely on Fidelity to take care of all their administrative work. A healthy stock market also has helped, since many donors give securities to the fund.

Fidelity, which marked its 20th anniversary last year, displaces one of the oldest charities in America, the Salvation Army, which fell from No. 2 to No. 3 after donations dropped 6 percent.

Some groups are, however, bucking the trend. Among the groups rising to the top ranks is Feeding America, which leapfrogged from No. 14 to No. 6, with a 71.6-percent increase in donations from 2010.

Most of the increase reflects a doubling in the value of donated food, officials say, as Feeding America forged new agreements with Wal-Mart and other retailers while making a concerted effort to procure more fresh produce.

Donations of food, as well as medicine and other noncash gifts, fueled the growth of many of the groups on the list: At least 40 organizations raised more than 50 percent of their contributions from noncash donations.

But some groups are also reporting increases in cash giving.

The two organizations with the biggest gains were the Huntington Library, Art Collections, and Botanical Gardens (No. 121 on The Chronicle’s list), with a 480.1-percent increase in donations, and the Rhode Island Foundation (No. 295), with a 396.8-percent rise.

Minimum to Make the Rankings

Still, such gains are hardly the norm. That can be seen in the minimum it took to get on the list. The 400th charity in 2007, Bank of America Charitable Gift Fund, raised $55.3-million when adjusted for inflation. This year’s 400th-ranked charity, Saint Louis University, raised just $49-million.

Among the groups that made the list because of that lower threshold: the Zoological Society of San Diego (No. 385).

After facing challenges in 2009 and 2010 during the sluggish fiscal recovery, the nonprofit that supports the San Diego Zoo came out firing.

It adopted a new name and image, calling itself San Diego Zoo Global as a way of emphasizing that the organization isn’t just a zoo but also does wildlife and conservation work in 35 countries.

The zoo conducted research and discovered that 10,000 supporters were affluent and good targets for seeking large donations.

Such efforts helped the zoo increase giving by 37.7 percent to $51-million in 2011.

Also helping the zoo increase gifts, says Mark Stuart, president of the zoo’s fundraising arm, is its status as a popular tourist destination, including a place people with means often visit. “For many people, a trip to the San Diego is on their bucket list.”

Noelle Barton, Peter Bolton, Emily Gipple, and Holly Hall contributed to this article.

Send an e-mail to Raymund Flandez and Marisa López-Rivera.

  • 1255 Twenty-Third St., N.W.
  • Washington, D.C. 20037
subscribe today

Raise more money and increase awareness with trusted insight.