Giving Thought: Shifts in funding

If you work for a non-profit or are involved with philanthropy, you are likely aware of the rising need for financial support for community-serving non-profits. According to the Nonprofit Times, “giving to non-profits in the United States plunged during 2022, led by the disappearance of individual donors. Giving dropped to an estimated $499.33 billion — down 3.4% in current dollars and 10.5% after adjusting for inflation from a revised total of $516.65 billion in 2021.”

Anecdotally, regional non-profits report that donations from individual donors were lower in 2023 than in 2022. As final data on 2023 has yet to be available, we cannot say with certainty what has happened, and it is impossible to know the full impact of these shifts.

For the past few years, many non-profits have been supported by supplemental infusions from governmental agencies from the pandemic, which has kept their financial situations from entering disastrous territory. Yet, much of this funding is also ending. As we move into 2024, the pandemic funds that bolstered non-profits are dwindling, if not already dried up. At the same time, non-profits are seeing the same, if not increased, demand for their services.

While many regional employees have increased wages since the pandemic, only some have kept up with inflation. For many residents, this means they are attempting to live on less than they did before 2020. Non-profits are in the same situation, trying to do more with less. Many are serving more clients than ever, often uncertain about their long-term financial sustainability.

In 2023, LIFT-UP (Life Interfaith Team on Unemployment and Poverty), a regional non-profit focused on supporting those facing food insecurity, reported that food prices had risen by 12% over the past 18 months. In 2022, LIFT-UP served 48,914 individuals at its fixed pantries and mobile distributions. As of July 31 2023, it had already served almost 55,000 individuals.

In addition to rising food costs, health premiums are also on the rise. As a result, several regional non-profit leaders have shared they cannot offer healthcare to their employees due to these high premiums. Non-profit leaders also share that tight budgets have kept them from being able to afford medical benefits, mainly because general operations have had less support from donors and foundations. Health benefits for its employees are not something many donors are excited to support, and yet, it is critical to the nonprofit’s services and sustainability.

When a non-profit employee encounters a health crisis without insurance, they take on a financial burden and the difficult task of managing their health. If they are forced to leave the organization, the ripple effect impacts that organization and the clients they serve. One solution is to support an organization’s general operating and provide unrestricted funds, allowing the organization to have flexibility and adapt to rising costs and shifts in pandemic support.

Knowing that federal and state funding from the pandemic is drying up for nonprofits and its impact, we need to come together as a community and look at longer-term, sustainable solutions for our non-profit ecosystem. Yes, it requires greater collaboration among our nonprofits, and it also requires honest dialogues between non-profit leaders and donors on sustainability and the true costs of operations in our mountain resort community.

Individual support for non-profits does make a difference regardless of the donation amount. As community members who desire a thriving economy and ecosystem, we are invited to assess our capacity to care for each other and to give as we can, for the good of all, as we continue to adjust to post-pandemic life.

Allison Alexander is the Director Strategic Partnerships and Communication at Aspen Community Foundation. ACF with the support of its donors works with a number of non-profits in the Roaring Fork and Colorado River valleys. Throughout the year, we will work to highlight non-profits in the region.