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Cuts in Spending Don’t Mean Cuts in Demand for Nonprofits

A Panel discussion takes place at the Donors Forum non profit summit at chicago cultural center on Wednesday, Nov. 20, 2013.
A panel discussion took place at the Donors Forum nonprofit summit at Chicago Cultural Center Wednesday, Nov. 20, 2013.

The last five years of economic turmoil have rattled America’s nonprofits. While funding for these organizations has been slashed, the demand for them has been steadily growing, advocates said Wednesday.

“Cuts in spending do not mean cuts in demand for social services,” said Delia Coleman, Donors Forum executive director of public policy. “These cuts affect more than nonprofits. … They affect children in need of nutrition, families needing shelter and our communities as a whole. These cuts have hit services for women, children and the poor hardest.”

Coleman spoke at the Illinois Nonprofit Policy Summit at the Chicago Cultural Center, 78 E. Washington St. Called by the Donors Forum. It featured a panel of nonprofit advocates and politicians discussing the future of funding and the government’s role and how best to confront a harsh economic reality.

The sequester alone gutted many nonprofit organizations by $64 billion across the board and more cuts are expected in January.

According to the National Council of Nonprofits, the last years have brought:

· A $405 million budget loss in Pre-K education programs

· A 5 percent cut in the Section 8 housing vouchers program due to sequestration

· More than 19 domestic violence crisis centers closing nationwide.

Governments and nonprofits need more dialogue, more data to understand each other,” said Valerie Lies, president and CEO of Donors Forum.

State Sen. Chapin Rose (R-Mahomet), echoed her sentiments.

“One thing I brought up during the discussion was [we need] better communication between the governor’s office and the agencies they have jurisdiction over,” she said.

Coleman discussed how important the nonprofit sector is to the public’s well-being.

“Nonprofits are at the center of communities,” said Coleman. “We’re the ones helping them get shelter. We’re the ones helping them with food. We’re the ones who help them recover from violence, recover from substance abuse. We’re the ones who help educate them, keep their kids safe, protect their water, give them art, maintain their health. So if the nonprofit sector isn’t there for the public, where will the public turn?”

The 2008 recession, sequester and recent government shutdown have all forced nonprofits to layoff workers, form partnerships with each other and seek funding from nongovernment donors. However, nonprofits that are just starting to look to the private sector for funding are putting extra pressure on nonprofits that have used the private sector as a source long before the economic collapse. Coleman said.

Such is the case of Manufacturing Renaissance, a nonprofit that trains young engineers.

“We rely completely on private funding and donations to keep our doors open, but when you have these new nonprofits entering the competition for private funding, things get difficult,” said Mark McKelvey, the company’s director of Foundation and Corporate Relations. “In the end, this makes it more difficult to help the communities we are in because we have to focus more time on securing funding.”

In the face of all of this adversity, the politicians on the panel were as serious about helping nonprofits as the advocates themselves. “Some of the best money the government spends is invested in nonprofits,” said state Sen. David Koehler (D-Peoria).

“My experience was that every dollar you gave to a not-for-profit, you got probably back… because they were able to stretch those dollars,” said former Gov. Jim Edgar. “So I would urge policy-makers today to learn how to deal with budget realities [and] that you make sure you take in consideration how effective that dollar can be used.”

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