Nonprofits and grantmakers in Illinois are continuing to feel the harsh effects of the economic downturn, a new report from the finds.
Based on a November survey of nonprofits and grantmakers in the state, the report, (12 pages, PDF), found that 71 percent of respondents had cut their budgets during 2009, while 66 percent reported a reduction in operating reserves, with 63 percent saying they had three months or fewer of reserves and only 11 percent reporting more than twelve months of reserves.
On the grantmaker side, 37 percent of respondents said they planned to further reduce their grantmaking, compared to 20 percent who said they planned to increase their giving. At the same time, 42 percent of the grantmakers surveyed said they had increased their support for nonprofit capacity building over the past twelve months — a sign, according to the report, that there is widespread concern among grantmakers in the state about nonprofit sustainability.
That concern comes at a time when 67 percent of nonprofits responding to the survey reported an increase in demand for their services — the same percentage as a year ago but up significantly from five years ago — while 41 percent reported a decrease in their ability to meet that demand, up from 21 percent in last year's survey. Nonprofits also reported declines in funding from foundations (68 percent) and government sources (62 percent), with 40 percent reporting that they had experienced delays in receiving government payments.
"While grantmakers and nonprofits alike have had to make spending cuts, they continue to seek creative solutions for supporting the programs and services nonprofits provide," said Donors Forum president and CEO Valerie S. Lies. "Grantmakers are changing funding strategies to bolster nonprofit sustainability and target the most effective programs. Nonprofits are also making tough programmatic and strategic choices, while pursuing new and more aggressive fundraising approaches. To continue to serve our families and communities, nonprofits will need the steadfast support of individual and institutional donors, as well as timely reimbursements from government funders that contract with nonprofits to provide vital human services."