April 6, 2020; Dayton Daily News
Nan Whaley, mayor of Dayton, Ohio, has a message for those receiving an economic impact payment from the federal government: If you can afford it, please donate the money to your local nonprofits on the frontlines of the coronavirus pandemic.
Community leaders are urging Ohioans who don’t have immediate expenses to cover, such as rent, to consider donating forthcoming funds to local food banks, homeless shelters, and other community-based nonprofits overwhelmed by an increased need for services due to the economic turmoil caused by COVID-19.
The money is part of the historic $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act’s economic relief package, dollars intended to stimulate an economy that’s witnessing skyrocketing unemployment. Individuals who qualify will receive up to $1,200 starting this month.
Dayton’s immediate response has been to establish an emergency relief fund for nonprofits, a practice that’s seen widespread adoption in multiple states. But area nonprofit leaders continue to believe in the philanthropic goodwill of their neighbors despite the current economic situation.
“The Miami Valley is one of the most philanthropic communities in the United States and we believe it will continue to be just that and more,” Tom Maultsby, president and CEO of United Way of the Greater Dayton Area, told the Dayton Daily News.
Dayton nonprofits’ financial strain is evidenced in the increased costs associated with community efforts to accommodate Governor Mike DeWine’s stay-at-home order while also “flattening the curve,” or the attempt to hinder the virus’s spread by limiting social interactions. St. Vincent de Paul of Dayton, for example, is spending $80,000 a week to house individuals in need of shelter services in hotel rooms to maintain social distancing.
With no concrete end to the pandemic—Ohio is currently projected to reach a peak in hospital resources sometime between the next few days and early May—these expenses can only compound until social distancing is no longer necessary and the economy stabilizes.
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Whaley isn’t the only one asking economic impact payment recipients to reinvest their aid into the social-serving sector. Publications such as the New York Times and Forbes have encouraged readers to donate stimulus money and provide guidance on where funds may be most useful. It isn’t a farfetched concept; NPQ’s “2020 Map of the Nonprofit Economy” ranks individual giving as the third-largest source of nonprofit funding at $265 billion.
Writing for the Conversation, Patrick Rooney and Jon Bergdoll note that overall giving declines during economic downturns but giving to specific organizations based on need and cause—homelessness and unemployment associated with the Great Recession, for instance—can see an increase.
“In 2008 and 2009, giving fell by a total of 15 percent,” they write. “But giving to nonprofits such as food banks and homeless shelters that provide essential social services grew by 10 percent.”
Except the coronavirus pandemic isn’t the Great Recession. The needs are similar in that food banks and shelters are seeing huge demand, but the suddenness of COVID-19’s effects on society have caused miles-long lines for food distribution and created unsafe health environments for shelter staff, volunteers, and those they serve. Ten million people filed for unemployment in a two-week period.
Nonprofits are facing an uncertain future that stimulus payments, while both welcome and critical, can only buoy for so long without substantial reevaluation of funding models—even those influenced by the turmoil of 2008 and 2009. As NPQ Senior Editor Steve Dubb recently observed, “All nonprofit programming that requires close personal contact is at risk.”
Fortunately, the sector is already seeing a shift, as thought leaders urge foundations and grantmakers to change policies and procedures around funding so organizations can continue operating during a time of consistent, overwhelming need. Already 560 foundations have pledged to ease or eliminate the restrictions and requirements associated with grants so as to support nonprofit partners and their communities with “fierce urgency.” This, combined with the direct nonprofit relief support provided by the CARES Act, is a step in the right direction.
Individual giving and community investment will always be a core component of nonprofit sustainability. Encouraging the donation of stimulus money to organizations that are best equipped to disseminate necessary resources, programs, and services is one strategy, but it’s also far from the only strategy. We will continue to see how the sector, if not charitable giving itself, evolves in the wake of this unparalleled modern challenge.—Drew Adams