July 29, 2019; St. Paul Business Journal
In Minnesota, one affiliate organization has decided it is time to leave the United Way nest. Merrick Community Services has figured out that the only way it is likely to develop a solid individual donor base is through developing that relationship directly.
MCS has seen its allocation from the Greater Twin Cities United Way (GTCUW) decline by half in the past decade, and in so doing, it has left a significant and increasing hole in the budget. The decline at individual agencies, of course, should come as no surprise, since GTCUW’s campaign, which brought in $101.9 million in 2014, only raised $77 million last year. The model is simply in decline and, despite many variations on turning things around, many communities and community groups must look for new ways to connect with the goodwill of the small to mid-size donors currently wandering away from the habit of giving.
For its part, GTCUW says it has taken on more policy concerns and is looking beyond the workplace to engage donors wherever they are. But is that what local agencies need? Some do not believe so; they’re looking to reorganize their donor engagement campaigns.
“People seem to have a more vested interest in controlling their money,” said Patina Park of the Minnesota Indian Women’s Resource Center back in March 2018. She, too, wants to reduce her agency’s reliance on GTCUW. The Phyllis Wheatley Community Center, which used to rely on the GTCUW for 90 percent of its funding, now receives less than 20 percent of its funding this way.
“United Way used to be our primary funder, and we relied heavily on them,” said then-interim executive director Theartrice Williams. “That is going to make it very challenging for a number of nonprofits, particularly the smaller nonprofits brought up on United Way support.”
Revenue is declining at many United Ways. Funding for United Way Worldwide has decreased over the last ten years by about 28 percent since 2007. The top three United Ways—Greater Twin Cities, Greater Cincinnati, and Greater Philadelphia and Southern New Jersey—have each faced declining revenues since 2008. NPQ has covered the struggles of these United Ways and more, which include decreasing funding for the communities they serve, major staff layoffs, and rapid turnover among leadership.
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Interestingly, CharityWatch, the watchdog agency, contends, “In most cases where a charity is acting as an intermediary for donor contributions, doing nothing more than passing on those funds to other organizations that operate charitable programs, CharityWatch advises donors it would be more efficient to avoid the intermediary (and its overhead) by giving directly to the charities that are actually conducting program services.” While CharityWatch argues that many United Ways do offer value beyond their intermediary role, they clearly state that the intermediary process itself is inefficient and does not serve the community.
Meanwhile, the landscape has changed, and many community groups see a need for a direct relationship.
“We have to be nimble. What’s the latest trend?” said Jennifer Harrison, development director at Greater Minneapolis Crisis Nursery. “Millennials give very differently than their grandparents did. It used to be easy. We wrote a letter, and they sent a check back. Millennials, they want to get their hands dirty. They want to get involved.”
Perhaps some of us have lost the habit of engagement and reliance on our communities. It is time to recapture that and allow the United Way to occupy an ever-smaller space. For every thing, there is a season.— Sheela Nimishakavi and Ruth McCambridge