A year into what has been forecast as a long recession, the region's nonprofit sector is caught in an economic Catch-22: More people are in need of basic services — shelter, food and clothing — while the agencies themselves find donations harder to come by.
"In times like this, our kids and families struggle more than we do as an organization," says Todd McFarlane, president and CEO of the Boys and Girls Clubs of Metro Richmond. "The revenue streams may be going down, but the needs of our kids are increasing tenfold. If we cut people or our hours, we have to reduce services to our kids — and we don't want to do that."
The Boys and Girls Clubs' 12 locations serve 1,000 children every day in Richmond, Chesterfield, Hopewell and Petersburg. Because almost 70 percent of the group's membership comes from single-parent homes, McFarlane says, his team is very concerned about the impact of a recession on the kids they serve.
"I don't know how any nonprofit organization can avoid being impacted," says Jeanine Harper, executive director of Greater Richmond Stop Child Abuse Now (SCAN).
"People are nervous," affirms Bobby Thalhimer, senior vice president at The Community Foundation Serving Richmond and Central Virginia. The Richmond-based endowed foundation provides grants, training and strategic support to area nonprofits.
"If your organization has a diverse donor base, then the probability that you'll be able to maintain is more likely," he says, noting that individual donations tend to weather recessionary storms. "Nonprofits at greater risk are those who receive funding from the state or from the corporate community."
On his blog, Thalhimer chronicles recent trends: A 97 percent increase in the number of people served by the Salvation Army this September over the previous September. Housing Opportunities Made Equal (HOME) reports a 197 percent increase in local home foreclosures during the third quarter of 2008, compared with the same quarter in 2007.
The picture Thalhimer paints is familiar, says Alice Tousignant, executive director of Virginia Supportive Housing. For 20 years, VSH has provided permanent housing and support services for very low-income individuals and families who are homeless, disabled or both.
"We've got to figure out how to expand what we're doing so that we can take care of the increased demand," she says. "But what this economy has also signaled for nonprofits in a very stark way is that we need to diversify our portfolios."
Don't put all of your eggs in one basket, she means. Look for support from a variety of sources — individuals, grants and corporations and explore creative partnerships with other like-minded nonprofits.
Tousignant points to a new partnership between the Central Virginia Food Bank and Meals on Wheels as a good example.
Exploring merger opportunities is exactly what SCAN has been doing — since long before the economic downturn, says Harper. SCAN focuses its energies on strengthening families, improving parenting and preventing abuse and neglect in the region.
While groups like VSH, SCAN and the Boys and Girls Clubs are adjusting to the tightening economy, organizations like The Community Foundation are rolling out new support for the nonprofit sector.
After receiving local agencies' calls for help in the fall, The Community Foundation's staff got a process rolling that led to the board's creation of the Safety Net Fund, a $1 million fund to help local nonprofits meet meet growing demands in key areas such as housing, health care and food assistance.
"The Safety Net Fund is really for those organizations, like the Food Bank or CARITAS or even smaller groups, who are seeing an increased need for their services," says Susan Davis, The Community Foundation's senior vice president for community leadership initiatives.
The Community Foundation is not just throwing money at the situation. Beginning in December, the organization launched a series of workshops for nonprofits focused on budgeting and financial planning, as well as several forums emphasizing ways nonprofits can maximize their services through strategic partnerships.
"This is when creativity and innovation happen," Thalhimer says. "As we go about our initiative to help nonprofits deal with this situation, it's with a focus on giving each of them tools to evaluate their best course in this environment."