Local nonprofits face uncertain futures in unstable economy

Chris Kirk

As foundational support and private contributions dry up, charitable organizations are often forced to scale back services offered. Chris Kirk/The Daily Northwestern

Martasi Tolar jams to her iPod as she works on her chemistry homework. A junior at Evanston Township High School, she comes to an after-school program every day to study. Program coordinators say it keeps her out of an empty home and off the streets.

But Tolar may soon need to find someplace else to study. Tolar attends an after-school program run by Youth Organizations Umbrella, or YOU, one of several nonprofits operating in Evanston and at Northwestern that faces an uncertain future in an unstable financial climate.

The challenge of nonprofits is not necessarily to encourage students and residents to care, charity organizers said. Rather, it is to draw dollars out of donors’ tightened grips.

“A lot of people have had to cut back,” said Don Baker, executive director of YOU. “You can’t give away money you don’t have.”

Although more people participated in Dance Marathon this year, Evanston businesses have been more reluctant to donate to charity organizations.

“When we tried in the fall to get donations from (businesses), they were just saying, ‘You know, it’s a really hard time, I’m just not sure,'” said Emilie Hsieh, co-president of Northwestern University to benefit Special Olympics.

Meanwhile, a psychology of panic prompts those who do have the money to hold back and save.

“It’s not that we’re particularly hurting at this moment – it’s just the anxiety,” said Evanston donor Kim Cohen.

Last year, Cohen and her husband donated $50 to YOU. This year, she said, they’re only donating $30.

Foundations, on which many nonprofits rely for revenue, have lost a good portion of their assets as the plummeting investment market erodes their nest eggs. A survey conducted by the Chronicle of Philanthropy showed that among 60 large national foundations, assets declined an average of 28 percent from 2007 to 2008.

State funding, which makes up three-fourths of YOU’s revenue, is also imperiled as local coffers are under strain. By June, the organization may lose up to 40 percent of state funding, Baker said.

“Our hope is to last through June – through the end of the school year – even if that means we end the year with a deficit, and we could conceivably end up with a substantial deficit,” he said.

A deficit will force Baker to make cuts, and the first services to suffer will be after-school programs, he said.

Volunteers of Soup at Six, a local soup kitchen, wrote to the Evanston RoundTable, to promote the organization after donations plummeted last year, volunteer leader Julie Cowan said.

As an organization that relies entirely on private donations, Soup at Six needs those contributions because it is not supported by foundations or the government.

It especially needs large donations because casual donors are now contributing about half as much as they were last year, volunteer Erica Hall said.

Other organizations enjoy steady funding but escalating demand for their services.

The need for Evanston’s Connections for the Homeless skyrocketed when foreclosures turned homeowners out onto the streets, adding to a homeless population that had already been growing for years, said Director of Development Meagan Downey.

Since the recession began in December 2007, the number of homeless people in Evanston has doubled, straining the organization’s resources, Downey said.

Now Connections for the Homeless must refer some homeless people to other organizations, many of which have already made cuts to their own programs due to drops in revenue.

The nonprofit is preparing for drops in both foundational and governmental support, which account for 13 percent and 68 percent of the organization’s funding, respectively.

“We know that it’s a serious possibility, so we are doing everything that we can to encourage money from the private sector,” Downey said.

YOU also faces the same irony – at the same time the financial climate threatens its resources, students like Tolar and their families need it more than ever, Baker said.

“We’re having to provide more counseling and more support at the very point where we have less dollars,” he said.

[email protected]