Bracing for Tough Times

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No matter how much success the 400 top fund-raising organizations in the United States achieved last year, the future looks gloomy.

Particularly since the September 11 attacks, charities have seen a drop in donations, initially because mail appeals were canceled and donors steered contributions to relief efforts. Within the last few weeks, mail potentially contaminated by anthrax has worried people about opening letters, threatening to pose yet another hurdle to the crucial end-of-year fund-raising push.

"Everything happening right before the best giving season cut into our ability to approach people," says Alyssa Herman, director of development for Doctors Without Borders USA (Médicins Sans Frontières USA), in New York. The international relief group lost $2-million in expected revenue after halting an appeal scheduled to be sent immediately after the attacks.

As a result of anticipated fund-raising shortfalls, many charities are proceeding cautiously with new programs, hiring additional staff members, or spending on travel. The fund-raising climate does not seem likely to improve soon: a recent poll by Independent Sector, a coalition of major nonprofit organizations and grant makers, found that half of the 1,009 people it surveyed said the sinking economy would negatively affect their giving decisions.

Government officials have started to take notice of the plight of charities.

President Bush recently recorded a public-service announcement for United Ways, describing their support of child-mentoring and drug-treatment programs, as well as shelters for people who are homeless or abused. "All of us have a responsibility to promote these efforts--now more than ever," the president says in the announcement. "I encourage all Americans to support their local United Ways, to help build--and rebuild--communities we can be proud of."

Two U.S. senators also have proposed tax-relief legislation intended to spur giving to all types of charities.

Sharing Strategies

As charities head into the final stretch of this year, fund raisers are hastily comparing strategies for how best to proceed given the uncertain economic outlook.

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