Nonprofit Sector Update During COVID-19: A Word From CNPE

Our friends at the Center for Nonprofit Excellence (CNPE) shared a report on how our local nonprofit sector is doing during the COVID-19 crisis. We appreciate their partnership and their ability to keep their finger on the pulse of the nonprofit sector. Below CNPE answers a few questions.

Question: How are local nonprofits doing?

Answer: This is a wonderful time for donors to make real, near-term impact. Our area nonprofits are really struggling, and they need your help. We would like first to tell you how they are doing and then we have specific recommendation for new strategies you might consider.

Before the pandemic, our nonprofit sector was already being asked to do more with less. Now, many nonprofits are being asked to serve in ways they had never imagined and resources are constrained in ways previously unthinkable.

Our nonprofit leaders are remarkably committed and resilient. They are feeding record num­bers of people, responding to increased crisis housing needs, moving mental health services to virtual plat­forms, and advocating for policy changes at the state and local level so they can keep serving – to name just a few. This crisis is showing us just how entrepreneurial and innovative our nonprofit leaders are.

The Center for Nonprofit Excellence and our community-wide partners have surveyed the sector to better understand how they are doing.

Below are highlights of the unprecedented challenges the Greater Louisville and Southern Indiana nonprofit sector face:

• Nonprofit organizations are asked to address life-threatening conditions for the most vulnerable of our community – with increasingly constrained resources:
  • Almost 25% of the nonprofits we surveyed saw their earned income drop by 75% or more in March and April.
  • Another 18% expect to see their revenue drop by 75% or more by the end of July.
  • Meanwhile, 38% of them have seen an increase in demand for their services since February.
• Most nonprofits are innovating dramatically in order to serve and respond in new ways. This requires them to build new systems and skills very quickly with extremely few resources.
• Enormous numbers of major fundraising events have been cancelled, further reducing their resources.
• Only half of the nonprofits we recently surveyed got funding from the federal Paycheck Protection Program to help with payroll and rent – although 70% applied for it.
• Half of the respondents we surveyed reported that the pandemic either has caused them to “really struggle” to keep up their programs and services or has prevented them from accomplishing their mission at all. And half expect the same outcomes three months from now – with 3% expecting to shut down completely.

Question: How can donors help in new and creative ways?

Answer: Across our Greater Louisville and Southern Indiana community, people of all ages have responded with compassion, creativity, and generosity. A teenager is raising funds for the One Louisville Fund through a Facebook page, local businesses are shifting their production to make hand sanitizers, and nonprofits are making major pivots to continue providing much-needed programs through virtual platforms for children and those who are socially isolated.

Below are our top 10 strategies for how donors can respond and maximize the impact of their philan­thropic giving. The first five are adapted from excellent suggestions from The Council on Foundations “Call to Action: Philanthropy’s Commitment During COVID-19”; the remaining five are based on our experience over the last few months.

1. Loosen or eliminate the restrictions on your giving.
2. Contribute to community-based emergency response funds and other efforts to address the health and economic impact on those most affected by this pandemic.
3. As appropriate, support nonprofits as they advocate for important public policy changes and funding resources at local, state and federal levels.
4. Respond especially to those communities that are least heard and resourced.
5. Reduce your expectations for follow up on reporting, acknowledgements, and other responses as nonprofits struggle with reduced staff, virtual workplaces, and increased programmatic demands.
6. Remember the Community Foundation of Louisville’s Commitment to Diversity, Equity & Inclusion as you allocate your donations.
7. Reach out directly to nonprofits and ask how you can support them. They will tell you.
8. Think differently about your philanthropic giving and consider moving it to a higher level – either as an increased percentage of your income or divesting more assets than you normally would.
9. Recognize that we have embarked on this journey together. Those in the nonprofit and donor communitie­s are mutually dependent on each other to create the thriving community we all aspire to.
10. Spread the word. Encourage your family members, faith community, business associates, and friends to join you in responding compassionately and generously.

If you are not sure where to start, consider contributing to our local community-based response funds such as:

• The One Louisville: COVID-19 Response Fund – a collaborative public, private and nonprofit emergency relief fund.
• The Fund for the Arts – a great resource for strategic giving to arts and culture (see their Cultural Lou Recovery Fund).
• Metro United Way – support their network of nonprofits serving on the front line.

Bill and Melinda Gates recently explained why they give so generously: “At its best, philanthropy takes risks that governments can’t and corporations won’t.” This is a golden opportunity for you to take just such a risk. Your local nonprofits need your help urgently.

Statistics in this article come from three recent surveys of nonprofits: (a) a statewide March survey by the Kentucky Nonprofit Network and community partners; (b) a mid-April survey by CNPE focused on PPP funding; and (c) a late April CNPE “Check-In” survey. CNPE’s two surveys focused on Greater Louisville and Southern Indiana.

The Center for Nonprofit Excellence (CNPE) is itself a 501(c)(3) Kentucky nonprofit, formed 20 years ago. We help other nonprofits in Greater Louisville and Southern Indiana succeed with training, consulting, and networking resources. Since the pandemic began, we have reached more than 1,000 people with free COVID-related webinars, we helped many get PPP funding by posting current SBA loan information and tools, and in the first four weeks sent almost daily eNews blasts with current information to help nonprofits survive this challenging time. You can sign up for CNPE’s newsletter here.