Giving Down 6% In First Quarter
Giving to charities dropped 6 percent in the first quarter of 2020 compared to the same time last year, including an 11-percent dive in March as the country headed into the coronavirus pandemic (COVID-19) shutdowns.
The survey results released yesterday comes a week after initial Giving USA estimates showed 2.4-percent growth in 2019 to almost $450 billion. If a 6-percent decline were projected through the end of 2020, it would result in an estimated $25-billion drop in giving for the year, according to the 2020 First Quarter Report by The Fundraising Effectiveness Project (FEP).
The FEP is the provider of the Growth in Giving Database, the world’s largest publicly available database of actual donations to nonprofits in the U.S. and Canada.
“The first two months of 2020 started out strong,” Elizabeth Boris, chair of the Growth in Giving Steering Committee, said in a press release announcing the survey results. “But, in March alone, we saw an 11-percent decline in donations, which was almost certainly a reflection of the impact of COVID-19,” she said.
By the end of March, most special events and other fundraising events were canceled or postponed as COVID-19 was declared a pandemic.
Smaller-dollar donors came to the rescue during the first quarter, as the survey noted a 6-percent uptick in donations of less than $250. Steven Shattuck, a member of the FEP Steering Committee and chief engagement officer at Bloomerang, called that was something unusual that will be watched closely.
While donations of less than $250 increased, mid-level gifts of $250 to $999 decreased by 2.2 percent. Higher-level gifts, those of $1,000 or more, dropped by 7.4 percent.
The number of overall donors also continues to drop, diving 5.3 percent during the first quarter. The percentage of donors who gave last year and have already given in 2020 — the donor retention rate — dipped 3 points to 16.4 percent.
“I think nonprofits took a deep breath like the rest of the planet,” Boris said. “They are resilient and mission-driven because they are supported by everyday people who care about their communities,” she said.
Recent tax changes allow all taxpayers — including those who do not itemize — the ability to deduct their donations this year, he added. Congress passed the CARES Act in response to COVID-19, which allowed individual taxpayers to deduct donations of charity of up to $300 on their 2020 federal tax return, even if they take the standard deduction.
The FEP was first established in 2006 and the Growth In Giving database was created in 2012. Both are administered by the Association of Fundraising Professionals (AFP). The Growth in Giving Database is the world’s largest public record of donations activity with more than 204 million donor transactions, continuously updated by fundraising software companies, including Bloomerang, DonorPerfect and NeonCRM. Additional partners including the 7th Day Adventists, The Biedermann Group, DataLake Nonprofit Research and DonorTrends, a division of EveryAction.
Data analysis includes giving details from almost 2,500 nonprofits based in the U.S. as a subset of the FEP. Distribution of the NTEE codes is comparable to the sector-wide distribution. The FEP 2020 First Quarter Report is available for free at www.afpfep.org
This article originally appeared in The Non-Profit Times. It is used with permission. To subscribe to the free newsletter of The Non-Profit Times, click here.