Over the past year or more, I’ve been suggesting that the impact of the current economy has created a perfect storm, a worst-case set of circumstances in which the demand for the services nonprofits provide to their communities has risen dramatically as the resources they have to provide those services are falling like Niagara.
Unemployment is high, but people still need to eat. Wages are down, but people still get sick and need care. Families are trying to cope by generating two or three or four incomes, but they can’t do that without reliable day care for their kids or their elderly parents. The “safety net” which tries to catch those spiraling down with the economy is a nonprofit enterprise.
Now comes a report from the National Council of Nonprofits which suggests that things are not only bad, they’re getting much worse. “State Budget Crises: Ripping the Safety Net Held by Nonprofits” finds the storm is growing more sinister at every turn.
The demand on nonprofits is indeed higher than it has been in ages, but that’s just the beginning.

As one state government after another cuts services to those in need, the burden on the nonprofit sector rises. As one state government after another cuts their budget to the bone, funds available to nonprofits are drying up.

And, to make it even more horrible, states are now beginning to withhold payments to nonprofits, driving them into debt (or, more accurately, dragging them down).
What is happening to nonprofits is not new. There has been ample evidence of the plight they face for quite some time now, but just as it isn’t new, it also isn’t news. The pressures which nonprofits are enduring are barely noted in most media most of the time, save an occasional story about a strapped food bank or a challenged United Way. That must change.
The NCN report echoes what many of us who work with and for the nonprofit sector have been arguing for a long time now. They argue that it is time for nonprofits to band together and use their collective strength to make noise and make change. The also recommend that nonprofits draw upon the clout of Boards, often powerful and well-connected folks who can make a difference as advocates within state government and as respected voices in media.
It would be wise of leaders in the nonprofit world to read the NCN report and pay attention to both its focused portrait of the state of affairs and its recommendations about next steps and action needed.
The disaster which nonprofits face is bad, but there’s growing evidence to suggest that it’s worse than we thought – the need to make the public aware of what’s happening and to take steps to prevent far greater harm to our society is as urgent as it can be.

http://www.councilofnonprofits.org/sites/default/files/Special-Report-State-Budget-Crises-Ripping-the-Safety-Net-Held-by-Nonprofits.pdf