Nonprofit survey: expect to do more with less

Nonprofits expect to serve more people in 2012, yet they also anticipate reduced revenues from major funders, particularly state and federal grants and contracts, according to the 2012 State of the Sector survey from Nonprofit Finance Fund. The 2012 report extends a dramatic three-year trend of  steeply rising demand for services in the face of declining revenues. Sixty percent of those surveyed don’t believe they can meet the anticipated need for their services this year.

The survey is the latest of five conducted in two-year intervals by Nonprofit Finance Fund. While the survey does not represent a statistically valid sample of all U.S. nonprofits, the number  and diversity of respondents (4,500 nonprofit managers from representing all major nonprofit fields and a range of annual budgets) does create a revealing cross-section of American nonprofits.

The financial squeeze has been particularly tough for nonprofits addressing child poverty, housing insecurity and homelessness, hunger and other human needs that have exploded during the last four years of economic decline and dislocation. These service providers take the brunt of state and federal disinvestment in social services and penny-pinching tactics such as delayed reimbursements.

More than three quarters of nonprofits said that state and federal funding did not cover the full cost of services provided. Sixty-six percent of respondents affected by government cutbacks and shortfalls dipped into reserves to meet the excess cost of services. Among all nonprofits responding, 57 percent said they had only enough cash on hand to meet operating costs for three months or less.