"Could we
have picked a worse time for a gala?" asked Richard J. Moylan, president of Green-Wood Cemetery
in Brooklyn, regretting the disappointing
turnout for the institution’s fund-raising dinner on Friday night. He could
have spoken for hundreds of nonprofits of all sizes in all boroughs as they
confront the high season of the benefit.
The city’s vast and traditionally overstressed nonprofit community is
already reeling from the crisis on Wall Street. "We have been in perfect storms
before," said Lorie A. Slutsky, president of the New York Community Trust,
which distributed $166 million to 2,500 nonprofits in 2007.
But given
the cratering economy, "many charities rely on year-end giving, so they are
nervous about the impact of the market turmoil," she said, adding that the
downturn was having an affect not only on private contributors, foundations,
corporations and the availability of credit to nonprofits, but also the
viability of government grants and contracts in a time of looming tax-revenue
gaps.
Beyond
providing services to the young, the elderly, the poor and the sick, the city’s
more than 10,000 nonprofit organizations are estimated to have some $50 billion
in annual expenditures and employ at least 500,000 people.
Some 85
percent of the city’s nonprofits have annual budgets under $3 million, "and
most of them don’t have endowments or cash reserves," said Fran Barrett of the
Community Resource Exchange, which provides management and financial help to
about 300 community groups. "Some smaller organizations will have to shut their
doors."
If they
do, many of their employees, neighborhood residents, "will be needing services
themselves at a time when there will be less of them," she said.
The
nonprofits most seriously affected by the economic meltdown depended on
donations from financial icons brought to their knees by the crisis, including
Bear Stearns, Lehman Brothers, Merrill Lynch, the American International Group
and Washington Mutual.
Citymeals-on-Wheels
a nonprofit that provides three million meals yearly for more than 18,000
homebound residents through 83 agencies in the five boroughs received major
support from Bear Stearns and its executives.
The loss
of these contributions and others from a variety of donors, including a
troubled hedge fund as well as spiking food and gasoline prices forced
Citymeals to cancel a $2 million-a-year program in August. For most of a decade,
Citymeals had been delivering a second daily meal, in addition to the standard
single-meal delivery, to 1,400 people "who are slipping into malnutrition,"
said Marcia Stein, the group’s executive director.
During the first week of the financial crisis in mid-September, "many
donors cut their contributions in half," Ms. Stein said. "And after the
uncertainty of this week, I shudder to think what will happen next week when we
open the mail."
Similarly,
the collapse of Lehman Brothers and other donors affected the Asian American
Legal Defense and Education Fund, and beyond the possible consequences to its
budget, the group had been looking forward to a landmark celebration of its
35th anniversary next year. "The times make it difficult for us to plan now,"
said Margaret Fung, executive director of the fund, which offers educational
training and legal assistance to poor Asian immigrants.
Both
Washington Mutual and Lehman Brothers were donors to the Food Bank for New York City, which
works with 1,000 local organizations to provide soup kitchens and food pantries
serving 1.3 million New Yorkers. The organization has also suffered a $200,000
cut in state funding.
But aside
from money, "much of our volunteer support came from corporations, especially
from people in the financial sector," said Gregory L. Boroff, a senior vice
president at the Food Bank. Yet as volunteers have dwindled, the Food Bank’s
own community kitchen in Harlem, at 252 West 116th Street
near Frederick Douglass Boulevard,
has had "a 35 percent increase in the number of meals served," Mr. Boroff said,
compared with this time last year.
And at
the same time, during the last two weeks, the group’s direct-mail donor
revenues were down 27 percent, he said.
In Brooklyn, in the heart of the fund-raising season, "we
were expecting 100 to 150 people to join us," Mr. Moylan said of the dinner at
Green-Wood, the 170-year-old resting place of Boss Tweed and Leonard Bernstein.
Gala contributions of $150 to $250 will help pay for preservation, education
and community outreach projects. "We’ll only have 70," he said under a festive
white tent at the event, "but under the circumstances, we think it’s a
success."
In other
boroughs, nonprofits are worried, and wary. "The Bronx
has been making such a comeback, and now a lot of hardworking people are going
to have the rug pulled out from under them," said Bill Aguado, executive
director of the Bronx Council on the Arts.
Last year
the group gave about $500,000 to 80 arts organizations and 70 artists, but
going forward "I am projecting that we will have cuts of from 10 to 30
percent," he said.
And in
many city nonprofits, fears have already been validated. Carol Raphael, the
president of the Visiting Nurse Service of New York,
said the organization had suffered a 3 percent cut in its 2009 New York State funding, amounting to several
million dollars.
The
organization provides a network of home-based services to some 30,000 seriously
ill and elderly people in the five boroughs and parts of Westchester and Nassau Counties,
and "all of this is happening while the need for our services is increasing,"
she said.
As for
nongovernmental donors, some have already told United Neighborhood Houses of
New York that "there will be no new grants in 2009," said Nancy Wackstein,
executive director of the federation of 35 community centers and settlement
houses in five boroughs.
Its
agencies employ 8,000 people, "many of whom are low-income," Ms. Wackstein
said. If there are layoffs, "fewer people will get services and many of the
people we employ are one paycheck away from want."
At least one of its community
centers has already been affected by government budget-cutting. On Monday,
Stephan Russo, executive director of the Goddard Riverside
Community Center on Columbus Avenue and
88th Street,
had to inform the staff of Public School 165 that Goddard’s 10-year-old Dropout
Prevention Program there would have to be closed. The city cut the entire
$90,000 budget of the program at the elementary school, at 109th Street between Amsterdam Avenue and Broadway.
However, the picture is not
universally gloomy. Some established nonprofits have so far eluded the bailout
blues. The New York Public Library has not seen a decline in support for its
annual Library Lions fund-raising dinner on Nov. 3 for 600 people. A spokesman
said the library raised more than $2.6 million for the event, only $50,000
short of its goal.
And the
New-York Historical Society’s History Makers Gala, its annual fund-raiser,
which will be held on Oct. 15, has already exceeded its goal of $1.3 million,
said Louise Mirrer, the society’s president.
She
remains optimistic for the future, thanks to the loyalty of donors and "because
with a maximum admission fee of $10," she said, "we are a bargain."
But even
for organizations that have not suffered funding cuts, it is planning season,
"and we are going to have to be much less ambitious about our next budget than
if we had been planning it four weeks ago," said Andrew Friedman, a co-executive director of Make the Road New
York, a nonprofit
that has four offices in Brooklyn, Queens and Staten Island.
Mr. Friedman worries that the city and state
will reduce support for the organization’s legal services, after-school
programs and adult-literacy classes for 5,000 low-income New Yorkers.
Although
some nonprofits may fail, others may survive if "we see more strategic
alliances between smaller agencies and larger nonprofits that can help them
with administration and fund-raising," Ms. Wackstein said.
And in
the long run, "nonprofits are very resourceful groups," Ms. Slutsky said. "And New York is a city of
very generous people."