By Andy Graham, For The Times-Mail
agraham@heraldt.com
Barry Lessow compares gauging the current United Way of Monroe County fundraising campaign right now to judging the status of a presidential campaign in mid-summer.
"It feels a bit like presidential politics in July, when you have some polls to look at," Lessow, the local United Way director, said last week. "You can perceive some trends that might take hold, but it's still too early to tell what the end result will be Nov. 4."
This year's United Way campaign figures to extend at least through January, but some of the trends Lessow and others can read are already persuasive. Demand for social services is up. Donations supporting those services, to-date, are not. And local nonprofits should ponder how to successfully ride out a recession of uncertain, but possibly substantial, depth and length.
"The bottom line is that - at this rate - it is going to be tough to meet this year's $1.4 million campaign goal unless we continue to see new donors and increased contributions from those who recognize the need," Lessow said. "On the demand side, what we hear from our agency partners amounts to about a double-digit increase across the board - 10-15 percent - in demand for the basic services, especially food," Lessow said. "This comes on the heels of a similar increase last year.
"Volunteers in Medicine is seeing twice as many low-income patients as last year. Hoosier Hills Food Bank, which counts its volume by the pounds of food it distributes, is setting a distribution record, but that record would be even higher if it had more food to distribute."
Lessow reported that the call volume for the 2-1-1 service - the free, confidential informational and referral hot line for people seeking social services help - is up 40 percent over last year and that about 60 percent of the calls concern need for basic services.
The level of giving seems unlikely to keep pace with the $1.421 million in donations last year's campaign produced, just shy of the $1.45 million goal. Lessow said it was difficult to evaluate, with some of United Way's business partners choosing a different timetable for turning in donations, including some likely to hold off until January.
"Corporate gifts, which often match employee gifts, are down at this point as companies delay their decisions to get a better sense of their markets and their access to credit," Lessow said.
"We probably won't close the campaign till February, so we can try to make allocation decisions of our funds by mid-February.," he said.
"We knew last year's figure would be a tough number to repeat, and weren't sure about the timing of layoffs and business closings locally, so we wanted to be a bit more conservative. We estimated our realistic range as being between $1.35 and $1.4 million and obviously opted to go after the larger number. Demand isn't going down."
Pinched times for many
Evidence is emerging from all directions that more Hoosiers are hurting financially.
Economist Morton Marcus noted that Indiana's unemployment rate was up to 6 percent in October, meaning that of the 3.2 million Hoosiers in the labor force, 200,000 were looking for work, not counting those who had given up the job search entirely and therefore considered by federal statisticians as being outside the labor force.
The Associated Press reported last week that Indiana is seeking a $330 million federal loan to bolster its unemployment insurance fund, the balance of which has fallen from $1.6 billion in 2000 to just $21 million. There are currently 75,000 Hoosiers drawing unemployment benefits, and the fund has already paid out $242 million this year.
And it is a natural, if vicious, cycle for nonprofits during a recession that, just as the need is peaking, private donors have less to give and governmental and corporate revenue streams constrict, with a resulting drop in support from those sources.
Sometimes those numbers don't look overly dramatic, nationally. According to Melissa Brown, associate director for research at the Center for Philanthropy at Indiana University, national levels of giving during "the 11 or 12 years labeled recessionary since 1967" have declined annually by about 1 percent on average.
But numbers within the numbers can tell a different tale.
"There are certainly times when the levels of donation have fallen more sharply than that 1 percent average might indicate," Brown said by phone from her Indianapolis office last week. "In 1974, during the oil embargo - in the middle of a 16-month recession, longest since the Depression - giving fell 5 percent."
And given the consensus that the nation faces its worst financial context since the Great Depression, the numbers might well end up worse than those of 1974.
Local evidence accumulates
Jamie Andree, director of Indiana Legal Services' Bloomington office, which serves a 14-county region, said she is starting to see things not normally found outside larger metropolitan areas in the state.
"I can't give you any raw numbers today regarding open or closed cases but ... anecdotally ... it definitely appears that requests for legal assistance to defend foreclosures are up," Andree said. "I think there is no question we've seen a real increase. Similarly, we've seen an increase in the number of people needing legal help to access benefits such as food stamps and Medicaid (federally-funded medical care for the indigent).
"What we hadn't seen before and are now seeing here are some of the things you usually see first in bigger cities, such as requests for legal assistance from tenants who are losing their housing because their landlords are facing foreclosure. I've known of that happening in Indianapolis or Gary, but not here till recently."
Andree said her agency's federal and state funding had yet to see reductions, but she knows that might be coming.
"In any case, you're competing for funds with everybody else, including, currently, Wall Street and the Detroit automakers," Andree said. "I would hope Congress and the administration would prioritize support of the safety net, especially in times like these."
Local government, big givers hurting
Indiana cities and counties might not be able to help much. They are getting squeezed by caps in the state's property tax levels stemming from legislation signed into law July 1. Howey Politics Indiana noted these recent budget cuts in its Nov. 26 postings: $15 million by the Lake County Council, slashing 112 jobs, $6 million in Michigan City, $5 million by the Vigo County Council, $2.5 million in Fort Wayne and $1.5 million in New Albany.
Agencies that have benefited from foundation or endowment money are taking big hits, too.
Sue Gulley, executive director of the Monroe County chapter of the American Red Cross, cited an endowment her agency set up 25 years ago to fund efforts encouraging people to donate blood.
"We've lost over $50,000 in that fund just since July, given the reverses in the stock market," she said.
Nationally, losses of traditional big givers have been in the billions. IU's Brown said higher education might take a big hit as endowments and corporate donors economize.
"On average, giving to education has a 1 percent drop during recessions while other sectors can see gains," Brown said. "The types of organizations that feel the pain the most tend to be those used to receiving very large contributions for, say, new research wings or new classroom buildings.
"People of means creating new trusts to benefit a charity, or creating new charities to initiate a new effort, is the sort of thing that seems to slow down quite a bit during recessions."
Which might be bad news for major capital campaigns such as, for example, IU's current "For the Glory of Old IU" campaign for athletics facilities.
Every little bit helps
Lessow knows many individual 401(k) retirement plans have lost 30 to 40 percent of their value during the recent stock market plunge. Lori Garraghty, chairing this year's United Way campaign, also noted that a lot of long-term contributors were now themselves in need as retirees on fixed incomes.
Gulley of the Red Cross said agencies would try to work harder for donations, and be ever more grateful for even the smallest amounts.
"The main strategy is to do more grass-roots fundraising, relying on the many who may be able to give a little to help make up for those who cannot, for now, give the amount they customarily do," Gulley said. "I think all the executives in the nonprofit sector realize people are stretched, and we're extremely grateful for whatever anybody can give at this point. The need doesn't go away."
Lessow said he was confident fellow residents would do what they could: "In Monroe County, we know that people respond when they're needed.
"And unlike politics, where it isn't legal to 'vote early and often' as the joke goes, we encourage folks to give early and often to social service agencies in times like this."