Trends in Charitable Giving 2014 Colorado Generosity Survey. San Luis Valley RPD Colorado Nonprofit Association August 2015

Transcription

1 Trends in Charitable Giving 2014 Colorado Generosity Survey San Luis Valley RPD Colorado Nonprofit Association August 2015

2 Colorado Nonprofit Association Lead the sector in best practices and resources 1300 members statewide Cost-saving member benefits Advocate for the nonprofit sector

3 Agenda for Today Snapshot of Colorado s nonprofit operating environment IRS charitable deduction statistics Generosity Survey Overall findings Donor profiles Regional comparisons Tax incentives for charitable contributions

4 501(c)(3) Public Charities Count # Filing Form 990 or 990-N Total Revenue (millions) Total Assets (millions) Alamosa $131 $150 Conejos $1.7 $3.8 Costilla $.77 $5.4 Mineral $1.5 $5.1 Rio Grande $62.2 $156 Saguache $6.3 $26.3 Colorado ,188 $30.2 billion $66.1 billion Source: Internal Revenue Service, Exempt Organizations Business Master File (May 2015), accessed through the National Center for Charitable Statistics,

5 2014 Year In Review Has demand for your nonprofit's programs/services: 2% 1% 19% 46% 33% Significantly Increased Somewhat Increased Stayed about the same Somewhat decreased Significantly decreased

6 2014 Year In Review In terms of revenue for 2014, do you expect your organization to...? Overall revenue 31.74% 41.74% 24.35% 1.74% 0.43% Individual donations 30.40% 38.77% 21.15% 8.81% 1.32% Fall short of our revenue goals Corporate giving 37.78% 27.56% 12.00% 20.44% 2.67% Meet our revenue goals Foundation grants 32.89% 37.72% 16.67% 11.40% 2.19% Exceed our revenue goals Government grants 14.22% 35.11% 7.56% 40.89% 2.22% Not applicable Government contracts 8.11% 18.47% 7.66% 61.26% 5.41% I don't know/prefer not to say Earned income/fees for services 17.41% 29.91% 18.75% 30.80% 4.02% 0.00% 20.00% 40.00% 60.00% 80.00% % %

7 2014 Year In Review Has your nonprofit done any of the following in 2014? Are you considering any of these measures for 2015? Cut back on programs Eliminate programs Turn away clients 4.92% 11.06% 6.56% 4.50% 8.60% 4.92% 8.60% 15.16% 17.21% We may do this in 2015 We expect to do this in 2015 We've done this in 2014 Cut staf pay or hours Lay off staff 5.73% 4.09% 4.92% 3.28% 7.38% 13.11% Try new strategies to increase revenue 9.02% 51.22% 69.67% Try new strategies to reduce expenses Restructuring (such as a merger or a major change in strategy/focus) 8.20% 9.84% 9.47% 9.43% 42.62% 43.85% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00%

8 2014 Year In Review When considering your outlook for your organization in 2015, are you % 2.88% 25.51% 16.87% Very pessimistic Pessimistic Neutral Optimistic Very optimistic 52.67%

9 Coloradan s Charitable Giving Year Total Charitable Deductions (billions) Ave. Contribution per Return 2012 $3.376 $4, $3.244 $4, $3.050 $4, $2.777 $3, $2.981 $3, $3.313 $4,278

10 Charitable Deductions Of taxpayers claiming charitable deductions, Colorado ranked 31 st in percentage of AGI donated to charity at 2.73% Utah 1 st at 6.56% and New Hampshire 50 th at 1.74% Median contribution- $2,947 Source: Chronicle of Philanthropy

11 AGI Coloradan s Charitable Giving % of taxpayers claiming deduction Of those deducting, % by income category Ave. contribution deduction Under $25, $1,376 $25,000 to $49, $2,006 $50,000 to $74, $2,268 $75,000 to $100, $2,825 $100,000 to $200, $3,817 $200,000 to $500, $7,229 $500,000 to $1 million $18,533 $1 million and more $136,099

12 Generosity Survey 2014 Key Findings

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14 Generous Spirit Generosity Environment Generosity Resources Giving Decision Generosity Priorities

15 Generous Spirit

16 Generous Spirit 55% strongly believed they are the type of person who supports charitable causes Women more likely than men (64/46) Lower income and younger people less likely to believe

17 Generosity Environment Importance of personal connections and outreach 56% made a donation as a result of an ask from family or friends 30% donated based on from someone they knew 49% learned about organization from family or friend before making first donation

18 Generosity Environment

19 Generosity Environment Millennials and Gen X more likely to visit websites, but also more likely to learn about organization from friends or family People with incomes over $100,000 and those who donated more than $1,000 annually more likely to research

20 Generosity Environment

21 Generosity Environment Millennials more likely to donate as a result of radio, TV or advertising Millennials less likely than Silents to donate in response to mail (15% vs. 54%) or a phone call from organization (12% vs. 38%)

22 Generosity Environment Trust 67% agreed that charities are honest and ethical in the use of donations, but 28% disagreed, an increase from 11% in 2011.

23 Generosity Environment Technology 32% through website More likely: Millennials, Gen X, higher incomes, people who donated more Less likely: Western region 14% via cell-phone text More likely: Gen X, higher incomes, people who gave more

24 Generosity Environment 18% of Southern Coloradans have heard of Colorado Gives Day 42% of those made a gift

25 People who have heard of Colorado Gives Day Donate to more nonprofits (compared with those who haven t heard of Colorado Gives Day) Have higher household incomes

26 Giving Resources

27 Giving Resources 45% of people with higher incomes donated between $1,000 and $10,000 About one-third of both Millennials and Silents donated less than $100

28 Ways People Give

29 Ways People Give People with incomes over $100,000 and Generation X and Millennials are more likely to buy products or services from a business that donates a portion of the proceeds to charity Southern Coloradans least likely to donate via regular or recurring automatic donations Most likely to purchase products or services from a nonprofit

30 Ways People Give

31 Ways People Give Generation X-- schools and education Boomers-- health or medical Incomes over $100, education, health, social and environment Republicans- Religion Democrats- Arts & Culture, environment

32 Donor Profiles loyal Faithful Friends religious planners Mavericks independent skeptical social Free Spirits spontaneous trusting Occasional Donors unconnected rarely give

33 Donor Profiles Based on people who feel similarly about whether: Family and friends support charitable causes Feels a responsibility to support charitable causes Believes that most charities are ethical Thinks of herself/himself as a charitable person Gives as a part of religious beliefs Is a planed or spontaneous giver Gives mostly to same or new charities Gives to charities that do or do not contact her or him

34 Donor Profiles The Faithful Friends and everyone else Giving is part of my religious beliefs Most of my giving is planned in advance My charitable spending tends to go to the same charities every year

35 Donor Profiles The Faithful Friends Causes Supported (Past 12 months) Household donations, past 12 months Religious Youth Environmental

36 Donor Profiles The Faithful Friends Learned about the organization from a friend or family member compared with 45% of everyone else Researched how effective the organization is compared with 35% of everyone else Looked at the organization s financials compared with 14% of everyone else Question: Did you do any of the following before making your most recent donation?

37 Donor Profiles The Faithful Friends MORE Republican Household income $100,000 or more Gen X ABOUT AVERAGE Race/Ethnicity Baby Boomer, Silent Generations Gender LESS Politically Independent/Unaffiliated Millennials

38 Donor Profiles How to reach Faithful Friends: Offer automatic or reoccurring donation opportunities Provide easy access to your financial statements or annual report Share your effectiveness Urge current donors to invite their family and friends to give Build one-to-one relationships Highlight any relationships with faith-based organizations Encourage planed giving and bequests

39 Donor Profiles The Free Spirits and everyone else Most charities are honest and ethical in their use of donations 67% 87% I tell my friends and family about the charitable causes I support Most of my charitable spending is spur-of-themoment donations

40 Donor Profiles The Free Spirits Searched online for information about the organization Researched how effective the organization is Question: Did you do any of the following before making your most recent donation? In the past 12 months, have you donated as a result of an from someone you know?

41 Donor Profiles The Free Spirits I tend to pick different charities to support each year Number of charities supported, past 12 months

42 Donor Profiles The Free Spirits Causes Supported (past 12 months)

43 Donor Profiles The Free Spirits MORE Democrat Household income between $30,000 and $50,000 ABOUT AVERAGE Generations (All) Politically Independent/Unaffiliated Household income between $30,000 and $50,000 Gender LESS Republican

44 Donor Profiles How to reach Free Spirits: Provide opportunities to invite their family & friends to give Create general messaging campaigns, particularly through social networks Promote giving through activities that bring people together Personalize your mission Reach out through many community networks, including business Promote your participation in Colorado Gives Day

45 Donor Profiles The Mavericks and everyone else Most charities are honest and ethical in their use of donations Politically Independent/ Unaffiliated Giving is part of my religious beliefs

46 Donor Profiles The Mavericks Searched online for information about the organization Looked at the organization s website Researched how effective the organization is Question: Did you do any of the following before making your most recent donation?

47 Donor Profiles The Mavericks In the past 12 months, have you donated as a result of I feel a responsibility to support charitable causes My friends and family support charitable causes

48 Donor Profiles The Mavericks Causes Supported (past 12 months) Top Charities Supported Humane Society Goodwill Salvation Army Disabled Veterans Wounded Warrior Food Banks

49 Donor Profiles The Mavericks When they make donations: More likely than average to donate more than $1,000 annually (27% vs. 24% statewide)

50 Donor Profiles The Mavericks MORE Politically Independent/Unaffiliated Male Millennials, Baby Boomers ABOUT AVERAGE LESS Household income $75,000 or less Silent Generation Democrat, Republican Female Gen X Household income more than $75,000

51 Donor Profiles How to reach Mavericks: Highlight your organizational transparency Provide thorough information about your organization, i.e. financials, annual report Communicate your effectiveness Keep asking through current donors who are in the social circles of Mavericks Create media stories about your organization

52 Donor Profiles Occasional Donors and everyone else My friends and family support charitable causes I feel a responsibility to make charitable donations I think of myself as someone who supports charitable causes

53 Donor Profiles Occasional Donors Total Household Donations past 12 months Number of Nonprofits Supported past 12 months

54 Donor Profiles Occasional Donors Causes Supported (past 12 months)

55 Donor Profiles Occasional Donors In the past 12 months, have you made a donation as a result of?

56 Donor Profiles Occasional Donors Household Income

57 Donor Profiles Occasional Donors MORE Income $30,000 or less Gen X ABOUT AVERAGE Millennials, Silent Generation Republicans, Politically Independent/Unaffiliated LESS Baby Boomers Democrats

58 Donor Profiles How to reach Occasional Donors: Offer small donation opportunities Highlight your work with health or social service organizations Offer volunteer or service opportunities

59 Regional Comparisons Southern Colorado has the highest percentage of: Spur of the moment donors (62.9) Donors giving less than $100 annually Slightly more likely to agree that Giving to charity is part of my religious beliefs. Donating to 2 to 4 charities in the previous year

60 Regional Comparisons Western Slope donors are: Most likely to give as result of being asked by someone they know (69.2%) Have volunteered for organization (34.1%) Had a good experience with organization (71.8%) Could use or benefit from services (61.7%)

61 Regional Comparisons Western Slope donors are: Most likely to name a charity in their will (12.9% vs. 5.5% overall) Least likely to: give through a website (14.9%), look at an organization s website (32.1%) search for information online (22.2%) prior to donating.

62 Regional Comparisons Northern Colorado contribute to: Disaster relief (51.5%) Broad-based funds like United Way (37.3) Religious causes (56.5%) Educational organizations (49.4%) Health or medical (50.8%) Many Northern Coloradans disagreed that most charities are honest and ethical (36%)

63 Regional Comparisons Northern Colorado had highest percentage: Making a regular or recurring automatic donation (40.8%) Purchasing tickets to a fundraising event or dinner (43.4%) Donating to charities (16%) Making a donation through a website (41.6%)

64 Regional Comparisons Central Colorado had the lowest percentage of: Spur of the moment donations Responding to requests received in the mail (15.3) Responding to requests from someone they did not know (13.6) Central Colorado had the highest percentage of $1,000 to $10,000 donors (28.8)

65 Regional Comparisons Denver respondents largely tracked the statewide sample, except: Denver donors were less likely to disagree that charities are honest and ethical in their use of donations, i.e. Denver donors are more trusting A higher percentage of Denver respondents donated goods (clothes and household items) than other regions Denver donors were least likely to donate as a result of a radio, television or other advertising campaign for a cause.

66 Discussion Questions What findings surprised you? What data is most helpful to your organizations fundraising? What strategies would you use to reach: Faithful Friends Free Spirits Mavericks Disengaged

67 Coloradans Consider Tax Benefits 50% agreed that they consider tax benefits when they donate. Gen X and Baby Boomers Incomes over $100,000 (75.8%) Republicans more than Ind./other (27/19 strongly agreed) Those who gave more ($1,000 to $10,000)

68 HB Endowment Tax Credit Increase giving to funds for investment purposes Increase opportunity for nonprofit longterm financial sustainability. Add to the buffet of charitable giving incentives for donors Raise public awareness of longer-term giving options including planned giving

69 HB Endowment Tax Credit State income tax credit for individual donations to eligible funds of nonprofits and foundations Subject to the Uniform Prudent Management of Institutional Funds Act (C.R.S to 1110)

70 HB Endowment Tax Credit Eligible funds: Endowment funds that, under the terms of a gift instrument, are not wholly expendable on a current basis Institutional funds held by an institution exclusively for charitable purposes. Can be board designated and wholly expendable.

71 HB Endowment Tax Credit Donations include cash, property, and securities Credit amount is 25% of the amount of the gift Maximum credit is $25,000 Credit is not refundable- donor must have tax liability Credit may be carried forward up to five years

72 Other States Iowa- $115m in gifts since % increase in annual giving to endowments $4.6m in credits, $18.5m in gifts. Kentucky credits used up a few weeks after July 1 $500,000 cap on credits will increase to $1m for 15. Montana- $123m in gifts from 1997 to 2010 $600,000 distributed to MT nonprofits annually (assuming a 5% distribution rate)

73 Renny Fagan, President and CEO, 789 Sherman Street, Suite 200 Denver, CO