After two years of declining donations and increasing demands for services, the Bay Area's nonprofit sector is stabilizing revenues, service, and staffing levels, while maintaining strong volunteer support, the United Way of the Bay Area's third annual Nonprofit Pulse Survey finds.

In the face of government funding cutbacks, 36 percent of respondents that receive public-sector support reported a drop in government funding in 2004, but 39 percent of nonprofits that receive gifts from individuals reported an increase, and 34 percent that receive donations from corporations and foundations also reported an increase. By comparison, two years ago, 60 percent of nonprofits surveyed indicated that both institutional and individual giving were down. And while organizations saw employee cutbacks during the last two years, 69 percent said they maintained or increased staffing levels last year. And volunteer and in-kind support continues strong, with 83 percent of respondents saying that they stayed the same (44.8 percent) or increased (38.5).

Overall, 46 percent of local nonprofits surveyed reported an increase in total revenues in 2004, while 22 percent said revenues remained steady. At the same time, 71.9 percent reported that their financial safety nets, as measured by their reserve funds, are in jeopardy: 28.2 percent of respondents said that they do not maintain reserve funds; 5.8 percent have depleted their reserve funds; 21.2 percent have begun to tap reserve funds; and 16.7 percent may need to do so in coming months. In an effort to strengthen their financial base, 38 percent said they had allocated more resources — staff and/or dollars — for fundraising.

Seventy percent of the organizations surveyed projected more demand for services in 2005, mirroring an upward trend from the previous three years. In response to increasing community needs, 32 percent plan to add new services in 2005, while 86 percent will maintain (46.7 percent) or increase (39.1 percent) the level of services they already provide. "Bay Area charities are weathering the storm, showing just how resourceful and adaptive they can be in the face of adversity," said Anne Wilson, CEO of United Way of the Bay Area. "They are addressing challenges head on — diversifying their funding sources and exploring creative, collaborative ways to address the increases in service demand."

To see more survey results (3 pages, PDF), including graphs, visit: http://www.theunitedway.org/news/UWBA_Nonprofit_
Pulse_Survey_FactSheet_FINAL.pdf.