Answers About United Way and Nonprofits

January 28, The New York Times — Following is the first set of answers from Gordon J. Campbell, the president and chief executive of United Way of New York City. Mr. Campbell answered selected readers’ questions on how New York City nonprofits are coping with the recession and how New Yorkers can give back and provide assistance to those in need. We are no longer accepting questions for this feature.

What is your advice to young 20-somethings trying to get their start in public service? Would you recommend graduate study or law school? Should they go immediately into the work force, working their way up in the nonprofit or government sector? I suppose the broader question would be, how can a young person best contribute to our world without having had the kind of professional experience and skills that are usually necessary to have an impact on society? I am curious to know your thoughts.

— Posted by Will E.

I commend you for your interest in public service, whether in the nonprofit sector or with government. Both sectors are thirsty for the energy, creativity and innovative ideas that members of your generation can bring. Certainly, the Obama campaign demonstrated what can be accomplished when the passion and power of Generation X and Millennials are effectively harnessed.

With regard to advanced degrees, I think it is extremely valuable to have real life experience before entering graduate school. For six years I taught at New York University’s Robert F. Wagner School for Public Service, where it was clear that students who had previously worked in the nonprofit or public sectors were often better grounded and could more quickly understand the marriage of theory and practice. The routes to gaining this experience are myriad, and include not only paid employment but also service as a volunteer. In fact, many volunteer roles, such as managing a soup kitchen, serving as a financial coach to low-income families or organizing a fund-raiser, provide excellent opportunities to learn through hands-on experience.

I have a startup nonprofit that runs a program called the BioBus, a mobile biology classroom that gives K-12 students hands-on experience using microscopes and developing their interest in science. I would like your advice on a fund-raising issue that has been exacerbated by the recent economic crisis. I sometimes feel guilty asking individuals for donations because most of my financing is already coming from government agencies. But of course, I would like to supplement my organization’s budget with private donations. Do you have any philosophical tips that could assuage my guilt and perhaps also make me a better fund-raiser?

— Posted by Ben Dubin-Thaler, Ph.D.

Your situation is not unique, especially for New York City nonprofits, which provide the lion’s share of social services under contract by government. The challenge from a nonprofit management perspective is that government dollars typically are not flexible — they pay for specific services and rarely fully cover an organization’s basic administrative expenses. Private donations are critical to nonprofits, not only to help “keep the lights on,” but also because they give nonprofit managers the flexibility to innovate and enhance the services they offer.

If you believe in the mission of your organization, you should never feel guilty about asking individuals for donations. In fact, if you are not asking them for a contribution, you can rest assured that others are. Remember that you are telling them the story of your organization with enthusiasm and commitment. You are enlisting them in your mission, and asking them for their support is a natural part of that process. Of course, you should offer them opportunities to volunteer and engage with your organization in other ways, as well.

People with a record of philanthropy expect to be asked. If you and your board have confidence in your organization and are able to tell people very concretely about your goals and the results you have achieved to date, asking for donations should be that much easier.

Is there somewhere I can go to gain access to a list of charities and volunteer events in the city?

— Posted by Peter Kelly

In light of the many challenges facing our nation and our city, President Obama, Gov. David A. Paterson and Mayor Michael R. Bloomberg have all called for a new era of public service and volunteerism. There is no doubt that for many nonprofits, volunteers are essential to their ability to deliver on their mission, especially during these lean economic times.

Since 2005, United Way of New York City has partnered with the Mayor’s Volunteer Center on a joint Web site — VolunteerNYC.org — which is specifically tailored for New Yorkers looking to volunteer their time and talents. The site features a database of more than a thousand one-time and ongoing volunteer opportunities at hundreds of local charities, and you can search by criteria like ZIP code, areas of interest, and the skills you are able to offer. Whether you are looking to tutor a child, design a Web site for a small nonprofit, or help clean up a city park, it is all there. You can also find opportunities for children, teenagers and families. It is never too early to instill the habit of giving back to the community.

The recent changes in both the political and economic landscape of the country are reshaping the face of philanthropy as we know it. What advice do you have for nonprofit groups in the city concerning how they can harness the energy of an empowered younger generation of New Yorkers that want to be a part of a city that continues to evolve the term “giving back”? In other words, when budgets are being cut, what are some innovative ways a nonprofit can mobilize volunteers to help realize their organization’s mission?

— Posted by C. Donovan

That is a great question. With a lot of nonprofits struggling during the economic downturn, they must still plan for the future and seize on current opportunities. Planning for the future, of course, should definitely involve strategies for “harnessing the energy” of youth, as you mention.

First, it is important to note that the younger generation is very issue-driven, and nonprofits are challenged to engage them and to be able to show a measurable impact of their work. There is a perception that existing nonprofits are stodgy and bureaucratic, so the onus is on us to make young people know that their input and their hands-on participation is not only welcome, but also needed.

In exploring the term “giving back” with regard to the changing political landscape, my mind first goes to President Obama’s call to service, as I have noted previously. It is interesting to see the same technology employed so successfully by his presidential campaign to raise money and secure votes now being used to spread his message about the importance of serving one’s community.

Just as we’ve seen Web 2.0 respond to the younger generation’s need to personalize their experience with the Internet (YouTube, MySpace, etc.), the modern United Way offers volunteer opportunities that draw on individual experience — be it educational, professional, or personal — in new ways. For instance, we have a program called MoneyUP that trains volunteers to serve as tax preparers and financial counselors to low-income families in need. It provides a great way for volunteers to “give back” by using their own professional experience.

The recession will swiftly affect badly-run nonprofits, of which there are many! Are there any pro-bono consulting groups or resources for nonprofits that need management or budget help? Does the United Way in New York do any leadership development or training for nonprofit staff?

— Posted by Laura

The economic downturn poses a serious challenge to all human services nonprofits that are facing increased demand for their services at the same time that their revenue is down as government revenues decline, foundation endowments shrink, and individual and corporate donors cut expenses. Sound management and budgeting are especially crucial, so I am glad that you asked about resources that are available to assist nonprofits navigate the economic storm.

There are a number of pro bono resources for nonprofits in the New York City area that I can recommend:

Two organizations that harness the knowledge and expertise of retirees who volunteer their services are National Executive Corps and Gray Matters.

Other groups provide capacity-building “service grants” delivered pro bono. Taproot Foundation is a leader in this area.

Nonprofits can also get pro bono business and transactional legal services through Lawyers Alliance for New York.

The Foundation Center can provide answers on a range of fund-raising issues, including via e-mail, live online chat or in person.

Other useful resources include: Support Center for Nonprofit Management, which offers a range of affordable workshops, Governance Matters, which provides valuable support for nonprofit boards, including how to manage economic fluctuations, Council of Community Services of New York State, and Nonprofit Coordinating Committee of New York.

United Way of New York City established its Nonprofit Leadership Development Institute in 2004 to help build a diverse group of young professionals with the skills, credentials and connections necessary to lead nonprofit organizations effectively. Over the past four years, the leadership development institute has strengthened emerging leaders at more than 800 nonprofits in the five boroughs. Our N.L.D.I. junior fellows, senior fellows and executive fellows programs for this year are already filled; however, our Linkages Board Training and Placement program, also part of the leadership development institute, continues to accept applications both from prospective board members and nonprofits looking to strengthen their boards.

In addition, we are currently working on a Human Services Resiliency Initiative aimed at improving local nonprofits’ organizational stability and service delivery productivity during this time of economic downturn. Through the initiative, we will partner with others to offer staff development workshops, technical assistance, and funding to support individual nonprofits and multiorganization collaborations.

January 29, 2009, The New York Times — The president and chief executive of United Way of New York City abswered selected readers’ questions.

Following is the second set of answers from Gordon J. Campbell, the president and chief executive of United Way of New York City. Mr. Campbell answered selected readers’ questions on how New York City nonprofits are coping with the recession and how New Yorkers can give back and provide assistance to those in need. We are no longer accepting questions for this feature.

I am president of a community-based women’s volunteer organization in Westchester County. We are confronted with a huge increase in demand for basic needs, while grants and donations are harder than ever to come by.

With needs exploding and resources diminishing, how should our organization prioritize which pressing community needs to meet first? How can we maximize our impact in ways that do not require greater expenditure?

— Posted by Lisa Copeland

The challenges you face are, unfortunately, all too typical for nonprofits these days.

It is critical to focus on your organization’s programs and activities and evaluate how absolutely integral they are to your core mission. Some activities, while relevant, must be viewed as ancillary. Focus on your core and begin to jettison those activities that are not absolutely central to mission. These are not easy decisions, but to avoid them is risky.

This process requires objectivity, and a willingness to discard historical or emotional attachments. Many activities are “good” or “useful,” and in times of rising need it is easy to feel the urge to add activities. Instead, I recommend a laserlike focus on core mission.

Create a range of budget contingency projections, including the worst case, and plan how your agency would respond.

Without knowing the particulars of your situation, I suggest that you:

1) Get your board and leadership team to establish or re-establish a clear process for making these kinds of decisions. Who is empowered to make decisions, and when will they be made?

2) Understand your revenues and expenses by program. By program, I mean those that have been identified as core to your mission, the “keepers.” In evaluating program economics, remember to quantify unfinanced mandates that are unavoidable and require outlays. Here, you are trying to ascertain the true cost of a given program or activity.

Doing 1 and 2 above will enable you to create a decision-making matrix: program versus mission match and program as financially positive versus negative (i.e., it costs more than the revenue available to support it). This process can also help level the emotional stress that accompanies these decisions.

3) Plan to use temporarily restricted net assets to support core programs. In some cases you will need to communicate with the funders who made the restricted gifts, and get written permission to redirect the dollars to core program or to remove the restrictions. This may free up unrestricted dollars, which could instead be employed to support infrastructure and other unfinanced expenses.

4) Communicate your need, and know what you are asking for. What is your “call to action”? Contact your local news outlets, speak to your elected officials, communicate with your supporters, and use your board as never before to activate their connections and resources.

There is no “silver bullet,” but taking action now will maximize your odds of remaining viable, reasonably healthy and in position to meet community needs that directly align with your mission.

How does the Wall Street crisis affect donations to nonprofits, especially those for homeless people? Are you seeing a drop in donations, are these substantial, and what do you do to cope with that?

— Posted by Eva

The economic downturn has had a particularly harsh effect in New York City, home to a large low-income population, important economic sectors (finance, insurance, media, fashion and real estate) that have been especially hard hit, and substantial government contracts with nonprofit agencies.

New York City is projected to lose 170,000 jobs through 2010, and its unemployment rate is likely to hit all-time highs. Emergency food providers report a 28 percent increase in clients, and the number of families entering the homeless shelter system has increased by more than 15 percent.

This is a challenging environment for all nonprofits, and United Way of New York City is not immune to the economic downturn.

Over the past several years, we have made funds diversification a top priority. While several years ago corporate employee giving represented nearly 80 percent of our overall revenue, today it represents 60 percent. Other sources of revenue include private individual donors, sponsorships, corporate and private foundations, and government.

However, even with that greater diversification, we still expect our overall fund-raising to be down from last year. Within our corporate workplace campaign, we are witnessing smaller average gift sizes across sectors. But we are heartened that overall participation has been up. Those who are in a position to give seem to understand that now, more than ever, it is essential to keep our city strong and help our most vulnerable neighbors.

Finally, we have taken the step of streamlining our own operations. This has included a work force reduction as well as a number of other nonpersonnel expense cuts.

Addressing the Wall Street Journal CEO Council on Nov. 19, Rahm Emanuel, chief of staff to President Obama, said it best: “You never want a serious crisis to go to waste. … It is an opportunity to do things that you think you could not do before.” Mr. Emanuel, of course, was talking about the economic crisis as an opportunity to tackle issues like health care reform and energy. But his words are equally true when it comes to thinking about the ability of the city’s nonprofits to survive and thrive during these difficult times. Now, more than ever, we need to remain focused on our mission, fine-tune our fund-raising and keep our boards and supporters engaged and motivated. With effective leadership and strong execution, we can weather the storm and emerge stronger on the other side.

The Independent Budget Office projects a long recession that will continue to erode jobs and tax revenues, resulting in large budget deficits well into 2011. There will continue to be an increased demand for services and a decreased capacity among nonprofit human service providers to deliver critical assistance.

I am heartened by the many thoughtful questions about how to give back, volunteer opportunities, and genuine interest in the sector, and I think Mr. Campbell’s answers are thoughtful and provide some guidance to those who have posed the questions.

We really are all in this together, and United Way of New York City, along with a myriad of organizations, must continue to make the case with elected officials on behalf of and continue to provide the programs upon which our most vulnerable residents rely.

— Posted by Fatima Goldman

No single organization — or government agency — can possibly solve the complex problems facing New York City. Only by collaborating and agreeing upon shared goals can we hope to collectively achieve the kind of enduring, communitywide changes that can significantly improve the lives of poor and low-income New Yorkers. This has always been true, but has rarely occurred. Now more than ever, collaboration will be even more necessary during the prolonged recession.

In addition, individual New Yorkers need to speak out, roll up their sleeves and get involved. Recognizing that there will be cuts, it is imperative that all of us communicate with our elected officials to let them know of the urgent need to maintain vital services. Volunteers with professional skills in areas such as accounting, financial management, human resources, strategic planning, fund-raising and technology are especially valuable to nonprofits and the individuals, families and communities they serve.

Someone else on this blog commented on very small charitable contributions being essentially meaningless. I always think of my small contributions made directly to a charity as a way for that charity to demonstrate to other donors that they have support and can prove by numbers that they are valued in this very specific way by showing their donors. Is this approach valid? Does United Way also use the number of donors to an organization when deciding which ones to support? What are the means by which United Way chooses which organizations to finance? How would United Way support organizations it does not finance?

— Posted by David Blaustein

All gifts, no matter how modest, are valuable to a charity. In fact, my colleagues and I in the sector are especially gratified by the many people who make so-called “small” gifts, because often such contributions are substantial in terms of their disposable income.

You are absolutely right in saying that foundations and other funders do look at the number of donors who support a nonprofit, because it is an excellent gauge of the organization’s public support.

Over time, “small” donors frequently become “large” donors, especially when they have an opportunity to become engaged firsthand with the work of the charity.

Please know how valued your contributions are, no matter what the size.

Mr. Campbell, why should a donor give to United Way of New York City as opposed to giving to a specific charity that is a United Way member charity or a charity that is unaffiliated with United Way? Thank you.

— Posted by Pat F

Giving is a personal decision, and only you can decide which charities are important to you.

As to why someone should give to United Way of New York City, I can tell you that the modern United Way is working hard to create sustainable social changes that mean more New Yorkers in control of their finances, more children achieving their potential, and fewer health problems related to poor diet and nutrition. Because we are uniquely positioned at the convergence of community-based agencies, government, corporations, foundations, communities and individuals, we are able to bring together a wide array of stakeholders to work toward shared goals, such as reducing the dropout rate.

We believe that everyone has a role in building a better future for all. If you share our vision of a thriving New York City characterized by income stability, educational success and healthy people, we invite you to be a part of the change.

January 30, 2009, The New York Times — The president and chief executive of United Way of New York City is answering selected readers’ questions.

Following is the third and final set of answers from Gordon J. Campbell, the president and chief executive of United Way of New York City. This week he answered selected readers’ questions on how New York City nonprofits are coping with the recession and how New Yorkers can give back and provide assistance to those in need.

We are no longer accepting questions for this feature.

I volunteer for a nonprofit that assists Medicare beneficiaries with their problems with their H.M.O.’s and prescription drug plans. One of the problems is how can the organization be put on a firmer financial foundation? How can the organization grow?

Nonprofits are so dependent on market forces. Grants always add new duties and force the organization to change and highlight the current favored programs of the granting organization. It perverts the organization.

— Posted by Rebecca

Now, more than ever, it is critical that your organization has a clear vision and strategic plan for the future that focuses on programs, fund-raising, communications and financials. Having such a road map will guide your organization in determining what types of grants and other financing opportunities to pursue. This is important, because all too often nonprofits chase the dollars and, as you point out, inadvertently stray from their core mission, incurring unfinanced mandates and unanticipated expenses.

In addition, the more your organization can do to raise unrestricted dollars, the better. Fortunately, some funders are beginning to understand the need to invest in nonprofits’ capacity and infrastructure, rather than financing yet another “program.”

What is the United Way doing to ensure that our government invests in the basic human services that are the bulwark against humanitarian disaster in a recession? For instance, while United Way may help small nonprofits to feed children, what are you doing to ensure that the major programs like school meals and food stamps are properly financed?

— Posted by Peter

United Way of New York City regularly works with government on a variety of human service issues, and we are always working to strengthen and build the capacity of nonprofit groups that provide services at the neighborhood level.

Our Food Card Access Project is a case in point. Statistics show that up to 700,000 New Yorkers are eligible, but do not participate in the federally financed food stamp (also known as the food card) program. Intended to ensure that low-income people can afford nutritious food, food stamps are a significant tool for helping low-income individuals and families stretch their budgets.

In 2003, United Way joined community partners from the nonprofit, private and government sectors to begin the Food Card Access Project with the goal of improving New York City residents’ access to food stamps. Since the New York City Human Resources Administration is the only agency authorized to enroll individuals for food stamps, our efforts focus on raising awareness of the availability of the food card and preparing individuals for the application process.

FoodChange Inc. (now a part of Food Bank for New York City) had a successful food card outreach model program but lacked the resources and relationships to take it to a larger scale. United Way was able to expand Food Change’s model to seven neighborhoods identified as having the greatest need, where we provide community-based organizations with tools and resources to assist clients with the food stamp enrollment process.

In addition to community outreach, we worked closely with the Human Resources Administration and other community and government stakeholders to reduce the food card application form to 4 pages, from 16 pages — a significant improvement that made gaining access to this vital program much easier for the New Yorkers who need it.

Through the Food Card Access Project, 122,000 individuals have enrolled in food stamps, resulting in at least $232 million in economic activity for the city.

With so many New Yorkers finding themselves newly unemployed, shouldn’t there be a way to harness their talents as volunteers?

— Posted by Kathy

You are absolutely right that those who have lost their jobs as a result of the economic downturn would do well to consider volunteering their time and talents to local nonprofits. As I’ve stated previously, volunteers with professional skills in areas such as accounting, financial management, human resources, strategic planning, fund-raising and technology are especially valuable to nonprofits as they struggle to manage effectively and maintain vital services in the face of shrinking revenues. And, of course, volunteering in one’s own field is also a way to network, which could pave the way to new employment.

United Way of New York City’s MoneyUP has attracted volunteers from finance, banking, accounting and other fields who give of their time to help low-income families become more financially secure. Some provide tax preparation to determine client’s eligibility for the Earned Income Tax Credit. Other MoneyUP volunteers are trained to provide year-round financial coaching to individuals and families to help them increase assets, decrease debt, improve their credit score and achieve their financial goals.

Another route to consider is service as a board member. Our Linkages Board Training and Placement program trains board candidates on the expectations, responsibilities and rewards of trusteeship and then introduces those professionals to nonprofits seeking new board members. Similarly, BoardnetUSA offers a unique Web site that connects nonprofit boards with people interested in board service.