Nonprofits struggle with fewer resources as demand grows

June 10, 2012 

Thurston County nonprofits are straining under the weight of the recession, withdrawing programs and restructuring staff in order to meet their new fiscal realities.

It’s the same story across the state and the nation. State and federal funding has steeply declined along with private and corporate giving, leaving nonprofits to execute painful downsizing, even as the demand for services has been increasing at an alarming rate.

The state budget has been cut by more than $10 billion since January 2009, and some estimates say 10 percent to 20 percent of that amount has directly impacted human services nonprofits.

John Masterson, chief executive officer of Behavioral Health Resources, has lost almost $3 million in funding over the past two years. That resulted in 27,000 fewer hours of mental health services to Thurston and Mason counties, and caused a 27 percent reduction in full-time-equivalent staff.

Charles Shelan, executive director of Community Youth Services, says his organization is suffering from government funding cuts or rate reductions of up to 10 percent for its many children’s administration services. They had to close their in-house medical clinic in mid-2010, and shuttered the county’s only program specifically targeting gang violence – the CYS Violence Intervention Program – at the end of 2011. It had served some 75 young people.

Yet, CYS has been fortunate in finding new sources of funding.

Kellie McNelly, executive director of Rochester Organization of Families (ROOF) Community Services in Rochester, has been forced to eliminate two full-time staff and rely on AmeriCorps volunteers despite grappling with a doubling of food bank clients served since 2007.

In the month of July alone, the demand on the ROOF food bank increased threefold from 2007, partly driven by state workforce cuts. “Many of these new clients are former state workers,” McNelly says.

Those three nonprofit leaders, along with John Walsh, executive director of the Thurston-Lewis-Mason Community Action Council and Paul Knox, executive director of the United Way of Thurston County, told The Olympian’s editorial board last week that they all expect the increase in demand for services will continue.

In fact, Walsh says his organization is seeing a new face of need. About two-thirds of the CAC’s clients are either employed or retired.

That is forcing them and the other Thurston County nonprofits to figure out how to go forward while being stretched between lower funding and higher caseloads.

Informal conversations are occurring right now between South Sound nonprofits about way to deliver services more efficiently, including mergers and collaborations.

One concept is to work smarter by putting a community focus on a single topic, say homelessness, and pulling together several smaller funding sources for a larger, collective impact.

The larger elephant in the room is whether the once-booming nonprofit sector has expanded too much, and if the decline or stagnation in charitable giving will ultimately result in a consolidation of the field.

According to the Urban Institute, the nonprofit sector has been growing steadily, both in size (plus-25 percent) and financial impact, for more than a decade. The growth rate of the nonprofit sector has surpassed the rate of both the business and government sectors.

It’s a touchy subject because every nonprofit is filling a need that no one sees going away.

The long-term solution is upstream, they say, in programs such as early childhood education and teaching young adults to become better parents. Those programs have proven track records of producing adults who contribute positively to society and require less crisis intervention and engagement with law enforcement.

Meanwhile, today’s human services nonprofits in Thurston County have to meet the needs that already exist. To do that, they will need increased support from individuals willing to volunteer time and money.

Taking the time to volunteer in elementary schools or at Boys & Girls Clubs, becoming a Big Brother or Big Sister and even a foster parent – whatever it is you are passionate about – can help nonprofits offset their lack of funding. And, of course, you can always write a check.

Masterson, of BHR, put it well, “We are all going to pay for it one way or another.” People in need of service either get it from a human services program, or they eventually end up in taxpayer-funded emergency rooms and jails.

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