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Study: Nonprofits struggle amid pandemic

Nonprofits around the state are struggling to make ends meet during the pandemic, according to a new study by the University of Washington.

The study, from the Nancy Bell Evans Center on Nonprofits and Philanthropy, found that of the 200 some nonprofits surveyed, many have run into financial strain. On average, nonprofits reported a funding decrease of 30%, even as demand for services increased by 10%.

What makes the lack of funding even more dire is that as more people turn to nonprofits for help during the pandemic, many are struggling to fully meet the need.

“Many nonprofits are now at risk of being unable to fulfill their missions due to financial insolvency and bleak funding outlooks for the near future,” the report states.

But the study found more. Over the next year, nonprofits are bracing for a continued decline in revenue, some by more than 25%. Volunteer numbers have also dropped off, with organizations seeing up to a 50% reduction in volunteers.

Nearly two thirds of of nonprofits have also had to put at least one program on hold.

While nearly all of the nonprofits surveyed received CARES Act Paycheck Protection Program loans, they noted confusion about if and how the loans will be forgiven. The organizations also overwhelmingly said that they need assistance in terms of more funding from foundations, government and individuals. Further, they said that reducing restrictions on current funding streams, information about the pandemic and local regulations around COVID-19 would be useful.

The study suggested that philanthropic foundations and corporate funders provide more money to nonprofits to help them through the near future. It also recommended institutional funders increase flexibility by reducing reporting requirements, loosening restrictions on current funding agreements and making new unrestricted grants.

It also recommends that both government and institutional funders support communities most affected by the pandemic and economic downturn including Black, Indigenous and communities of color.

Across the state there are more than 31,500 registered nonprofits, with just under 8,000 of them having paid staff. Nearly 5,000 of the larger nonprofits provide health and social assistance, education service and safety net services. They’re also economic drivers, as they account for more than 9% of annual wages, and nearly 10% of annual employment.

It’s unclear when a coronavirus vaccine will become available, but the first shots will likely going to frontline health care workers and the elderly. The Independent reports that the vast majority of Americans will likely have to wait until spring or summer 2021 to receive a vaccine.

Until then, the economic fallout of the pandemic will likely continue.


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