2010 Outlook Report
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Introduction
To assess the outlook for grantmaking in
Minnesota in 2010, the Minnesota Council on Foundations (MCF) conducted its 2010
Outlook Report survey in October and November of 2009. The survey asked MCF
members and other large grantmakers in the state to predict how their 2010
giving will compare to 2009. In all, 125 organizations responded, representing
about 70 percent of annual grantmaking in the state.
At a time of diminished
public and private resources, the outlook for grantmakers and the nonprofit
community remains challenging. Overall, grantmaking is estimated to decrease by
approximately 1 percent in 2010 compared to 2009.
This report is a snapshot of
survey responses provided to MCF in the fall of 2009. While it provides an
indication of the overall sentiment about the outlook for grantmaking in 2010,
changing economic indicators, volatile markets, and government action may also
affect grantmakers and nonprofits in the coming year.
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Key Findings
- Overall, giving by grantmakers in Minnesota is
estimated to decrease by about 1 percent in 2010 compared to 2009.
- More grantmakers expect decreases in giving in 2010 than expect increases:
30 percent expect to give less compared to 25 percent who expect to give more.
- Twenty percent of grantmakers expect to decrease the number of grants
they make in 2010, and 10 percent expect to decrease the size of grants
awarded.
- Among the 78 percent of grantmakers who reported having assets, nearly
60 percent expect them to increase in 2010. Twenty-seven percent expect no
changes.
- Among all types of grantmakers, corporate foundations and giving
programs are most likely to expect their 2010 giving will remain the same as
compared to 2009.
- Seventy percent of grantmakers report they are currently providing some
kind of assistance to those affected by the economic downturn. Basic needs –
food, housing and jobs – are the areas these grantmakers are most likely to
support.
- Many grantmakers express concern about the well-being of their nonprofit
partners, which are under significant programmatic and financial strains
resulting from increased demands for services and decreased resources.
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About This Report
This report summarizes survey responses from 56 private foundations, 40
corporate foundations and giving programs, and 29 community/public foundations.
Eight of the 10 largest grantmakers in the state are represented here.
Seventy-four percent of grantmakers responding to the 2010 Outlook Report
survey also responded to the 2009 survey.
The majority of respondents (83 percent) granted $10 million or less in 2009.
The 17 percent of respondents who said they granted $10 million or more in 2009
represent approximately 80 percent of the grant dollars reported on here.
Seventy-eight percent of respondents reported they have assets. Of those with
assets, 70 percent have assets of $50 million or less and 30 percent have assets
over $50 million.
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Grantmaking Down Slightly in 2010
To assess the outlook for grantmaking in the state, MCF asked grantmakers to
predict how much their grantmaking was likely to increase or decrease in 2010
compared to 2009 (see Figure A).
Overall, grantmaking in Minnesota is estimated to drop by approximately 1
percent in 2010 compared to 2009.1 This follows an estimated drop in grantmaking
of about 4 percent in 2009 compared to 2008, as reported in MCF’s 2009
Outlook Report.
Although grantmakers are more optimistic about giving in 2010 than they were for
2009, about one-third of grantmakers expect their giving to decrease in the year
ahead (see Figure B). Twenty-five percent of grantmakers expect to give more in
2010, as compared to only 15 percent in the 2009 survey. And while 30 percent
expect to pull back on giving in 2010, this is an improvement from the 40
percent in the 2009 survey who expected declines.
Expected increases in giving in 2010 span a wide range. Ten percent of the
grantmakers surveyed expect to increase their giving by 1 to 4 percent in 2010.
About 9 percent of respondents expect to boost giving 20 percent or more.
Anticipated decreases in 2010 appear to be moderating. Thirteen percent of
respondents expect to decrease giving in 2010 by less than 10 percent, while 9
percent anticipate declines ranging from 10 to 14 percent.
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Giving by Largest Grantmakers Varies
In aggregate, giving by the largest grantmakers – the 21 respondents granting
more than $10 million annually – is estimated to decrease by 3.5 percent in
2010. Although this appears significantly larger than the approximate 1-percent
decrease anticipated for all grantmakers in Minnesota, the difference is due
primarily to shifts by three grantmakers.
One grantmaker anticipates a decrease of 30 percent or more in 2010 after
ramping up giving to an unusually high level during 2009 to respond to the
economic downturn. Two others anticipate decreases in the range of 20 to 29
percent. One of these cites the completion of previous grant commitments as a
reason for the decline and notes that no other changes to the size or number of
grants are anticipated for 2010. When decreases by these three grantmakers are
excluded from calculations, the giving by Minnesota’s largest grantmakers is
estimated to decrease by less than 1 percent in 2010.
Overall, about one-third of large grantmakers expect their giving to decrease in
2010, while about one-quarter expect increases.
Among all sizes of grantmakers, only small ones (those granting less than $1
million) are more likely to expect their giving to increase than decrease in
2010 (see Figure C).
Grantmakers giving between $1 million and $10 million are more likely to
anticipate decreases in giving than do small or large grantmakers.
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Corporate Giving Stable
Among all types of grantmakers, corporate foundations and giving programs are
most likely to expect their 2010 giving to be comparable to 2009, and least
likely to expect their grantmaking to increase or decrease (see Figure D).
Nearly 60 percent of corporate grantmakers anticipate no changes to their
giving, while only 18 percent expect an increase. Twenty-five percent of
corporate grantmakers anticipate giving less in 2010.
Among corporate grantmakers who anticipate changing their giving levels in 2010,
about half cite changes in company profits as the reason, and 20 percent note
other reasons related to business operations.
About one-third of private grantmakers expect to decrease their giving in 2010,
while a similar percentage (29 percent) expect increases. Most private
foundations (65 percent) say changes in the value of foundation assets will be
responsible for adjusted giving levels in 2010.
Among community foundations, 34 percent expect to decrease and 28 percent expect
to increase giving in 2010. Community/public foundations cite two major reasons
for expected grantmaking changes: shifts in asset values (46 percent) and
changes in gifts received from individuals or other donors (36 percent).
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More Optimistic Asset Picture
Grantmakers are much more optimistic about how their assets will fare in the
coming year than they were in the 2009 Outlook Report survey. Among the 78
percent of grantmakers who report having assets in this year’s survey, most
expect their assets to increase or stay the same in 2010 (see Figure E).
Fifty-eight percent expect their assets to increase next year, compared to just
13 percent who expected asset increases in 2009. Most grantmakers who anticipate
higher assets expect increases to be less than 10 percent (see Figure E).
Twenty-seven percent of grantmakers expect their assets to remain flat in 2010.
Only 8 percent expect their assets to decrease in 2010, compared to 52 percent
who anticipated decreases in 2009.
Among the 7 percent of respondents who chose not to predict what would happen to
their assets in 2010, most cite volatility in the markets as the reason for
their uncertainty.
Nearly 80 percent of grantmakers who anticipate a change in their assets in 2010
say the major reason is a change in return on investments. Twenty percent
attribute changes to receipt of a major gift. A handful note either a change in
investment strategy or a change in grant payout as a reason.
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Limited Changes to Priorities, Programs and Operations
One-third of grantmakers say they will not adjust the number of grants they give
in 2010, while another third are unsure how many grants they will award next
year. Two in 10 expect to decrease numbers of grants awarded in 2010.
About 46 percent of grantmakers anticipate no changes to grant sizes next year,
while about one-quarter report uncertainty about grant sizes. One in 10 expect
to decrease the size of grants in 2010.
Fifty-one percent of grantmakers anticipate making no changes to their
grantmaking programs and priorities in 2010, while 21 percent of grantmakers
expect to make temporary changes related to the economy. Nineteen percent plan
to make changes to their programs or priorities for other strategic reasons.
About half of grantmakers do not expect to make other major changes to their
operations in 2010 to respond to the economic downturn. Nine percent say they’ll
make changes to the administration or operation of their organization. About
one-fourth report they will offer more non-monetary assistance to nonprofits in
2010 such as technical assistance, convenings, and in-kind products or services.
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Focus on Basic Needs
Seventy percent of grantmakers report they are currently providing some kind of
assistance to those affected by the economic downturn. Basic needs – food,
housing and jobs – are the three areas these grantmakers are most likely to
support. Fifty-three percent are providing aid for food assistance, 51 percent
are supporting emergency housing or homeless shelters, and 45 percent are
focusing on basic skills education or job readiness.
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Grantmakers Concerned About Nonprofit Partners
Many grantmakers express concern about their grantees, given the increased
demand for services they are facing, along with the loss of resources. One
respondent worries about how grantmakers could respond to the needs of
nonprofits if the “dollars they lose today as cuts will not be restored when the
economy improves.”
While the needs of current partners are paramount, finding the right balance
between supporting current and new grantees has been difficult. Several
grantmakers hope to be better equipped to consider new requests in 2010 and
2011.
Finally, many grantmakers express ongoing concerns about volatility in the
financial markets and the unsettled economy, which could change their current
predictions for 2010. Several cautioned that 2011 may also be challenging,
depending on what 2010 holds.
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1 Figure calculated using median percentage changes for ranges shown and weighting based on number and size of respondents.
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