Local charities bracing for another difficult year
By Frank Cho
Advertiser Staff Writer
With talk of a possible war with Iraq, a weak stock market and the state facing a budget shortfall, nonprofit agencies are setting more conservative goals in 2003. Some are expecting to raise less money than they did this year, while many others are hoping to just keep pace with 2002.
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The grim outlook follows a year in which Hawai'i charities saw a modest increase in giving, but an even-larger rise in demand for services.
Seli Savaiinaea and Eric Westfall unload donated items at the Hawaii Foodbank. Charitable organizations worry that giving may decline in 2003.
"It's really a difficult time for charities and for people who have less means in Hawai'i," said Kelvin Taketa, president and chief executive of the Hawaii Community Foundation. "We know that increases in the need for services is being fueled by not only the weak economy, but changes in the federal welfare system that is really putting incredible pressure on the underprivileged."
Taketa said it is impossible to tell how charitable giving will shape up in 2003 because of the continued uncertainty surrounding the economy and possibility of war with Iraq, but it is certain that a growing number of charities will be competing for fewer dollars.
Factors such as layoffs and company cutbacks following the Sept. 11 attacks have combined to cause some charities to fall short of amounts they had raised in the previous year. And now charities face the possibility of lower support levels from financially-strained government agencies.
The state budget is not yet final, so nonprofit agencies will not know for several months exactly what their budgets will be in the year ahead. But the state Department of Human Services and other government agencies — which provide the majority of financial support to Hawai'i charities — are facing budgets that will remain flat or decline in the year ahead, because of the state's projected budget deficit, estimated by some at more than $150 million.
"It's not much of an enthusiastic outlook," said Aloha United Way president Irving Lauber.
To stretch contributions further, Lauber said, many charities are looking at reducing expenses through strategic alliances and clustering of services to reduce the demand for staff and other resources.
"We are really trying to hold costs down," said Yvonne Morris, incoming president of the Association of Fundraising Professionals, Aloha Chapter, and director of development for Maryknoll School, a private nonprofit school in Honolulu.
Morris said giving, especially among large donors, has dropped from a year ago and the trend is expected to carry into 2003.
The result may be that large nonprofit agencies with an already-established network of contributors could fare better next year than those that need to find new contributors every year.
Daniel de Castro, director of public relations for the Hawaiian and Pacific Islands division of the Salvation Army, said he believes people may be reducing donations either because of their own economic uncertainty or because they gave so generously after the Sept. 11 attacks.
De Castro said the Salvation Army is about $35,000 short of its goal on its Christmas appeal and will be about $100,000 short for the year, despite a promise by the Harry and Jeanette Weinberg Foundation to provide up to $200,000 in matching money.
"A lot of people thought things were back to normal after Sept. 11, but we are finding that is not the case," de Castro said. "A lot of people are still struggling to get back on their feet and they are finding that there is not much left over to give at the end of the month."
