Foundations Feel the Impact of States’ Budget Gaps

Many Try To Assist Nonprofits Reeling From State Funding Cuts

New York, NY — September 15, 2011. Nearly ninety percent of America’s largest foundations report that at least some of the nonprofit organizations they support have been severely affected by state budget cuts. One-quarter report having grantees that have been forced to suspend operations. According to the Foundation Center’s new report, Foundation Leaders Address the State Budget Crises, about half of the funders surveyed have provided assistance to affected nonprofits, while two-thirds expect to increase funding for organizations serving vulnerable populations in general.

"Foundation budgets are dwarfed by government spending," said Steven Lawrence, director of research at the Foundation Center and principal author of the report. "Nevertheless, many foundations are trying to help keep the doors open at nonprofits until the state budget crises pass."

Yet the Grantmaker Leadership Panel respondents were not optimistic about a rapid return to fiscal health for states and the affected nonprofits. Overall, four out of five respondents expect the budget challenges to continue into 2013 and beyond.

The report also includes an essay, "How Grantmakers Can Respond to the State Budget Crises," by Doug Bauer, executive director of New York’s Clark Foundation. Mr. Bauer emphasizes that foundations should prioritize support for general operating expenses, capacity building, working capital, and advocacy.

Surveying foundations on their current perceptions and future intentions supports the Foundation Center's overall efforts to bring transparency to the world of philanthropy. At the Center’s web site, foundations that have taken the lead in communicating about their work are featured along with direct links to initiatives, research reports, and data visualization tools that show philanthropy’s contribution to today’s most pressing issues.

Foundation Leaders Address the State Budget Crises (PDF) can be downloaded at no charge from the Gain Knowledge area of the Foundation Center's web site.

About the Grantmaker Leadership Panel

The Foundation Center's Grantmaker Leadership Panel draws upon the expertise of 220 chief executives at leading U.S. private and public foundations on critical issues of interest to the sector, providing a regionally representative sample of the largest 400 independent and 200 community foundations in the country. Panel members hold assets totaling over $100 billion and make grants totaling more than $7 billion annually.

Cheryl Loe
Communications Project Manager
The Foundation Center
(888) 356-0354 ext. 701

About the Foundation Center
Established in 1956 and today supported by close to 550 foundations, the Foundation Center is the leading source of information about philanthropy worldwide. Through data, analysis, and training, it connects people who want to change the world to the resources they need to succeed. The Center maintains the most comprehensive database on U.S. and, increasingly, global grantmakers and their grants — a robust, accessible knowledge bank for the sector. It also operates research, education, and training programs designed to advance knowledge of philanthropy at every level. Thousands of people visit the Center's web site each day and are served in its five regional library/learning centers and its network of 450 funding information centers located in public libraries, community foundations, and educational institutions nationwide and beyond. For more information, please visit or call (212) 620-4230.