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NONPROFITS >> In tough times, priorities often change Giving help to those who 'need it most' ABOUT THE SERIES ON THE MOVE ABOUT CHARITY BY THE NUMBERS

July 6, 2008 12:16 am

BY AMY FLOWERS UMBLE

Historian and author Paula Felder is passionate about the Fredericksburg area's history.

But she recently wondered whether preserving the past is more important that saving another area resource--its people.

So she chose to forgo donations to historic-preservation groups and gave money to social-services groups instead.

When the city resident heard Fredericksburg had cut funding to Rappahannock Legal Services and that the nonprofit would have to drop its housing advocacy position, she donated $10,000.

"I feel very strongly that we neglect the parts of our society that need it the most," Felder said. "When the times get tough, they cut out the people who need it the most."

The legal-aid group has seen more clients walk through its door and less money coming in, said director Bill Botts.

Rappahannock Legal Services' attorneys help low-income residents fight for disability, food stamps and custody payments. Staff members also work to prevent homelessness and to help with poverty issues.

So far this year, the agency has seen an almost 50 percent increase in its caseload.

In light of the demand for services and reduction in funding, Botts moved the agency to cheaper office space. Also, employees are looking for new contributors and more money from faithful donors, Botts said.

Felder said she felt compelled to help after hearing stories from the group's homelessness-prevention paralegal, Ellyn Hartzler.

Felder said that as much as she loves history, in a bad economy she believes money should go to groups working with the poor and the disabled before museums.

And she's not alone. During recessions, donors often reprioritize their giving, said John Havens, associate director of the Center on Wealth and Philanthropy at Boston College.

The good news, he said, is that giving itself doesn't go down much. But often the wealthy, the biggest donors, will close their checkbooks to arts centers and museums.

"Wealthy people often do give to those things when times are good," Havens said. "But there's reprioritizing when times get tough."

A newly released study underscored that shift in priorities. The Giving USA report, which came out June 23, found donations to international aid, environmental and human-services groups rose the most.

When the economy recovers, donors typically go back to their old giving habits, Havers said.

So social-services groups could see their donations remain steady if they have wealthy donors, he said.

People on the lower economic end feel the pinch more from a recession, and will cut back on giving.

"As gas prices go up, people may not be giving as much to, say, a drug program on the street, when they otherwise might," Havens said.

Some of the effects of this economic downturn are yet to be understood fully, he said. Typically, recessions don't affect wealth--which is household net worth, total household assets minus debt. But last quarter, wealth dropped by 6 percent, the largest decline since 1974.

During previous recessions, lower- and middle-class givers decreased donations by the amount their disposable income dropped.

So, if rising costs or a reduced paycheck cut a $10 chunk out of the donor's budget, the donor would give $10 less to a charity or religious group.

In the past, fears about the future didn't enter the picture, Havens said.

But, in this economy, the housing market has been hit hard. As people see foreclosures in their neighborhood or find their home values plummeting, it's hard to know whether people will hold on to their purses a little tighter while fearing for their nest eggs.

Overall, Havens said, people want to reach out and help. Studying giving, he said, has shown over and over that most people are compassionate.

The Rappahannock United Way will count on that compassion in late August when it sets its goal for this year's fundraising campaign. President Stephen Batsche said the organization will set a modest goal, keeping in mind that most people have been hit by rising food and fuel costs.

But the goal will definitely be more than last year's $3 million, he said, because "this is a very generous community."

Rappahannock Legal Services and other nonprofits are counting on that generosity in this uncertain economy.

"They're relying on a donor base where everyone's tightening their belts," said Deborah Williamson, director of the Virginia Network of Nonprofit Organizations. "They're feeling the pinch just like everyone else."

Amy Flowers Umble: 540/735-1973
Email: aumble@freelancestar.com