A recent survey conducted by the Delaware Alliance for Nonprofit Advancement indicates that when state funding is reduced nonprofits have no alternative but to reduce service hours to clients, eliminate employee benefits and lay off workers.
The fiscal 2018 state budget reduced grant funding by more than $25 million, including $8.6 million of grant-in-aid dollars, according to the December 2017 expenditures report from the Delaware Economic and Financial Advisory Council
In fall 2017, DANA asked nonprofit executives to provide insight into the choices they made due to the government funding reductions. Of the 52 nonprofits who completed the survey and indicated they typically receive state funding, 42 realized a reduction. Nearly all reported that to offset reduced revenue, they will seek new sources of funds. But in the immediate term, they were required to reduce service hours, employee benefits, cut back on promotion or eliminate services with small businesses offering professional services.
Collectively, 13 agencies laid off 40 workers.
The December DEFAC report also provided future projections for state funding, indicating a continued reduction in grants based on current revenue projections. DANA asked nonprofit executives what actions they are considering to sustain their organizations in the long-term. Eighty-one percent of those who responded expressed plans to expand fundraising efforts to attract new donors or hold more fundraising events. Additional future actions included changes to their operations by either by forming strategic alliances, eliminating fringe programs to focus on their core, restructure or close.
To view the DANA Survey Infographic or read the full report, visit delawarenonprofit.org/research-and-resources.