Grantmaker Response to State Fiscal Crisis

Tuesday, November 28, 2017

As many of you know, the CT state legislature passed a budget on October 26. Outstanding questions about that budget have been resolved, such as the hospital tax, and there is better clarity for agencies and non-profit groups that contract with the state to provide critical services for children, families, seniors, and individuals with complex needs.

Unfortunately, the newly adopted budget is already in a deficit, and there are more issues on the horizon. Those following the state’s fiscal situation know the outlook is somewhat bleak -- budget obligations of pensions and health care for retirees will continue to grow as a portion of the budget leaving less and less for critical needs like education, municipal support, and the many programs that create a social safety net for Connecticut's residents.

In an effort to better understand the philanthropic landscape, we circulated a survey asking members if and how they are responding to the state's fiscal crisis. We had a strong response to this survey, with about 30% of members completing it. Thanks to all of you who took time out to provide input about your foundation.

Results: State Fiscal Crisis Survey

At this time, about 25% of respondents are currently responding to the fiscal crisis. The vast majority of these grantmakers are responding with increased grant support to non-profits. Some grantmakers, about 33%, are supporting conversations about non-profit mergers. And a smaller number, about 20% each, are offering learning programs and/or advocating.

But many more foundations, about 44% of respondents, report that they plan to respond to the state’s fiscal crisis. Again, the majority, about 50%, are planning to increase their grant support to non-profits. Even more, 57%, report they will support conversations about non-profit mergers, and still others, 42%, will offer learning programs to non-profits. A smaller number, 21%, plan to advocate or lobby.

What Grantmakers Are Hearing from Grantees

Most respondents reported that they are hearing from their grantees and that many of them are adjusting their work based on the state budget. The most widely reported messages are displayed in the chart.

While many respondents noted that they are having conversations internally at their organizations or with their colleagues, most acknowledged that more information is needed and more conversations need to be had. They noted that discussions among foundations, and in collaboration with nonprofits or other partners, are critical.

What CCP Can Do to Support Grantmakers

Lastly, we asked you how you thought CCP could best support your work – and your grantees' work – at this time. Many of you had smart and timely suggestions:

Advocacy. Help organize a unified response; advocate for a responsible budget, for an equitable budget; make sure legislators understand that philanthropy cannot fill government’s gaps; and let us know when philanthropic advocacy, our advocacy, can do the most good.

Inform. Keep us up to date; help us understand impacts of the budget and other policies on non-profits; share what others are doing; and explore and share possible solutions.

Convene. Hold forums to deepen our understanding; bring us together to share information, learn together what funders can consider doing; and help us understand what is needed immediately to mitigate short-term harm and help us plan a long-term strategy together.

Like many of you, we think that the time is now to bring the philanthropic community together – to deepen our collective understanding of the current fiscal crisis, projections for out-years, and what roles philanthropy can play to mitigate short-term pain, to support evolution in the state’s non-profit landscape, and to start developing longer-term strategies.

At CCP, we’re beginning to plan now for such conversations in 2018, and hope you’ll join us. In the meantime, we’ll continue to provide updates on the budget, other policies, and nonprofit impacts as we have them. If you have thoughts about additional steps that we can take, please reach out to us.

Karla Fortunato is president of the Connecticut Council for Philanthropy. CCP's blog, Giving Voice, is a blog for and about grantmakers in Connecticut.


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