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Disasters fuel charitable giving

By TIMES WIRES
Published June 19, 2006

A record outpouring of donations in 2005 to victims of natural disasters did not exhaust and may have inspired charity to the everyday needy and dispossessed, according to a report released today.

The report said that giving to all charitable causes by American individuals, corporations and foundations rose by 6.1 percent, to $260.28-billion, in 2005 from 2004's level. Adjusted for inflation, the increase was 2.7 percent, which marked the best showing since 2000.

Giving for disaster relief accounted for about 3 percent of the total, according to the Giving USA Foundation, an educational and research program of the American Association of Fundraising Counsel, which together with the Center on Philanthropy at Indiana University publishes the annual report.

From December 2004 to October 2005, an estimated $7.37-billion was donated to address the ravages of natural disasters, with individuals accounting for a majority of the gifts. The American Red Cross alone received $2.4-billion to help victims of Hurricane Katrina, and the Salvation Army took in $363-million, more than three times what it raised through its annual holiday Red Kettle Campaign.

Without disaster-related philanthropy, however, giving would have been flat. The stock market increased only modestly last year, and personal incomes fell for the second year in a row.

"When there is a very significant need, when people are clearly aware of that need, they will respond," the chairman of Giving USA, Richard Jolly, said. "Were it not for the disasters, what we would have expected is more of a flat number. With the staggering need generated by the disasters, it's very in keeping with what has happened in the past - the American public stepped forward and provided additional support."

He said it was impossible to know what impact special tax breaks intended to stimulate charitable giving had on philanthropy overall.

The trend was echoed among corporations, whose giving jumped 18.5 percent, adjusted for inflation, to $13.77-billion. Many companies enjoyed record profits last year, which they shared with disaster victims and relief groups.

Jolly and other fundraising experts said that heightened awareness of the human toll of disasters might have helped reverse a three-year decline in giving to nonprofit organizations that provide after-school programs, housing for the homeless, substance abuse programs and other human services.

Contributions to those charities increased 11.3 percent, when adjusted for inflation, before adding in the disaster-related part.

"We got pretty intense exposure to some of the realities of poverty after Katrina," said Patrick M. Rooney, director of research at the Center on Philanthropy, "and that may have spurred more giving to the types of nonprofits that try to address those problems."

Individuals account for more than three-quarters of the total philanthropic pie, or $199.07-billion in 2005 - and more than four-fifths of giving when bequests are factored in.

Foundations gave about $30-billion, or 11.5 percent of the total, according to the survey, while corporations accounted for 5.3 percent.

But Lester M. Salamon, director of the Center for Civil Society Studies at Johns Hopkins University said that while the overall amount of giving last year was impressive, the survey overstated the amount actually available to organizations to spend in a given year.

"It conjures up an image that charities have $260-billion to spend," Salamon said, "but some of those dollars represent Picassos given to museums, stocks given to major university endowments, and money flowing to foundation endowments, which is not available for use."

Information from the Associated Press, Chicago Tribune and New York Times was used in this report.

[Last modified June 19, 2006, 05:35:34]