Rethinking Nonprofit Self-Sustainability In An Endowment Elimination Era

nonprofit self sustainability

Impact of the Budget Blueprint on Nonprofits

Created in 1965 when President Lyndon B. Johnson signed legislation declaring that any “advanced civilization” must fully value the arts, the humanities, and cultural activity, the National Endowment for the Arts and the National Endowment for the Humanities are now on the chopping block in the President’s recent Budget Blueprint.

From culture and education to jobs and tourism, the elimination of these sister endowments, in addition to the Institute of Museum and Library Services and the Corporation for Public Broadcasting—would undoubtedly impact New York City, as one major geographic example.

“Eliminating these agencies is yet another example of Trump’s preference for building walls rather than bridges. The arts and humanities provide a critical link for cross-cultural understanding, for community collaboration and for developing and fortifying our national identity.

A threat to zero out the N.E.A., for instance, is a threat to eliminate arts education programs for our children, to destroy essential spaces for self-expression and critical thinking and to dislocate community arts organizations that depend on public funding.”

—Scott Stringer, Controller, City of New York
—Lisa Robb, Executive Director, The Center for Arts Education

What is the Purpose of These Endowments?

The NEA funds, promotes, and strengthens the creative capacity of our communities by providing all Americans with diverse opportunities for arts participation—including concerts, readings, performances, exhibitions of visual and media arts, broadcast performances on television, radio, and cable.

The NEH supports scholarly and cultural activity in order to achieve a better understanding of the past, a better analysis of the present, and a better view of the future. NEH grants typically go to cultural institutions, such as museums, archives, libraries, colleges, universities, public television, and radio stations, and to individual scholars.

This Federal agency supports the growth and development of museums of all sizes. Of note, it provides capacity building grants to small and medium-size cultural institutions in urban, suburban, and rural areas.

CPB strives to support diverse programs and services that inform, educate, enlighten and enrich the public.  Through grants, CPB encourages the development of content that addresses the needs of underserved audiences, especially children and minorities.

An Opportunity For Nonprofit Self-Sustainability

Here’s the thing: Though the official budget announcement by Congress is scheduled for May, it looks like these agencies will be eliminated due to Republican control of both houses of Congress and the White House—not reduced, but completely eliminated.

Whether that’s the case, or (by some miracle) not, all nonprofits across the country really need to rethink how they reach, recruit and engage donors, as a start. This includes online contributions, corporate sponsorships, planned giving, major gifts, ticketed events and more—and not only by the very nonprofits impacted by these grant eliminations or other fiscal cuts.

This may be an opportunity, across the board, for nonprofits to become more financially self-sustainable.

To cut unnecessary or duplicated costs, there’s a need to assess internal efficiencies and expenses, from manual data entry and processes to web technology, donor CRM, fundraising platforms, payment processing fees and more. Nearly every engagement with a nonprofit client begins with an audit of internal and external processes, systems, expenses, etc.—and I can tell you that in every instance, there have been income opportunities discovered and efficiencies created that save money and make staff more productive (and happier) because they no longer toil over manual, repetitive tasks.

With the rug being pulled out from so many organizations simultaneously—combined with our climate of societal unrest and resistance—there is no better time than now to completely reimagine, re-strategize and then implement a plan to do the following:

Improve visibility: reach new audiences / prospective donors, sponsors and funders
Reduce costs: create efficiencies through technology automation, eliminate manual labor, negotiate with or change vendors, etc.
Increase income: augment the volume, frequency and dollar amount of all contributions

Regardless of size, the rules by which nonprofits have played for decades have shifted dramatically. We can get a little more aggressive—and certainly more creative—with our “asks”.

By taking this opportunity to really hone in on communications, operations, processes and development, many nonprofits could come out on the other side renewed. Yes, smaller organizations that relied heavily or solely on endowment and government funding will close—based on the many agencies outlined in the budget.

However, those that can become self-sustainable will find more freedom in their programs—especially arts, humanities, and cultural organizations. And perhaps more importantly, they’ll develop stronger, deeper relationships with their communities, donors, grantmakers and volunteers.

Author: Kelly Campbell
Kelly Campbell is an Agency Leader Transformation Coach based in New York. The former owner of a cause marketing agency for 14 years, she helps creative leaders transform their businesses and their lives—focusing on the 5 P's: purpose, people, positioning, pipeline and profitability. She speaks at agency growth conferences across the country, has been featured in The New York Times, Woman Entrepreneur and Forbes, gets vulnerable on Medium, and is currently authoring her first book on reframing leadership. She is the host of THRIVE: Your Agency Resource, a bi-weekly video podcast sponsored by Workamajig that helps agency owners navigate personal and professional growth.

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