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Ablowitz: A message for nonprofits and donors

They used to be called charities.

Then they were referred to as not-for profit corporations, often shortened to nonprofits, and, in some contexts, non-governmental organizations (NGOs).

Now, some are suggesting calling them public-benefit corporations or public-benefit enterprises. They comprise "The Third Sector," the space between public and private that often has elements of both in terms of how they are funded.

Whatever they are called, the key element that defines them is the lack of a profit motive -- the desire to "do good" for the benefit of society -- and there are nearly 2 million of them in the U.S. alone.

They run the gamut from literacy organizations to museums, hospitals to schools and universities, societal safety nets to philharmonics and ballet troupes.

These organizations, referred to as 501(c)3s by the IRS, employ more than 9 million people and have a volunteer, unpaid workforce equivalent to nearly 14 million more.

What if they no longer existed? What would happen if people stopped giving and the nonprofit, non-government organizations were not able to do what they do?

What impact might that have on communities, society, or even global viability? How do these organizations affect our lives?

Imagine if government taxation was the only source of funding and there were no volunteers.

Fortunately, the public-benefit enterprises continue to do their work, relying on people who share their values to support them.

The Community Foundation of Boulder County's Culture of Giving project offers a searchable database of more than 500 such organizations in the Boulder area. They serve many constituencies through programs that address self-sufficiency, mental health, conservation, educational scholarships, animal rescue, legal justice, disability services, low-income housing, transportation, aging, discrimination, medical research, leadership, building civic engagement and more.

And that's just Boulder.

It is astounding to comprehend the impact of the Third Sector in addressing local, national and world-wide challenges.

Each year, the Giving USA Foundation tracks charitable giving in the United States. Despite the signs over the past year of significant challenges for the economy, in fact there was an increase in giving. It wasn't monumental or even great ... only a 1 percent increase on an inflation adjusted basis, but it was still an increase.

In raw numbers, in 2006 donors made gifts of nearly $295 billion. In 2007, gifts totaled over $306 billion.

What will happen in 2008?

That's hard to say. Certainly, there is more demand for programs and services as the impact of the sub-prime lending is felt and gas prices rise. Hardship often heightens awareness of society problems. Many donors will become more generous as a result. Donors may look to support those programs that have a proven track record or can demonstrate real impact.

Yet, many problems are interrelated, like addiction and homelessness, or gas prices and increased interest in alternative fuels or carpooling. One organization may address one part of a problem while what another works on will address a different component. Collaborations will become increasingly important, as will creative solutions that cost less to do more.

One thing is for sure, donors must continue to provide the support that maximizes the ability of the third sector to keep working to solve problems.

While there is a strong message here to donors to continue giving, there is also a strong message to the nonprofits to stay true to their missions.

Avoid the mission creep that happens when you try to "do it all." Use donations wisely. It is hard to attract a donor. It is also hard to keep them, especially in challenging times.

Donors will give for many reasons, but they will stop giving if they don't believe their gifts make a difference. And while there may be more need, donors want longer terms solutions, not just band-aids.

There are creative approaches emerging that seek sustainable solutions. They are emerging in many arenas, from pairing elders with youth, to revamping the financial aid model for education to nonprofits merging to reduce overhead costs.

Muhammad Yanus created the Grameen bank and used microfinance, the giving of small loans to stimulate private enterprise, to give hope and transform the lives of people previously impoverished. He won a Nobel Peace Prize for his extraordinary contribution.

Big ideas can make a big difference, but so can small, targeted, sustained contributions.

Now is a good time to reinforce the importance of and encourage accountability, creativity and generosity. .

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