Charities Pull Out Stops to Keep Dollars Coming

Americans, traditionally, are a charitable people. Even in a recession, they give till it hurts.

It’s just that in a recession, it starts to hurt sooner.

Corporate giving has “leveled off in the last few years, barely keeping pace in its growth rate with inflation,” said Virginia Hodgkinson, the vice president of research for the Independent Sector, a national coalition of about 780 nonprofit corporations, foundations and volunteer organizations.

“What we’ve found is that people don’t stop giving, but they don’t give as much,” she said.

Most Orange County charities report that donations are still coming in, but their concern about the future has them adopting newer, more aggressive strategies to coax reluctant money out of wallets and corporate accounts.

* United Way is now offering donors a say in where their money goes.

* Goodwill thrift stores are undergoing face lifts to make them more attractive to non-traditional shoppers.

* And Olive Crest, an Orange County network of homes for abused children, has enlisted a star attraction to bring in donations.

Heather is 18, pretty, fresh-faced, endearingly shy and has a winning manner behind a podium, even when she speaks of an “emptiness that doesn’t go away.” She declares that her former life was “a nightmare,” that “all I ever wanted was for my mom to love me, but she didn’t.”

In Heather, who lives in a foster home in El Toro, audiences see the reality of child abuse--and successful recovery from it. And, more than mere anonymous pleas, her presence helps bring home the point that Olive Crest is a charity that needs support.

Heather was particularly effective at a recent gathering of corporate chief executive officers at the exclusive Center Club in Costa Mesa.

“They were people who are hard to get donations from during the (economic) crunch,” said Sue Kirby, Heather’s foster mother. “But when Heather was done speaking, one of them came up and said, ‘Young lady, you’re the reason this whole thing makes sense. When you stand up there, it makes us realize why we’re doing this.’ ”

Olive Crest officials say that Heather is not merely a magnet for fund raising, but also serves as an example of the success of the foster homes. However, said Kirby, Olive Crest is “tickled pink to have someone like her” to present its case.

Goodwill Industries, generally thought of as a recycler of clothes and household goods, is getting into a different end of the recycling business in an effort to prime the fiscal pump.

In about two months, the organization will begin to collect and recycle bottles and cans in cooperation with Alpha Beta and Stater Bros. markets. The group hopes that this source of revenue, among others, will help revive a budget that is flagging under the recession.

“The year 1989 was a very good year for Goodwill, but now we’re seeing a trend about halfway through ’90 of decreased collections,” said Goodwill’s director of marketing and public relations, Andrea Pronk. “Also, our stores were not generating the same revenue that they had in ’89. We thought we were really on to something in ‘89, because it was such a successful year, but it hasn’t continued.

“We’re really starting to feel the pinch right now,” she said.

In addition to reorganizing the thrift stores to make them more attractive to shoppers, Goodwill has initiated a direct-mail program and door-to-door advertising with doorknob hangers, Pronk said.

“We’re definitely becoming more knowledgeable in the marketing of our program,” she said. “We’re forcing ourselves to become more aggressive in getting the word out.”

While revenue generated from Goodwill’s thrift store and used-goods business from last December through February has increased slightly over the previous year, revenue from conventional fund-raising during that time dropped from slightly more than $183,000 to about $179,000. The combined figures were not what Goodwill had expected, based on its previous year’s success.

As a result, Pronk said, Goodwill has been forced to institute a hiring freeze and cut back the hours of some staff workers. A small number of staff layoffs also may occur. The organization’s budget was revised last week.

Many charitable organizations, such as the Volunteer Center of Orange County, saw the recession coming.

“Every year, you factor in a certain percentage of increase (in donations),” said Vici Woods, the vice president of development for the center, which is a countywide clearinghouse for about 1,200 nonprofit organizations. “You can usually bank on about an 8% increase each year. But not this year.

“I’d say we’ve planned for about a 20% decrease this calendar year. We’d been warned as early as last year to beware that contributions to nonprofit organizations were going to be low.”

The response to the recession at the Volunteer Center, and at other charitable organizations throughout the county, has been to cut back expenses and step up their pleas for funds.

As part of the center’s austerity program, said Woods, the organization’s two offices were combined into one, and efforts have been stepped up to attract more individual donors and coax previous donors into giving more.

“We’ve developed more of an individual donor program,” Woods said. “We’re targeting donors at a higher level. For instance, the people who traditionally contribute $500, we’re now asking them to give $1,000 this year. In times like this, it’s your friends you go to.”

At the United Way of Orange County, that strategy--with a bit of modification--seems to have worked. The United Way is a clearinghouse for funds raised primarily through contributions by individuals in the workplace and, traditionally, funds collected from employees were allocated to different charities by United Way volunteers.

This year, however, employees have been allowed to designate money to one or more of seven “issue areas”--substance abuse, sexual and physical abuse, literacy, homelessness, child care, mental health and health care for the “under-served.”

This, said Jeff Rocke, the vice president for marketing and community relations for United Way of Orange County, may be the reason contributions from mid-September to mid-January are up 3% from the same period a year ago.

“It’s tough to quantify why there would be an increase in the midst of all the trouble surrounding the economy and the war in the Mideast,” Rocke said. “But we believe our campaign was successful because we gave donors more of a choice about where their money would go.

“We have been listening to donors the past couple of years,” Rocke said, “and they have told us they want greater independence in their charitable giving decisions, a stronger voice in where their money goes.

“We anticipated, to some extent, that 1990 would be a difficult fund-raising year because of the projected economic situations, so it seemed like an appropriate time to implement (the new program).”

The American Cancer Society, Orange County Unit, also has seen success in the midst of hard times--the result, it says, of high visibility and an emphasis on individual donors rather than corporations. Funds are raised, among other methods, through direct mail, pledges, memorial gifts and through sales at a high-end thrift shop in Corona del Mar called Discovery Shop.

“One reason we’re not down in income is that we have an extremely broad fund-raising base here,” said Michael Wagschal, the society’s director of income development. “We get out into the community and have a grass-roots network out there. People are very much aware of who we are and what we are.”

Still, said Wagschal, the society, like many other charities, has seen a drop in corporate contributions, which make up about 30% of its total revenue. Also, he said, the larger fund-raising events that have brought in money in the past, such as black-tie dinners, wine tastings and 10K runs, have suffered as a result.

The reason, said Wagschal, is that corporations that traditionally have purchased tables at dinners, underwritten printing costs or heavily sponsored other special events, have cut back.

To counteract the corporate slump, the society has concentrated on staging more smaller events and using the money raised at them to support the more traditional larger fund-raisers. A small afternoon fashion show might be held to finance the printing of programs for a gala dinner later in the year, said Wagschal.

Also, he said, the society is designing more programs and events to attract younger donors. The “average donors,” he said, have traditionally been senior citizens.

“We’ve started a group called Young Professionals Against Cancer,” Wagschal said. “We’ve never targeted that group before.”

There is an almost constant in the charity business: individual donations from lower-income people do not waver in a recession economy.

“We find that lower-income people give more than upper-income people if you take their donations as a percentage of their income,” said the Independent Sector’s Hodgkinson. “They’re very close to the situation of living on the margin, and they give from the perspective that they’re sharing resources. They understand the kind of problem a person may have.”

Upper-income people, on the other hand, rarely feel the squeeze.

“When you’re insulated (from poverty),” said Hodgkinson, “you tend not to be very closely affected by it and you may not think of giving.”

Times Researcher Elene Brunet contributed to this report.