SPECIAL FOCUS

The Giving Season

JOHN W. COMERIO, CLP
is the development director for the Illinois Association of Park Districts and manager or Friends of Illinois Panes, lAPD's nonprofit organization established in 1998 to involve more citizens in their local park district and forest preserves. Comerio received his certification as a fund-raising manager from the Fund Raising School at Indiana University, Center of Philanthropy. He can be reached at 217.523.4554 or iapd@eosinc.com.

Some say philanthropy is the future of parks and recreation, and this fund-raiser agrees

BY JOHN W. COMERIO, CLP

We make a living by what we get, but we make a life by what we give." -Winston Churchill

'T is the giving season in more ways than one. Yes, we are fast approaching the holidays, when people give to friends and family...and to charities. (Those end-of- the-year write-offs can benefit a particular cause as well as an individual's bottom line.)

At this time, too, society's giving spirit is particularly aimed at nonprofit organizations, which could include public park districts, forest preserves and their fund-raising arms. In fact, giving to nonprofit organizations is at an all-time high. Americans contributed a record $174.52 billion to nonprofits in 1998, according to "Giving USA 1999," a report published by the American Association for Fund Raising Counsel (AAFRC) Trust for Philanthropy.

This kind of generosity comes at an opportune time for park districts, forest preserves, recreation and natural resource agencies.

"Do more with what you've got" is the mantra of our citizenry, and every agency hears it.

According to a recent economic assessment survey by the Illinois Association of Park Districts, member districts need more funds and more resources to satisfy local demands for facilities, open space and recreational programming. While asking for more and expecting the best from their public park and recreation agencies, taxpayers don't like tax increases. They see "tax caps" as a way to protect their income. And, already these agencies are realizing 50 percent or more of their annual operating income from fees and charges.

Savvy taxpayers, however, are also looking for ways to reduce their personal taxes and ways to direct their social capital. Districts can help these taxpayers and themselves by taking advantage of "the giving season."

Who gives what?

For the first time since 1972, giving to charity exceeded two percent of the gross domestic product. Revenues to all four sources tracked (individuals, bequests, foundations and corporations) increased during 1998.

Personal giving by living individuals continues to represent the vast majority of charitable contributions. More than 77 percent of todays giving comes from individuals who contribute nearly $135 billion, a 10 percent increase over the past reporting year. (See "Sources of Contribution" pie chart on page 29.)

Giving by bequest, a gift of personal property by will, continues to increase, hitting $13.6 billion in 1998.

Corporate giving for 1998 was at $8.9 billion from over 5.1 percent of the contributors.

Foundations weighed in as the second highest source of contributions at $17.1 billion from 9.8 percent of the donors.

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Who gets the money?

Organized religion dominates for contributions by type with nearly 44 percent of the funding at $76 billion. (See second pie chart on page 29.) Nonprofits that are more directly or traditionally aligned with parks, recreation, arts, natural resources, wildlife or the environment also represent a significant percentage of the recipients. For example, the category "other" includes environment/wildlife organizations receiving $5.25 billion.

In addition, giving to foundations ($16.94 billion), along with arts ($10.53 billion), public/society benefits ($10.86 billion), provided a combined total of $43.5 billion from nearly 25 percent of all inventoried sources. Each of these four recipient categories represent potential gift sources or leads for your fund-raising arm or your agency.

The "Sources of Contribution" pie chart is especially revealing. A commonly held belief is that corporations are the best or greatest source of giving to nonprofits. Many Illinois-based corporations are, in fact, generous through direct giving, workplace giving, as well as in-kind contributions through their marketing, community relations and advertising budgets. Park districts, forest preserve districts and conservation districts have come to rely on corporate giving and corporate sponsorships for major events, activities, programs and facility development.

Giving by individuals is the real story. All sources and research to date report the same significant finding: the preponderance of giving comes from individuals. Thus, personal giving remains the most potent force for park and recreation agencies to tap into.

Nancy Raybin, chair of the AAFRC Trust for Philanthropy, believes nonprofit organizations should strike a balance between raising money from individuals and foundations.

According to Raybin: "Individuals have more capacity to give than foundations do, and their capacity has not yet been unleashed at its highest possible level."

How do you get the money?

Park districts and forest preserves can take advantage of all this generosity in ways that are appealing and attractive to donors while meeting the community's needs. Here are several ways to do this.

• Dedicate a staff member to corporate sponsorship of agency programs, events and facilities. Champaign Park District's "Partner in Parks," a corporate sponsorship program, to date has raised $115,000 for park projects.

• Hire a development officer to garner funds from nontraditional sources. This is becoming increasingly popular among park and recreation agencies. The Deerfield, Barrington and Skokie park districts are realizing success from the creative efforts of their development directors to secure funds.

• Create a "friends" affiliate organization focused on a specific district need. Homewood-Flossmoors friends group launched a "Save the Auditorium" campaign, which realized $72,000 for an important district facility.

The 501(c)3

Another popular approach used by districts across Illinois is a 501(c)3 nonprofit corporation. We know the American public is extremely generous as evidenced by the statistics on giving. Generally speaking, individuals do not like to give to government for specific causes. Many believe they give enough to government in the form of taxes.

Establishing a nonprofit corporation offers distinct advantages to the district and, in turn, to potential donors. The advantages of a nonprofit corporation include:

• Ability to focus community support for an identified mission.

• Leadership by a governing board of individuals interested in the mission, financially able to give and influential, so that others follow their lead.

• Can supply and apply their resources directly to identified purposes and provide prudent stewardship of resources.

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• Provides protection and identifies limitations established by federal law.

• Has a separate identity with an independent, accountable governance board.

• Allows assets to be protected from potential litigation against the district (a corporate veil).

• Allows gifts like cash, investments, securities, endowments, planned gift instruments (life estates, memorial gifts, trusts, and donations of land) to be managed by the corporation or its agent.

• Provides opportunities for forging new partnerships and alliances in and outside the community or district.

• Enhances the district's ability to solicit and garner community support.

• Allows donor contributions to be tax- deductible, within limits identified by the Internal Revenue Code.

Creating a nonprofit organization, however, does not automatically ensure success. When considering establishing a 501(c) 3, be aware of other considerations

• The nonprofit must have a mission that prospective donors can relate to, find of interest and wish to support.

• People do not give to causes, but rather they give to people with causes; hence, the need for dedicated and committed leadership to direct the nonprofit.

• Brick and mortar projects are very popular and successful. In contrast, fund-raising efforts to increase operating expenses often are very difficult to market.

Giving 1998: $ 174.52 Billion Note :$'s in billions Source : Giving USA 1999 / AAFRC Trust for Philanthropy

Giving 1998 Note: Percentages represent "allocated" giving and add to more than 100%. "Other" includes Environment/Wildlife, $5.25 (3.0%), and International Affairs, $2,14 (1.26%). Source : Giving USA 1999 / AAFRC Trust for Philanthropy

In Illinois, 54 park districts and forest preserves have a "Friends" group or foundation,established to benefit the mission of their organization. Some of those organizations have separate governing boards. In several cases, the district trustees are also directors of the foundation board. Not all of these supporting organizations are designated501(c)3 nonprofit corporations.

Some of the nonprofits are more successful than others. Typically, those less successful lack a focused mission or a passionate leader. Those with a limited, identified and established purpose—for

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example, a museum, nature preserve or zoo —are realizing success.

Each district or community must identify its long-term needs and the best course of action to address its future and the challenges that lie ahead. Supporting organizations, particularly a nonprofit 501(c)3 corporation, oner considerable advantages and possibly untapped sources for your district.

And what better time than this, the giving season, to consider a fund-raising program for your agency.

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