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Spare Change?: Local non-profits cut back as donors tighten their purse strings 

Local non-profits cut back as donors tighten their purse strings.

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On the final day of business at the Working Wonders Children's Museum, Jason Friedman watched his two sons intensely engaged in their tactile experiences. The 15-month-old, Levi, squeezed the mysterious substance "moon sand" into a ball, then crushed it gleefully. Five-year-old Maxwell ran around dressed up like a firefighter, role playing with other kids in costumes.

"All this realistic setting is very healthy for brain development," Friedman said. "The kids can learn to be builders, veterinarians, chefs. It's hard to recreate that at home."

With Working Wonders closed, parents now have to find other places for their children to play. And there's nothing else quite like the museum here: a hands-on environment where kids could immerse themselves in "exhibits" such as grocery stores, veterinarian offices or foreign countries.

Working Wonders, a recent casualty of the economy, relied heavily on the local development and real estate industry, which was flourishing when the nonprofit museum opened five years ago. As that industry dried up last year, so did its ability to give. Working Wonders' viability vaporized.

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Working Wonders isn't the only one hurting. The recession has bulldozed the bank accounts of all kinds of granting foundations, businesses and individuals, whose charitable giving has financed nonprofit groups that provide social services, support the arts and protect the environment.

Portland-based Grantmakers of Oregon and Southwest Washington, a group that aims to inspire and assist philanthropy, surveyed funders earlier this year.

"At that time, funders' assets were down 25 to 40 percent and nonprofits were doing what they could to reduce costs without sacrificing their mission. Everypart of the nonprofit community has been impacted - health and human services, education, arts etc. No one has escaped," said Joyce White, the executive director of Grantmakers.

Nonprofits that are not outright starving are at least getting leaner. They use staff more efficiently and market themselves better. Some groups reduced employees' hours, some laid off staff. Some downsized offices. Others shuttered doors.

And it's not supposed to get better any time soon.

"The predictions for 2010 and 2011 are grim. Most of us in the philanthropic community - either foundations or corporate giving programs - anticipate the next two years will be tough," said White.

And it might even be tougher for nonprofits in Central Oregon than those in more metropolitan parts of the state, said White. There are fewer funders in smaller communities, White said, and Bend's economy is not diversified enough to maintain all of its once-vibrant nonprofits now that the development and real estate cash cow has died.

After the natural resource industry faded out, the construction industry filled in the void - perhaps too well - and Bend's rapid growth and reputation as a Western boomtown was well documented.

But since development and real estate have gone bust, unemployment rates in Central Oregon - hovering around 15 percent - have risen even higher than the state and national average. Food banks and homeless shelters are busier than ever. It didn't take long for the collapse of the industry to ripple into the world of government and non-profits. Just as in the private sector some business have been hit harder than others, but no one has escaped the fall out.

Some donors have a specific mission, such as supporting the arts, and will continue to do so, albeit at reduced levels. But others have to make a choice about where to spend their dwindling assets. And in a time of crisis, the choice can be clear.

"I'd say that people are probably looking to invest more in real critical needs," White said. In a recession, experts say, often the social services fare best, the arts fare worst, and the environment falls somewhere in the middle.

"We're not food, clothing or shelter," said John Furgurson, a founding member of Working Wonders and board vice president. He gets that. But, "That doesn't diminish the need for Working Wonders."

For Working Wonders, according to Furgurson, a number of factors led to its closing:

First: "Our donor base was made up predominantly of businesses and individuals in the building and development industry," Furgurson said. "Funding from those companies evaporated. Donations fell off last year completely."

Second: The organization's youth hurt its ability to get grants from organizations that like to see stability and longevity in a nonprofit, he said. Bittersweet, he said, because they were just getting there.

Finally: General fundraising was tough. The museum couldn't get sponsors to underwrite an annual fundraising gala that could bring in $75,000.

About 40 percent of its $475,000 annual budget came from admissions fees - solid, but not enough to stay open. In past months the board tried cutting staff, renegotiating the lease to lower its overhead, scaling back some operations. But in the end, board members saw what was coming and wanted to quit while they were ahead.

"In the nonprofit world so many people want to do so many good things," Furgurson said. "So many thrived during the economic tidal wave. Now there's a smaller pool of money to distribute among so many."

Over the past 10 years charitable organizations registered in Oregon jumped from about 10,700 to 15,220, according to the state Department of Justice.

In an attempt to remain viable, one of the younger organizations here, independent film festival organization BendFilm, eliminated staff. It moved into a smaller, $1,000-cheaper office, is foregoing its sit-down awards dinner party and will no longer fly filmmakers here for the festival - the latter two of which organizers once touted as marquee elements of the festival.

"If you go back to the boom years, it's a very different thing," said Terri Mintz, director of operations, and the only full time staffer left. But Mintz said all that matters now is keeping BendFilm alive.

It isn't just arts organizations that have felt the pinch. Last year, staying alive was questionable for the local Boys and Girls Clubs of Central Oregon, which provides programs for children during after-school hours and on holidays while parents are at work. The clubs started here in 1995, and in five years rapidly grew throughout the region.

Governmental funding decreased over the past three years, said Lisa Burbidge, the organization's president. Foundation funding dropped in 2006, and decreased steadily since. Madras and La Pine branches shuttered in 2006 and 2007. In 2008, corporate backing tanked. Warm Springs and Prineville clubs closed in mid-2008.

At the height of the funding drought in late 2008, the organization abruptly closed all of its remaining four locations in the Bend and Redmond areas for the month of November and put out an urgent call for donations.

"That was absolutely devastating to my family and so many others," said Kimberly Peterman, mother of Aspen, 12, and Skyler, 9, who have been members of the downtown club since 2006.

During last November's temporary closure, a handful of staff remained to develop plans and raise money. But the organization's expected revenue for 2009 is down 25 percent from 2008 revenue, and Burbidge.

Peterman lives with fear that it'll close down again.

Burbidge said the organization is diversifying its donor base from the once-powerful real estate and development industries. It also recently started a BINGO hall in Redmond which has some potential to raise some cash, Burbidge said. Besides general streamlining and reorganizing, other efforts to stay alive included laying off seven employees, using more part time staff to save costs, and asking parents to pay $50 a month, up from no monthly fee. Some scholarships are available.

Peterman counts herself lucky; She can afford the extra charge - albeit with some sacrifices. In addition to a paycut at her job as a payroll processor, the extra expense squeezes her budget further. Her family now skips movies and dining out. They lower the thermometer at home to trim utility bills.

"I'll do whatever it takes," she said. She wants her kids to remain at the Boys and Girls Club because the programs and staff are phenomenal, inexpensive and convenient, she said.

Organizations that planned for the long term have fared a little better.

Deschutes Land Trust, a land conservation organization here since 1995, has a unique survival strategy. It has ensured its own capacity to "weather the storm" by establishing endowments to create ongoing support for its various projects - generally land acquisitions saddled with conservation easements.

"We have a continuing obligation to these properties," Brad Chalfant, a Land Trust founder and executive director since 1997. "We'll continue to manage the lands that we've got."

But that's a far cry from saying things are good. The Land Trust has a steady membership but recently lost large amounts of donations from individuals, Chalfant said. The loss of support from the development industry was painful, he said, and the organization has dipped into its reserves.

All eight Land Trust employees' hours were slashed 15 percent. On the cusp of big projects: land conservation for the return of salmon and steelhead, and projecting a massive swath of land west of Bend known as the Skyline Forest, the Trust didn't want to cut any staff whose valuable, institutional knowledge would be needed to finish what they started.

"These are people who have sacrificed other careers and other work to work in a field that doesn't pay all that well because they believe in what we do," Chalfant said. "To then take a further cut is pretty painful. That said, everyone understands the economic situation. I think people are still glad to have a job."


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