The Great Recession was tough enough on many nonprofit organizations, as donations declined due to Americans having less money to donate. But adding to the misery of groups like Goodwill, the Boys & Girls Clubs of America, the American Red Cross, homeless shelters, food banks and others was the inability of government agencies at the federal, state and local level to make timely payments to nonprofits.

 

A study by the Urban Institute found that about 33,000 nonprofits were under contract in 2009 with the government. Sixty-eight percent reported having trouble collecting all the money owed to them by public agencies, and 76% complained about bureaucratic procedures being too complex and time consuming. Fifty-three percent said they were paid late.

 

By the end of 2009, 42% of nonprofits were struggling with budget deficits, causing salary freezes, pay cuts and layoffs.

-Noel Brinkerhoff

 

Human Service Nonprofits and Government Collaboration Findings from the 2010 National Survey of Nonprofit Government Contracting and Grants (Urban Institute) (pdf)