Human Service Nonprofits and

Government Collaboration:

Findings from the 2010 National Survey of Nonprofit-Government

Contracting and Grants

The Urban Institute

Center on Nonprofits and Philanthropy

The National Grants Partnership

October 19, 2010

Katie L. RoegerThe Urban Institute

The Study

The Urban Institute

First national survey on nonprofit human service providers and impact of government contracting and grant policies

Funded by the Bill and Melinda Gates Foundation A collaborative project between the Urban

Institute’s Center on Nonprofits and Philanthropy and the National Council on Nonprofits

Key Questions

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Scope of Government Contracting Number of organizations Number and types of contracts Contract requirements and reporting outcomes

Problems Late payments Changes in contracts

Recession Deficits Declines in revenue Actions or measures taken

The Sample

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All 50 states and the District of Columbia Examples of direct human service providers

Crime and legal-related Employment Food, agriculture, and nutrition Housing and shelter Public safety Disaster preparedness and relief Youth development Human services multipurpose

Size and Scope of Contracting

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33,000 human service nonprofits have government contracts and grants

Single largest source of funding for 60 percent of nonprofits

Report over $100 billion dollars worth of contracts and grants 65 percent of total revenue in 2009

Nearly 200,000 contracts and grants Average 6 contracts

Half contract with federal, state, and local government agencies

Contract Types & Requirements

The Urban Institute

Matching or sharing of costs 54 percent of human service nonprofits

Limits on program administrative costs 62 percent of human service nonprofits

Limits on organization/general administrative costs 58 percent of human service nonprofits

Reporting requirements 89 percent report on results, outcomes, or impacts

Problems with Contracts

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Five key problems reported for government contracts and grants Insufficient payments Late payments Changes to existing contracts Complexity of/time required for applying Complexity of/time required of reporting

Problems with Contracts

The Urban Institute

42%

25%

24%

32%

29%

31%

39%

39%

24%

24%

26%

37%

37%

44%

47%

Late payments (beyond contract specifications)

Government changes to contracts/grants

Complexity of/time required by application process

Complexity of/time required for reporting on grants/contracts

Payments do not cover full cost of contracted services

Not a problem Small problem Big problem

2009 Experience Compared to Prior Years

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About the same, 64%

Better, 5%Worse, 31%

Human Service Nonprofits and the Recession

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47%43%

40%42%

$100,000–$249,999

$250,000–$999,999

$1 million ormore

Overall

Percent of Organizations with Deficits in 2009

Declines in Revenue

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Nationwide Nonprofits Experiencing Declines in Revenue

Local government agencies 49State government agencies 56Federal government agencies 31

Individual donations 50Private foundations 53Corporate donations 59

Investment income 72

Revenue Source Percent

Actions Taken

The Urban Institute

21%

22%

23%

38%

39%

50%

Reduce number of programs or services

Borrow funds or increase lines of credit

Reduce health, retirement, or other staff benefits

Reduce number of employees

Draw on reserves

Freeze or reduce employee salaries

Recommendations

The Urban Institute

• Standardize and simplify application• Implement prompt payment processing• Formal feedback mechanisms for obtaining

information on how well practices are working

• Collect and report data – Practices– Impact on nonprofits