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Survey Says Gifts to Big Charities Down for First Time in 12 Years

Economic troubles and post-9/11 fatigue factor into the 1.2% decline in 2002. The Red Cross bumps the Salvation Army out of first place.

October 27, 2003|From Associated Press

WASHINGTON — Contributions to the largest charities fell in 2002 for the first time in a dozen years because of the troubled economy and uncertainty among donors, a survey finds.

Donations to the 400 largest charities dropped 1.2% last year, to $46.9 billion from $47.5 billion in 2001, according to the Chronicle of Philanthropy's annual survey released today. During the previous five years, donations increased an average of 12% a year.

"This economic downturn has just had so many twists and turns that donors aren't feeling very certain about the future, so they aren't as willing to give," Editor Stacy Palmer said. "As donors are feeling more pinched, charities are feeling it too."

She said the growing number of charities also contributes to the decline, as more organizations compete for donations. In response to the hard times, some charities are changing the way they raise funds, adding staff and sponsoring events to attract donors.

For the first time in a decade, the Salvation Army -- with nearly $1.4 billion in contributions -- slipped from the top spot, the survey said.

A surge in giving prompted by the Sept. 11 attacks pushed the American Red Cross from ninth to No. 1 last year. With $1.1 billion given to the Red Cross' Sept. 11 fund, the organization's donations totaled more than $1.7 billion.

Charity officials have said their task in 2002 was complicated by many challenges: the waves of layoffs, the stock market plunge, the erosion of trust in some institutions and donor fatigue after the response to the attacks.

Gifts to the top 400 charities accounted for nearly a fifth of the $241 billion given to all U.S. charities last year. Nearly 90% of donations come from individuals, Palmer said, with the rest from foundations and companies.

The survey's annual statistics, which cover private donations and not government contributions, are adjusted for inflation.

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