Donors make 2015 Americas most generous year ever

Charitable giving by U.S. donors in 2015 was slightly above $373 billion, reflecting a 4.1 percent increase over 2014 levels, according to Giving USA, the longest running and most accurate report on philanthropy in America.

Giving USA’s 61st annual report, released in June, shows that total estimate for 2015 broke the record set in 2014, with six of 10 nonprofit categories reflecting their highest levels ever of support by donors.

The research and writing for the report was done by faculty and staff at the Lilly Family School of Philanthropy at Indiana University, and I was a member of the editorial review board.

Lilly School representatives predict that if total giving continues to grow at the 4.2 percent it has averaged over the last two years, in a year or so inflation-adjusted levels of giving will return to the levels realized in 2007.

Total giving for 2015 was $17.68 billion above the 2007 total, a year before the Great Recession hit.

Jewish nonprofits are not specifically identified in the Giving USA report, although there are several highlights that relate specifically to Jewish entities:

1. Giving in the “Public Society Benefit” category, which historically includes giving to Jewish federations as well other “umbrella campaigns” (such as the United Way, Catholic Charities and the Combined Federal Campaign) had a 6 percent increase, but this was camouflaged significantly because of very significant support of donor-advised funds.

Giving USA highlighted that the UJA-Federation of New York campaign and Jewish Federation of Metropolitan Detroit reported very large year-over-year increases. Overall, giving to Jewish federations has declined over the past 25 years — individual donations dropped 37.6 percent (in inflation-adjusted dollars) between 1991 and 2015.

2. Individuals living and dead accounted for 80 percent of all giving, with about half of that total giving coming from high-net-worth households.

In the 2014 report, Giving USA projected that the lion’s share of the largest donors were from the technology industry, including many young Silicon Valley tech professionals. However, this was not repeated in 2015, where the majority of mega-donors were in the banking/finance, real estate or oil industries.

Among the most generous Jewish donors were Michael Bloomberg ($510 million in donations); Stefan Edlis (who directed $400 million in art to Chicago’s Art Museum); and hedge funder John A. Paulson (who gave $400 million to his alma mater, Harvard University.)

U.S. charitable giving (in billions)

3. Giving to religion, representing about one-third of all giving, is at its highest level:  $119 billion. However, gifts of $1 million plus, as reflected in the Chronicle of Philanthropy, are seldom announced and it is difficult to amass a correct listing of major gifts to U.S. synagogues.

It should be noted, however, that after a few years of pauses, prompted primarily because of the Great Recession and a concomitant recovery, that there has been a surge in capital and endowment campaigns at U.S. Jewish congregations.

Reports suggest that many congregations (Jewish and otherwise) are finally seeking bequests, especially from baby boomers. Estimates suggest that mid-size and larger houses of worship are averaging one bequest per year.

Other reports have found that faith-based organizations realized their greatest year-over-year monthly increases in overall giving in the three-month period ending in April (9.9%). Giving declined by 3.5 percent, however, in the three-month period ending in October.

4. The largest increases in giving were attributed to two categories: arts and culture and the environment and animals. In the former category, David Geffen’s $100 million gift to New York’s

Lincoln Center was perhaps the most highly publicized, but it was only one of many large gifts to cultural institutions across the nation.

5. Giving to education, and especially to higher education, grew by 8.8 percent, making this category the third-fastest growing sector out of nine that Giving USA follows. Of special optimism to Jewish day schools is the note that pre-collegiate independent schools, as a group, showed the most positive fundraising results. Finally!

6. Giving to human services marked its second consecutive year of growth in 2015, making it the sixth-fastest growing subsector out of nine. Half of human services organizations engaged in capital or special campaigns in 2015 reported campaign goals of between $2 million and $18 million. Of special note: Of all donations/gifts made online or via an app, nearly 80 percent went to human-services organizations.

7. Giving to health organizations, including disease-focused agencies and hospitals, grew very slowly. Giving to this subsector in 2015 was well below the five-year average growth rate of 5.4 percent.

Dominating this category were gifts to medical research causes, especially those focused on finding cures for cancer, pediatric illnesses and heart disease. Several years ago, researchers predicted a slower pace of giving to hospitals with the introduction of President Barack Obama’s health care law, and this prediction seems to be correct.

8. International giving attracted very strong support in 2015. This refers to organizations working in international aid, development or relief, or those that promote international peace and security.

Some gifts made for international purposes are actually counted as gifts to education, health, human services or religion. For example, “American friends” of many Israel-based institutions may have their support recorded in other categories.

Historically, international disaster relief is reflected in this category and, fortunately, the only such event was the April 2015 Nepal earthquake. Americans collectively gave $164 million.

Gifts by major foundations may also be linked in increases to giving in the international category. The Bill and Melinda Gates Foundation consistently makes massive annual gifts to this subsector; several organizations, including Google, Coca Cola and the Carnegie Endowment for International Peace, shifted their programmatic focus toward global issues.

9. Giving to foundations declined in 2015, perhaps attributable to an increase in giving by America’s wealthiest donors to donor-advised funds. Gifts in this category tend to vary considerably from year to year; often they are very large and dependent on investments. But giving to DAFs is so significant over the last 25 years that undoubtedly DAFs must be considered the most significant “new” tool donors have available.

The Giving USA report noted several other trends that deserve careful attention:

• Though online giving was not specifically tracked by Giving USA, it was noted that #Giving Tuesday and other promotional efforts continued to attract support, primarily from donors making small gifts.

• The number of nonprofits, not including houses of worship, was stagnant at about 1.2 million agencies.

• Corporate giving remained a slow-paced component of giving, falling to .8 percent of pre-tax profits, the lowest level in 25 years.

• Individual giving as a percentage of disposable personal income rose to 2 percent, reflecting that most Americans do not seem to be adopting tithing as a guideline for giving. More than 60 percent of U.S. households claim to have made charitable gifts in 2015.

• The number of volunteers in 2015 remained at approximately 62.8 million people, down from the all-time high of 2005.

A summary of the report is available for free at www.GivingUSA.org. The full report is available for purchase in different formats.

Robert Evans is founder and president of the Evans Consulting Group, located in Pennsylvania. He is a member of the Giving USA editorial review board and a board member of the Giving Institute. This piece originally appeared at eJewishPhilanthropy.com.