GOAL: Greater Boston communities are vibrant, safe and affordable.

OBJECTIVE: Increase job growth, economic competitiveness and equity in Greater Boston.

STRATEGY: Enhance the long-term vitality of the Massachusetts nonprofit sector.

Problem & Key Data
The nonprofit sector provides tremendous civic, social and economic value to Massachusetts, making up 14% of the State’s workforce, generating $87B in revenues and holding $207B in assets in 2007 (Passion and Purpose, The Boston Foundatiion, June 2008):

• The sector has doubled in size over the past 18 years; however, the growth in revenues has not kept pace with the growth in numbers:
  • Number of organizations have grown at an annual rate of 6.3%, revenues have grown at rate of 1.3%, and expenses have outpaced revenue growth at 2.1% annually.
    
    
• Fiscal health of nonprofits is further deteriorating with the economic climate:
  • In 2003, more than 40% of nonprofits showed a deficit and roughly 1/3 had less than 30 days of cash on hand.
  • A national survey of nonprofits indicates philanthropic funding is projected to be down in FY2010 and FY2011.
  • Massachusetts revenues were down $2B in FY2009 and are projected to be flat in FY2010.
    
    
• Lack of visibility and understanding of the nonprofit sector results in public policies and government revenue cutbacks that weaken the sector:
  • Government contracts do not cover the full cost of services.  In FY2009, Massachusetts nonprofits experienced 9-C cuts for services totaling $700M;
  • FY2010 projections show a $1.5B increase in the cost of services due to inflation and an increased case load.
    
    
• Lack of investment in the capacity building of nonprofits results in weak financial and leadership capacity, which affects the ability of nonprofits to succeed:
  • Philanthropic funders and individuals favor program funding over capacity building and general operating support.
  • In 2007, 6,000 nonprofit sector employees surveyed reported that while 1 in 3 aspired to lead a nonprofit organization, only 4% viewed themselves as being groomed for executive roles.
  • In 2002, the Annie E. Casey Foundation reported that 15%-35% of nonprofit executives planned to leave their current jobs within two years, while 61%-78% planned to leave within 5 years.

Approach:
Nonprofits provide three distinct values – creation of a civil society, a safety net for the Commonwealth’s residents, and economic value/competitiveness. Their strength and vitality is critical to the healthy growth of the region and its residents.

While the Foundation’s grantmaking and other tools help to support the social impact and overall strength of a subset of nonprofit organizations, the Foundation also works to influence issues related to the broader sector (e.g., the Foundation’s Passion and Purpose report on the fiscal health of Massachusetts nonprofits, and its support of the creation of the Mass Nonprofit Network).

The wealth of information and data about the nonprofit sector suggest the following productive avenues for ensuring superior performance of nonprofits and needed investments in the sector to improve regional competitiveness and equity:

1. Improve performance and impact by building the leadership and management capacity of Greater Boston nonprofits, which account for more than 37% of the state’s 990 filing nonprofits.
2. Promote and support collaborations and mergers among nonprofits to increase efficiency, improve effectiveness and promote innovation.
3. Improve the visibility/awareness of the MA nonprofit sector among policy makers through research, convening and advocacy.
4. Improve incentives and benefits for MA nonprofit workforces in order to attract and retain talent.

Desired End State

• of the approximately 3,000 Greater Boston nonprofit organizations filing IRS form 990 will have leaders credentialed in nonprofit management by 2014
• At least 30% of nonprofits have received technical assistance or attended workshops provided by TBF by 2014
• Increase # of completed mergers/ alliances in the nonprofit sector
• Nonprofits show evidence of a better match between their revenues and expenses
• Policy makers have a greater appreciation and understanding of benefits provided by nonprofit sector

Download a PDF of the new strategic framework.