First Look

Donations to Red Cross plunge: Typical ebb and flow or sign of lost faith?

The humanitarian relief organization saw donations fall by nearly a third in the past year, according to the latest charitable giving survey conducted by The Chronicle of Philanthropy.

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    A member of the American Red Cross distributes food to residents of Coney Island affected by superstorm Sandy in New York, Nov. 9, 2012. A year after receiving huge sums to respond to Superstorm Sandy, the American Red Cross experienced a 32 percent drop in charitable donations in 2014.
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The American Red Cross experienced a 32 percent drop in donations over the past year amid growing competition from newer nonprofits.

The organization’s rank among the nation’s best-supported nonprofits fell from ninth to 21st place in an annual survey released Thursday by The Chronicle of Philanthropy – its lowest position since the survey began in 1991.

United Way’s $3.87 billion in private donations for the 2014 fiscal year ensured its place in the top spot of the Chronicle’s survey for the ninth year in a row. Fidelity Charitable Gift Fun, a Boston-based donor-advised fund, came in second with $3.85 billion.

The Red Cross ranked second in the survey as recently as 2007. It received almost $3 billion in donations after hurricane Katrina in the 2006 fiscal year.

Donations surged again after superstorm Sandy. Suzy DeFrancis, chief public affairs officer for the Red Cross, said the organization received $307 million in 2013 in response to the massive storm. Its total contributions, which totaled about $1.08 billion that year, fell to $734.6 in the 2014 fiscal year.

While the most recent fiscal year saw its share of natural disasters – from raging wildfires in the west to tornado outbreaks across the Great Plains – none were on the same scale as Sandy or Katrina.

"The American Red Cross is an organization that responds to disasters so our contributions fluctuate depending on the disasters that take place in a given year," Red Cross spokeswoman Jeanne Hamrick said in a statement to the Monitor. "We typically receive a large influx in donations after large disasters such as Sandy or Katrina, and we don’t expect to maintain those higher levels of giving in years without catastrophic disasters."

She added that the difference between 2013 and 2014 donations appeared particularly stark because they had surged so high in direct response to Sandy.

Criticism for the organization’s slow response to Sandy and inadequate anti-fraud measures in the aftermath of Katrina also could have hampered donations.

So too could the newer generation of nonprofits that is outpacing long-established charities such as the Red Cross and United Way, said Stacy Palmer, editor of The Chronicle of Philanthropy. Even though United Way remained in first place in the latest rankings, its donations were virtually the same as the last fiscal year.

Meanwhile, the Silicon Valley Community Foundation, launched in 2007, boosted its private support by more than 40 percent from 2013 to 2014, from $1.38 billion to nearly $1.97 billion.

"There's a question as to whether the big legacy organizations are attracting new and younger donors," said Ms. Palmer, adding that some young donors are seeking to support charities with sharply focused missions instead of those with a broad range of priorities and commitments.

The American Red Cross ranked sixth in The Christian Science Monitor’s most recent “Guide to Giving,” a list of the top 50 charities.

This report includes material from the Associated Press.

[Editor's note: This article has been updated to include a statement from the Red Cross.]

 
 
 

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