1. North Dakota State University, IACC Room 424, P.O. Box 6050, Dept. 8000,Fargo, ND 58108-6050 - Phone: (701) 231-8621 : http://www.ndsu.edu/sdc The Impact of the Nonprofit Sector in North Dakota: Challenges and Opportunities Dr. Richard Rathge Professor and Director North Dakota State Data Center Nonprofit Conference Economic Challenges: Anticipating Change Fargo, ND March 5, 2009

2. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 2 Presentation Objective: 1. To present demographic challenges facing ND’s nonprofit community. 2. To offer a contextual overview of the nonprofit community within the state. 3. To present key findings from an impact assessment of the nonprofit sector in ND and address opportunities.

3. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 3 Key Population Trends 1. Population consolidation 2. Rapidly shifting age distribution 3. Shifts in household composition This means who we serve and where we serve them is changing

4. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 4 Population North Dakota’s population peaked in 1930 at 680,845. The July 1, 2008 population estimate for North Dakota totaled 641,481, an increase of 3,577 persons from 2007. Source: U.S. Census Bureau, Decennial Census and the Population Estimates Branch, http://www.census.gov/popest/estimates.php

5. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 5 North Dakota Cass County McIntosh County 40 similar counties 4 similar counties

6. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 6

7. 7

8. 8 N.D. Rural-Urban Population Distribution, 1900-2020 Source: U.S. Bureau of the Census, Decennial Censuses.

9. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 9 North Dakota City Size: 2000 Chart taken from the May 2002 Issue of the Population Bulletin, published monthly by the North Dakota State Data Center (Vol. 18, No. 5). Source: U.S. Census Bureau, Census 2000.

10. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 10

11. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 11 A Maturing Age Distribution, 2000 (National data) 14121086420 14121086420 Population (in millions) Source: U.S. Census Bureau, International Data Base. 85+ 80-84 75-79 70-74 65-69 60-64 55-59 50-54 45-49 40-44 35-39 30-34 25-29 20-24 15-19 10-14 5-9 0-4 Male Female

12. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 12 A Maturing Age Distribution, 2020 Male Female 1412108642014121086420 Population (in millions) Source: U.S. Census Bureau, International Data Base. 85+ 80-84 75-79 70-74 65-69 60-64 55-59 50-54 45-49 40-44 35-39 30-34 25-29 20-24 15-19 10-14 5-9 0-4

13. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 13 Baby Boomers enter system 1.825 million/yr or 5,000 a day (on average) Baby Boomers enter age 85 Source: Older Americans 2004

14. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 14 Persons Ages 65 and Older as a Percent of the Total Population in North Dakota by County: 2000 Source: U.S. Census Bureau, Census 2000

15. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 15 Persons Ages 65 and Older as a Percent of the Total Population in North Dakota by County: 2020 Source: North Dakota State Data Center, North Dakota Population Projections: 2005 to 2020, Sept. 2002

16. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 16 2000 Census – Rural and Urban Population Distributions by Age and Gender for North Dakota Traditional Babyboom X Generation Y Generation

17. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 17 Population of Persons Ages 0 to 9 and Ages 65 and Older North Dakota: 1890 to 2020

18. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 18 North Dakota Public K-12 Enrollment, 2004-2006 and 2008-2016 Projections Source: ND Department of Public Instruction

19. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 19 Change in North Dakota’s Labor Force by Age: 1970 to 2020 Note: The change in labor force participation was calculated for 2010, 2015, and 2020 by applying the 2006 ACS labor force participation rates to the population projections. Sources - U.S. Census Bureau: 1970, 1980, 1990 and 2000 Census; 2006 ACS. North Dakota State Data Center: North Dakota Population Projections by Age and Gender: 2010, 2015, 2020

20. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 20 Households by Type

21. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 21 Household Types

22. Poverty Rates in North Dakota by County: 2007 Nearly 12 percent of North Dakotans had family incomes that fell below the federal poverty thresholds in 2007. Prepared by the North Dakota State Data Center. Source: U.S. Census Bureau, Small Area Income and Poverty Estimates, www.census.gov/hhes/saipe

23. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 23

24. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 24 Nonprofit Community in ND & MN 1.Distribution of nonprofits 2.Characteristics 3.Charitable giving North Dakota Association of Nonprofit Organizations Minnesota Council of Nonprofits (Jon Pratt)

25. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 25 Number of Charitable Nonprofits in North Dakota, 1996-2006 Source: National Center for Charitable Statistics, Urban Institute

26. Number of Minnesota Nonprofits North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc Source: Minnesota Council of Nonprofits

27. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 27 Expenditures and Assets of Nonprofits in North Dakota, 1996-2006 Source: National Center for Charitable Statistics, Urban Institute

28. Expenditures by Minnesota Nonprofits North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc Source: Minnesota Council of Nonprofits

29. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 29 Registration of North Dakota Nonprofits in 2006

30. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 30 Distribution of Expenditures of Nonprofits in North Dakota, 2006

31. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 31 North Dakota Employment in the Nonprofit Sector by Activity Area; 2004 Paid employment 12.5% of ND workforce Additional 2.3% unpaid full-time equivalents or 9,000 workers In thousands

32. Statewide Nonprofit Employment North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc Source: Minnesota Council of Nonprofits

33. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 33 501(c)(3) Public Charities in North Dakota by County: 2007 The first number in each county represents the total number of 501(c)(3) public charities reported for that county. The second number, in italics, represents the July 1, 2007 population estimate for that county. Sources: The Urban Institute, National Center for Charitable Statistics, NCCS Core File (Public Charities, circa 2007) and the U.S. Census Bureau, Population Division, Population Estimates Program.

34. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 34 North Dakota Nonprofits by Field, 2006 Source: National Center for Charitable Statistics, Urban Institute

35. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 35 North Dakota Foundations, 2006

36. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 36 Average Charitable Contribution from Tax Filer who Itemized Deductions, 2006 (80% of ND taxpayers did not itemize)

37. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 37 Percent of Income Contributed by North Dakota Taxpayers, 2005

38. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 38 Estimates of North Dakota Charitable Giving, 2001-2055

39. Challenges Minnesota organizations are experiencing due to recession Source: Minnesota Council of Nonprofits Member Survey, 2008 North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc

40. 40 Nonprofit Sector Study Methods and Approach Examined North Dakota’s top 100 public charities & 66 foundations Used IRS records (Form 990) Developed financial performance measures Fiscal Mission Sustainability

41. Key Findings 1. Resources highly concentrated 2. Management & general expenses high 3. Financial performance measures mixed Modest changes in approaches combined with partnerships can have high value impact on the nonprofit sector in North Dakota. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 41

42. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 42 Concentration of wealth among North Dakota’s Top Public Charities: Assets vs Number, 2007 Assets Number Top 10% of public charities account for 59% of total assets 65% of total revenues 66% of total expenses

43. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 43 Impact of Potential Changes Develop collaborative structure to leverage resources Skills building Fundraising Marketing Capacity building Consider: if the 10 largest charities redirected 1% of expenses to collaborative support, the amount available for leveraging would be $16,076,688. (This is equal to total revenues for the smallest 141 nonprofits in ND.) Note: 1% redirection for foundations = $127,839, (which would cover all revenues for the smallest 45 nonprofits).

44. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 44 Distribution of Expenses: ND Top Public Charities Management and General Expenses among North Dakota Top Public Charities Average Management & General Expenses = 12.4% of total expenses 35% of top public charities have a rate above 15% of expenses 18% of top public charities have a rate above 20% of expenses Average rate for foundations = 26% of total expenses

45. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 45 Impact of Potential Changes Reduce management and general expense and redistribute to programming or collaborative leveraging Consider: if top public charities whose management & general expenses exceed 20%: reduced their rate by 5%, the savings would be $1,549,408 reduced their rate by 10%, the savings would be $3,098,817 If foundations whose management & general expenses exceeded 26%: reduced their rate by 5%, the saving would be $151,624 reduced their rate by 10%, the saving would be $303,266

46. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 46 Financial Performance Mixed 48% of public charities in our sample are financially weak. Health care and human services have the lowest scores. Largest charities (above $10 million) had the lowest scores Fiscal Performance Mission Performance Fewer than 10% of charities dedicate less than 70% of expenses to programming. Many charitable nonprofit rely heavily on program payments relative to contributions for revenues. Sustainability Performance Uniformly high among public charities.

47. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 47 Impact of Potential Changes Skills training and capacity building can strengthen nonprofit’s financial performance What is needed? 1.Funds to assist nonprofits in capacity building 2.Online resources that make location irrelevant 3.Fundraising training to expanding contribution revenue sources 4.Collaborative forums to assist nonprofits in all aspects of their program 5.Leadership skills training

48. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 48

49. North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - URL: http://www.ndsu.edu/sdc 49 Nonprofit Presentation 2009 Dr. Richard Rathge, Director North Dakota State Data Center, Fargo, ND NDSU, IACC 424, Fargo, ND 58108-6050 Richard.Rathge@ndsu.edu Phone: (701) 231-8621 Fax: (701) 231-9730 URL: www.ndsu.edu/sdc