The past few weeks of policy changes from the Trump administration have been fraught and nerve-racking for the staff at Better Tomorrow, a nonprofit in Steamboat Springs, Colo., that helps provide services to a range of vulnerable groups, including domestic violence survivors, abused and neglected children, and LGBTQ youth.
“When Trump announced the executive order, ordering the spending freeze, we were devastated,” said Lauren Hughes, director of development for Better Tomorrow.
The organization has 11 staff members and a budget of $1.5 million. It serves as an umbrella agency for four programs operating in Routt County, which has a population of about 25,000 people and a median household income of $83,400. The four programs under Better Tomorrow are Advocates of Routt County, Brighter World Child Advocacy Center, COMMA Projects, and Queer Futures. About 25 percent of Better Tomorrow’s budget is federal money, which might not seem like a lot but is critical to the organization’s work, Hughes said.
“We are in an isolated and rural region within our state with no other agencies able to provide the services we do,” she said.
In the month since the Trump administration rolled out the federal funding freeze (now-rescinded) and executive orders prohibiting funding for diversity, equity, and inclusion programs, Better Tomorrow has begun considering the consequences of operating without government support, according to Hughes. The possibilities include downsizing staff and getting rid of programs entirely, she said.
Better Tomorrow has publicly committed to redress disparities due to racial, ethnic, gender, and other forms of historic discrimination. Staff now worry that the organization could be targeted because of the administration’s opposition to DEI programs. The relationship between Better Tomorrow and the Queer Futures program (which does not receive government support) could jeopardize federal funding for the other programs Better Tomorrow supports, Hughes added.
Across the country, other nonprofit leaders are similarly reeling from the sudden policy shifts and massive layoffs at federal agencies where they had longstanding staff contacts. While the federal funding freeze was reversed and the order to end federal contracts to groups promoting DEI halted by a Maryland state court, some nonprofits say they are still seeing federal grants and contracts paused or canceled.
The Trump administration also continues to send strong signals that it plans to alter the relationship between the federal government and nonprofits in ways that could have a significant and long-lasting impact on the sector. Last month, Trump directed federal agencies to investigate “nongovernmental organizations” and suggested that many are engaged in programs that “actively undermine the security, prosperity, and safety of the American people” — a move that has further heightened concerns about future funding cuts.
Data from a nonpartisan think tank tracking the impact of the changes show much of the sector would be on the brink of collapse if federal funding were discontinued. In every state, 60 to 80 percent of nonprofits that receive federal funds would struggle to cover their expenses without that money, according to data collected by the Urban Institute. Nationwide, 103,475 nonprofits received more than $267 billion in government grants in 2021, the institute said.
Separately, nearly 70 percent of 585 nonprofit leaders told the Center for Effective Philanthropy that the results of the November elections were affecting their work. More than 60 percent said they expected ripple effects from changes at the federal level to affect their future state and local funding levels, according to a survey released by the center Wednesday. About half of the leaders also said they worried about heightened political divisions, with 40 percent noting concerns about the safety and well-being of their staff and the communities they serve.
CEP has been conducting surveys through its Nonprofit Voice Project since 2012. This particular survey yielded the highest response rate ever, which speaks to the urgency nonprofits feel to speak out about what is happening in their organizations, said Elisha Smith Arrillaga, CEP’s vice president of research.
“I think one of the most disappointing things about this attack on nonprofits is that nonprofits really stand in the gap for communities everywhere,” she said.
“This data and a lot of the quotes highlighted the kinds of work that nonprofits are doing. They’re supporting aging populations, they’re supporting the homeless, they’re working in partnership with schools, they’re part of local churches and synagogues. They’re providing all sorts of needed services.”
One leader told CEP that “the current administration has essentially deemed the work of social justice, health, and human services unworthy of federal support. My employees and I feel defeated and fearful of our futures.”
Need for Private Funding
All of the nonprofits included in CEP’s survey received funding from at least one foundation that gives $5 million or more in grants to various groups annually. Many said they wanted to see funders do more to help fill gaps, a plea made by many nonprofit leaders since the Trump administration started rolling out executive actions in January.
At the time the survey information was gathered (February 3-21), most nonprofit leaders told the center they had not yet heard from many of their private funders about how they planned to respond to the current political environment. The number of communications seem to have increased since then, CEP said. The John D. and Catherine T. MacArthur Foundation and Freedom Together Foundation are among the organizations that have recently announced plans to increase their annual payouts in response to policy changes.
Nevertheless, nonprofits continue to feel anxious and want to hear more from funders about their future grant-making commitments, according to the report. Specifically, nonprofits said they wanted to learn more about funders’ views on the political environment and whether they understand how communities have been and may continue to be affected.
“Advances for increased equity for people of color in education, health, voting rights, and economic opportunity are being rolled back,” a nonprofit leader told CEP. “Our communities are under attack and, frankly, it doesn’t feel like philanthropy is that alarmed.”
Hughes said there was a similar sentiment among staff at Better Tomorrow.
“I am not sure how we are going to persevere for another 47 months, but we’re dedicated to continue serving our communities in need and will need donors to step up and answer the call.”
The Freedom Together Foundation is a financial supporter of the Chronicle of Philanthropy.
