Despite all the distraction and noise around the 2020 election, veteran fundraiser Keith Hopkins does not think the cycle will have any effect on giving. Even so, he’s monitoring what’s going on in the economy and how the massive transfer of wealth could change what West Michigan nonprofits will need to do to attract the next generation of donors.
What’s on your mind as you look ahead to 2020?
The November jobs report exceeded expectations. The unemployment rate is the lowest it’s been since 1969 and the Dow is up 20 percent. I’m not going to say that we’re going to have a recession in an election year, but I think 2021 may be a different story. I’m anticipating a pretty strong 2020 based on what we’ve seen this year. … Locally, even if things are going poorly nationally, West Michigan tends to be much more resilient because we’re more diversified.
How are nonprofits positioned heading into the new year?
2019 was very strong. Organizations like Wedgwood Christian Services and D.A. Blodgett, which had major fundraising campaigns, exceeded their goals. Grand Rapids Community College raised over $15 million and the Grand Rapids Boy Scout service center raised over $6 million. Given that, all of the economic indicators seem to be pretty strong.
What’s the climate for nonprofit fundraising?
Because we had a change in the tax law in 2018, we’re seeing more bundling where accountants are telling their clients that, because they’re not itemizing deductions anymore, they may want to think about bundling their contributions. As an example, if my plan is to give $10,000 to my alma mater in 2019 and another $10,000 in 2020, my accountant may say, ‘Why don’t you give more in 2019?’ This is happening particularly with mid to upper-income earners.
What gives you hope about 2020 and beyond?
I really feel like we’re entering into the Golden Age of philanthropy with 10,000 Baby Boomers retiring every day now. Over the next 20 years, all of those retirees are going to be slowly dying off. That will create a giant transfer of wealth with $6 trillion to $9 trillion going from one generation to the next.
What challenges come with that next generation that’s receiving that wealth?
The younger Millennial generation … are not joining civic groups like their parents and grandparents did, and I think it’s because they’re busy. I wonder about how the younger generation is going to lead the charitable sector. Strategies will have to change. Getting their time might be more challenging than getting their attention. But I’m seeing people doing good at a younger age. When kids buy products now, they want to know how socially responsible that company is. The younger generation is much more attuned to that.
What legislation would you like to see enacted to benefit the nonprofit sector?
There’s been a big discussion around endowments. Harvard University has a $40 billion endowment, most of the Ivy League schools have endowments up in the $10 billion range. Harvard could never charge another student for tuition by using just that endowment to pay tuition for every student. The $1.6 billion in earnings from that endowment would pay for a helluva lot of tuition. Why is Harvard sitting on this when we have so many students in debt? Colleges with a really healthy endowment should spend more money to keep the debt limit low. If kids have got that kind of debt, they’re not creating economic wealth. Colleges or any organizations with really healthy endowments ought to put that money to better use.
Hope College, my alma mater, just got a new president and to his credit, he wants to turn Hope into a tuition-free college. I think it’s the writing on the wall. If we don’t do it, the government will.
What other policies do you think might pop up?
Most community foundations have donor-advised funds. Every year, I give to a fund. I could take the deduction and keep taking deductions while building that fund to the community foundation. The government should say that they require you to spend 5-10 percent of that fund each year, and that’s a potential law that could pass. A donor-advised fund is an endowment that addresses a particular issue, so rather than having the money just sitting there, why not use some of it now to make a difference.
I was driving through downtown Kalamazoo the other day and I saw homeless people outside in 20-degree weather. Could we find ways to use the money now and care for them now?
What keeps you up at night?
Fundraising keeps you up at night because it’s fundraising. One thing I always wonder about is the economy. Although it doesn’t prevent people from giving, it sometimes takes longer to get to that goal.
EDITOR’S NOTE: This story has been updated from its original version.
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