San Francisco Chronicle

Charities and nonprofits at risk of closing

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More than onethird of U.S. nonprofits are in jeopardy of closing within two years because of the financial harm inflicted by the viral pandemic, according to a study released Wednesday by the philanthro­py research group Candid and the Center for Disaster Philanthro­py.

The study’s findings underscore the perils for nonprofits and charities whose financial needs have escalated over the past year, well in excess of the donations that most have received from individual­s and foundation­s. The researcher­s analyzed how roughly 300,000 nonprofits would fare under 20 scenarios of varying severity. The worstcase scenario led to the closings of 38% of the nonprofits. Even the scenarios seen as more realistic resulted in closures well into double digit percentage­s.

Among the most vulnerable nonprofits, the study said, are those involved in arts and entertainm­ent, which depend on ticket sales for most of their revenue, and cannot significan­tly reduce their expenses.

The perils that nonprofits face are similar to the economic damage from the pandemic that forced so many restaurant­s to either close or operate at deep losses over the past year.

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