While total estimated charitable giving edged up by 3.8 percent compared to 2009, gifts to churches and religious organizations actually declined when adjusted for inflation.

Philanthropy toward other human services groups, like those that sought funds for the Haiti earthquake disaster, fell even more, registering a 1.5 percent decline when adjusted for inflation.

The latest information on charitable giving is out, courtesy of the Giving USA Foundation. Their “GivingUSA 2011:

The Annual Report on Philanthropy for the Year 2010” is an invaluable tool for those interested in charitable giving, including churches and religious institutions.

Here are the charitable giving recipients who benefited from the rise in giving (subtract approximately 1.6 percent to adjust for inflation):

—      Educational institutions up by 5.2 percent

—      Foundations up by 1.9 percent

—      Health research and organizations up by 1.3 percent

—      Public-society benefit causes up by 6.2 percent

—      Arts and humanities up by 5.7 percent

—      International affairs up by 15.3 percent

Here are the losers in charitable giving in 2010:

—      Religious groups and organizations at 0.8 percent (adjusted for inflation: down by 0.8 percent)

—      Human services at 0.1 percent (adjusted for inflation: down by 1.5 percent)

—      Environmental and animal causes at 0.7 percent (adjusted for inflation: down by 0.9 percent)

Trends in how people give are also in flux. While charitable giving as a whole was up 3.8 percent, individual giving was up by only 2.7 percent, meaning that the 10.6 percent rise in corporate giving raised the overall average in giving significantly.

But giving by foundations is actually down 0.2 percent, which may reflect a poor return on endowments, or a drop in giving because many foundations would come under the categories of human services, environmental and animal causes, or religion.

What does this mean for small churches in particular? While overall religious institutions claim the largest piece of the charitable giving pie at 35 percent of total giving, contributions to religious groups are not rebounding at the same rate as education, the arts and international affairs giving.

Based on the demographic that church memberships tend to be older than the population as a whole, the failure of religious giving to recover might reflect the continuing poor returns on investments held by many older adults.

But I believe that the continuing decline of religious institutions, churches in particular, also means that there are fewer people to give to support churches and their ministries.

To address this problem and to qualify for gifts from foundations and even government programs, many churches have formed not-for-profit corporations under which they fund and run their programs designed to benefit the common good.

Some churches will have ideological difficulties in making that leap, but other churches that have successfully done so can serve as models.

The good news for churches in all of this is that charitable bequests are up 18.8 percent.

Your church might consider doing what ours has just done – establish an endowment fund and encourage your members to leave a bequest to the church in their will.

You will need to consult estate-planning professionals to help your church craft a program that will ensure benefactors that their money will be handled carefully to ensure the long-term viability of the congregation they love.

But, with careful planning, churches can take advantage of this trend in charitable giving.

Chuck Warnock is pastor of Chatham Baptist Church in Chatham, Va. He blogs at Confessions of a Small-Church Pastor, where this column first appeared. 

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