The Center for High Impact Philanthropy   April 2009 

School of Social Policy & Practice | University of Pennsylvania  Action Agenda 

High Impact Philanthropy for the Economic Downturn 

The US and the global economies are facing a contraction not seen since the Great 
Depression.  The  downturn  has  produced  much  hardship  for  those  directly 
impacted—individuals and families who have lost homes, jobs, and access to basic 
necessities.  The  government  has  responded  with  nearly  a  trillion  dollars  of  public 
financing. But no matter how well crafted and well meaning, government financing 
of this scale is too diffuse and distant to reach all those in need effectively. 

Overview   address the suffering caused by the current

Alongside government spending, there is a
critical role for private philanthropy.
Philanthropists have the ability—if they choose
to use it—to target programs, assess the cost/
benefit of actions before spending the funds, and
directly support the community organizations
engaged in alleviating and preventing the human
costs of the economic meltdown. Though
dwarfed by public financing, private
philanthropy brings a nimbleness and
responsiveness unmatched by government’s
efforts.
Unfortunately, not all philanthropic spending is
effective. Like any form of funding, private
philanthropy can fail to deliver results. Worse
yet, it can do more harm than good when not
invested wisely.
To transform good intentions into meaningful
impact, individual philanthropists require
information about what issues are most in need
of philanthropic attention, what practices and
models offer the best promise for impact, and
what costs are involved to determine where
dollars can be used most efficiently. Over the
next three months, the Center for High Impact
Philanthropy is working to provide that
information and will develop a philanthropic
investment guide for individuals seeking to
economic crisis.
 
The Needs 
 
Unprecedented rates of foreclosures and rising
unemployment have escalated need in three areas
where private philanthropists have a unique role
to play: (1) housing, (2) health, and (3) nutrition.
The foreclosure crisis that began in earnest at the
end of 2006 is triggering significant instability
among families and in communities across the
country.1The scope is vast: the Mortgage Bankers
Association estimates that 2.2 million
foreclosures were initiated in 2008 alone.2
Foreclosure can be devastating not only to the
individual household, but also to the broader
community as vacant properties corrode
property values and invite crime. Case in point:
in August 2008, nearly a third of mayors and
police chiefs in 124 cities reported an increase in
crime that appears to be a consequence of the
growing number of foreclosures.3 Based on the
examination of foreclosures in Chicago,
researchers estimate that direct municipal costs
(e.g., costs related to inspections, court actions,
police and fire department responses, unpaid
water and sewage bills, and trash removal) can
reach $34,000 per unit. Plus, an additional
$220,000 is lost in reduced property values and
home equity for the homes nearby.4

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HIGH IMPACT PHILANTHROPY FOR THE ECONOMIC DOWNTURN 
With increasing unemployment comes a
corresponding rise in the number of uninsured
Americans with limited healthcare access. It is
estimated that for every one percentage
increase in the national unemployment rate,
1.1 million more Americans will become
uninsured and join the ranks of the 46 million
Americans already without health coverage.5
Research shows that uninsured adults and
children are less likely to receive preventive
care. Such lack of preventive care will almost
certainly translate into worse health outcomes
for individuals and higher costs to society.
A particularly troubling health-related impact
is the growing number of people unable to
meet their basic nutrition needs. In March
2009, the USDA confirmed that participation
in the Supplemental Nutrition Assistance
Program (SNAP) (i.e., food stamps) had
reached a historical high: in December 2008,
about 32 million Americans received SNAP
benefits, 4.5 million more than in Dec. 2007. In
December 2008 alone, recipients of SNAP
benefits increased by 700,000 people.6 Food
banks are also seeing an increase in demand. In
a survey of its members in late 2008 by Feeding
America (a national network of food banks),
almost all member food banks (99%) reported
seeing more first-time users and were
experiencing growth in demand between 28%
and 37%. Nearly three quarters of these food
banks (72%) also reported not being able to
meet the need adequately with the resources
available to them.7  are available at no charge. Philanthropists can
 
Potential Roles for Philanthropists  representatives of legitimate nonprofits to the
 
In our preliminary conversations with funders,
policy analysts, researchers, and nonprofit
leaders, several examples have already emerged
where philanthropists are filling the gaps not
covered by government programs or funding.
THE CENTER FOR HIGH  IMPACT PHILANTHROPY   2
For example:
Helping those left out. While new initiatives
in the stimulus plan expand Medicaid coverage
for the poor and help offset the costs of
continuing health coverage (COBRA) after lay-
offs, many Americans still do not qualify for
these benefits. Located in high-need
communities and governed by community
boards, community health centers that serve
the poor and uninsured are able to provide
comprehensive, primary care services tailored
to local needs. A 2008 estimate of community
health center programs’ impact on local
economies found that for every $1 million
invested in health centers, a $6 million rate of
return can be expected, while providing
needed care for an additional 8,400 patients.8
Philanthropists can support local community
health centers to meet the growing demands
for basic health services.
Covering the “last mile”. The federal
government’s plan to prevent foreclosures
includes incentives for lenders to cut mortgage
payments for at-risk borrowers.9 However, such
incentives will have little impact if borrowers
are unaware of these options, or fall prey to
illegitimate offers of refinancing. In fact, some
estimate that more than half of those (some
estimates reach as high as 80%) who have lost
their homes never contacted their lenders,10
even though housing counselors trained to
facilitate a fair restructuring for the borrower
support “door knock” programs that send
doors of homes at risk of foreclosure. For as
little as $25 per household, these representatives
can explain these options and help homeowners
arrange meetings with housing counselors. Such
programs cover that needed “last mile” of
service delivery necessary for the success of
federal intervention.
 HIGH IMPACT PHILANTHROPY FOR THE ECONOMIC DOWNTURN 

Breaking down service silos. Sadly, the
breadth and severity of this economic crisis has
meant that more families are grappling with
clusters of problems that include legal,
financial, physical, and psychological needs.
While programs exist to address food needs,
childcare, health insurance, mental health,
joblessness, etc., too often these programs are
housed in different agencies located across the
community, with different and oftentimes
complicated eligibility requirements, and
different procedures for securing desperately
needed help. Philanthropists can break down
service silos and support single-stop
counseling centers that provide one-on-one
counselors to help low-income individuals
navigate the public benefits available to them.
A McKinsey & Company study of one such
program in New York found that for every
dollar invested, the program immediately
returned to its clients at least $3 in benefits; $4
to $13 in legal counseling; $2 in financial
counseling; and $11 in tax credits.11
A Call to Collaborative Action 
 
From now through June, the Center for High
Impact Philanthropy will examine these and
other promising models for philanthropists to
have impact. Our goal is to produce a
philanthropic investment guide that outlines
specific ways philanthropists can help.
However, our ability to produce effective
guidance relies on others joining our effort. To
that end, we invite researchers, funders,
policymakers, community leaders, and
nonprofits to respond to the ideas outlined
here and work with us to unlock the
philanthropic capital that is so urgently
needed.

About the Center for High Impact Philanthropy 
 
The  nonprofit  Center  for  High  Impact  Philanthropy  was  founded  in  2006  by  Wharton 
alumni  and  is  housed  at  the  University  of  Pennsylvania’s  School  of  Social  Policy  & 
Practice. Our aim is to provide information and tools to help philanthropists determine 
where  their  funds  can  have  the  greatest  impact  in  improving  the  lives  of  others.  With 
expertise in business, medicine, the law, and public and social policy, our team brings a 
multidisciplinary  approach,  in‐depth  knowledge  of  research  methods,  and  seasoned 
judgment to the analysis of high impact philanthropic opportunities. 

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ENDNOTES 

1
Pierce, S. (2009, February). Emerging Trends: State Actions to Tackle the Foreclosure Crisis. Na-
tional Governors Association. Retrieved April 3, 2009, from http://www.nga.org/Files/
pdf/0902FORECLOSUREREPORT.PDF
2
Mortgage Bankers Association. (2008, December 5). Delinquencies Increase, Foreclosure Starts
Flat in Latest MBA National Delinquency Survey. News Release. Retrieved April 3, 2009, from
http://www.mbaa.org/NewsandMedia/PressCenter/66626.htm; Pierce, S. (2009, February).
Emerging Trends: State Actions to Tackle the Foreclosure Crisis. National Governors Association.
Retrieved April 3, 2009, from http://www.nga.org/Files/pdf/0902FORECLOSUREREPORT.PDF
3
The United States Conference of Mayors. (2008, August 6). 2008 Economic Downturn and Fed-
eral Inaction Impact on Crime. Retrieved on April 3, 2009, from http://www.usmayors.org/maf/
documents/CrimeReport_0808.pdf
4
Apgar, W.C., & Duda, M. (2005, May 11). Collateral Damage: The Municipal Impact of Today’s
Mortgage Foreclosure Boom. Homeownership Preservation Foundation. Retrieved April 1, 2009,
from http://www.995hope.org/content/pdf/Apgar_Duda_Study_Short_Version.pdf
5
Rowland, D. (2009). Health Care and Medicaid – Weathering the Recession. New England Jour-
nal of Medicine, 360(13), 1273-1276.
6
Feeding America. (2009, March 6). Unemployment Reaches Record Levels, Food Banks Struggle
to Feed Hungry Americans. Retrieved April 2, 2009, from http://feedingamerica.org/newsroom/
press-release-archive/unemployment-rate.aspx
7
Feeding America. (2008, December 18). New Survey: Nation’s Food Banks Report Dramatic In-
crease In Demand For Emergency Food Assistance As Unemployment Rises and Economy Worsens.
Retrieved April 2, 2009, from http://feedingamerica.org/newsroom/press-release-archive/local-
impact-survey-2008.aspx
8
Shin, P., Finnegan, B., & Rosenbaum, S. (2008, February). How Does Investment in Community
Health Centers Affect the Economy? Geiger Gibson/RCHN Community Health Foundation Re-
search Collaborative. Research Brief #1. Retrieved April 2, 2009, from http://www.gwumc.edu/
sphhs/departments/healthpolicy/CHSRP/downloads/
DHP_RCHN_HealthCenterInvestmentReport.pdf
9
Tedford, D. (2009, February 18). Obama Sets $75 Billion Plan To Stem Foreclosures. NPR. Re-
trieved March 31, 2009, from http://www.npr.org/templates/story/story.php?storyId=100807505
10
Freddie Mac. (2005, December). Foreclosure Avoidance Research. Retrieved April 1, 2009, from
www.freddiemac.com/service/msp/pdf/foreclosure_avoidance_dec2005.pdf
11
Single Stop USA. What are the results? Retrieved April 2, 2009, from http://
www.singlestopusa.org/roi.html

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