Director’s Blog: The Arboretum’s Funding
As a nonprofit the Dawes Arboretum receives no federal, state or local tax revenue in support of its operations. The funding for the Arboretum comes from the endowment, memberships and other miscellaneous user fees.
Our founders established the endowment in 1929 in order to fund our mission of dedication to trees, history and nature in perpetuity. Endowments are not guaranteed income and are susceptible to market fluctuations. After the stock market downturns especially in 2001 and 2008, the Arboretum’s endowment lost nearly 1/3 of its value. The resulting losses led to budget reductions following those downturns.
As a best practice, non-profits should diversify revenue in order to reduce reliance on one source of income. So, in 2009 the board took steps toward diversification that will help preserve the endowment to ensure future and ongoing funding of the Arboretum’s mission.
After initiation of these funding strategies, the Arboretum has fully recovered from the market shocks of 2001 and 2008. In 2017 and with 2018 nearly complete, the Arboretum is now in the best financial position it has ever been in. Through the growth of memberships, sponsorships, donations and grants, the arboretum now derives approximately 65% of its annual budget from the endowment.
This initial diversity of our revenue has led directly to a substantial growth in the delivery of our public programs. Subsequently, the arboretum was able to complete major capital projects including the Rt 13 turn lane, sewer connect, construction of a new grounds building and garage, in additional to visitor amenities such as a new garden and new trails.
In compliance with the IRS, all donations to the arboretum are used as directed by the donor. Our financials are audited yearly and we remain in full IRS compliance.