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November/December 2001

Inside This Issue:

 

Charitable Giving in Pennsylvania
Charitable giving is a fundamental component of the American way of life. Over the past several months, America has seen how eager and willing our nation's residents are to support those in need. To learn more about charitable giving and organizations in Pennsylvania, the Center for Rural Pennsylvania took a closer look at charities, specifically those located in rural areas.

There are 905 charitable organizations based in our state's rural counties that are registered to solicit funds in Pennsylvania. Altogether, these organizations collect about $132.3 million a year in contributions and spend $2.1 billion on program services.

The Solicitation of Funds for Charitable Purposes Act of 1990 requires all charitable organizations, with a few exceptions, to register with the Pennsylvania Department of State's Bureau of Charitable Organizations in order to solicit funds in the state. More than 6,500 charitable organizations are registered to solicit contributions in Pennsylvania. Of these, 5,351 are based within the state while the remaining 1,179 are located in every other state in the nation except Hawaii.

The 905 charities based in Pennsylvania's rural counties represent 17 percent of the in-state total, meaning that the vast majority are situated in urban counties. Butler (71), Franklin (70) and Crawford (51) counties are home to the largest number of rural-based charities in the state. More than half of Pennsylvania's rural counties house fewer than 20 charities each. Every Pennsylvania county houses the main office of at least one charitable organization.

While rural charities number only 17 percent of the state's total, they earn 22 percent of the total income generated by charities, or $2.5 billion; an average of $2.8 million in income per organization. Urban charities bring in less at $2.1 million per charity.

Rural charities receive $132.3 million in annual charitable contributions, representing 5 percent of total income. This figure is about $146,000 per organization. Urban charities earn 32 percent, or $2.9 billion, of their income through donations, amounting to nearly $658,000 in donations per charity. Furthermore, charities based outside the state earn 63 percent from donations or a whopping $12.3 million per organization.

While urban charities raise much more of their income through contributions, rural charities appear to get more out of their fundraising dollars. Charities in rural Pennsylvania spent $9.3 million on fundraising ventures, which means that for every dollar spent, $14.18 was brought in. Urban charities received $9.69 in contributions per fundraising dollar spent and out-of-state charities took in $8.97 for every dollar spent.

In its analysis, the Center for Rural Pennsylvania found that rural charities spend about 98 percent of their annual income. Urban charities, on the other hand, spend about 86 percent of their annual income.

Rural Pennsylvania organizations spend 86 percent of their income on program services, 12 percent on administrative services and less than 1 percent on fundraising efforts. Urban organizations spend 72 percent of their income on program services, 11 percent on administrative services and about 3 percent on fundraising efforts. Out-of-state organizations spend 70 percent of their income on program services, 6 percent on administrative expenses, and about 7 percent on fundraising.

Geographically, the commonwealth's charities do not seem to be based in areas of most need but in areas where these is more money. Thirty-three percent are based in the southeast region where the per capita income and education levels are highest. About 20 percent are located in the south central region where poverty and unemployment are lowest, and only 8 percent are located in the northwest region, where poverty and unemployment are greatest. A straight urban/rural comparison shows that there are nearly five times as many urban-based charities as rural-based charities even though rural counties have only three-fourths as much income, higher poverty and unemployment rates, and lower education levels.

Like other charities nationwide, charitable organizations in rural Pennsylvania are providing their communities with much needed services and support. It is encouraging to know that while these organizations earn just 5 percent of their income from contributions, they spend 86 percent of it on services that aid and support individuals, communities and resources.

Top Fundraising Organizations
Of all charitable organizations that solicit in Pennsylvania, those that receive the most in annual contributions are:

Of the above, only the American Heart Association is based in Pennsylvania. Other PA-based top recipients of contributions are:

The top rural PA-based charities in terms of contributions are:


Chairman's Message
Over the past few months, Americans have come together to demonstrate their unity and to offer their support to those affected most by the tragic events of September 11. In the wake of those events, Americans continue to do whatever they can - offer money, time, resources, and expertise - to help the recovery efforts in New York City, Washington, DC, and Somerset County, Pennsylvania.

While the article on page 1 was researched and written before September 11, the Center for Rural Pennsylvania felt it would be appropriate to feature this look at charities and their spending in this issue of Rural Perspectives. Although the analysis does not include the outpouring of funds and support that have been donated to charitable organizations over the past months, it does provide a basic understanding of the organizations operating in our state and how much they collect and spend. From the analysis, it would appear that rural-based charities tend to spend down most of their budgets every year and spend the majority of their funds on program services.

In a separate article featured on page 4, program spending and program effectiveness are the focus of a recent research project and report released by the Center for Rural Pennsylvania. A Retrospective of Pennsylvania's Economic Development Programs was conducted by faculty members at East Stroudsburg University of Pennsylvania, and offers a look at the state's economic development programs and their effectiveness in generating jobs and income and in growing businesses. The report, which is available by contacting the Center, rates the overall effectiveness of these programs and offers recommendations to decision-makers on which programs may help their areas achieve specific development goals.

While some programs are more effective in achieving specific development goals in rural areas, others may serve specific purposes for other areas and communities and may address unique problems and provide useful solutions.

This issue of Rural Perspectives also takes a look at drug and alcohol treatment programs in rural areas, provides a Census 2000 update on rural housing units, and offers some facts on the growing prison population.

Since this is our last issue of the year, on behalf of the Center's Board of Directors and staff, I extend our thanks to everyone we have worked with in 2001. I would especially like to thank the participants, sponsors, speakers and moderators of the Rural Summit in the City. We will provide more on the outcome of the Rural Summit in the January/February issue of Rural Perspectives.

I would also add that, as we approach the holiday season and the New Year, we continue to share our strength with each other throughout the coming year and to continue to demonstrate our unity as a nation.

Representative Sheila Miller

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Are PA's Economic Development Programs Working?
Pennsylvania spends hundreds of millions of dollars on programs and resources every year to stimulate economic development and sustain the well being of the state's citizens. But are these programs working, and more specifically, are they working in rural Pennsylvania? These questions served as the rationale for a recently completed research project, funded by the Center for Rural Pennsylvania and conducted by researchers from East Stroudsburg University, which examined the economic development programs administered by the state Department of Community and Economic Development (DCED) from 1987 through 1999. The research looked at how effective these programs are in generating income, employment and business growth. The programs studied are listed below.

Overview of results
The research shows that a number of funding sources, or programs, have consistently emerged as highly effective. For this project, effectiveness was defined as a positive change in per capita income, employment and/or business establishments. Programs with a high statistical correlation between funding and these growth factors were identified as being the most effective. In rural Pennsylvania, the top three programs impacting employment were the Community Facilities Program, the Storage Tank Loan Fund, and the Pennsylvania Industrial Development Authority. For per capita income, the number one impacting program was the Machinery and Equipment Loan Fund. The top three programs impacting business establishment growth were the Pennsylvania Industrial Development Authority, Community Facilities Program, and Storage Tank Loan Fund.

For Pennsylvania's 25 predominantly urban counties, the top three programs impacting employment are the Pennsylvania Capital Loan Fund, the Customized Job Training Program, and the Pennsylvania Minority Business Development Authority. In the area of per capita income impact, the top three programs were the Pennsylvania Capital Loan Fund, the Pennsylvania Minority Business Development Fund, and the Business Infrastructure Development Program. The top programs impacting business establishments were the Industrial Communities Action Program, the Pennsylvania Industrial Development Authority, and the Community Facilities Program.

In terms of dollars and how many went to rural Pennsylvania, 25 percent of the $2.1 billion, or $553 million, in loans and grants were distributed to the state's 42 rural counties. On a per capita basis, expenditures were $225 per person in rural Pennsylvania and $172 per person in urban areas of the Commonwealth.

Programs not identified as significant growth contributors in the study are not necessarily ineffective. There were a small number of cases where specific development incentive programs could not be properly evaluated because statistical records were not compatible with the other variables in the research model. Therefore, the researchers did not make specific recommendations on these programs.

The research methodology
Researchers C. A. Christofides, Todd Behr, and Pats Neelakantan studied the economic development programs administered by DCED from 1987 to 1999 to determine the effectiveness of the programs in generating income, employment, and business.

For the study, economic development was defined as a general increase in the living standards of a region. Since living standards are directly related to employment and earnings, the researchers used growth in per capita income, the number of jobs, and the number of business establishments as proxies for economic development. All three measures were used in the study to measure the effectiveness of state run economic development programs. The researchers employed appropriate statistical techniques to control for other factors that can affect growth, such as population density, industry structure, and other national variables.

They also determined which economic development programs are the most successful in achieving specific end results desired by decision-makers.

Overall, the four main goals of the study were to:

Again, the researchers noted that caution should be exercised when reviewing the results because some programs that are statistically insignificant may still serve specific purposes for some counties and may address unique problems and provide useful solutions.

Want more info?
For a copy of the report, A Retrospective of Pennsylvania's Economic Development Programs, contact the Center for Rural Pennsylvania at (717) 787-9555 or at email info@ruralpa.org.

DCED Programs Included in the Study
AQIF: Air Quality Improvement Fund
BID: Business Infrastructure Development
CDBG: Community Development Block Grant Program
CERP: Community Economic Recovery Program
CFP: Community Facilities Program
CJT: Customized Job Training
COMMOP: Communities of Opportunity
CRP: Community Revitalization Program
EOAP: Employee-Ownership Assistance Program
EZP: Enterprise Zone Program
ICAP & ICSP: Industrial Communities Action Program & Industrial Communities Site Program
MELF: Machinery and Equipment Loan Fund
NAP: Neighborhood Assistance Program
PCLF: Pennsylvania Capital Loan Fund
PORTS: PennPorts
PIDA and PIDA RET: Pennsylvania Industrial Development Authority
PMBDA: Pennsylvania Minority Business Development Authority
RIDA: Recycling Incentive Development Account
SAF: Set Aside Fund
SDP: Site Development Program
STLF: Storage Tank Loan Fund
SUNNY: Sunny Day Fund

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Update: Census 2000
Rural Housing In the New Century

Census 2000 numbers show that housing is booming in rural Pennsylvania. There were 4.9 million housing units in 1990 and 5.3 million in 2000, representing a growth of 8.4 percent. The increase demonstrates that housing grew faster than the population, which showed a growth of 6.0 percent. For example, from 1990 to 2000, for every 100 people that moved into a rural area, 63 new housing units were built.

As new homes were being built, however, others were left vacant. The number of vacant homes in rural counties grew by more than 3,000 units, or 2 percent, from 1990 to 2000. This is minor compared to the number of vacant homes in urban counties, which grew by nearly 27,000 units, or 10.5 percent. In addition, 63 percent of the vacant units in rural areas are seasonal-use places.

Not only is the number of housing units increasing, but homeownership is increasing as well. More than 75 percent of rural units are owner-occupied. This homeownership rate of 76.3 percent is significantly higher than the urban rate of 70 percent, and is one percentage point higher than the 1990 rural rate.

Many rural residents, however, do not live in typical households. Persons living in group quarters make up 4 percent of Pennsylvania's rural population. This is up from 3 percent in 1990. Group quarters include correctional facilities, nursing homes, college dorms and military quarters. Growth in group quarter housing is mostly attributable to the increase in the correctional facility population, which increased from 9,891 in the 1990 Census to 28,403 in 2000.

A Look at Drug and Alcohol Treatment Programs
Access to illegal drugs in rural areas is increasing the need for drug and alcohol treatment programs for rural residents. To better understand the issues surrounding the need for treatment programs, the Center for Rural Pennsylvania examined the characteristics of drug treatment clients from rural Pennsylvania and compared them to urban clients, the state, and the nation. The number of persons in treatment programs was also compared to arrests for drug and alcohol offenses and to county spending on drug and alcohol services.

For the analysis, the Center used data from the state Department of Health's Bureau of Drug and Alcohol Programs; the Pennsylvania State Police's Uniform Crime Report Division; the state Department of Community and Economic Development's municipal statistics project; a 2000 study by the National Center on Addiction and Substance Abuse at Columbia University; and an annual survey by the Substance Abuse and Mental Health Services Administration.

All state and county treatment data refers to the 1999-2000 fiscal years unless the 1994-1995 comparison is stated. To make the analysis easier to read, the last date of the fiscal year is used to represent the entire fiscal year.

Crime data is from 1999, the most recent available, and 1994, the five-year increment.

A sample of the findings

Want more info?
For the fact sheet, A Look at Drug and Alcohol Treatment Programs, call the Center for Rural Pennsylvania at (717) 787-9555 or email info@ruralpa.org.

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Did You Know . . .

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JUST THE FACTS: Prison Population Growth
One of the fastest growing segments of Pennsylvania's rural population is prisoners. According to the U.S. Census Bureau, between 1990 and 2000, the percentage of people in correctional institutions in rural Pennsylvania increased 187 percent while correctional institutions in urban areas experienced a 46 percent increase.

Throughout the rural United States, the prison population also increased. During the 1990s, the number of prisoners in rural areas doubled, while those in the nation's urban areas increased 64 percent.

The increase in rural prison population may be partially attributed to a boom in prison construction. Between 1990 and 1995, more than 200 new prisons were built in the United States, many of which were state and federal facilities located in rural areas. In Pennsylvania, 12 new state prisons opened from 1990 to 2000.

In 2000, rural Pennsylvania was home to 28,403 prisoners. Nearly 56 percent of these inmates were in state correctional institutions, 28 percent were in federal institutions, and the remaining 16 percent were in county prisons. In the state's urban areas, 92 percent of prisoners were in local/county facilities or state prisons. According to the Pennsylvania Department of Corrections, in 1999, nearly 12 percent of the inmates in commonwealth prisons are from the state's rural areas.

On a per capita basis, rural areas have more prisoners than urban areas. Census data shows that in 2000, rural areas had 11 prisoners for every 1,000 residents while urban areas had only 5 prisoners for every 1,000 residents. In 1990, rural areas had only 4 prisoners for every 1,000 residents and urban areas had 3.5 for every 1,000. The national average is slightly higher than in Pennsylvania. In 2000, rural areas throughout the United States had 12 prisoners for every 1,000 residents and urban areas had 6 for every 1,000 residents.

For numeration purposes, the Census Bureau includes prisoners as part of the county's or the municipality's total population and the increase in prisoners has affected the population in rural areas. Between 1990 and 2000, Pennsylvania's rural county population increased 5.4 percent. If prisoners were factored out, the growth rate would have been 4.7 percent. Urban areas would have seen only a slight change of less than 0.2 percentage points if prisoners were factored out. Two counties that gained population during the 1990s, Somerset and Delaware, would have lost population if the prison population were factored out. Nationally, 56 counties that gained population during the 1990s would have lost population if prisoners were not included.

Statistically, rural prisons are also affecting the racial makeup of many rural communities. Census Bureau data shows that about 16 percent of rural Pennsylvania's non-white population are in prisons. In seven predominantly rural counties, non-white prisoners comprise more than 50 percent of these counties' total non-white population.

In Pennsylvania, prisons are big business. In 2000, county, state, and federal prisons employed more than 26,000 workers for a total payroll of $79.3 billion.

 

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