Philanthropy and Volunteering in Houston

Volunteer activity and financial donations are a force of good throughout our region

Nonprofits in Houston’s three-county region advance civic engagement not only by improving the condition of our residents and their communities but also through the strengthening of social ties among those who actively participate.

Why philanthropy and volunteering matter to civic engagement in Houston

A strong local nonprofit sector plays an essential role in building healthy communities — the ultimate goal of civic engagement. Not only do they provide critical services and resources to meet residents’ needs, but they also strengthen social connectedness across and among donors, volunteers and clients.1 The nonprofit sector provides opportunities for residents to actively participate in the betterment of their communities by volunteering time, talent, treasure or ties. Giving back to one’s community fosters a sense of community and has personal benefits. Studies have shown that participating in volunteer opportunities or making charitable donations can increase general life satisfaction, happiness, self-esteem and overall psychological well-being.2

The more we understand how Houstonians improve their communities through the nonprofit sector, we can work to create a region where everyone gives back.

The data

Almost half of residents donate $25 or more to nonprofits

When people feel connected to their community, they take action to protect and improve it.3 They work to better the condition of their neighbors. One way to do that is through donations to nonprofit organizations. According to the GivingUSA 2021 Report, Americans gave $471.4 billion in 2020. Individuals gave the most ($324 billion), followed by foundations ($89 billion). The region’s giving spirit has supported recovery efforts after multiple natural disasters in Houston, but on average, about half of residents give $25 or more to nonprofit organizations.

In the greater Houston region, nearly half of residents (48.8%) said they donated at least $25 to a charitable organization(s) in 2019. This is similar to the national average (50.5%) and slightly higher than the Texas state average (45.3%). When looking at other large metropolitan areas, Greater Houston is in the middle of the pack when it comes to charitable giving. A larger share of Houstonians donated to nonprofits compared to metropolitan areas such as Los Angeles, New York and San Antonio, but Houston lagged in giving rates compared to regions like Austin, Atlanta and Chicago.

In the greater Houston region, nearly half of residents (48.8%) said they donated at least $25 to a charitable organization(s) in 2019.

Residents of Houston’s three-county region have given an average of $4.4 billion a year to charitable organizations between 2011 and 2018. This is about roughly one-fourth of the donations made by Texans. Charitable giving tends to increase in times of disaster.4 Consequently, charities in Houston topped the list for the highest total contributions out of 30 major metros in 2017. 

Most recently, reported giving levels have fluctuated widely, and are $3.6 billion in the 2018 tax year — down 37% from $5.7 billion in the year before. This decline can be attributed, in part, to a change in federal legislation that year that increased the standard deduction for charitable donations — total itemized deductions, as of 2018, must exceed $12,000 for individuals (up from $6,350 in 2017) and $24,000 for married couples (up from $12,700 in 2017). This change likely resulted in significant declines in the number of individuals who claimed contributions on their tax returns, and the overall amount — a trend seen nationally as well.

Households with higher incomes are more likely to make charitable contributions than their lower-income neighbors. Yet, fewer than half of households that earn more than $200,000 annually in Houston’s three-county region claimed charitable contributions in 2018. 

While the aforementioned 2017 tax law decreased the total number of people who itemized, top earners still had an incentive to itemize. This could help explain why top earners have such a higher share of filers with charitable givings itemized.

Not surprisingly, reported levels of giving vary greatly by household income, with higher-income households donating more money than low-income households. But, giving also varies across the region. Households that earn $200,000 or more in Fort Bend County gave an average of $20,000 in the 2018 tax year. This is nearly half the average in Harris County ($38,661) and slightly lower than the average in Montgomery County ($24,301).

While the aforementioned 2017 tax law decreased the total number of people who itemized, top earners still had an incentive to itemize. This could help explain why top earners have such a higher share of filers with charitable givings itemized and the amount they gave.

Nonprofits in Houston are robust and provide critical services

Nonprofit organizations provide a variety of critical services, and therefore include a multitude of different types of organizations — private hospitals in the healthcare industry, chambers of commerce, private universities or organizations focusing on funding for schools, philanthropic foundations, and established charitable organizations who provide services to people and animals. Public charities in particular tend to play a vital role in strengthening communities as they have strong relationships with the people they serve — typically low-income and other historically marginalized communities — and possess unique understanding and knowledge of their community and their needs,5 particularly when the organization is led and staffed by people who share similar experiences with those they serve.

How many nonprofits are in Houston? Across the three-county area, there are a total of 15,660 nonprofit public charities — classified under section 501(c)(3) organizations by the IRS. The vast majority (12,509) are located in Harris County, with far fewer in Fort Bend (1,788) and Montgomery (1,363) counties. Religion-related organizations comprise the majority of nonprofits in Houston, followed by human services organizations that provide a broad range of social services. Overall, the three-county region has a higher share of religious nonprofit organizations and a smaller proportion of human services organizations compared to the state and nation.

Houston’s three county region has a reputation for being home to a large number of charitable organizations that provide important services to residents in need. However, the number of public charities per 10,000 residents is lower in each of our region’s three counties when compared to the state and national rates. This disparity may suggest that nonprofits in Houston are overwhelmed with demand, particularly when they are needed most — during times of crisis.

The number of public charities per 10,000 residents is lower in each of our region’s three counties when compared to the state and national rates.

COVID-19 disrupts steady rates of volunteering in Houston

The act of volunteering one’s time to better their community is a key behavior of civic engagement. Volunteering strengthens community ties and can spur additional forms of civic engagement such as advocating for public policy change or by inspiring Houston voters to get out and vote. Taking advantage of volunteer opportunities is not only important to organizations and communities, but also has a number of benefits for the volunteer. Volunteering can increase overall mental and physical health and have a positive effect on psychological well-being when done consistently and regularly.6

Between 2012 and 2020, at least 50% of residents in the three-county area had volunteered at least once in the last 12 months, according to the Kinder Houston Area Survey. However, between 2020 and 2021 the proportion of Harris County residents who volunteer fell 14 percentage points to 39.5%. This decline in volunteer rates is consistent with national trends as well. A study conducted by Fidelity found that two-in-three Americans surveyed either reduced or stopped previous volunteer activity due to the COVID-19 pandemic.7

Among those who volunteered in 2019, residents of the Houston metropolitan area volunteered at slightly lower rates than in Texas the U.S. overall. Of those who did participate in volunteering opportunities in Houston, over 60% do so at least once a month compared to roughly 70% for the state and the nation.

Continue reading about civic engagement in Houston

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Resources

References:

  1. Schneider, J. A. (2007). Connections and disconnections between civic engagement and social capital in community-based nonprofits. Nonprofit and Voluntary Sector Quarterly, 36(4), 572-597.
  2. Konrath, S. (2014). The power of philanthropy and volunteering. Wellbeing: A complete reference guide, 1-40.
  3. Wang, L., & Graddy, E. (2008). Social capital, volunteering, and charitable giving. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 19(1), 23.
  4. Dietz, Nathan, and Grimm, Robert T., Jr. 2020. Community in Crisis: A Look at How U.S. Charitable Actions and Civic Engagement Change in Times of Crises. Research Brief: Do Good Institute, University of Maryland. Retrieved fromhttps://dogood.umd.edu/research-impact/publications/community-crisis-look-charitable-activity-and-civic-engagement-times.
  5. Handy, F., Shier, M., & McDougle, L. M. (2014). Nonprofits and the Promotion of Civic Engagement: A Conceptual Framework for Understanding the “Civic Footprint” of Nonprofits within Local Communities. Canadian Journal of Nonprofit and Social Economy Research, 5 (1), 57-75. Retrieved from https://repository.upenn.edu/spp_papers/176
  6. Piliavin, J. A., & Siegl, E. (2007). Health benefits of volunteering in the Wisconsin longitudinal study. Journal of Health and Social Behavior, 48(4), 450-464.
  7. Fidelity Charitable (2020). The Role of Volunteering In Philanthropy. Retrieved from https://www.fidelitycharitable.org/insights/the-role-of-volunteering-in-philanthropy.html.