They move out of declining center city neighborhoods. They shift their facilities and investments to suburbs, or even to other regions, countries, or continents. Nonprofit organizations do not have that freedom of action. Most nonprofits are highly local organizations, tied to their sites and facilities by their charters, service missions, support bases, and relationships with trustees. They cannot easily transfer their resources or aid from affluent communities to needy places, except for the large, national charities that specialize in short-term relief efforts.
Donors generally target their contributions on their own communities.
Thus, only about 10 percent of charitable contributions are directed to the poor, and most charities lack the mechanisms to reallocate donations where they are needed most. Their inability to move around or switch services has strong parallels to public agencies and facilities like police and fire departments, libraries, and schools. This greater attachment to place can be a benefit for clients remaining in declining neighborhoods and cities. Yet the flexibility that private-sector firms have in responding to client and market shifts might provide some lessons for nonprofits that would be worth studying. For nonprofit organizations that provide vital services for the needy in center cities, the financial prospects can be grim.