Building a Comprehensive Nonprofit Database – The Case of Indiana
By Kirsten A. Grønbjerg, Indiana University

Understanding the “big picture” of nonprofits on a local or statewide level—how many there are, where they are located, what they do, and how they are funded or interact with one another—is a critical, if daunting, task. It is important because devolution and privatization means that nonprofits and local service networks (in which nonprofits are prominent) play a growing role in providing or coordinating a variety of key community services. At the same time, other types of nonprofits--membership and civic organizations that promote social capital and civic engagement--appear to have declined, raising broader questions about the capacity of local communities to respond to challenges.

As a first step in developing a “big picture” of nonprofits at the community level, we have built a comprehensive database of all types of nonprofits for the state of Indiana. I summarize here briefly our approach, since it may be of interest to nonprofit practitioners and researchers elsewhere. For a more detailed description, see Grønbjerg, “Evaluating Nonprofit Databases,” American Behavioral Scientist 45 (11, July 2002): 1742-78 (a procedural manual is available upon request). See also www.indiana.edu/~nonprof.

We used two complementary approaches--an institutional and a community informant approach--to create a comprehensive listing of nonprofits in the state. The institutional approach involved merging (a) all 32,600 records from the IRS list of registered tax-exempt organizations under section 501(c) with Indiana reporting address, (b) 29,400 organizations incorporated as nonprofits with the Indiana Secretary of State (ISOS), and (c) 9,000 churches and religious groups listed under that heading in the yellow pages for the state. Because of their different purposes, these three listings promised to provide the greatest overall coverage when combined. After eliminating all known duplicates, 54,100 nonprofits remained in our database.

We supplemented this effort by using community informants to identify local listings in 11 communities across the state. For most areas, we added 20-25 percent to the institutional listings, for a total of 59,400. If done statewide, the total would probably have exceeded 65,000. As a check on the validity of these strategies, we also surveyed Indiana residents and asked them to provide names and addresses of nonprofits with which they were personally involved as employees, volunteers, attendees at meetings or events, or religious congregants. When checked against our comprehensive database we found that 30 percent were not included (some may have been programs of nonprofits already on our database).

Two conclusions stand out. First, each of the three institutional databases added a significant number of nonprofits not included on the other two listings. Indeed, the known overlap between the IRS and ISOS listing was only 23 percent. Of the three, the IRS list of registered nonprofits is the most complete, covering about 60 percent of Indiana nonprofits, followed by the ISOS list (54 percent) and the church listings (17 percent). Second, even these three combined listings appear to leave out many nonprofits on local listings. Thus, our complementary strategies allowed us to locate many more nonprofits than other efforts-- more than 100 nonprofits per 10,000 residents. By comparison, the number of charities that file financial information with the IRS is about 10 per 10,000. Of course, the latter include most of the larger, more established nonprofits.

We are now in the process of analyzing survey data for 2,207 nonprofits selected through a stratified random sample from the comprehensive database (response rate of about 30 percent). Our preliminary findings suggest that many nonprofits are indeed small in terms of revenues or staff and rely extensively on volunteers. While most of these may not play a major role in the state’s economy or system of service provision, their ability to engage volunteers means that they are an important mechanism of civic engagement.

In addition, our efforts to track down non-respondents suggest that our original sample contained surprisingly few inappropriate listings: at most 15 percent defunct, 2 percent duplicates of another organization in the sample, and 2 percent ineligible for other reasons (e.g., for profit, government, located out of state). (Note: These are unweighted percentages.) Thus, our original comprehensive database should be of relatively high quality as well.

Our work has benefited from major efforts to develop and enhance existing databases on the sector at both the national and sub-national level. Aided by significant advances in information technology, this includes posting national listings of registered charities on the web, as well as disaggregating these listings to the state and community level. The work by the National Center for Charitable Statistics (Center on Nonprofits and Philanthropy, the Urban Institute), Independent Sector, and Philanthropic Research Inc. (alias Guidestar) is particularly noteworthy.

Kirsten Grønbjerg is the Efroymson Chair in Philanthropy at the Center on Philanthropy at Indiana University and Professor in the School of Public and Environmental Affairs at Indiana University Bloomington. For more information, visit www.spea.indiana.edu/gronbjerg or e-mail her at kgronbj@indiana.edu.