Poor economy impacts non-profits. BusinessWeek has on article on the impact the poor US economy has had on non-profit organizations. In a nutshell, when the economy isn't doing well, non-profits are hit from both sides: less money coming in through donations, coupled with an increased need/demand for their services. This problem is especially accute for non-profits where most if not all of their revenues flow-through directly to their operations.

For most community foundations (at least in Canada), flow-through accounts for a small part of their activity. Revenue is typically invested, with a percentage of the interest being granted out. In part, this is what differentiates CFs from other non-profits: the notion of building a permanent endowment for the community.

Having said that, a poor economy usually means a low return on investments, which impacts the CFs granting budgets. So while community foundations are well placed to withstand downward turns in the economy, they are not entirely immune to its effects either.