The challenges facing nonprofit organizations are coming into sharp focus in 2026, as funding uncertainty collides with increasing demand for services. A Power Breakfast event hosted by the Business Record in Iowa brought together leaders to discuss the precarious state of the sector, highlighting concerns over federal funding changes and their ripple effects.
According to the Center for Effective Philanthropy’s 2025 State of Nonprofits report, a significant 62% of U.S. Nonprofit leaders surveyed reported that actions by the federal government are impacting their work. This comes at a time when the need for nonprofit services is demonstrably growing, creating a dangerous squeeze on resources. The report also indicates widespread uncertainty about future funding as costs continue to rise and traditional revenue streams are not expected to expand.
The Business Record’s Power Breakfast panel addressed several key areas of concern. One central theme was the impact of 2025 federal government policies on nonprofit funding streams and operations. The discussion explored how the types of issues receiving funding have shifted over time, and the consequences of increased demand on nonprofit workers – including the growing risk of burnout and difficulties in attracting and retaining qualified staff.
The event also emphasized the critical role nonprofits play in Iowa’s economy and quality of life. They are not merely service providers, but essential partners in economic development and cultural enrichment. The potential inability of these organizations to meet demand poses a significant risk to the well-being of communities across the state.
The discussion extended beyond simply identifying the problems, focusing on potential solutions. A key area of exploration was fostering strategic cross-sector collaboration – a necessity in an environment where all organizations are facing increased uncertainty. The need for partnerships between nonprofits, businesses, and government entities was repeatedly stressed as a means of maximizing impact and leveraging limited resources.
This situation isn’t isolated to Iowa. Broader trends suggest a nationwide challenge for the nonprofit sector. While specific details regarding federal policy changes weren’t provided in the Business Record report, the overarching concern reflects a growing anxiety about the stability of funding for vital social services. This uncertainty forces nonprofits to operate in a constant state of planning for contingencies, diverting resources from direct service delivery.
The Power Breakfast series, as highlighted by the Home Builders Association of the Sioux Empire (HBASE), is designed to provide leadership insights and practical strategies for navigating complex challenges. While the Iowa event focused specifically on nonprofits, other sessions in the 2026 series address broader themes of leadership, growth, and purpose. featured Tyler Mount discussing “The Power of Effing Up,” framing failure as a catalyst for success. Future sessions, scheduled for with Drew Moldenhauer (“Building Elite Teams”) and with Paul TenHaken (“Code of Contentment”), aim to equip leaders with tools for resilience, collaboration, and strategic thinking.
The HBASE series emphasizes the importance of adapting to change and embracing new approaches to leadership. This message resonates strongly with the challenges facing the nonprofit sector, where innovation and collaboration are increasingly crucial for survival. The ability to build strong teams, cultivate trust, and foster a culture of accountability – as discussed in Moldenhauer’s upcoming session – will be particularly important for nonprofits navigating a turbulent funding landscape.
Elsewhere, other Power Breakfast events are taking place across the country. NAIOP Southern Nevada is hosting a breakfast meeting on focused on the commercial real estate market, while Crain’s is hosting an economic outlook breakfast featuring regional leaders. These events underscore a broader trend of business communities coming together to address economic uncertainties and explore opportunities for growth.
The challenges facing nonprofits are a microcosm of the broader economic anxieties facing many sectors in 2026. The combination of rising costs, funding uncertainty, and increasing demand for services creates a perfect storm that requires innovative solutions and collaborative partnerships. The discussions taking place at events like the Business Record’s Power Breakfast are a crucial step towards identifying those solutions and building a more resilient future for the nonprofit sector and the communities it serves.
