Amid continuing bad economic news, the Greater Twin Cities United Way has launched a new Internet fundraising effort called Give5Now. The 80-second YouTube video tells viewers that there is a small way to make a big difference, and encourages them to give a mere $5 to help people in need get a hot meal and a warm bed. It provides the link to make a donation.

It's an experimental program that won't raise a whole lot of money in the near term, but could pay long-term dividends. Andy Goldman-Gray, United Way's vice president of marketing, said the campaign's "dream" is to raise $50,000 by Dec. 31 (that's 10,000 people giving $5 each). The money would go to programs to address hunger, housing, job training and financial stability.

That $50,000 would certainly help a few food shelves, and every little bit helps. But for some perspective, it is .06 percent of the United Way's $88 million annual campaign. The upside has to do with how successful the United Way is at growing its Internet base.

The United Way produced the simple Give5Now video in-house, just text with background music. It is doing what a lot of other nonprofits are doing: trying to figure out how to make on-line social-networking fundraising work as well as it did for the Obama campaign.

Expect to see the United Way produce more short-term and targeted on-line campaigns in the future. For example, Goldman-Gray said if there is a surge in demand for heating assistance, United Way could put up a new video targeted to heating assistance, tapping its network of on-line contributors to help the cause.

Donor building
Some people feel powerless about the community's growing needs. Goldman-Gray said the Give5Now campaign gives them the opportunity to help in a "bite-sized" way. "It is as much about filling the needs of the donor as it is the needs in the community," he said.

The effort not only raises extra money for basic needs, but it is strategic. It is adding to United Way's already substantial donor list (about 150,000 individuals). In part, it will help cultivate relationships with the millenial generation as it gets into the workforce. Young people are able to give $5 or $10 or $25 now, but the United Way is building connections for later when they can make more substantial gifts.

"It is important to be creating this virtual relationship with them while they are in that micro-giving category," Goldman-Gray said.

$12,150 and counting
Nick Coleman wrote about the Give5Now campaign in Monday's StarTribune, the day the campaign started. (United Way also has advertised the campaign on MinnPost.) Donations have been coming in, in $10, $25 and even $100 increments, Goldman-Gray said. By midday Wednesday, less than three days into the campaign, it had raised $12,150 from 536 individuals (nearly $23 per person).

It's smart. It's a start. Clearly more is needed. The Give5Now campaign is no short-term solution. In the big picture, the United Way is hoping to hold its own through the economic downturn. It raised $88 million in 2007. It hopes to maintain an $88 million annual campaign in 2008 and 2009. "We are looking at 2009 and concerned about what that is going to look like," Goldman-Gray said. "We are probably going to have a tighter year."

Keeping stable funding during difficult financial times is a great thing. Still, factor in inflation and increased demand for help and it paints a challenging picture for those organizations depending on charitable giving to provide food, shelter and other basic needs.

The Minnesota Council on Nonprofits (MCN)  just released a report saying many nonprofits already are seeing shrinking revenues, and some are cutting staff.

State cuts are coming
The state's multibillion-dollar deficit likely will translate into more funding cuts; some will affect programs the United Way funds. They will either have to find new money or cut services. This session, the Legislature will debate whether the state should raises taxes to reduce the size of the cuts.

In a recent handout to members, MCN wrote: "Advocate for adequate revenues, raised fairly, for strategic investments. We can't make up for the extraordinary shortfall with just cuts."

I asked Goldman-Gray if the United Way had a position on tax increases to help offset cuts.

"We wouldn't weigh in on that," he said. "I don't think we have enough information or analysis on that for us to speak on that at this point."

Note: After Nick Coleman's column on Give5Now, the United Way got inundated with calls from people who wanted the agency's mailing address. They wanted to donate but either didn't use the Internet or didn't want to use their credit card online. For those interested, the United Way's address is: 404 S. 8th Street, Minneapolis, MN 55404-1084.