In 2024, the Democratic Socialists of America (DSA) found ourselves at a pivotal crossroads.  Our  organization had experienced notable membership growth from 2016-2020 and had increased our income and expenses to match. However, as membership growth began to slow and then reverse, the previously sustained level of spending became a strain on finances. In 2020-21, during the height of the COVID pandemic, organizing costs were significantly reduced by a shift to online organizing and so DSA had accumulated savings. In 2022, DSA's income fell short of projections by nearly one million dollars. The organization also underspent its expense budget, and so DSA ended the year 2022 with a surplus.

However, in 2023, we returned to in-person organizing, including an in-person Convention. We faced  increased costs and decreased income from membership dues. DSA ended 2023 with a budget deficit of over $1,000,000, with much of our reserves depleted.

2024 Budget: Reducing DSA’s Expenses and Pursuing Financial Solidarity

Budget and Finance approved a partial budget to recommend to the NPC in January 2024, which was passed onto the NPC with several items as open questions for NPC approval. Had the budget been approved with no adjustments, DSA would have carried a deficit of $1,566,264,  a level of financial shortfall that would have jeopardized the organization's future. There were additional spending items open which were not approved by B&F but would have added into the deficit further, approval of which would have plummeted the organization into a deficit of over $2 million. The organization had just over 6 months’ worth of cash on hand at the start of 2024; the spending anticipated by this budget would have eroded this cash balance down to the point of unsustainability. With the guidance of the National Finance Director and Budget & Finance Committee, the NPC approved a spending freeze at the beginning of 2024 to address these financial issues and revise the budget. In January 2024 the NPC also approved fundraising goals for 2024 to raise $1.2 million in new income combined from monthly dues, major gifts, and new member recruitment, in addition to $350,000 already projected in new income from monthly dues and one-time donations.

In a series of meetings, the National Political Committee made substantial revisions to the 2024 budget, reducing costs by over $1,800,000 in the preliminary 2024 budget as well as requested expenses that had not been added to the budget, across areas including staff, events, and organizing expenses.  These cuts were the results of lengthy deliberations by the NPC and involved painful sacrifices in order to bring recurring expenses to a sustainable level.

The 2024 Budget Cuts

• Freezing five vacant positions: The NPC froze five vacant staff positions, resulting in a savings of $442,100.
• Staff layoffs: The NPC laid off the communicators director and five staff members. This resulted in a savings of $320,700 after severance payments and vacation buyouts.
• Freezing Leadership Stipends: The NPC froze NPC SC and YDSA Priority Committee Stipends, reducing expenses by $93,600.
• Ending Contract with NHGO: The NPC terminated the contract with the National HGO, resulting in savings of $292,000.  
• Democratic Left: Cut $273,296 by ending the paper edition
• Travel, merchandise, and other non-staff expenses: Cut $268,000, and moved to a virtual YDSA summer convention
• Internal Audit: An internal review conducted by the operations director and the National Tech Committee identified several areas for cuts, including office phone/internet expenses, tech-related expenses, and postage costs.

After these changes to reduce expenses, the NPC adopted a 2024 budget anticipating a small deficit.

2024 Actuals: Surplus Achieved

Preliminary end-of-year (EOY) 2024 figures indicate that the organization performed ahead of income projections and well below expense projections, with a significant surplus of $777,965(12.8% of income). These figures are subject to confirmation and may change during the final  reporting process.

Dues and contributions were $427,135 above projections, with a notable increase in membership in November, following the Presidential election. Notably, while the majority of new members initially opt to pay annual dues at the time of joining, our strategic emphasis on monthly giving has proven effective in converting many of these annual payers to monthly contributors over time. 2024 income was bolstered by the Solidarity Dues Drive to encourage members to switch to monthly income-based dues. Through the success of the Solidarity Income-Based Dues drive, which kicked off around the 2023 Convention and continued through May 2024, income projections were increased by another $420,000 in March 2024 based on Actual income counted through January 2024 ($374,000 of the added income came from the funds raised in 2023).

Later in the year, the $25 for '25 End of Year push, which began in mid-October 2024, significantly contributed to this increase. Instead of focusing on one-time donations, as has been done in previous years, DSA shifted focus to increasing our average monthly dues income, which is our strongest and most consistent source of revenue. The goal of the drive was to increase the number of members paying $25+ in monthly or SIBD dues from 3,172 to 4,000. We achieved and surpassed this goal by the end of November 2024, in part by converting one-time and annual members over to monthly dues, and encouraging existing monthly dues members to increase their contributions.

We also eliminated one-time dues as a category entirely and set the suggested monthly donation at $25 (previously $15), resulting in a large number of new members joining at this level. This elimination of the one-time dues category for new DSA signups, which was implemented in November 2024, is a significant recent change affecting organizational income. In prior years, major membership bumps were typically followed by a significant drop-off, particularly by new members who had opted for one-year dues payments. These one time yearly payments required a high administrative burden for chapter leaders and national staff to reconnect with members to renew their dues. Now, recurring monthly dues will be the default join option going forward. As a result, by November 2025, this passive attrition from one-time dues signups will no longer be a factor in DSA membership loss.

A member-driven Fundraising Committee was expanded in 2024, aimed at expanding fundraising initiatives and increasing one-time donations from members. Also, bequests accounted for $168,800 of the surplus, but bequests are difficult to predict or plan for on a yearly basis.

Budget actuals by the end of 2024 showed that, of goals set for the three major fundraising categories for the year:

• New monthly dues through October (that can be attributed to monthly dues increases through the Solidarity Dues Drive active through May and the beginning of the $25 for '25 End of Year push in October, before the period of net new membership growth) amounted to $682,607 for the year, compared to the overall goal of $720,000.
• Major gifts contributions amounted to $327,448 for the year, including $86,039 in one-time general donations through efforts organized by the Fundraising Committee, and $168,836 in unexpected bequests, compared to a total one-time donation fundraising goal of $400,000.
• New monthly dues for the period of net new membership growth (November-December 2024) amounted to $197,597 for the year, compared to a goal of $432,000 in additional income from new member recruitment.

DSA Dues Income 2021-2024 | Flourish

While spending was mostly on target for 2024 or slightly over in a couple of categories, the organization saw underspending for what was approved in key categories. In addition to the budget cuts, adjustments were made to expenses after the first three quarters of 2024 to reflect actual expenditures. These included adjustments to staffing costs to account for times when positions were open, and to reflect a net savings of $200,000. Marginal adjustments were made on travel, consultant, and administrative costs. Significantly, many national committees did not spend the majority of their budget. After reviewing amounts spent at the end of September, Budget and Finance reached out to each of these committees and made adjustments based on discussions about what the committees were planning to spend by December 31, 2024 and made adjustments based on the responses:

In total, committee expenses were reduced by 67%, and some committees did not spend their budgeted amounts even post-adjustments.  Some of the underspending was due to careful management, however, it’s worth noting that some underspending may not have been solely due to careful management—some committees may have overestimated their funding needs or encountered delays in planned activities, resulting in lower-than-expected expenditures. Additionally, the temporary pause of the grant program for compliance purposes meant that grant-related expenses were halted in November 2024, further contributing to the underspending.

It’s worth noting that the dues share line item appears significantly higher than in previous reports. This is due to an accounting change beginning in 2025, in which dues share is now recorded on an accrual basis, meaning the dues share amount for each month is recorded in the same month the monthly dues are received. This does not affect the actual dues share payments to chapters, which will continue to be distributed quarterly. The result of this is that, at the advice of our auditor, 2024 reflects expenses for 5, and not 4, quarters of dues share payments.

Overall, DSA operated under an understanding that expenses were tight in 2024 and we saw a reflected underspend in many categories. Preliminary spending for 2024 was:

Underspending, although beneficial in the short term, poses challenges. It indicates that better forecasting is needed to ensure accurate budget planning and to help decision makers navigate complex compliance concerns.

Based on the factors listed above, DSA (provisionally) ended 2024 with a surplus of $777,965. Key factors included a significant increase in dues and contributions, with annual dues exceeding projections, largely due to a surge in joins and membership activity in the months following the presidential election. Additionally contributing was  a strong Solidarity Dues Drive at the start of the year and the $25 for '25 End of Year push. On the expense side, careful cost control, especially in personnel expenses (lower due to unspent reimbursements, not filling the National Director role, and turnover in the second half of the year), overhead costs (including savings on rent, postage, and software), and national committee expenditures (which were reduced through Q3 adjustments), helped keep spending below budget.

This surplus strengthens the organization’s financial position, but as always, given the unique challenges of administering a membership-based political organization, which is distinct in numerous ways from almost any other type of organization, maintaining financial stability will require careful attention.

2024 Budget Visualization | Flourish