Transcript Document

Introduction to Community Foundations
The Hope Institute
The Beautiful Foundation
Barnett F. Baron
The Asia Foundation
February 13, 2008
What is a community foundation?
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An independent, nonprofit, grantmaking organization
Usually limits its grantmaking to a defined geographic area
(city, county, urban or rural area)
Governed by a voluntary board of directors usually composed
of representatives of the communities it serves
Provides the legal framework to manage multiple separate
funds or endowments named for specific donors, or created for
specific purposes or locations
Funded from multiple sources: individuals, families,
corporations, foundations, sometimes local governments
Provides expert staff advice and services to multiple
community donors and grantees
Seeks to initiate, engage, or facilitate community discussion
about critical community issues
U.S. community foundation statistics (2005)
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707 community foundations (413 in 1995)
≥ $44.5 billion in assets (the total has more than tripled since 1995,
but half of all community foundations still have assets of less than $10
million)
$5.6 billion in gifts received in 2005
$3.2 billion in grants made in 2005 (400% growth since 1995, but
three-fifths give less than $1 million)
Account for 1% of grantmaking foundations but 9% of total giving
(compared to 10% by corporate foundations and 68% by independent
foundations)
Source: Foundation Center, Key Facts on Community Foundations, September 2007; and Community
Foundation Giving and Assets 1981 to 2005, available at
foundationcenter.org/findfunders/statistics/pdf/02_found_growth/00_05.pdf.
Top 10 Community Foundations (2006)
Name
Assets ($bn)
Gifts Received
($mm)
Grants Made
($mm)
Tulsa CF
$3.07
$738
$50.6
New York CT
2.04
89
164.1
Cleveland CF
1.89
32
72.6
Silicon Valley
1.74
292
213.7
Chicago CT
1.64
89
77.9
California CF
1.3
235
245.5
Marin CF
1.22
29
60.9
Kansas City
1.05
179
172.1
Oregon CF
.99
77
49.8
Columbus CF
.98
107
72.3
Community leadership roles
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Convening stakeholders around a common problem or theme
Forging partnership to leverage additional public or private
resources
Brokering new relationships within community, including
bringing contending parties together
Providing training and technical assistance to nonprofit
grantees
Speaking out on issues to the media
Commissioning research and needs assessments to identify
service needs
Collaborate in creating new institutions (e.g., Martin Luther
King Library in Atlanta, Georgia)
Community foundation advantages
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Located in the communities they serve, community foundations
are “closer” to and may be more responsive to community
needs
You do not have to be wealthy to donate: gifts can be made at
any level
Alternative to setting up a private foundation
Provide expert staff services to donors and grantees
Governance structures are more likely to reflect the
demography and politics of local communities than the
governing boards of independent, corporate, or family
foundations
Community foundation advantages
Community foundations have contributed to the
“democratization” of philanthropy in the U.S., through
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Donor-advised funds
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Providing relatively more support for basic human services
Donor-Advised Funds (DAFs): Creating a
Charitable Checking Account
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Separately managed charitable giving accounts that exist
under the umbrella of a larger public charity, such as a
community foundation
DAFs can be as little as $10,000 or as large as several
$millions – “anyone” can be a philanthropist
Donors receive an immediate tax benefit
Distributions (grants) can be made over time
Donor has the privilege of “advising” to whom the grants can be
made
Donor gets the benefit of expert staff who work for the
community foundation
Donor does no administrative work
An alternative to establishing a private foundation
Donor Advised Funds
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Fastest growing segment of the US charitable sector
Assets under management have more than tripled in the last
decade
Offered by both philanthropic institutions (such as community
foundations) and commercial financial firms (e.g., Fidelity
Charitable Gift Fund)
In 2007, Fidelity had $4.6 billion in assets in 42,000 separate
DAFs. It made $995 million in donor advised grants.
Between 1991 and 2007, Fidelity made $7 billion in grants to
111,000 organizations.
Fidelity Charitable Gift Fund 1991 – 2007
Charitable divide in the U.S.
“Research shows that less than 10 percent of the money
Americans give to charity addresses basic human needs,
like sheltering the homeless, feeding the hungry and
caring for the indigent sick, and that the wealthiest
typically devote an even smaller portion of their giving to
such causes than everyone else.”
Stephanie Strom, “Big gifts, tax breaks, and a debate on charity,” New York
Times, September 6, 2007; Nicole Wallace, “Donors overestimate their
antipoverty giving,” Chronicle of Philanthropy, January 24, 2008.
Charitable divide in the U.S.
80% of donations of $10 million or more go to elite colleges or
universities, medical institutions, or arts and cultural
institutions.
Households with annual incomes below $100k provide 49% of
all contributions to organizations that provide food, shelter, and
other basic necessities to needy people.
Holly Hall, “A Charitable Divide: As wealthy institutions report record fund-raising
gains, social service groups struggle to stay afloat,” Chronicle of Philanthropy,
January 10, 2008, citing Gary A. Tobin and Aryeh K. Weinberg, Megagifts in
American Philanthropy, Institute for Jewish Community Research, December 2007,
available at www/jewishresearch.org/PDFs/MegaGift.EWeb.07.pdf .
Charitable Gifts of $1 Million or More
Private higher education
Public higher education
Health and medical
Arts and culture
Public and society benefit
Human services
Secondary/elem education
General educ
Environment
International
Religion
Federated appeals
Other
25%
19
16
12
5
5
4
4
4
3
2
2
1
72%
Grant Priorities
$1 Million +
Pvt H Ed
Pub H Ed
Health
Art & Cult
Pub Ben
Hum Svs
Community foundation grant priorities (2005)
Education
Human Services
Health
Arts & Culture
Public Affairs/Benefit
Environ/Animals
Religion
Science/Tech
International
Other
23%
22
14
14
12
6
4
3
2
1
Grant Priorities
Community Foundations
Educ
Human Svs
Health
Art & Cult
Pub Ben
Environ
Human services
Not only do community foundations provide more support
to human services organizations, but within the human
services category, community foundations are more likely
to than either independent or corporate foundations to
focus on people with disabilities, the aging, victims of
crime or abuse, and substance abusers.
Globalizing the community foundation model
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Cleveland Community Foundation 1914; Winnipeg Foundation
1921
US model originally based on gifts from wealthy local families
and corporations
Later expanded to middle-class through DAF and pooled funds
UK in 1980s – prominent role of government funding for startup costs and basic operations (Community Foundation for
Northern Ireland)
Central, Eastern Europe, Russia, and Africa: strong role of
USAID and international ODA community. Mott Fdtn, CAF
Asia: role of international NGOs and foundations (Ford,
Synergos).
Growth of international support organizations: WINGS-CF,
World Bank
WINGS now identifies 1175 community foundations in 46
countries (274 outside the US, UK, and Canada)
Issues: What is a “community”?
There are widespread Asian traditions of
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Clan associations
Guild associations
Religious trusts
Self-help associations for internal migrants and international
immigrants based on place-of-origin
Village self-help organizations
There are even examples of clan-based endowed agricultural estates
during the Sung dynasty in China, which distributed grain and
money to needy members of the clan.
Are these good models for contemporary community
foundations? Or are they obstacles?
Issues: Confucian ideals?
Benevolent government is the best philanthropy.
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Beyond one’s own network of personal and family
relationships, is benevolence the duty of government?
Why does Asia lag in the growth and popularity of
community foundations?
Does The Beautiful Foundation represent a break from
those traditions? Can it be a model for other Asian
(Confucian) societies?
Issues: Dependence on Foreign Aid?
The recent surge in interest in community foundations
around the world has been largely initiated and funded by
external donor agencies, including foundations,
international NGOs, USAID, and the World Bank.
Can funding for local community foundations be
sustained by local sources? At what levels?
Resources: WINGS
WINGS: Worldwide Initiatives for Grantmaker Support
2005 Community Foundation Global Status Report, at
www.wingsweb.org/download/GSR2005_p1a.pdf
International Connections: Resources that support the
growth and development of community foundations
globally, at
www.wingsweb.orf/download/InternationalConnections.
pdf