The Latest News About Private Foundations

Charitable giving is increasing steadily,” reported Richard Mittenthal, President & CEO of the TCC Group, “and foundation giving, accounting for less than 20% of all charitable giving, has increased at a much greater rate than overall giving.”  Mr. Mittenthal was the first of three insiders speaking at “Private Foundation Update: Trends, Challenges & Opportunities,” a forum presented by the Wilmington Trust’s Walter J. Dillingham, Jr., CFA at its Park Ave. headquarters on September 24th, attended by the NPI Private Grants Team.

On the other hand, large foundations are increasingly interested in policy, believing they can have a greater impact on social problems by pushing for social legislation.  Ominously, donor-advised funds are growing at a faster rate than private foundations.

Donor-advised funds, said Mr. Mittenthal, have been criticized as vehicles for warehousing wealth rather than for charitable giving, a point elaborated on by Sanford J. Schlesinger, founding partner of Schlesinger Lazetera & Auchincloss LLP, a law firm specializing in trusts and estates.  Unlike private foundations, which are required to distribute annually at least 5% of their assets, Mr. Schlesinger noted that no minimum payout is applicable to donor-advised funds.  In addition, donors tend to overlook the fine print in their agreements with the funds, learning to their chagrin that the funds are often not obligated to honor a donor’s pledge.  Consequently, less money is being paid out to charities by donor-advised funds than by private foundations.

Mr. Schlesinger was followed in the forum by Page Eberstadt Snow, Chief Philanthropic and Marketing Officer at the Foundation Source, who enumerated alternative giving strategies certain foundations have preferred to traditional grant-making.  These include allocating funds directly to individuals (permissible by law in cases of hardship and emergencies), making or guaranteeing loans, and operating niche programs, such as providing durable soccer balls for use on broken and debris-laden fields overseas.

“Small foundations are not retreating from community-based organizations,” Ms. Page affirmed.  These foundations, however, tend not to entertain unsolicited submissions, but, she said, they can be contacted.  They want compact submissions, cost-benefit analyses of your program, and they want to know how your nonprofit is different from others in the same field.

“But you need to know a trustee,” Mr. Mittenthal advised.  “They don’t want strangers.

We welcome your comments about this post on the NPI blog.

Leave a Reply

Related Posts

Has Donor Trust in Charities Changed?

In this age of “fake news”, “alternative facts” “hyper partisanship” and what seems to be a general erosion of trust, why should we even care?  And if we care what can we fundraisers do about it?

Of course, every fundraiser should care because trust is the lynchpin of a solid and sustainable relationship with a donor.  And because there are ways to measure trust, taking steps to increase the level of trust, and by doing so increase donor value and an organization’s net revenue.

Read More »

MacKenzie Strikes Again

You probably won’t recognize most of the names on the list of the top 50 mega-philanthropists.

MacKenzie Scott’s name, though, immediately rings a bell and puts a smile on the face of those of us serving in the non-profit sector.

Ironically, she is not on that list, unlike her ex-husband.

Yet we love her for the special sensitivity she shows us, and her latest “strike,” an announcement to give away $250 million in funding to small nonprofits, is no exception.

Read More »

The CEO as Chief Fundraiser: A Role That Should Never Be Delegated

Our recent posts have lasered in on fundraising perennials–retention of fundraising staff, annual funds, and why donors give.  Another perennial stacks up as equally worthy of thoughtful commentary, and that’s the role of the chief executive officer in fundraising.  

A short definition of a CEO is he or she who makes decisions.  Nowadays, we recognize the value of consensus decision-making, and that’s fine.  But the kinds of decisions I’m referring to are the big ones, decisions such as those made by the captain of a ship.

Read More »