Comprehensive Look at 2003 Grant Making Shows Gifts of $30.3-Billion, a 0.4% Decline

Foundation giving slipped in 2003 to $30.3-billion, despite the beginning of the stock-market recovery and the creation of more than 1,500 new grant-making foundations, according to a report by the Foundation Center, in New York.

The 0.4-percent dip in grants was concentrated among private foundations, which make up the vast majority of grant-making institutions, the report found. Those foundations trimmed their grant budgets by nearly 3 percent — to $22.6-billion — following steep declines in their assets over the previous two years.

By contrast, giving by community and corporate foundations remained virtually unchanged in 2003. Operating foundations increased their grant making by 46 percent, to $1.7-billion, due mainly to grants by large foundations established in the last decade, including the Bristol-Myers Squibb Patient Assistance Foundation and the Janssen Ortho Patient Assistance Foundation. Together with the Merck Patient Assistance Program, those foundations awarded $996.8-million, or nearly three-fifths of dollars distributed by operating foundations.

The report, the final in a series of three on foundation trends produced annually by the Foundation Center, offers detailed analysis of figures from 2003, the last year for which complete data were available.

The Foundation Center said that when final numbers are tallied, giving in 2004 will show a rebound, since assets in 2003 — which grant makers used to set their 2004 grants budgets — rose 9.5 percent. Also, donations to foundations in 2003 increased by 12.2 percent, to $24.9-billion, the report said.

Large foundations increased their giving by a bigger share than grant makers overall, the report says. Grants awarded by the 25 largest foundations increased by 10 percent, to $6.6-billion, while their assets climbed nearly 17 percent, almost double the rise in overall foundation assets.

The biggest grant maker in 2003, the Bill & Melinda Gates Foundation, gave away $1.18-billion, a 2.1 percent increase over the previous year. The William and Flora Hewlett Foundation scaled up its giving by more than 50 percent — to $258.05-million — while giving by the Lilly Endowment and Ford Foundation dropped by 17 percent and 15.3 percent, respectively.

Regional Changes

The number of foundations in the West grew faster than in any other region, recording a 3.4-percent gain in 2003.

The number of active foundations in that region has soared by 321.4 percent since 1975, outpacing the increase for all U.S. foundations (203.4 percent).

The growth in grant making by foundations in the West has also outpaced other regions, rising by more than elevenfold after inflation since 1975. Overall giving by foundations increased by an average of 355.7-percent in that period.

Despite a comparatively slow growth rate of 2.3 percent, the Northeast still boasted the greatest number of active grant makers, at 20,797. Foundations in that region also showed the largest gain in giving (3.1 percent), followed by the West (1.3 percent).

Grant makers in the Midwest and South, by contrast, gave out less money in 2003 than the year before.

Foundations in just five states — New York, California, New Jersey, Washington, and Pennsylvania — accounted for close to half (47.1 percent) of total giving in 2003.

The report, “Foundation Yearbook: Facts and Figures on Private and Community Foundations,” can be purchased for $45 by contacting the Foundation Center, Attn: Customer Service Department, 79 Fifth Avenue, New York, N.Y. 10003; (800) 424-9836; fax (212) 807-3691, or online at http://fdncenter.org.