Gifts to Community Foundations Decline, but Grants Are on the Rise

As the economy faltered and stock values plunged last year, gifts to community foundations

fell 15 percent compared with 2000 and community-foundation assets dipped for the first time in a decade, according to a survey by the Columbus Foundation, in Ohio, and the Council on Foundations.

The survey, one of two new ones on community foundations, found that community-foundation assets declined by about 1 percent in 2001, to $31.4-billion. In most years over the past decade, assets rose by substantial margins.

Grants, meanwhile, totaled nearly $2.6-billion in 2001, up 18 percent from the previous year, the survey found.

Unlike endowed foundations, community foundations raise money from many sources and generally limit their grant making to specified geographic areas.

Community foundations collectively received $3.5-billion in gifts last year, or some $608-million less than the record amount of 2000, the survey reports.

The Tulsa Community Foundation received the most: nearly $137-million. It was followed by the Greater Kansas City Community Foundation ($124-million), New York Community Trust (nearly $115-million), Community Foundation Silicon Valley ($111-million), and the San Francisco Foundation ($103-million). All the other foundations received less than $100-million.

On the grant-making side, the New York Community Trust gave away the most money by far: $125-million. Other big donors included the San Francisco Foundation ($83-million), Greater Kansas City Community Foundation ($77-million), Community Foundation Silicon Valley ($76-million), and the San Diego Foundation ($70-million).

The wealthiest community funds were the New York Community Trust, with nearly $1.8-billion in assets; the Cleveland Foundation ($1.5-billion); the Chicago Community Trust (nearly $1.2-billion); and Marin Community Foundation, north of San Francisco ($1-billion). The next richest fund, the San Francisco Foundation, had just $741-million in assets, and no other community fund held more than $700-million.

The amount paid in grants grew by $393-million over the $2.2-billion granted in 2000.

In a separate survey, 200 community foundations responded to a poll, conducted last year by the Columbus Foundation, that documents the growth of donor-advised funds — individual accounts held by foundations that permit donors to suggest the beneficiaries of their gifts.

The study found that the foundations collectively held 17,213 such funds, worth some $5.2-billion. The number of donor-advised funds at each community foundation ranged from one to 745, and the median was 35 funds, meaning that half the community foundations had more funds and half fewer.

The community foundations that participated in the survey reported that a total of 42,562 gifts were made to donor-advised funds. The gifts were valued at nearly $1.5-billion.

In turn, the foundations made 96,263 grants from donor-advised funds, for a total of $695-million.

In addition to financial data, the survey asked community-foundation officials about various management practices. Among the findings:

• 98 percent of community foundations charge a fee to manage a donor-advised fund. About half the foundations base the fee on a percentage of the fund balance.
• 94 percent do not limit the number of grants or distributions that donor-advised funds can make each year.
• 83 percent require a minimum sum to establish a donor-advised fund. That ranges from $1,000 to $500,000, with a median threshold of $10,000.
• 63 percent bar gifts from donor-advised funds to individuals, while 38 percent allow only gifts to domestic organizations.

Both reports are available online.

To see the “2001 Columbus Foundation Survey,” go to http://www.columbusfoundation.org.

Printed copies are available from Amber Erickson, Columbus Foundation, 1234 East Broad Street, Columbus, Ohio 43205; (614) 251-4000.

The report on donor-advised funds, called “A Flexible and Growing Service to Donors: Donor-Advised Funds in Community Foundations,” can be found at http://www.cof.org, the Web site of the Council on Foundations. Information is available at the Council on Foundations, 1828 L Street, N.W., Washington, D.C. 20037; (202) 466-1652.