Giving by Big Foundations Rose 6% in 2005, Study Finds

By Ian Wilhelm

The nation’s weathiest foundations increased the amount of money they awarded by 6.1 percent to $16.4-billion

in 2005, from $15.5-billion in 2004, according to a new study.

But while giving grew, it was at a slower pace than in 2004, when grant making rose 8.1 percent.

The report, which was produced by the Foundation Center, in New York, blamed the slowdown on smaller financial gains in the stock market in 2005, the most recent year for which data are available. However, it said that giving probably expanded in 2006 thanks to a robust economy and the historic gift by Warren Buffett, which the center predicted would spur more wealthy people to establish foundations.

For the study, the center examined 1,154 charitable funds, whose combined grant making represents about half the giving by the nation’s roughly 68,000 philanthropies.

International Grants

In 2005, support for “international affairs,” which includes efforts to promote peace in foreign conflicts, economic development in impoverished nations, and overseas disaster relief, grew to a record $591.2-million — a jump of almost 41 percent.

The growth was attributed to the outpouring of generosity to help victims of the Indian Ocean tsunamis. However, while giving to international affairs surged, total giving to charitable projects abroad, which includes education and health efforts, remained flat at $2.8-billion.

Besides international affairs, giving to environmental and animal causes grew sharply, rising nearly 28 percent. The increase marks a turnaround for such support, which had declined from 2002 through 2004.

As in previous years, education garnered the largest amount of support, receiving almost a quarter of all grant dollars spent in 2005. Within that area, giving to vocational and technical training rose the greatest percentage — 38.2 percent.

The study also found that giving to specific charitable programs continued to be the most popular type of support.

Unrestricted grants were the second-most popular. The total amount for such giving grew 1 percent, to $3.3-billion. Support for construction or rebuilding of facilities increased about 16.7 percent, to $3-billion.

Family Funds

According to a separate report from the Foundation Center, the number of family foundations created in the last few years has grown rapidly. From 2001 to 2005, the number of such funds in America rose 22.3 percent, to almost 34,000. In that period, their giving rose 8.2 percent, to $14-million, and their assets increased 14 percent, to $233-million. Like other philanthropies, the family funds directed the majority of their giving toward improving education.

While the growth of family foundations continues to be significant, the Foundation Center pointed out that the rate at which such nonprofit groups were established peaked in the late 1990s and has steadily fallen ever since.

The two-page family-foundation study, “Key Facts on Family Foundations,” is free.

The 104-page giving study, “Foundation Giving Trends: An Update on Funding Priorities,” is part of the Foundation Center’s annual Foundations Today series, and can be purchased for $45 or as part of the three-report series for $95.

Both reports are available on the Foundation Center’s Web site.

Foundation Grants, by Region Percentage of grant dollars awarded Percentage of grant dollars received Northeast 32.0% 28.6% Midwest 21.5% 17.9% South 17.5% 22.3% West 27.8% 23.5% NOTE: A total of 6.1 percent of grant dollars was provided to organizations outside the United States.