Seeking a Bigger Share

Leaders of minority-run groups argue that foundations fall short in their support of ethnic charities

During a National Philanthropy Day luncheon at a San Francisco hotel recently, demonstrators

bearing leaflets interrupted the salad course to deliver a message to the Marin Community Foundation: Give Latino-run nonprofit groups more grants so they can better fight for good schools and low-cost housing.

The brouhaha between the Marin Community Foundation and a dozen or more advocacy groups in Marin County, Calif., pits nonprofit leaders serving the county’s poorest residents against the nation’s fourth-largest community foundation, with assets of $1.1-billion. It also highlights a longstanding complaint made by minority nonprofit groups about foundations: Despite all the problems of the ethnic poor, private foundations and some community foundations give too little to minorities, particularly organizations run by ethnic groups.

Cesar Lagleva, a steering committee member of the Poor and Needy Advocates of Marin, in Mill Valley, Calif., says his group and others are demanding that the Marin Community Foundation develop a comprehensive plan for helping the county’s poor. Included in that plan, the activists argue, should be an increase in grants to nonprofit organizations run by minorities. “We’re the ones who know intimately the daily struggles of our people,” Mr. Lagleva says. “We wanted to show them that many of the social-service organizations the foundation backs don’t reflect the colors of their communities.”

Thomas Peters, the foundation’s president, counters by saying that his organization poured 70 percent of its annual grants last year into housing, education, and social services for the county’s poor, including its 30,000 Latinos and other minorities. “I’m very proud of our record of involvement in Latino issues, which is based on need, not quotas,” says Mr. Peters.

8% of Grants

Research on grant making to minority groups is spotty, but data from the Foundation Center, in New York, suggest that groups dedicated to minority causes reap a considerably lower percentage of foundation dollars than do mainstream groups that may serve a variety of populations.

Grants made to organizations that specifically designate themselves as belonging to a minority group tallied less than 8 percent of total foundation giving in 1999, according to the center’s most recent figures. Minorities make up about 30 percent of the U.S. population.

Giving to Latino groups accounted for 1.2 percent of all foundation giving surveyed in 1999. For blacks, the figure was 1.9 percent. Blacks and Hispanics each make up 13 percent of the U.S. population. Grants for Native American programs and Asian nonprofit groups, combined, were less than 1 percent. A separate category measuring general grants to ethnic groups shows that an additional 3.9 percent of total foundation giving went to help minorities.

“The record of foundations is just really, really bad,” says Erica Hunt, executive director of the 21st Century Foundation, a New York organization founded and led by blacks. “If we’re looking to mainstream foundations to address our issues, we’ll always be underfunded.”

Questioning Figures

Others, however, question the accuracy of the Foundation Center’s numbers, arguing that much of the money granted to mainstream groups serving minorities is not included in the Foundation Center’s breakdowns of giving to racial and ethnic causes.

Some foundation officials and philanthropy observers say that reports such as the Foundation Center’s grossly understate grant makers’ support for minorities in other ways. Uncounted, they say, are grants to non-minority-run charities, even when grants to those groups are used largely, or even exclusively, for programs that benefit minorities.

“You can’t take mainstream organizations that serve vast populations of minorities out of the equation,” says Curtis W. Meadows Jr., executive director of the RGK Center for Philanthropy and Community Service, at the University of Texas at Austin. “If you are supporting a YMCA in a neighborhood that is 80 percent minority, that’s support for minority populations even though the YMCA and its programs are not exclusively designed for minorities.”

Chester E. Finn Jr., president of the Thomas B. Fordham Foundation, in Washington, agrees that many studies overlook foundation grants benefiting minorities.

The Fordham Foundation gives about $400,000 annually to scholarships and charter schools in Dayton, Ohio. Mr. Finn says the foundation classifies the awards as education grants. But because the overwhelming majority of the scholarship recipients and charter-school students are black, says Mr. Finn, the foundation is supporting programs that benefit minorities.

And because most of Dayton’s charter schools — public schools that frequently operate separately from school-board bureaucracies — have principals who are black, the beneficiaries of the foundation’s money could be considered minority-run.

But, says Mr. Finn, such grants aren’t tied to minority programs in data compiled by the Foundation Center.

Mr. Finn says that the harshest critics of foundation giving typically are not people who have fairly examined grant makers’ track records. Instead, he says, they are likely to be what he calls “jilted grantees.”

Bypassing Minorities

But other observers say that minorities have a reason to be upset.

Rick Cohen, president of the National Committee for Responsive Philanthropy, a nonprofit organization in Washington that promotes giving to minorities and groups that represent the poor and disenfranchised, says foundations often bypass ethnic organizations when handing out grants.

Mr. Cohen adds that the Foundation Center’s study includes only a fraction of the total number of foundations in the nation.

“The top 100 of the 1,016 foundations the Foundation Center looked at actually do a decent job of funding ethnic causes,” Mr. Cohen says. “I wonder about the other 76,000 foundations out there. There’s not much evidence that the vast majority of them are doing anything for ethnic groups.”

Even when grants dollars go to minority-run groups, they are often insufficient or misdirected, some charity leaders say.

Pablo Eisenberg, senior fellow at Georgetown University’s Public Policy Institute, says that ethnic-run organizations’ involvement with many of society’s problems may actually be hurting them. Mr. Eisenberg says that mainstream foundations are reluctant to consider granting money to groups that center their work on political or controversial issues. Many foundations back off from funding groups in ethnic neighborhoods that serve minorities or try to mobilize them.

“Foundations take a back seat on all the major issues — poverty, racism, you name it,” Mr. Eisenberg says. “There’s a huge disconnect between foundations and these problems.”

Emmett D. Carson Jr., the first black president of the Minneapolis Foundation, who once worked at the Ford Foundation, says a lack of understanding of ethnic issues underlies foundations’ rates of giving, largely because of a lack of minorities working as foundation staff or on their boards.

“The fact that many foundations aren’t supporting community-service groups has more to do with the racial and ethnic makeup of foundations than that of nonprofit groups,” he says. “Grant making is always about choices. If people making the choices all have the same experiences and backgrounds, then certain things will not get funded.”

Typecasting Foundation Officials

A 1999 study by the Joint Affinity Groups, a coalition of ethnic nonprofit leaders affiliated with the Council on Foundations, showed that 18 percent of staff members at 652 foundations were minorities. Minorities held 5 percent of foundation chief-executive positions.

Even when a member of an ethnic group is hired by a foundation, he or she often is typecast, says Hanmin Liu, president of the Wildflowers Institute, in San Francisco, a nonprofit organization that studies traditions and cultural differences and makes reports for foundations and others interested in understanding ethnic groups.

“What you’ll often see is a person of color hired who works only with people of color,” says Mr. Liu, who is also a trustee of the W.K. Kellogg Foundation, in Battle Creek, Mich. Ethnic foundation staff and board members are more common now than they were 10 years ago, but they frequently end up “boxed in,” he says. “If you’re a Native American, you’re likely to work with Native Americans.”

Operating Funds

William T. Merritt, chief executive officer of the National Black United Fund, in Newark, adds that grants to minorities are usually earmarked for specific programs or special projects, and not to help organizations pay operations costs or make groups grow. Mr. Merritt says he recognizes that foundations are often criticized for ignoring the general operating needs of all kinds of nonprofit groups. But, he says, minority-run, grass-roots organizations are particularly needy in that area.

Because small, minority-run groups have such trouble getting off the ground, he says, foundations tend to support “the bigger, more popular black organizations over and over again.” And those groups, according to Mr. Merritt, “may not be down in the communities addressing the real needs.”

Mr. Merritt, whose organization raises money for black-run nonprofit groups, says black charity leaders feel hampered by what they see as competition for limited foundation dollars.

“The perception is that there is a certain amount of money that will be for the black community, so even if you have two or three good proposals, only one is going to get funded,” Mr. Merritt says. “Whether or not you get money is based on the limit, instead of the value, of your proposal.”

Assessing Efforts

Foundation officials insist that they do not limit, or even categorize, grants in that way. Besides standing by their organizations’ records of making grants intended to support minority programs, they say they remain vigilant about how they are faring in minority matters.

“We must constantly reassess what we are doing to make sure that our work reflects, represents, and supports a population that is becoming more diverse every day,” says Lewis Sandy, executive vice president of the Robert Wood Johnson Foundation, in Princeton, N.J.

Still, they say they understand why minority-run organizations feel they aren’t getting their fair share.

Some foundation leaders say they have heard the arguments about granting minorities more money to run their operations, make them larger, and expand their missions — and they agree with them.

“The perception by those organizations that they are insufficiently supported is because many foundations don’t recognize that minority organizations need more infrastructure, more core support, because they might not have the advantages of their peers with longer histories, bigger endowments, and better networks,” says Douglas W. Nelson, president of the Annie E. Casey Foundation, in Baltimore.

The irony, he says, is that, in most cases, both the grant makers and the minority-run groups have good intentions and believe they are doing what is right.

“On one side you have all these foundations that believe they are working for and by and with minority-run groups, but on the other side you have the minority-run groups thinking, fairly, that they are not well-positioned in terms of support,” Mr. Nelson says.

Lowering Barriers

Some nonprofit groups are looking to change that. Diana Campoamor, executive director of Hispanics in Philanthropy, a grant-makers organization in Emeryville, Calif., says that raising the profile of small ethnic nonprofit groups is key to opening grant makers’ doors.

“When you see that Hispanics get less than 2 percent of grants from foundations, the question becomes, What are the barriers?” says Ms. Campoamor.

Her group started the Funders Collaborative for Strong Latino Communities last year to try to eliminate one of those perceived barriers: the inability of many small, minority-led nonprofit groups to grow large enough to attract foundation attention. The goal of the program is to match national foundation grants with the money of local donors to increase the size and strength of 100 or more Latino nonprofit groups.

So far, Hispanics in Philanthropy has collected $7-million from 33 grant makers, including the Ford, Rockefeller, and W.K. Kellogg Foundations.

Role of Community Foundations

While private foundations often are viewed as insensitive by ethnic nonprofit groups, feelings about community foundations are a bit more complex.

To many activists and nonprofit leaders in Northern California, the Marin Community Foundation, located in one of the richest counties in the country, all too clearly shows the gulf between a rich grant maker and some of the county’s advocates for the ethnic poor. The foundation denies the existence of any such gap.

But many community foundations are trying to reach ethnic populations and help their causes.

The development of minority funds within community foundations is an example of how mainstream foundation money, used to seed minority funds, can work to inspire giving by minorities and spur the development of ethnic nonprofit groups, says Henry A.J. Ramos, principal in Mauer Kunst Consulting, a company in New York that advises nonprofit groups.

“Community foundations have been criticized roundly by people of color for being unresponsive,” says Mr. Ramos, a former program coordinator at the Ford and James Irvine Foundations. “Dedicated funds for ethnic groups within these foundations are starting to change that.”

The Greater Kansas City Community Foundation and the Saint Paul Foundation each has several funds that exclusively serve minorities.

The Hall Foundation, started with money from the Hallmark Cards Company, in Kansas City, Mo., provided $200,000 to create two ethnic funds for blacks and Hispanics in 1983. “The Hall family believed that it was important that the minority community have a voice,” says Janice Kreamer, president of the Greater Kansas City Community Foundation. Since then, the funds have grown to about $5-million total. What’s more, the ethnic funds have been partially responsible for the founding of several social-service nonprofit groups that serve minority needs.

Similarly, the Saint Paul Foundation’s so-called diversity endowment funds for black, Asian, Hispanic, and Native American populations were established in 1992. Those four funds plus an additional one held in common by all four groups have grown to $6.5-million in assets while funneling $1.5-million to nonprofit groups over the past five years.

The funds now garner donations from many minorities, says Norman Harrington, development officer for the diversity funds.

Besides increasing minority nonprofit activity, such funds provide an additional service to foundations whose boards are made up largely of whites. “Diversity funds have served to inform foundations as to how they should be doing business,” says Mr. Harrington.

Ms. Kreamer acknowledges that critics of funds such as the ones within the Greater Kansas City Community Foundation worry about their potentially balkanizing effects.

“Some might argue that these specialized funds segregate philanthropy,” says Ms. Kreamer. “Our experience has been the opposite. Blacks and Hispanics now sit at the same table as whites. It has raised their influence in philanthropy here.”