Tapping Hispanic Philanthropy

Grant makers respond to burgeoning Latino population

Efraín Jiménez was introduced to the world of philanthropy by a family squabble. In 1997,

several years after he had left his small Mexican town of La Villita to live in California, Mr. Jiménez’s relatives divided into opposing camps over how to bring more water to their hometown.

Mr. Jiménez, who owns an auto-repair shop in San Fernando, near Los Angeles, went back to mediate. After helping the townspeople agree to dig a well, he volunteered to raise money so they could also build a paved road. Back in California, he began buttonholing other La Villita migrants, and they raised about $70,000 for the road in a year and a half.

That initial fund-raising success led to the creation of Club La Villita, a charity created by the migrants to support the town. The club is now one of more than 600 Mexican “hometown associations” across the United States that raise millions of dollars each year through raffles, dances, beauty pageants, and other activities to help build facilities or pay for social programs in Mexico. Their money is often matched by the Mexican government.

Such clubs have in recent years started to attract the attention of some of the biggest American foundations in response to the nation’s shifting demographics. And while the dollar amounts given to Hispanic organizations over all remain fairly small compared with the needs, according to some Hispanic leaders, the money is helping some of those groups gain a foothold as established and thriving organizations in what previously has been an informal network for funneling millions of dollars to immigrants within the United States and to the hometowns they left.

Support From Rockefeller Foundation

Mr. Jiménez has seen this “new breed of philanthropy,” as he terms it, firsthand. He is now executive projects director of the Federation of Zacatecan Clubs of Southern California — which unites Club La Villita and more than 70 other hometown associations of immigrants from the Mexican state of Zacatecas — and his salary is paid for by a grant from the Rockefeller Foundation.

Rockefeller has provided more than $400,000 over the last three years to help the federation hire a paid staff member, buy equipment, hire consultants, and cover travel expenses so that the group could better oversee the increasingly sophisticated projects its members were paying for — such as factories to help create jobs so that people are not forced to migrate to find work.

Mr. Jiménez hopes other major foundations will follow suit. “If they really join efforts with these hometown associations, what they would see is that really good philanthropy doesn’t come from the top,” he says. “Really good philanthropy comes from the bottom up, from the people themselves.”

Hometown Groups

Rockefeller, like many other foundations, is exploring ways to respond to the explosive rise of the nation’s Hispanic population, fueled largely by migration.

The Council on Foundations, in Washington, and Hispanics in Philanthropy, a network of grant makers that give to Hispanic groups, plan to set up an advisory group that will meet in October in Miami to begin brainstorming about how to strengthen philanthropic ties between the United States and Latin America, and the work of hometown associations will probably be one of the topics the group will explore.

According to U.S. Census Bureau statistics, the country’s Hispanic population ballooned by 20 percent from 2000 to 2005, to 42.7 million people — a growth rate far surpassing that of any other ethnic group. Furthermore, Hispanics accounted for half of the population growth in the United States from 2000 to 2004, compared with 18 percent for non-Hispanic whites.

The rapid influx of migrants, mostly from Mexico, has helped fuel the contentious debate over illegal immigration that Congress is scheduled to restart after the November elections. While some foundations are spending money to influence the outcome of that debate, others are looking for ways to help the migrants who have settled in the United States, whether or not they are here legally.

“We try not to look at immigration as an issue,” says Robert Stark, executive director of the New Mexico Community Foundation. “It’s more like a reality of who our communities are and how philanthropy responds to the needs of the full community.”

The Chicago Community Trust, for example, has awarded a series of grants since 2001 to provide training to leaders of local Mexican hometown federations in areas such as publicity, fund raising, public speaking, and strategic planning.

“The view was, the people who would go through the training would most likely be continuing to reside in the region,” says Margo Corona De Ley, a former senior program officer who is now a consultant. “They would likely be involved in their local schools, their local churches, local community organizations. And the more they learned about the development of leadersthe more effective they would be in these other arenas.”

But the program had an additional, unplanned outcome. The participants, whose organizations had previously worked independently of each other, began to see the merits of joining forces. In 2003, seven Mexican state federations united to create Confemex, or the Confederation of Mexican Federations, in Chicago.

“We were spending so much time together, sharing experiences,” recalls one graduate, Claudia Lucero, vice president of one of the federations, Durango Unido, which brings together people from the Mexican state of Durango. “We started building that trust with each other. We started working together.”

Confemex, which played a major role in organizing immigrants-rights rallies in Chicago last spring, won its own training grant from the Chicago Community Trust, for $50,000, last January, and Ms. Lucero, who moved to Chicago with her family in 1990, when she was 17, is now the group’s director of training.

The Community Foundation of Greater Greensboro, in North Carolina, found another way to help a Mexican hometown association. Last year, it created a fund for Patronato Mezquital, a group that represents more than 200 families in central North Carolina from the town of Mezquital, in the Mexican state of Durango.

The group was raising money to build a nursing home and retirement center in Mezquital, and the foundation set up the fund to give the donors a place to park its money on favorable terms.

“We waived minimums and fees in the interest of helping them,” says Tara Sandercock, the foundation’s vice president for programs. She says the foundation also advised the charity’s donors on how to get charitable tax deductions.

Saving Money

Other grant makers are also trying to help Hispanic immigrants get favorable terms for the huge amounts of money that they send to their families and hometowns.

“How do we help people both save money, but also take that money and go from being just a short-term cash transaction to use that to build some wealth and assets in the United States?” says Irene Lee, a senior associate at the Annie E. Casey Foundation, in Baltimore.

Casey and the Ford Foundation, in New York, have made grants of $145,000 and $153,000, respectively, to help pay for a project by Appleseed, a network of public- interest law centers, to help improve access for Hispanic immigrants to financial institutions.

The group issued a report last December noting that Mexican migrants in the United States sent an estimated $20-billion to their families and hometowns in Mexico in 2005, representing the world’s largest remittance market.

But Appleseed found wide differences in the fees and exchange rates charged by 21 remittance centers in four states that it studied — and a lack of openness about what those charges are. It proposed that the industry adopt new standards under which companies could earn a “Fair Exchange” logo, similar to the “Fair Trade” label for coffee, if they followed practices such as clearly disclosing fees and exchange rates on receipts and guaranteeing delivery times.

Linda Singer, Appleseed’s executive director, says the group is now working on a pilot project with a bank, which she declined to name, that has agreed to allow Hispanic immigrants who are in the country legally to qualify for mortgages by using their remittance histories to show they are creditworthy.

‘Far Behind’

Despite those examples, some philanthropy experts say foundations have lagged behind the demographics in increasing their giving to groups that serve the fast-growing Hispanic population.

Julieta Mendez, executive coordinator of the International Community Foundation, in San Diego, says community foundations, for example, have been slow to recognize that hometown associations could be valuable partners in responding to the profound changes that the influx of immigrants are bringing to their regions.

“Despite the fact that these changes started to take place 22 years ago, community foundations are still far behind in finding innovative approaches to working with this community,” she wrote in a paper that was presented this month to a Council on Foundations community-foundations conference in Boston. Of 21 community foundations surveyed, only two had formal partnerships with a hometown association, her paper said.

Overall, philanthropy for Hispanic causes has edged up in the past 10 years. Grants to Hispanic groups rose from $85.3-million in 1998, or 0.9 percent of total grants, to $198.8-million, or 1.3 percent, in 2004, according to data compiled from more than 1,000 grant makers by the Foundation Center, in New York.

But those figures do not impress Diana Campoamor, president of Hispanics in Philanthropy, in San Francisco. “If you look at the increase in population and the increase in funding in the last 30 years, there’s been a decline when you look at it proportionately,” she says.

Steven Lawrence, the Foundation Center’s director of research, cautions that the center’s figures include only grants that are directed specifically to Hispanic groups, not those that may benefit Hispanics among others.

But Ms. Campoamor insists that foundations, especially the big ones that set the philanthropic agendas, need to do more. “When you think about the potential for the nonprofit sector to [support] the leadership of that new population, a very young population in comparison of the rest of America, I think we’re losing an opportunity,” she says.

Among other measures, grant makers should be looking for ways to hire more Hispanics in decision-making positions, which would help them improve their giving records, she says. According to surveys by the Council on Foundations, only 5.9 percent of full-time foundation staff members in 2005 and 3.3 percent of governing board members in 2004 were Hispanic.

To help improve those numbers, Ms. Campoamor says, her group is in the process of developing a sophisticated database of Hispanic job candidates who can be referred to executive-search firms that work for foundations.

Hispanics in Philanthropy started a major program in 2002 — the Funders’ Collaborative for Strong Latino Communities — which hopes to get foundations, corporations, individuals, and state and local governments to pool their resources to give money to small and medium-size Hispanic nonprofit groups.

The project has raised $30-million and awarded grants to more than 300 organizations at 15 sites in the United States and three in Latin America.

National and regional grant makers provided more than $17-million of the total to match giving by local grant makers, with the Ford Foundation providing the most, $2.5-million, followed by the Knight Foundation ($1-million), and the Marguerite Casey Foundation ($750,000).

In fact, the Ford Foundation is the granddaddy of Hispanic philanthropy, awarding about $200-million since the 1960s to organizations such as the National Council of La Raza, the nation’s biggest Hispanic civil-rights group, and the Mexican American Legal Defense and Educational Fund. Its spending — which has focused on legal rights, improving neighborhoods, and more recently arts and culture — grew from about $1-million in 1975 to $9.4-million in 2005, says Susan Berresford, Ford’s president.

“Any time in which large numbers of newcomers enter the country, we need tohelp them understand the communities they arrive in and help the communities they are arriving in understand them,” she says.

Eleven Grant Makers

Ford was also the main driver in getting the U.S.-Mexico Border Philanthropy Partnership off the ground in 2002. The project, which now unites 11 grant makers — including the Annie E. Casey, Charles Stewart Mott, and William and Flora Hewlett Foundations, as well as Pfizer, the pharmaceutical company — wants to help strengthen 22 community foundations on both sides of the U.S.-Mexican border.

Managed by the Synergos Institute, a nonprofit anti-poverty group in New York, the partnership has raised more than $15-million to provide money, training, and information to the community foundations to help them design programs to address problems in a region that is marked by poverty, rapid population growth, and inadequate social services.

Ms. Berresford says she expects that other foundations will step up their giving as more Hispanic leaders emerge in politics, education, and the arts to draw attention to the needs of Hispanics. “Over time, it will probably improve because the growth of the Hispanic population is so dramatic,” she says.

But some fund raisers say that in looking for donors to help Hispanics in need, there is a huge untapped resource — Hispanics themselves, especially affluent ones.

“Latinos say that they are not asked,” says Teresa Alvarado, executive director of the Hispanic Foundation of Silicon Valley, in San Jose, Calif. “People make the assumption that we can’t give.”

Ms. Alvarado was named the foundation’s first executive director in March and was charged with expanding the organization’s fund-raising efforts beyond an annual charity ball. Over the past 16 years, the foundation and its predecessor, the Hispanic Charity Ball, awarded $850,000 to 43 nonprofit groups that help Hispanics find housing, deter gang violence, and fight childhood obesity.

But the foundation wants to do more to encourage giving by the region’s large Hispanic population, which includes many high-tech workers and entrepreneurs, Ms. Alvarado says. She says Hispanics are sometimes a tough sell, however. Helping people in need is “very much ingrained” in Hispanic culture, she says. “But formal philanthropy is a bit different.”

The Hispanic Foundation conducted a study with the Community Foundation Silicon Valley last year to unearth the giving patterns of Hispanics in their region. Interviews with more than 1,500 adults showed that Hispanics had lower household incomes than other groups (45 percent earned less than $40,000 a year, compared with 17 percent of whites and 14 percent of Asians).

Nevertheless, they gave an average of 3.9 percent of their annual household income to charity, on a par with giving by non-Hispanic whites and double that of Asians. Much of the philanthropy was informal and personal, however, such as giving money to friends and relatives or directly to homeless people, or donating clothes or food to people in need.

Only 46 percent of those surveyed donated to a nonprofit group, compared with 80 percent of whites who are not Hispanic. Many Hispanics said they felt disconnected from local organizations because they did not see themselves reflected on the boards or staffs.

In another effort to court Hispanic donors, María C. Bechily, owner of a Hispanic-market consulting practice and a member of the Chicago Community Trust’s Executive Committee, helped spearhead a program in 2003 to encourage giving in the Chicago area.

The program, called Nuestro Futuro, hopes to raise $6-million by 2009 to provide grants to small nonprofit groups in the region that offer services to Hispanics. So far, it has raised $2-million.

Ms. Bechily notes that Hispanics have a history of giving generously to their families and hometowns across the border. “All that is wonderful,” she says. “But we want to create a vehicle and environment that will make those philanthropists in Chicago think about, What can I do here?”