Missoula News

Rural Philanthropy

Foundations Mixed on What to Give Rural America

By Rick Cohen, DailyYonder.com, 9-11-07

Dutton, Montana, population 375. Photo by Courtney Lowery.

Editor’s note: The following is from Daily Yonder, a “daily multi-media buffet of news, commentary, research, and features” all focused on Rural America. Find Daily Yonder at www.DailyYonder.com.

About one dollar, maybe a buck-fifty out of every hundred dollars given that U.S. foundations give away reaches rural America. That’s a pretty small slice of the $40 billion handed out each year by 80,000 foundations.

In early August, some 180 representatives from foundations and nonprofits met in Missoula, Montana, under the auspices of the Council on Foundations, the national trade association of grant makers, to examine how to get more money flowing toward rural people and communities.

Why Missoula?  Because in May of 2006, Montana’s U.S.  Senator Max Baucus spoke to the annual conference of the Council and challenged foundations to double their grant making to rural America in the next five years — and, while they were at it, they might add some rural people to the boards of the nation’s largest and most powerful philanthropies.

With Baucus chairing the powerful Senate Finance Committee — and to that extent controlling the tax laws under which philanthropies operate — foundations snapped to attention and called for a conference in the Senator’s home state to think about how to ratchet up foundation giving to rural communities.  The results?  So far, they are mixed.

The Council on Foundations just this week issued a brief summary report of the Missoula results, promising more talk about what might be useful and future targets for funders interested in rural America. The report hinted at a second rural philanthropy conference in 2008.

All well and good, but mechanisms for doubling foundation grant-making to rural America were nowhere to be found. The conference called for studying the "transfer of wealth" in rural areas, the rural portion of some $40 to $50 trillion dollars that retiring Baby Boomers will pass on to their heirs between now and the year 2050. Presumably, a chunk of that wealth is lodged in rural America in land and other assets, and some portion of that transfer could end up as philanthropic resources in private foundations and in "donor-advised funds" at community foundations.

The Nebraska Community Foundation has already conducted research on the amount of wealth likely to be transferred and how it might be tapped to create new philanthropic endowments. The Council called for transfer-of-wealth studies in all 50 states.  The implication of this suggestion was clear: To respond to rural needs, the Council was telling rural areas to build and control their own new philanthropic funds rather than rely on outside funders in the nation’s big cities for grant support.

The leadership of the foundation sector came out against what was termed "redistributive" philanthropy, the notion that funders that weren’t already giving in rural areas ought to be. Their reasoning was that this approach would simply be taking funds away from hard-pressed urban areas to meet the philanthropic needs of rural areas.

The answer really ought to be "both and." Endowment-building is great, but it’s slow, and the rural areas with the least wealth generally face the toughest and slowest sledding in amassing assets for responding to community needs.  The Nebraska Community Foundation model is a great example of the "both and"; its transfer-of-wealth endowment-building strategies were first capitalized by several million dollars worth of grants from multi-billion dollar foundations, notably Ford and Kellogg.

Read the rest of the story at www.DailyYonder.com.

Like this story? Get more! Sign up for our free newsletters.