Building community philanthropy

Community and Economic Development – Blog by UNC School of Government

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Building community philanthropy

By CED Guest Author

Published March 24, 2010

Lisa Stifler is a Research Associate with the Community & Economic Development Program.

Over the past decade or two, there has been increasing attention and interest in growing community wealth from within.  Activities have focused on leadership development, entrepreneurship and growing businesses from within, and place-based development that capitalizes on the characteristics or amenities in a particular community.  Another form of this “homegrown” community and economic development that has been taking shape is using community philanthropy to improve the economic prospects of communities and regions, often in the form of community foundations.Community foundations, unlike private foundations set up by a family or corporation, collect and manage money and other assets from a wide population of individuals, families, and organizations.  Although not new, community foundations have typically been concentrated in urban communities, but rural communities are increasingly creating their own foundations on their own initiatives or with the help of regional, state, and/or national organizations and foundations.

Beyond the formal philanthropic organizations that exist throughout this state, a recent report from the NC Rural Center highlights the amount of giving taking place in the state.  Particularly impressive is the fact that rural NC residents give a higher percentage of their income than urban residents (4.5% vs. 4%), and among rural counties, residents of Tier 1 counties gave a greater percentage of their incomes than those from  Tier 2 and 3 rural counties and urban counties.  The report’s findings highlight the fact that there is great potential in this state, particularly in rural, economically distressed counties, for formalized community philanthropy.

A number of organizations and foundations throughout this state and the country have approached the untapped potential that exists in rural communities in different ways.  In Nebraska, the Nebraska Community Foundation has taken a unique approach to building permanent community endowments.  Stemming from research out of Boston College on the amount of wealth that will transfer from one generation to another over the next 50 years, NCF decided to do its own analysis of wealth transfer in rural Nebraska.  Armed with their findings (that at $94 billion would transfer from one generation to the next over the first half of the 21st century among rural Nebraskans), NCF set out to help local leaders set goals for establishing and building permanent endowments in their communities.  NCF has encouraged affiliated fund and community leaders to capture 5% of the 10-year transfer of wealth for their communities or counties by building existing or developing new local endowments.  As of 2008, six communities met this goal, and another seven were at least half-way there, and these funds were raised through inclusive philanthropy – no gift is too small and all are encouraged to contribute.  NCF believes that this work helps to reconnect residents to their hometowns, take ownership of their communities, and encourages youth to view their communities as places where there are opportunities for them after college.

The Black Belt Community Foundation, in rural Alabama, got underway in 2002 with the intent of starting a community-based foundation that would not just be “for” the community but would be “of” the community.  In this sense, BBCF is truly a grassroots community foundation that has been built from the ground up.  In order to gauge broader community support for the idea, public meetings in each of the 11 counties that make up the Black Belt were held.  Those meetings allowed BBCF leaders to share the idea of a community foundation, map the assets within each county, and generate interest in and support for the formation of BBCF.  BBCF’s organizational structure also reflects the grassroots nature of the organization.  The board of directors includes at least one representative from each of the counties in the service area, and it is intentionally diverse, with members representing the demographics of the region and with youth representatives.  In addition, in order to remain connected to the communities and to develop leadership within each county, BBCF operates a Community Associates program.  Through the program, volunteer community members, typically those who are not the “usual suspects”, link BBCF with their respective communities, provide advice during the grant making process, identify strengths and needs in the communities, assist with grassroots fundraising, and become new leaders within their communities.  Currently in its fifth year of full operation, BBCF is committed to grassroots philanthropy by raising and celebrating donations from all (the majority of its donations are $100 or less) and by supporting community organizations within the 12 counties it serves.

Also focusing on grassroots and inclusive philanthropy, NCGives is a statewide organization that celebrates all forms of community giving, whether time, talent, or treasure.  Since 2005, NCGives has been working to change the idea that philanthropy is an activity only for the wealthy.  Through education, building relationships, support and technical assistance, and knowledge gathering, NCGives supports giving through North Carolina, particularly among youth, women, and communities of color.  The organization helps grassroots groups develop their own forms of organized giving, often through giving circles or volunteer opportunities.  NCGives is also developing the “Philanthropy of Community” program which works with organizations and communities to identify, develop, and amplify the forms and patterns of giving that already exist within those organizations and communities.  By highlighting and encouraging giving of all forms among all types of people, NCGives has seen that individuals, organizations, and communities become more aware of the assets in their communities and are empowered to give more.

The efforts highlighted above show that community philanthropy, in all its forms, has the potential to help distressed communities, particularly rural communities, build their communities and even their economies.  By involving the community at the grassroots level, leaders are developed, and there is often a new sense of pride and commitment to the community which often leads to further development activity.  Further, this work can also help leaders and residents view the assets in the communities in different lights and work to find ways to develop those assets such that they help to bring economic stability to their communities.  There are challenges in this work, and much needs to be done to increase knowledge on these issues and to build partnerships.  However, “homegrown philanthropy” efforts go hand in hand with homegrown business development efforts through their mutual goals to grow and support communities from within in order to improve the long-term stability of communities.