‘Green’ funding seen tilted to bigger advocates

Environmental funders are spending too little money on advocacy work to protect low-income areas and communities of color from environmental degradation, a new report says.

From 2007 to 2009, only 15 percent of environmental grant dollars were classified as benefiting “marginalized” communities, and only 11 percent were classified as advancing “social-justice” strategies, a “proxy for policy advocacy and community organizing that works toward structural change on behalf of those who are least well off politically, economically and socially,” says Cultivating the Grassroots, a report from the National Committee for Responsive Philanthropy.

In the same period, the report says, grant dollars donated by funders who committed over 25 percent of their total dollars to the environment were three times less likely to be classified as benefiting marginalized groups than were grant dollars given by environmental funders in general.

Environmental funders “are expending tremendous resources, yet spending far too little on high-impact, cost-effective grassroots organizing,” the report says.

In 2009, it says, half of all environmental grants went to environmental organizations with annual budgets over $5 million, a group that represents only 2 percent of the nearly 29,000 environment and climate public charities in the U.S.

That suggests a “predominantly ‘inside-the-beltway’ top-down fundraising strategy,” Sarah Hansen, author of the report, says in a statement.

“There are many effective pro-environment organizations on the ground that are under-resourced and underutilized,” she says. “By overlooking these grassroots groups and communities ripe for mobilizing to protect our environment from harm, philanthropy is marginalizing proven vehicles of social change and thus seeing less impact and progress.”

The report calls for environment and climate funders to provide at least 20 percent of their grant dollars to community-based groups that work to address the needs of underserved people most affected by environmental harm.

It also recommends those funders invest at least 25 percent of their grant dollars in grassroots organizing, advocacy and civic participation.

And it encourages them to “take a long view by building the infrastructure needed to succeed and preparing for tipping points.”

The report says more “environmental wins” can be secured “by decreasing reliance on top-down funding strategies and increasing funding for grassroots communities that are directly impacted by environmental harms and have the passion and perseverance to mobilize and demand change.”

Aaron Dorman, executive director of the National Committee for Responsive Philanthropy, says in a statement that winning big fights depends on popular support.

“Philanthropy needs to fund those groups that listen to people in communities that are most at risk from the impacts of environment and climate change, organize them and rally their support around important solutions,” he says.

Fundraising opportunity for advocacy work

By Todd Cohen

Advocacy work is fundamental to democracy, can generate a big payoff, and represents a key task for many nonprofits.

But nonprofits also can find it tough to raise money to pay for advocacy work.

Research and watchdog groups that track it report that advocacy funding can produce a big impact on social change, but that it also has suffered during the economic downturn.

The challenge for advocacy groups is to do a better job helping funders and individual donors understand the need for fixing flawed public policies, as well as the difference their support can have on addressing urgent social and global problems.

Tiny share

Overall charitable giving in the U.S. totaled over $290 billion in 2011, according to Giving USA, but advocacy funding represents only a tiny share of those dollars.

In 2009, for example, grantmaking to U.S.-based nonprofits that work for structural change to improve opportunity for the most vulnerable populations totaled just $3.1 billion, according to a report from the Foundation Center.

And the recession simply made it tougher to raise money for advocacy work, a decline that likely will continue, the Foundation Center says.

Big impact

Yet advocacy funding can make a big impact.

Over three years, for example, at least 321 foundations and other donors gave $231 million to 110 groups in 13 states, according to a recent report from the National Committee for Responsive Philanthropy.

The groups that received that funding, it says, leveraged it to generate $26.6 billion in benefits for communities and taxpayers.

Drop in funding

But a separate report, from the Foundation Center, says grants to groups in the U.S. that work for structural change to improve opportunity for the most vulnerable populations fell sharply during the recession, a decline that likely will continue.

And a third report, also from the National Committee for Responsive Philanthropy, says environmental funders do not give enough for advocacy work to protect low-income areas and communities of color from environmental damage.

Foundation support

Many nonprofits, including advocacy groups, tend to rely too heavily on support from foundations, yet those funders account for only 14 percent of overall giving in the U.S.

What’s more, too few foundations are willing to make grants to support basic operations, and that is the kind of support all nonprofits, including advocacy groups need.

In fact, several studies in recent years found, in comparing foundation support for conservative and liberal advocacy groups, that conservative groups tended to be more effective because they received a lot of operating grants, while liberal groups were not so effective because a lot of their grants were tied to specific programs.

Individual giving

In comparison to foundation support, individuals account for nearly 90 percent of all giving, including giving by living donors as well as those who give through wills and family foundations,

And charitable giving for generations has represented roughly 2 percent of gross domestic product, reflecting consistent growth in giving as the economy has grown.

So advocacy groups have a big opportunity to develop better relationships with individual donors and secure more funding for the work they do.

The challenge for all nonprofits, including advocacy groups, is to connect with individual donors, understand what they care about, help them understand critical needs, and show them how their support will help address the problems they care about.

Agency serves as voice for children

By Todd Cohen

CHARLOTTE, N.C. — In 2010, Mecklenburg County was home to over 233,000 children, 21.2 percent of them living in poverty, up from 13.9 percent just two years earlier.

Fueling the surge in child poverty, experts say, was the economic plunge that began in fall 2008 with the collapse of the capital markets.

Still, total investment in programming for children in the county in 2010 totaled roughly $1.6 billion, or about $6,700 per child, according to a new study by the Council for Children’s Rights.

That investment is less than some states spend on education alone per pupil, says Brett Loftis, executive director of the Council for Children’s Rights.

Better understanding and addressing the needs of children in the county through services, research and advocacy is the job of the council.

Created through the 2006 merger of the Council for Children, an advocacy group formed in 1979, and the Children’s Law Center, a nonprofit law firm formed in 1984, the agency serves as an advocate for individual children and as a think-tank that studies and promotes systems change.

Operating with an annual budget of $2.6 million and 31 employees, the council serves roughly 2,500 individual children a year.

It is the only specialized public defender for juveniles in Mecklenburg County, for example, representing about 1,500 kids a year through a contract with the state to provide all legal representation for children in juvenile court.

It also represents about 150 kids a year caught in high-conflict custody fights, plus another 300 kids on issues involving special education, school discipline, mental health, disability services and immigration services.

Serving as the council’s think-tank is the Larry King Center for Building Children’s Futures, a program that was created in 2008 and grew out of the United Agenda for Children, an initiative spearheaded by Foundation for the Carolinas, The Duke Endowment, Duke Energy and the John S. and James L. Knight Foundation.

A big lesson from that initiative, which aimed “to try to get the community engaged in setting priorities for children,” was that the community needed an “infrastructure” to push for change, Loftis says.

“There need to be people whose job it is to compile research, to do that data analysis, to work with the community to build plans for implementation, and then to drive the implementation of those plans,” he says.

A group of funders agreed to fund the new center for the first three years, and then help it raise funds to support its operations.

The Duke Endowment now has agreed to provide $300,000 a year for two more years, and Foundation for the Carolinas has agreed to provide $75,000 a year.

In October, the King Center released the first-ever Charlotte-Mecklenburg Children’s Budget that shows total public investment in children in the county, along with funding from United Way of Central Carolinas.

Through research, community planning and policy work, all available at its website, the center wants to help the community understand the problems children face and make decisions about how to those problems.

“Too often, we continue the services that we give to children and families without stepping back and looking to see if they are designed to give us the outcomes we are looking for,” Loftis says.

While parenting has the “single greatest impact on a child’s life,” for example, “we do very little as a community system to support parents to be good parents,” Loftis says.

Among 7,000 births every year to low-income mothers receiving federal Medicaid assistance, for example, only 250 mothers receive home visits by nurses and social workers.

So the center is working with local providers of home visits “to increase their capacity and their connection with each other to build a continuum” of parenting services and target those services to neighborhoods where they are most needed, he says.

“We exist,” Loftis says, “because the community believes that children need a voice.”

Social-justice funding plunges

Grantmaking to U.S.-based nonprofits that work for structural change to boost opportunity for the most vulnerable populations took a big hit from the collapse of the global economy in 2008 and likely will continue to suffer, a new report says.

Social-justice grants in 2009 fell to below 2007 levels, with smaller foundations posting the biggest drop, says Diminishing Dollars, a report produced by the Foundation Center on the impact of the 2008 financial crisis on social-justice funding.

Unless funders see five years of above-average investment returns, social-justice grantmaking levels in 2015 still will trail 2008 levels, says the report, which looked at 54 foundations that are active in social-justice funding and award $100 million or less a year, mainly from endowment.

“The future of social-justice philanthropy looks grim unless foundations and nonprofits working in this arena can devise ways to effectively navigate this climate,” Elizabeth Sak, executive director of the Cricket Island Foundation, which spearheaded and managed the research project, says in a statement.

The decline in social-justice funding is “particularly unfortunate,” the report says, because social-funding had been growing in the first half of the decade.

Data on funders sampled in Key Facts on Social Justice Grantmaking, a separate report from the Foundation Center, show their giving fell to $3.1 billion in 2009 from $3.7 billion in 2008.

And a third Foundation Center study, in 2009, said social-justice funding grew faster than overall giving between 2002 and 2006 and noted a “sense of optimism for the future with the start of the Obama administration,” the new report says.

Additional reasons for concern, it says, is that many of the nonprofits that seek and receive social-justice funding are small, community-based and member-led groups “working on behalf of he most vulnerable people in marginalized communities across the country.”

Those groups “play a crucial role by focusing on systems change that can have a beneficial impact on hundreds of thousands of people,” it says, yet those nonprofits also have a “small, dedicated funder base and are therefore very vulnerable to shifts in social-justice funding.

They also “often lack the capacity to compete with larger nonprofits for public funds or for funding from more ‘mainstream’ foundations as the environment becomes both increasingly competitive (due to scarce resources) and focused on scalability and outcomes.”

The report also found that foundations with less than $50 million in assets will struggle most to recover from the economic downturn.

At an average rate of return of 7 percent, it says, grantmaking levels for six small foundations studied are projected to be 17 percent less in 2015 than in 2008.

“Small foundations must spend less in grantmaking to avoid depleting their assets,” the report says. “This finding deserves particular note because of the very heavy reliance on small foundations by local, community-based nonprofits engaged in social-justice work.”

The report also says nonprofits seeking new funders will have a tough time.

In the wake of the downturn, it says, many foundations made their grant-review processes more selective, moved to a practice of not accepting unsolicited proposals, made multi-year commitments to a set of existing core grantees, and took other actions that “reduced the likelihood that organizations new to the foundation could receive funding.”

The report also says some foundations are “unintentionally depleting their endowments at a very slow rate,” a phenomenon that, combined with other the fact that other funders were spending more than they earned in the early years after the economic crisis, “may result in reduced grantmaking in the future as they take corrective actions.”

Advocacy funding pays off big, study says

Foundation funding to support policy advocacy, community organizing and civic engagement generated significant returns for low-wage workers, communities of color, rural residents and other marginalized groups a new study says.

Over three years, 110 organizations in 13 states received $231 million from at least 321 foundations and other donors and leveraged those funds to produce $26.6 billion in benefits for communities and taxpayers, says Leveraging Limited Dollars, a study by the National Committee for Responsive Philanthropy.

That investment in policy work and civic engagement provided a return of $115 in community benefit for every dollar invested, says the study, which summarized the finding of seven earlier studies the National Committee for Responsive Philanthropy conducted as part of its “Grantmaking for Community Impact Project.”

Groups that benefited included low-wage workers, communities of color, rural residents and other marginalized groups, the study says.

Organizations receiving those funds affected hundreds of policies on a broad range of issues, the study says, with some leading to additional government spending, some saving government spending or making government programs more efficient and effective, and some helping generate public revenue.

Over 700,000 residents in the 13 states studied were given the opportunity to voice their concerns publicly.

And the 321 grantmakers that supported the work of one or more of the organizations studied contributed, in the aggregate, over three of every four dollars spent on policy work and civic engagement.

Campaigns that advocates and organizers in multiple states undertook focused on raising the local or state minimum wage; increasing funding for public schools and pre-kindergarten; and spurring the development of affordable housing through housing trust funds.

In North Carolina, for example, the Raleigh-based A.J. Fletcher Foundation teamed with housing advocates and the state’s Housing Finance Agency to try to increase allocations for the state’s housing trust fund.

A grant from the foundation to the Campaign for Housing Carolina enabled its leaders to enlist new partners, including AARP, ARC and the North Carolina Bankers Association, the study says.

And the foundation’s principals, including Jim Goodmon, president and CEO of Capitol Broadcasting Co. in Raleigh, and his wife, Barbara Goodmon, gave the issue airtime on the company’s television stations and promoted the cause with business leaders and state lawmakers, the study says.

The effort led to an increase in housing funds that benefited 6,000 low-income elderly and disabled households, was expected to generate $232 million in new construction and rehab, created thousands of construction jobs, and generated $44 million in state and local tax revenues, the study says.

“Foundation funding for advocacy and civic engagement results in substantial benefits for families and communities across the nation,” Aaron Dorfman, executive director of the National Committee for Responsive Philanthropy, says in a statement. “These strategies enable nonprofits and grantmakers to address complex social and economic challenges and improve the lives of the underserved.”