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Sticking to basics

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Big foundations give more for operations, less for capital support.

By Todd Cohen

[04.26.04] — Giving by more than 1,000 of the biggest U.S. foundations fell in 2002 for the first time since 1990, a new report says.

And while those foundations continued to focus their funding on education, health and human services, they made smaller grants and gave more for operating support and less for capital support, according to Foundation Giving Trends, a report by The Foundation Center in New York City.

New grant commitments by more than 1,000 of the largest foundations fell 5 percent in 2002 to $15.9 billion, the average grant fell to $125,000 from $134,000, and the median grant fell to $25,000 from $30,000, with half the grants larger than the median and half smaller.

The number of grants of $5 million or more fell to 259 from 266, says the report, which looked at grants of $10,000 or more.

Capital support fell from 21.9 percent of grant dollars to 18.8 percent, a record low, while general operating support grew from 15.9 percent to 18.8 percent, the biggest share ever.

Grant dollars fell for most fields of interest, with health, social sciences, and the environment and animals showing the biggest declines.

The fastest growth in grant dollars was in giving for religion and for science and technology.

And program areas such as health and education that typically received larger grants in the past posted the biggest declines in giving, while areas such as human services and religion that received smaller grants showed an increase, says Josie Atienza, research analyst at the Foundation Center.

Giving for education, which received 26.4 percent of grant dollars, the biggest share, fell 6 percent, while giving for health, which received 18.3 percent, the second-biggest share, fell 15 percent.

Giving for human services, which received 14.8 percent of grant dollars, the third-biggest share, grew 1.6 percent, the fastest among major fields of interest, and posted the biggest increase in the number of grants, 7.5 percent.

With the decline in the stock market and the 2001 recession taking their toll after the boom years of the 1990s, “foundations are maintaining their core priorities,” says Atienza. “They are continuing to maintain their funding and support their grantees, although many are able to do that by giving smaller grants.”

The share of grant dollars that could be identified as benefiting economically disadvantaged populations grew to 16.7 percent from 12.1 percent.

“It does suggest that foundations are really trying to focus on the populations in need,” Atienza says, “and there may be more demand for grants to support programs benefiting those population groups.”

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