Foundation funding for capital scarce

Finding foundation grants for capital needs like buildings and renovations is hard work in California, where grantmakers strongly prefer to fund program activities, a new study says.

Only one in five of Southern California’s 3,064 foundations will consider such capital needs, says the report by the Center on Philanthropy and Public Policy at the University of Southern California.

“What this study tells us is that nonprofits with a need for capital will have to look beyond foundations,” James Ferris, director of the center, says in a statement.

Of all grant dollars awarded in the region, about 15 percent are earmarked for capital needs, which are significant given the area’s high costs and the growing number of nonprofit organizations.

While some funders will write such checks, many do so only for nonprofits with which they have long-term relationships, the study says, and others will make awards for capital only after the majority of the funding for a project has been raised from other sources.

Foundations that do support capital needs say they are not likely to increase the amount they give in the near future.

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