RALEIGH, N.C. — While its assets are down, and fees and interest from the funds it manages have slowed, the North Carolina Community Foundation is hoping to maintain its grantmaking.
To do that, the Raleigh-based foundation, which is parent to 59 affiliate community foundations serving 65 of the state’s most rural and underserved counties, has cut costs internally and is reaching out to the community.
“Truly, this is a difficult time for all communities and people,” says Jennifer Tolle Whiteside, president and CEO of the foundation. “It’s a great time for community foundations to talk about the work they do. It’s a great way to give funds in a way that can make a difference and have an impact in the community.”
For the fiscal year that ended March 31, assets had dropped to just under $90 million from about $117 million a year earlier.
Lower assets means less interest generated for grantmaking, and fewer fees generated from the 941 different funds the foundation manages.
While some community foundations, which are not required by law to distribute a minimum percentage of their assets as grants every year, have lowered their “payout” rates, the North Carolina Community Foundation is standing firm, says Tolle Whiteside.
“The board restated our investment policy in that we’d continue paying out 5 percent,” she says. “It really is the push and pull of a foundation. How do you preserve the assets in perpetuity while being responsive to community needs?”
Given that the foundation bases its payout on a 12-quarter rolling average of its assets, grantmaking dipped only slightly in 2009, coming in at just under the $6 million awarded last year.
That’s particularly important given that other funders, including corporations, are pulling back on funding.
“Nonprofits are feeling it from all angles,” says Tolle Whiteside, who before joining the foundation served as president and CEO of Prevent Child Abuse North Carolina. “We didn’t want to be part of that equation if we could help it.”
The foundation has seen an increase in grant requests lately, particularly from the eastern part of the state. And it is receiving inquiries from people and groups it hasn’t heard from before.
“We’re planning a lot of workshops for grantseekers to let people know about grants,” she says. “We’re trying to be proactive because we think there will be a much larger interest than in the past.”
So far, gifts to the foundation have remained stable, totaling an estimated $10 million for fiscal 2009, a figure that is in line with previous years.
To help keep grantmaking up, the foundation is working to reduce its budget by 10 percent.
That has led to several cost-cutting measures, including laying off one staffer, leaving vacant two other open positions, and instituting a mandatory six-day furlough for the remaining 21 employees.
Also, the leadership team has taken an additional salary cut and the foundation has cut its match to the retirement plan for this year.
“Our hope is that we’ve taken some pretty drastic measures to make sure we’re strong and stable,” Tolle Whiteside says. “It’s challenging to find ways to reduce costs without reducing the services we provide.”
Despite the cuts, morale at the foundation remains strong, says Tolle Whiteside.
“People appreciate the opportunity to be here,” she says. “We’ve got a great staff and people are willing to make sacrifices to move forward.”
And she says the organization is well-positioned to forge ahead.
The foundation was at the tail end of an eight-month strategic-planning process when the economy tanked, and the goals it had outlined then are still on target, says Tolle Whiteside.
“We were very clear in our strategic plan that our focus would be on our affiliate network, how we support communities across the state and how we attract new donors across the state,” she says.
While the growth it had hoped for may require a longer timeframe because of the recession, the downturn could work in the foundation’s favor in one way.
“The challenges of the economy in many ways provide an opportunity for our affiliates to step up their community leadership,” she says.
And the downward pressure on grantmaking across the sector could lead to an increase in collaboration and partnership.
Nonprofits need to work together to make sure their services are not duplicative, and funders already are discussing ways to identify shared funding priorities and perhaps pool their resources, she says.
“I hope the silver lining is that nonprofits are stronger and people and communities are more reflective around giving and what they’re able to do,” says Tolle Whiteside.
And until the chaos subsides, the foundation’s message to its donors and affiliate foundations is aimed at calming the tide of fear and uncertainty.
“It’s important to stay focused on those things that are important to us,” she says. “We have to stay passionate about charitable giving. We all can make a difference.”