Foundation giving plunges

Social-justice funding
Social-justice funding

Grantmaking by U.S. foundations tumbled $3.9 billion in 2009 to $42 billion, a drop of 8.4 percent, a new Foundation Center study says, the biggest decline since the group started tracking foundation giving in 1975.

As a percentage, the decline totaled just under half the 17 percent loss that foundation assets suffered the previous year, says the 2010 edition of the center’s Foundation Growth and Giving Estimates.

A Foundation Center survey, less pessimistic than a year ago, suggests foundation giving will stay flat this year.

And if the economic recovery does not collapse, the center’s Foundation Giving Forecast Survey says, foundation giving may show “positive, albeit very modest” growth in 2011.

The main factors that helped limit the overall decline in giving by the more than 75,000 grantmaking foundations in the U.S. included the decision by many funders to reduce operating expenses or tap into their endowments, or both; an increase in giving by the Bill & Melinda Gates Foundation and other grantmakers; continuing gifts and bequests from donors to new and existing foundations; and the practice at some foundations of making grants based on averaging their assets over several years to reduce the impact of year-to-year changes in asset values.

Giving by independent and family foundations, which represent nearly nine in 10 of all foundations, fell 8.9 percent to $30.8 billion, while giving by corporate foundations fell 3.3 percent to $4.4 billion.

Giving by community foundations fell 9.6 percent to $4.1 billion, exceeding the percentage decline by independent and corporate foundations combined.

“The economic crisis has not ended for this country’s nonprofits, and it will be some time before foundations are in a position to help them return to growth,”
Bradford K. Smith, president of the Foundation Center, says in a statement. “But funders have made exceptional efforts to lessen the pain faced by the nonprofit community.”

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