RALEIGH, N.C. – Despite the onset of the deepest economic downturn in decades, one that pummeled the assets of foundations across the U.S., grant-makers in North Carolina increased their giving in 2008, a new study says.
The combined assets of the state’s funders fell to $13.7 billion in 2008, down from $17.7 billion in 2007, says the report from Raleigh-based NCGives, a statewide group that encourages giving by women, youth and communities of color.
Over the same period, the number of foundations in the state dropped to 2,910 from 3,029, with some closing up shop, while others moved or were absorbed by other foundations.
Despite that steep decline in assets and the loss of foundations, the collective grant-making of the state’s 2,910 funders grew 5 percent to $1.39 billion in 2008.
“I was most surprised by the fact that the amount of giving increased so dramatically given that assets were down 23 percent,” says the study’s author, Anita Gunn Shirley, assistant director of foundation relations for Duke University Medical Center and author of several reports on philanthropy in the state.
While the increase in giving was good news for North Carolina nonprofits, the growth likely will not continue in 2010 and 2011, says Shirley.
The 2008 funding increase in large part was due to foundations’ practice of basing grant-making budgets on the rolling average of the prior three to five years of assets, meaning that 2008 grants budgets included asset totals from prior years of solid investment gains.
With the poor asset performance of 2008, many funders suspended grant-making in 2010 to compensate for the lower value of their endowments.
“I think it will be down pretty significantly,” Shirley says of foundation grant-making for this year. “But with the three-year rolling average, it’s hard to say what will happen.”
Despite poor asset performance in 2008, the state’s largest foundations continued their dominance, with the largest 2 percent of funders accounting for 72 percent of overall assets and 62 percent of all grants awarded.
The Duke Endowment has the largest asset base among North Carolina funders, reporting $2.2 billion in assets in 2008, followed by the Burroughs Wellcome Fund with $731 million and the Golden LEAF Foundation with $727 million.
The Bank of America Charitable Foundation awarded $204.5 million in grants in 2008, more than any other funder, followed by The Duke Endowment, which awarded a total of $162 million, and the Golden LEAF Foundation, which awarded $138 million.
Several multi-million-dollar grants were awarded in 2008. The largest was a $100 million grant awarded by the Golden LEAF Foundation to the Global Transpark Authority in Kinston.
Assets and giving by foundation type
More than nine in 10 grantmakers in North Carolina are independent foundations.
In 2008, the state was home to 2,631 independent foundations, down 5 percent from 2007.
Combined, these foundations held $11.4 billion in assets, down from $14.9 billion the year before, and awarded grants totaling $824 million, a jump of 16 percent over 2007.
The Duke Endowment is the largest independent foundation in the state, both in assets and grant-making, followed by the Golden LEAF Foundation and the Burroughs Wellcome Fund.
In 2008, there were 24 community foundations in North Carolina, down 11 percent from 2007.
Together, they reported assets of $1.4 billion, down 17 percent, and awarded grants totaling $179.3 million, a decrease of 14 percent from 2007.
The largest community foundation in the state in 2008 was Foundation for the Carolinas in Charlotte, with $449.8 million in assets and $92.9 million in grants.
The Winston-Salem Foundation was second largest, with $181.7 million in assets and $424.9 million in grants, followed by the Durham-based Triangle Community Foundation, which reported assets of $137.5 million and grants of $14 million.
The number of corporate funders in the state fell 4 percent to 98.
Together, corporate foundations reported assets of $693 million, down 28 percent from 2007, and awarded grants totaling $382 million, down 2 percent.
Bank of America Charitable Foundation awarded a total of $204.5 million in grants in 2008, far more than any other funder, followed by Wachovia Wells Fargo Foundation, which awarded $93.2 million, and the Duke Energy Foundation, which gave out $17.9 million.
Forsyth County was home to 1,219 foundations in 2008, significantly more than any other county, with combined assets of $2.3 billion and grants of $152 million.
However, Mecklenburg County, home to 540 foundations, had $4.5 billion in combined foundation assets and awarded a total of $687 million in grants, more than any other county in the state.
Nash County, home to the Golden LEAF Foundation and 21 other funders, is third in terms of grant-making, with $139 million awarded during 2008, while Guilford County’s 164 foundations reported a combined $1.3 billion in assets, earning it a third-place rank.
Categories of giving
Over the last several years, a shift has been taking place in the funding priorities of the state’s foundations, with social services overtaking education.
In 1997, almost half of foundation giving was directed toward education. In 2008, that had decreased to 30 percent.
Over the same time period, the share of foundation funding directed to social services grew to 36 percent from 19 percent, making it the leading category.
Health care and hospitals came in third, garnering 16 percent of foundation funding, down slightly from 20 percent in 2007.
The remaining funding categories remained fairly stable, with arts and humanities receiving 6 percent, religion receiving 5 percent and the environment receiving 4 percent.
Data for the report were based primarily on tax returns filed by individual foundations.