ASHEVILLE, N.C. – With community needs that far outpace the resources it can deploy, the Community Foundation of Western North Carolina is refining its role in the post-recession philanthropy sector.
For almost a year, the staff and board of the Asheville-based funder have been educating themselves about local issues and trends, and in October of last year launched a formal strategic-planning process, says Elizabeth Brazas, the organization’s president.
The exercise is necessary, she says, not only because of the effects of the recession on the foundation and the region it serves, but because of impending state, federal and local budget cuts that will affect local nonprofits and communities.
“The recession response was ‘hang on,'” says Brazas. “This is different. It’s not one year. Who knows when the budgets will recover?”
With the government cuts having more of a “permanent” feel, figuring out how to help organizations deal with the new reality is critical, she says.
To help with mounting local needs during the recession, the foundation, which serves 18 mountain-area counties, suspended its competitive grants program and started the Recession Response Fund, which raised and distributed $1.2 million to basic-needs organizations.
The response from donors was excellent, but the coming budget cuts may herald the start of a new season of austerity, says Brazas, who joined the foundation in late 2009.
“We know this is coming and we know we can’t fill the gap,” she says. “How can we help key organizations in our region respond?”
Financially, the foundation is climbing its way out of the recession, with the assets of its 900 funds totaling about $169 million at the end of March, up from a 2009 trough of $125 million.
And grantmaking, which dropped to $10.9 million in fiscal 2009 from $11.9 million in 2008, was back up to $11.8 million last year.
But with 75 percent of its assets tied up in donor-advised or other restricted funds, only about a quarter of the foundation’s grants budget is available for unrestricted grantmaking.
That breakdown is a public-relations issue, says Brazas, given that the foundation is a donor-advised organization primarily, with little capacity for unrestricted funding.
“People assume we have tons of money that we can choose how to spend,” she says.
The challenge is to figure out what role the foundation will play in the evolving environment, she says, then determine how to communicate that to the nonprofit community.
“We are a finite resource,” says Brazas. “When you’re a community foundation in a region as big as ours, there are a lot of people looking to you.”
To boost unrestricted grantmaking, particularly in rural areas, the Janirve Foundation, which has a goal of spending down its assets rather than existing in perpetuity, awarded the community foundation a $10 million legacy grant.
The $10 million will be spent over the next 25 years, says Brazas, and the foundation is in the process of developing proposal guidelines for interested nonprofits.
“We had long discussions about what $10 million over 25 years can do in western North Carolina,” she says. “We have lots of rural counties where a small grant can make a big difference.”
The strategic plan, which is expected to be in place this fall, will build on that momentum.
Changes recommended through the strategic plan will be internal for the most part, and are likely to involve streamlining operations and spending more time on donor engagement.
And the board and staff of the foundation will move forward with a better understanding of the organization’s business model and a framework for making programmatic decisions and for defining its role in the community, says Brazas.
“Most people in the nonprofit sector are moved easily,” she says. “To understand your own limitations is a difficult thing, but it’s important.”