Your local community foundation is a tremendous resource for your organization. Specifically, in our last Roundtable, we had the privilege of hearing from Shaun Shira and Jonse Young who work at the Grand Rapids Community Foundation. In this blog post, we will answer some of the most popular questions about community foundations and donor advised funds.
Why are Community Foundations Important?
Community foundations bring together financial resources of individuals, families, and businesses to support effective nonprofits and they play a key role in identifying and solving community problems.
What does the Grand Rapids Community Foundation do?
Primarily, they provide grants for nonprofits in Kent County. Also, community foundations teach and promote philanthropy, act as an intermediary organization between nonprofit and donor, and increase the accountability and operating standards of nonprofits.
What is a Donor Advised Fund?
A donor-advised fund is a charitable investment account, for the sole purpose of supporting charitable organizations a donor cares about.
Why would a donor consider a donor advised fund?
First of all, they would consider a donor advised fund because as soon as the donation is made there is immediate eligibility for a tax deduction. Some other benefits are simplified record keeping, the ability to name the fund, having legacy planning and strategy, and it directly supports what the donors care about.
Why the Grand Rapids Community Foundation?
The Grand Rapids Community Foundation is almost 100 years old and was Michigan’s first community foundation. They have awarded over $200 Million in grants and they are a trusted steward of the community’s resources.
What types of funds does the foundation have?
The foundation has a primary fund called Fund for Community Good. They also have field of interest funds, nonprofit funds, scholarship funds, and donor advised funds.
What areas of interest does GRCF fund?
Grand Rapids Community Foundation funds organizations with a focus on education, health, neighborhoods, engagement, prosperity or the environment.
How would someone set up a Donor Advised Fund at GRCF?
First of all, they would meet with Community Foundation Staff to discuss the goals, the funding of the donor-advised fund, the investment pool options, and determine the ultimate purpose of the fund. Then they would create a fund agreement and begin an orientation period.
How does a Donor Advised Fund work at the GRCF?
Individuals, families or businesses recommend grants to the nonprofits they care about most. If desired, donors can design a family grantmaking plan that includes the next generation.
What is the difference between an Endowed Fund and a Non-Endowed Fund?
An endowed fund is a perpetual fund from which grants are given annually and a non-endowed fund is one in which grants are given throughout the year.
How does my nonprofit get access to these Donor Advised Funds?
Donor advised funds can be a great source of funding for your organization. First of all, you should ask your donors if they have a donor advised fund. You could also look at the list of donor advised funds on the community foundation annual report and connect with the community foundation philanthropic services team. Lastly, you could consider adding a donor advised fund option on your fundraising cards, letters, etc.
Learn more about the Grand Rapids Community Foundation on their website!