The Power of Philanthropy
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Transcript of The Power of Philanthropy
Community Foundation of Washington County
The Power of Philanthropy
IT MAKES GOOD SENSE
What is a Community Foundation?
• 1. Grantmakers. They support a wide range of community needs- education, health, human services and more.
• 2. Local Giving Vehicles. They establish and hold numerous funds for a variety of charitable purposes.
• 3. Community Leaders and Conveners. They act as community catalysts focusing on long-term endowment building and sustainability.
Community Foundations Are…
IT MAKES GOOD SENSE
Iowa CommunitiesGrowing Endowments in
Surprising wealth transfer in 50 years
$41 trillion in United States
$531 billion in Iowa through probate estates alone
$6.1 billion in Washington County
$ 274,425 per probated estate in Iowa… $314,186 per probated estate in Washington County.
Many gifts, many generations
If 5% of estates transfer to endowment funds…A Washington County Example
YEAR 10
$45.2 million charitable gifts
$10.9 milliontotal grants
$53.3 million community endowment
YEAR 50
$304 million charitable gifts
$646,.6 milliontotal grants
$783 million community endowment
What could be accomplished in your community…
7
Ps a revenue source that allows for enhancement or expansion of programs during successful years, and that provides some security in more challenging financial times.
Definition: Endowment
Permanent, persistent resource
Provides a revenue source that allows for enhancement or expansion of programs during successful years, and that provides some security in more challenging financial times.
6+ TIMES
One gift, many generations
YEAR 15
$95,000 in cumulative grants and services
$164,000 balance
YEAR 25
$193,000 in cumulative grants and services
$234,000 balance
assumes 4.5% annual payout and 8.5% rate of return
Initial gift has been invested: 1 TIME 2 TIMES
YEAR 50
$662,000 in cumulative grants and services
$570,000 balance
YEAR 1
Establish a Named Fund
$100,000 gift
LOOKING AHEAD
IT MAKES GOOD SENSE
Tax CreditThe Endow Iowa
Endow Iowa?WHAT IS
•Encourages Iowa Taxpayers to Contribute to
Endowment Funds at Qualified Community
Foundations
•Permanent Endowment Fund
•Has to be held at and receipted by the
Community Foundation
•Iowa Charitable Purpose
(scholarships, agency endowments, donor
advised funds, etc.)
•No more than 5% spending/granting policy
Endow Iowa?WHAT IS
THEN donors can be eligible for...
•25% state tax credit for contribution- in addition to normal federal charitable deduction
•Limits each year
•per taxpayer (up to $227,590)
•statewide (approx $4.5 million in 2011)
•Tax credit paperwork has to be completed
•Awarded on a first come-first served basis
•Tax Credit Letter/# sent by IDED once awarded
•Can be carried forward up to 5 years
Surprising wealth transfer in next 50 years
$41 trillion in United States
$531 billion in in Iowa through probate estates alone
$XXX billion in [County]
$XXX,XXX per probated estate
Endow Iowa Tax Credit Example
With Endow Iowa, donations to community foundation endowments cost
donors less.
For example, a $10,000 gift could cost just $4,000.
Gift: $10,000
Tax Credit: $2,500
Federal Deduction: $3,500
Total Tax Savings: $6,000
Total Cost of Gift: $4,000
*Based on 35% marginal federal tax rate
Calculate for yourself and see the charitable impact at http://www.iowacommunityfoundations.org/resources.aspx
6+ TIMES
nonprofits
YEAR 15
$9,000 in cumulative grants and services
$16,000 balance
YEAR 25
$19,000 in cumulative grants and services
$23,000 balance
assumes 4.5% annual payout and 8.5% rate of return
Initial gift has been invested: 1 TIME 2 TIMES
YEAR 50
$66,000 in cumulative grants and services
$57,000 balance
YEAR 1
Establish a Named Fund
$10,000 gift
The Impact to
Surprising wealth transfer in next 50 years
$41 trillion in United States
$531 billion in in Iowa through probate estates alone
$XXX billion in [County]
$XXX,XXX per probated estate
Donation Amount
2010 2009 2008 2007 2006 2005 2004 Total
$1000 or less
1452 1069 1297 656 424 213 83 3,803
$1001 - $30,000
443 386 485 319 177 181 93 1,954
$30,001 - $100,000
36 34 69 45 36 37 10 239
$100,000 +
40 15 30 20 18 18 13 115
Total Donations
1,971 1,504 1,881 1,040 655 449 199 7,834
In 2005….In 2005….
• Approximately 13 community foundations operating within National Standards for US Community Foundations
• Estimated $206 million in total assets
What has this all done for Iowa?
In 2011….In 2011….
• Approximately 130 community foundations/affiliates operating within National Standards for US Community Foundations
• Estimated $523 million in total assets… growth of $317 million since 2005!
IT MAKES GOOD SENSE
Questions & Comments
Thank you