Fight or Flight: The Role of Private Philanthropy in Turbulent Times
In 2016, I was an early-career professional with a lot of opinions and little experience. I was working for a local community foundation, and I often wanted to pepper in the new buzzwords “equity” and “social impact” in our communications and events. Leadership agreed that those words, though a part of our core values, were too political, too brazen, and way too liberal to appease our conservative donors.
I hadn’t been in the sector or the workforce long enough to understand the need for a pause and delayed action from large philanthropic institutions. Instead, I was critical of philanthropy moving too slowly. Both with its funding and with its communications. When creating reports, webpages, or anything public, I wondered, “Why not just say ‘equity‘?” I was angry that leadership toned down the language to appease everyone, thereby appeasing no one.
I ultimately left the foundation with a chip on my shoulder, disproportionately aimed at my previous employer instead of the institutions and systems that forced their tepidness. I could never have predicted where we’d be as a sector and as a country nearly a decade later—the same place.
Fast forward to today. I’m grappling with the fact that private philanthropy is also, unlawfully, being attacked by the current administration. Private donors and dollars have every right to give, fund, and invest in any cause they care about, whether the current federal administration agrees with it or not. And that power, unique to private philanthropy, could save our sector and the nonprofit partners who rely on grants.
Private Philanthropy Should be on the Front Lines
Whether you agree there is a war on mission-driven organizations is your prerogative, but for lack of a better metaphor, let’s imagine that in this war, philanthropy has often been a shadow partner. It takes much of the credit for its funding and little accountability for its outcomes.
It’s time for foundations to take a step down from their ivory towers and support more vulnerable organizations and the populations they serve. It’s not a time to walk away, shutter doors, or dampen language meant to support causes and values we care about.
A nonprofit organization that receives federal funding, regardless of whether it’s been cut, frozen, or in question, cannot be on the front lines of this fight. They have to survive, to protect their mission and the people most impacted. It is private philanthropy on the front lines—foundations, corporate funders, major donors, et al.
It’s time to increase endowment payouts
The rainy day is here. Amid sweeping federal funding cuts to nonprofits, there are also tax reform propositions to require nonprofits and associations to pay taxes on revenue-generating activities. Essentially bankrupting many small organizations that rely on activities like sponsorships and paid services.
Foundations with large endowments granting only 4-5% should make a plan to increase their payouts. The MacArthur Foundation has pledged to increase its payouts for two years in direct response to the current administration’s attack on nonprofits.
Endowments have likely returned more than 5% year over year, and keeping the funds stashed and piling high will not protect the sector against the damage of losing crucial funding.
Community foundations should urge their fundholders to act
Community foundations have a unique opportunity to lead the conversation. Although many don’t have the funds or resources to give directly, they do have a database of philanthropists.
Depending on where and who the community foundation is serving can be an uphill battle. Educating the fundholders on the impact of their dollars and how they can supplement federal funding cuts—especially when pooled together, can help hedge some of the burdens their nonprofit grantees are feeling.
Maybe many donor-advised fundholders have voted this administration in, but educating them on its impact on the nonprofit sector and highlighting the power they have can help bolster the army.
Be in power with nonprofits, not power over them
With any exchange of money, a natural power dynamic exists. The tension between funder and funded has been known and documented, but this is another plea to private philanthropy to let the nonprofits serve who they need to with unrestricted dollars and resources.
Moving away from “donor-centered funding” practices to “community-centered funding” is going to take all stakeholders in the philanthropic system—especially private philanthropists. Donor-centered ideals highlight the funder as the hero of the story, not the folks or organizations receiving the funds. Community-centered funding eliminates the power over dynamic and moves into a power with one. One where both parties can feel powerful and impactful.
Nonprofit Partners’ Role in It All
If private philanthropy is on the front lines, then nonprofits are at base camp, planning, plotting, and strategizing what they need and when they need it. The hard truth is that no amount of private philanthropy will replace a total federal grant funding freeze.
Nonprofits can forge relationships with the philanthropists on the front lines. Form coalitions, assemble task forces, collaborate, and move in lockstep to ensure the sector’s survival. Although many private philanthropic institutions are not beholden to federal grant cuts and freezes, tax legislation and other attacks on tax-exempt organizations will have a devastating impact.
Private philanthropy is no longer a silent partner—it’s now a lifeline. If foundations wait too long to act, there may not be a sector left to save. But if they meet this moment with courage and clarity, they could help reshape the future of service, justice, and equity in this country.
Private philanthropy can secure the sector’s future by
Private philanthropy is unique. Philanthropists and philanthropic institutions have both the legal protection and moral obligation to secure the future of our sector.
- Increasing their endowment payouts.
- Educate and inform major donors and fundholders to act and payout their DAFs, unrestricted.
- Partner with nonprofits, and share the messages and values that have been silenced.
- Create (or join) task forces, coalitions, and collaboratives with lobbyists and organizers fighting for the sector. Like this one.
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Mindy Morgan Avitia has worked with nonprofits and mission-driven organizations for over a decade. She currently serves as the Senior Events and Community Impact Manager at Mighty Citizen, where she leads strategic initiatives that strengthen Mighty Citizen’s mission-driven community. Mindy also founded Grow Wild Creative, a creative agency supporting values-aligned brands, and has held previous roles with Impact Hub Austin, the Austin Community Foundation, and the National Center for Farmworker Health.
With a BFA from the School of Visual Arts and a passion for storytelling, Mindy brings a thoughtful and authentic approach to the nonprofit sector. Her writing has been featured in various publications, where she explores themes of equity, identity, and nonprofit strategy. She lives in Austin, TX, with her partner and two kids. She is currently working on her first book.