Understanding How to Work WithCommunity Foundations and the Roleof Gift PlanningDavid L. Westcott,Senior Vice President fo...
Working together to promote a vibrant rural America.Experience Works · First Nations Development Institute · Housing Assis...
Presenter – David L. Westcott• Currently Senior Vice President for Development at TheOregon Community Foundation, a positi...
Understanding How to WorkWith Community Foundationsand the Role of Gift PlanningDavid WestcottSenior Vice President for De...
WHAT IS A COMMUNITYFOUNDATION?NATIONALSTANDARDS FORU.S. COMMUNITYFOUNDATIONS
Definition of a U.S. Community FoundationA community foundation is a tax-exempt,nonprofit, autonomous, publicly supported,...
Mission, Structure and Governance1. Operated for public benefit and has a well-defined,articulated mission2. Recognized by...
Mission, Structure and Governance, continued6. Serves a particular geographic area such as a municipality,county, state, m...
Mission, Structure and Governance, continuedf. Reviews and adopts an annual operating budgetg. Ensures that the governing ...
Resource DevelopmentA community foundation has, or works to develop, broad support in the form ofcontributions from many s...
Stewardship and AccountabilityA community foundation is a steward of charitable funds, investing and prudentlymanaging fun...
Stewardship and Accountability, continuedAn annual audit (financial review when assets total less than $1million) is perfo...
Grantmaking and Community LeadershipA community foundation operates a broad grants program to multiplegrantees that is lim...
Donor RelationsA community foundation informs and educates donors about communityissues and grantmaking opportunities.A co...
CommunicationsA community foundation communicates openly and welcomes publicscrutiny.A community foundation has a communic...
QUESTIONS ON COMMMUNITY FOUNDATION STRUCTURE?
FUND TYPES
Unrestricted FundsThe donor chooses to establish a fund to provide broad general support to acharitable organization with ...
CHANGES IN THE WORLD OF DONOR ADVISED FUNDS (PPA 2006)Definition of Donor Advised FundsExceptions (there are some)Grants f...
QUESTIONS ON ADVISED FUNDS?
So, How Do Non Profits Connect WithDonor Advised Funds For Grants?
Who Are Establishing Donor AdvisedFunds, And Why Do We Care?(It’s the Boomers, and that’s where the money is…..)
Composition of Older PopulationSource: Projections for 2010 through 2050 are from: Table 12. Projections of the Population...
Old Age Dependency GrowingDependency Ratio (number of dependents per 100 persons of working age)Source: Congressional Rese...
Life Expectancy Is IncreasingSource: CDC/NCHS, National Vital Statistics System.
Funds Held in Retirement AssetsU.S. Total Retirement MarketSource: Investment Company Institute.
79 million10,000 a Day$7 - $9 Trillion85% of All Savings and LoansCash
Implications for Fundraisingand Planned Gifts
Lots of Uncertainty Means…Desire to keep moreassetsLonger decisionprocess for makingmajor giftsBlended gifts, longerpledge...
Observations for FundraisingControl– Boomers Want Involvement– Boomers Expect ResultsConnecting to Community– Less and Les...
Observations for FundraisingBequests– Charities build relationships– Donors keep flexibilityConnecting to Community– Less ...
Observations for FundraisingBequests– Charities build relationships– Donors keep flexibility“Younger older” donors are gro...
Observations for FundraisingBequests– Charities build relationships– Donors keep flexibilityConnecting to Community– Less ...
Leave Tax-Burdened Assets to Charity$1,000,000 Retirement Plan Asset Given at DeathDistribution to Family Distribution to ...
Donor Profile for Flexible Deferred CGABetween ages 50 and 65In peak earning years; could benefit from acharitable income ...
Flexible Deferred CGA—How It WorksPayments deferred to the futureMultiple start dates written into the contractThe later t...
QUESTIONS ON BOOMERS AND PLANNED GIVING?
Upcoming SlideShare
Loading in...5
×

Understanding How to Work With Community Foundations and the Role of Gift Planning

515

Published on

A webinar from NARP

Presented by David Westcott, Senior Vice President for Development for The Oregon Community Foundation.

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
515
On Slideshare
0
From Embeds
0
Number of Embeds
3
Actions
Shares
0
Downloads
0
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Understanding How to Work With Community Foundations and the Role of Gift Planning

  1. 1. Understanding How to Work WithCommunity Foundations and the Roleof Gift PlanningDavid L. Westcott,Senior Vice President for Development atThe Oregon Community FoundationJessica Hiemenz & Beverlie SopiepNational Consumer Law CenterOctober 2, 2012
  2. 2. Working together to promote a vibrant rural America.Experience Works · First Nations Development Institute · Housing Assistance Council · Indian Country Conservancy ·National Association of Community Health Centers · National Association of Development Organizations Research Foundation·National Consumer Law Center · National Trust for Historic Preservation · National Rural Health Association ·National Youth Leadership Network · NeighborWorks America · Save the Children · United Farm Workers Foundation
  3. 3. Presenter – David L. Westcott• Currently Senior Vice President for Development at TheOregon Community Foundation, a position he has heldsince 1997. David oversees a development staff of 14 withoffices in six cities throughout Oregon.• Prior to joining the foundation, he was the Chief FinancialOfficer for the University of Oregon Foundation for 11years, where he managed accounting, finance,endowment, and trust management operations.• David has presented papers and conducted numerousconsulting workshops for colleges, foundations, and non-profit organizations around the country, is a frequentspeaker before civic groups, and currently serves as amember of the Council on Foundation’s AdNet SteeringCommittee.
  4. 4. Understanding How to WorkWith Community Foundationsand the Role of Gift PlanningDavid WestcottSenior Vice President for DevelopmentThe Oregon Community Foundation
  5. 5. WHAT IS A COMMUNITYFOUNDATION?NATIONALSTANDARDS FORU.S. COMMUNITYFOUNDATIONS
  6. 6. Definition of a U.S. Community FoundationA community foundation is a tax-exempt,nonprofit, autonomous, publicly supported, non-sectarian philanthropic institution with a long termgoal of building permanent, named componentfunds established by many separate donors forthe broad-based charitable benefit of theresidents of a defined geographic area, typicallyno larger than a state.
  7. 7. Mission, Structure and Governance1. Operated for public benefit and has a well-defined,articulated mission2. Recognized by the Internal Revenue Service (IRS) astax-exempt under Internal Revenue Code Section501(c)(3), organized and operated exclusively forcharitable purposes3. Meets the public support test set forth in InternalRevenue Code Section 170(b)(1)(A)(vi) as modifiedby Treasury4. Has an independent governing body broadlyrepresentative of the community it serves5. retains variance power by which it may modify anyrestriction or condition on the distribution of assets, ifcircumstances warrant
  8. 8. Mission, Structure and Governance, continued6. Serves a particular geographic area such as a municipality,county, state, metropolitan area or closely related aggregation ofsuch areas that are considered for some purposes as acommunity, typically no larger than one state.7. A community foundation’s governing body:a. Is responsible for the mission, direction and policies of theorganizationb. ensures adequate human and financial resources andactively monitors and evaluates the organization’s chiefexecutive officerc. approves policies to prevent perceived, potential or actualconflicts of interestd. serves without compensatione. is not controlled by any other nonprofit organization, or byany single family, business or governmental entity or anynarrow group within the community
  9. 9. Mission, Structure and Governance, continuedf. Reviews and adopts an annual operating budgetg. Ensures that the governing documents include policies forsize of the board, required number of meetings annually,limits of members’ terms, and structure and responsibilitiesof standing committeesh. Ensures that the community foundation reflects the diversityof the community it servesi. Ensures that the community foundation meets all laws andlegal requirementsj. Approves all grants
  10. 10. Resource DevelopmentA community foundation has, or works to develop, broad support in the form ofcontributions from many separate, unrelated donors with diverse charitableinterests in the community served by the community foundation.Contributions to a community foundation represent irrevocable gifts subject tothe legal and fiduciary control of the community foundation’s governing body.A community foundation has a long-term goal of securing resources to addressthe changing needs of the community it serves.A community foundation accepts and administers a diversity of gift and fundtypes to meet the varied philanthropic objectives of donors.A community foundation adopts gift and fund acceptance policies that addressminimum fund size, types of fund options, types of gift mechanisms, andpolicies and procedures for accepting various types of assets, and makesthese policies available upon request, disclosing all roles and relationships tothe donor.
  11. 11. Stewardship and AccountabilityA community foundation is a steward of charitable funds, investing and prudentlymanaging funds and maintaining accurate financial records.A community foundation is accountable to the community it serves and regularlydisseminates information on its programs and finances.A community foundation maintains a written record of the terms and conditions ofeach component fund and all such records must reference the variance power.A community foundation honors the charitable intentions of its donors consistentwith community needs and applicable laws and regulations.A community foundation observes the balance between donor involvement andgoverning board control and complies with applicable laws and regulations.A community foundation ensures that the foundation’s financial resources areused solely in furtherance of its mission.
  12. 12. Stewardship and Accountability, continuedAn annual audit (financial review when assets total less than $1million) is performed by an independent public accountant, reviewedand accepted by the governing body and made available to the publicupon request.A community foundation:has investment policies that include asset allocationguidelines, a spending policy and criteria for measuringinvestment performance.makes available to the public upon request the names of itsinvestment managers, fees charged (including investment andadministrative fees), governing body or appointees responsiblefor investment oversight and investment.
  13. 13. Grantmaking and Community LeadershipA community foundation operates a broad grants program to multiplegrantees that is limited neither by a single focus or cause norexclusively to the interests of a particular constituency.A community foundation awards some grants from its discretionaryresources through open, competitive processes that address thechanging needs of the community.A community foundation widely disseminates grant guidelines toensure the fullest possible participation from the community andperforms due diligence to ensure that grants will be used for charitablepurposes.A community foundation works to identify community issues andopportunities and acts as a leader and convenor, using its resources toaddress immediate and long term community issues and opportunities.
  14. 14. Donor RelationsA community foundation informs and educates donors about communityissues and grantmaking opportunities.A community foundation actively involves donors in identifying andresponding to community issues and opportunities.A community foundation promptly and accurately acknowledges gifts.A community foundation provides fund statements, at least annually, tothose donors who wish to receive them.All private information obtained with respect to donors and prospects iskept confidential to the fullest extent possible.
  15. 15. CommunicationsA community foundation communicates openly and welcomes publicscrutiny.A community foundation has a communication strategy that includes areport, widely distributed at least annually, which describes thecommunity foundation’s mission, activities and financial operations.
  16. 16. QUESTIONS ON COMMMUNITY FOUNDATION STRUCTURE?
  17. 17. FUND TYPES
  18. 18. Unrestricted FundsThe donor chooses to establish a fund to provide broad general support to acharitable organization with the board determining how best to use the fund.Designated FundsThe donor chooses to establish a fund to support a specific purpose orpurposes within the organization.Scholarship FundsA type of designated fund specifically structured to provide scholarships.Field of Interest FundsFunds that support a broad interest of the donor, whether geographic,programmatic, or both.Advised FundsThis type of fund is most often associated with a community foundation. Thedonor retains the right to recommend distributions from the fund to his or herfavorite charity or charities.
  19. 19. CHANGES IN THE WORLD OF DONOR ADVISED FUNDS (PPA 2006)Definition of Donor Advised FundsExceptions (there are some)Grants from Donor Advised FundsPenalties and Problems
  20. 20. QUESTIONS ON ADVISED FUNDS?
  21. 21. So, How Do Non Profits Connect WithDonor Advised Funds For Grants?
  22. 22. Who Are Establishing Donor AdvisedFunds, And Why Do We Care?(It’s the Boomers, and that’s where the money is…..)
  23. 23. Composition of Older PopulationSource: Projections for 2010 through 2050 are from: Table 12. Projections of the Population by Age and Sexfor the United States: 2010 to 2050, Population Division, U.S. Census Bureau; Release Date: August 14, 2008.
  24. 24. Old Age Dependency GrowingDependency Ratio (number of dependents per 100 persons of working age)Source: Congressional Research Service (CRS).
  25. 25. Life Expectancy Is IncreasingSource: CDC/NCHS, National Vital Statistics System.
  26. 26. Funds Held in Retirement AssetsU.S. Total Retirement MarketSource: Investment Company Institute.
  27. 27. 79 million10,000 a Day$7 - $9 Trillion85% of All Savings and LoansCash
  28. 28. Implications for Fundraisingand Planned Gifts
  29. 29. Lots of Uncertainty Means…Desire to keep moreassetsLonger decisionprocess for makingmajor giftsBlended gifts, longerpledge periodsDelays; waiting beforetaking action
  30. 30. Observations for FundraisingControl– Boomers Want Involvement– Boomers Expect ResultsConnecting to Community– Less and Less Trust in Institutions– High level of VolunteerismDependents– Children Moving Home with huge Debt– Parents Require Financial AssistanceAdvised Funds – Pay and Play as You Go
  31. 31. Observations for FundraisingBequests– Charities build relationships– Donors keep flexibilityConnecting to Community– Less and Less Trust in Institutions– High level of VolunteerismDependents– Children Moving Home with huge Debt– Parents Require Financial AssistanceAdvised Funds – Pay and Play as You Go
  32. 32. Observations for FundraisingBequests– Charities build relationships– Donors keep flexibility“Younger older” donors are growing– Concerned about outliving retirement assets– Want to maintain controlDependents– Children Moving Home with huge Debt– Parents Require Financial AssistanceAdvised Funds – Pay and Play as You Go
  33. 33. Observations for FundraisingBequests– Charities build relationships– Donors keep flexibilityConnecting to Community– Less and Less Trust in Institutions– High level of VolunteerismDependents– Children Moving Home with huge Debt– Parents Require Financial AssistanceAdvised Funds – Pay and Play as You Go
  34. 34. Leave Tax-Burdened Assets to Charity$1,000,000 Retirement Plan Asset Given at DeathDistribution to Family Distribution to CharityRetirement PlanAsset Value$1,000,000 $1,000,000Income taxes @ 35% ($350,000) 0Federal estate taxes@ 35%($350,000) 0Savings from §691(c)Deduction* $98,000 N/ANet gift $398,000 $1,000,000*IRC §691(c) allows an income tax deduction for estate taxes paid on IRD assets.
  35. 35. Donor Profile for Flexible Deferred CGABetween ages 50 and 65In peak earning years; could benefit from acharitable income tax deductionHave seen retirement plan assets decrease inthe downturnLooking for ways to supplement their futureretirement plan incomeUnsure when they might retire
  36. 36. Flexible Deferred CGA—How It WorksPayments deferred to the futureMultiple start dates written into the contractThe later the date, the higher the payout rateImmediate income tax deduction based on theearliest start date for payments
  37. 37. QUESTIONS ON BOOMERS AND PLANNED GIVING?

×