What is a Community Foundation?

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  • (Customize this slide with your community foundation identity) Thank you for taking time to meet with me today. My name is ______ , [title] at the Community Foundation of Waterloo/Cedar Falls and Northeast Iowa .. your community foundation. And we are here... “ For good . For ever .” This phrase lies at the heart of what I’d like to address with you today... it’s what community foundations are all about. [ click ]
  • What is a Community Foundation?

    1. 1. For good. For ever. SM
    2. 2. Louise created an Unrestricted fund with the Community Foundation because she understood that the needs of this community might change in coming years and relied on the Foundation to respond to those needs. Louise gave quietly throughout her lifetime. She cared deeply for those in need and wanted to support charitable efforts with worthy missions.
    3. 3. Brett Bergstrom passed away in 1993 at the age of 20…. But his love for the environment and Habitat for Humanity live on through the fund his father created in his memory with the Community Foundation!
    4. 4. Bud Nichols was a teacher. He was diagnosed with pancreatic cancer in March 2002 and died on November 11th that year… The Nichols family established a scholarship fund with the Community Foundation so his memory will continue to live on with the experiences his fund helps provide for students.
    5. 5. Lowell J. Walker wanted to better his community and leave an impact long after his death… Through detailed estate planning, Lowell started a fund benefiting youth causes, donated a building to his favorite charity, and created a fund to support upkeep of that building so it would never be a financial burden.
    6. 6. t w a h is a community foundation? is a community foundation?
    7. 7. Our Mission <ul><li>Respond to the current and future charitable needs </li></ul><ul><li>of Cerro Gordo County. </li></ul><ul><li>Secure and serve as the custodian of endowment </li></ul><ul><li>funds contributed by many donors. </li></ul><ul><li>Create other mechanisms which will channel charitable money, </li></ul><ul><li>goods and services to meet community needs. </li></ul>
    8. 8. The Community Foundation has three distinct features.
    9. 9. e e t r h t o w o e n permanent endowment broad, flexible purpose personalized giving
    10. 10. permanent endowment o e n
    11. 11. feature one <ul><li>Invest and protect principal </li></ul><ul><li>Distribute earnings via grants </li></ul><ul><li>Build permanent community capital </li></ul><ul><li>Create donor legacies </li></ul>George and Hallene are still making a difference- You can too- for good… for ever! Permanent Endowment
    12. 12. broad flexible purpose t o w
    13. 13. feature two Making a real impact on real people Broad, Flexible Purpose Arts and Culture Economic Development Education Environment Health Human Services Historic Preservation Neighborhoods › Support high-impact opportunities › Bring organizations into existence › Redirect funds as appropriate › Monitor all community needs…
    14. 14. personalized giving e e t r h
    15. 15. <ul><li>› Fulfill multiple charitable intents </li></ul><ul><li>› Gain maximum tax advantage </li></ul><ul><li>› Be involved in establishing a fund: </li></ul><ul><li>- Unrestricted </li></ul><ul><li>- Field of Interest </li></ul><ul><li>- Designated </li></ul><ul><li>- Advised </li></ul><ul><li>- Agency Endowment </li></ul><ul><li>- Scholarship Fund </li></ul>feature three Personalized Giving
    16. 16. <ul><li>› More than 750 funds </li></ul><ul><li>› Over $39 million in assets </li></ul><ul><li>› Over $30 million is permanently endowed </li></ul><ul><li>› More than $5 million in annual grants </li></ul><ul><li>› Cumulative grants of nearly </li></ul><ul><li>$29,000,000 since our inception in 1956 </li></ul>foundation facts Our host foundation’s current vital statistics Tom Porth (’06-’07 Board Chair), and Mary Ann Burk (President and CEO)
    17. 17. Tools for giving.
    18. 18. Why are we an Affiliate The Community Foundation of Northeast Iowa handles all of the administrative responsibilities of the affiliate fund. This includes accepting gifts, assisting with paperwork, handling thank you letters, and promoting the fund through various publications and initiatives. The affiliate fund has its own Committee structure to make recommendations for funding, etc. The affiliate fund is able to accept gifts of all types! Tools for Giving
    19. 19. <ul><li>› Unrestricted Fund Meeting ever-changing community needs </li></ul><ul><li>› Field of Interest Fund Addressing needs in an important area of community life: arts, education, environment… </li></ul><ul><li>› Designated Fund Directing gifts to specific agencies or purposes (e.g., scholarship) </li></ul><ul><li>› Donor Advised Fund Involving donors in the use of their gift </li></ul><ul><li>› Scholarship Fund Benefits students seeking higher education </li></ul>Charitable Funds for giving tools You can create a named fund in any of these categories.
    20. 20. <ul><li>› Outright Gifts - Give cash, stocks, real estate or other assets </li></ul><ul><li>› Bequests - Designate a portion of an estate </li></ul><ul><li>› Charitable Gift Annuity - Annuity contract pays donor for life and charitable fund commences grants upon death </li></ul><ul><li>› Charitable Lead Trust - Trust pays the community foundation a fixed amount for a number of years and then assets go to beneficiary </li></ul><ul><li>› Charitable Remainder Trust - Trust pays beneficiary for life and then assets transfer to community foundation </li></ul><ul><li>› Life Estate Contract - Donor transfers home to the Community Foundation of Waterloo/Cedar Falls and Northeast Iowa and still enjoys living at home </li></ul><ul><li>› Retirement Plans - IRA’s, etc. By naming the Community Foundation as beneficiary of a retirement plan 100% stays in the community to benefit charities in the donors name. </li></ul><ul><li>› Insurance - Insurance policies can be named to the Community Foundation in total or even a portion. Many establish the Community Foundation as the owner and beneficiary during their lifetime. </li></ul>Charitable Instruments for giving tools We accept a wide variety of assets.
    21. 21. Legislation Iowa Legislation for Community Foundations <ul><li>Endow Iowa Tax Credits </li></ul><ul><li>Donors to Affiliate Community Foundations are considered eligible for tax credit purposes if affiliated with a qualified Community Foundation. </li></ul><ul><li>Donors receive tax credits if donations given to a Permanently Endowed Fund (fund max. 5% pay out) to a qualified Community Foundation. Donations must be to benefit Iowa charities. </li></ul><ul><li>Currently $2 Million Tax credits available for year 2007 (credit awarded on first come first serve basis when application comes to state and is stamped- If 2006 credits used up, those stamped are first to get credit in 2007 etc. </li></ul><ul><li>Beginning in 2008 credit should be approx. $3 million per year. Sunset clause for end of credit removed with this legislations- credits will continue unless new legislation formed to rescind. </li></ul>
    22. 22. Rollover Legislation IRA Did You Know? <ul><li>Individuals 70 ½ or older can transfer “tax free” up to $100,000 to charity in tax year 2007 </li></ul><ul><li>Payment must go directly from IRA to a charity </li></ul><ul><li>Amounts transferred to charity count toward IRA mandatory distribution requirements </li></ul><ul><li>Not tax free to advised funds; cannot make to split interest trusts (e.g. Charitable remainder trusts or Lead Trusts, or Charitable Annuities) </li></ul><ul><li>Donors making up to $100,000 tax free Rollovers to endowments at Community Foundations that meet National Standards in year 2007 are also eligible for the 20% Iowa State Tax Credit. </li></ul>
    23. 23. giving back people Did You Know? If you create an endowment worth $25,000 today, in 25 years you will have given this community $46,172 dollars in grants and your endowment will be valued at $69,257 . Gift and grant values assume an 8.5% growth in the market and grants of 4% annually .
    24. 24. Cerro Gordo County Wealth Transfer
    25. 25. Total Annual Transfer of Wealth for the County Cerro Gordo County $83.9 million in wealth is transferred each year
    26. 26. What if 5% of the Wealth was Gifted Annually? <ul><li>Cerro Gordo County </li></ul><ul><li>$83.9 million </li></ul><ul><ul><li>x 5% </li></ul></ul><ul><ul><li>$4.2 million gifted </li></ul></ul>
    27. 27. How could Cerro Gordo County use $4.2 million? <ul><li>One Time Projects </li></ul><ul><li>A fire truck costs $250,000 </li></ul><ul><li>Medical defibrillator for $2,500 </li></ul><ul><li>1 mile of bike trail costs $100,000 </li></ul><ul><li>Playground equipment $15,000 </li></ul><ul><li>Ethanol feasibility study $35,000 </li></ul>
    28. 28. How could Cerro Gordo County use $4.2 million? <ul><li>Long Term Priorities </li></ul><ul><li>An endowment of $1 million will provide $50,000+ in annual spending for… </li></ul><ul><li>Arts & Culture </li></ul><ul><li>Community Development & Entrepreneurship </li></ul><ul><li>Education & Youth </li></ul><ul><li>Environment & Historic Preservation </li></ul><ul><li>Health & Human Services </li></ul><ul><li>Assumes annual Endowment spending rate of 5%. </li></ul>
    29. 29. Grant Distribution Process
    30. 30. <ul><li>Application process once per year with deadlines decided by our committee. </li></ul><ul><li>Our committee reviews applications and makes our recommendations to the Community Foundation of Northeast Iowa. </li></ul><ul><li>The Committee’s final recommendations are approved by the full Board of Directors of the Community Foundation of Northeast Iowa. </li></ul><ul><li>Grantees are approved and notified by the Community Foundation of Northeast Iowa on our behalf. </li></ul>The Unrestricted Distribution Process grants Awarding
    31. 31. Questions???
    32. 32. © 2002 Council on Foundations and Community Foundations of America For good. For ever. SM

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