In an effort to curb criticism about donor-advised funds, the Silicon Valley Community Foundation has made public a searchable catalog of nearly half a billion dollars in grants made from those funds in 2015.
“We’ve become aware of increasing concern and interest in how donor-advised funds are being utilized to serve local communities and communities elsewhere,” said Emmett Carson, chief executive of the foundation. “As the largest community foundation in the U.S., with values around public accountability and transparency, we were looking for a way to share insights” about the funds.
Donor-advised funds, commonly referred to as DAFs, are charitable accounts into which individuals can deposit cash, stocks, or other assets in exchange for immediate tax breaks. Legally, there are no time requirements or minimum payouts.
Technically, the donor “advises” on the disbursement of the money, and ultimate decision-making power lies with the holding organization. In practice, the fund usually follows the donor’s wishes.
The accounts are often housed at major financial institutions like Fidelity or Schwab, or at community foundations, and they have exploded in popularity in recent years.
Last year, the Silicon Valley Community Foundation made a total of $823 million in grants to nonprofits. The newly released catalog includes only $479.7 million in DAF grants and the foundation’s discretionary grant-making programs. The catalog excludes grants made through employee matching funds and the foundation’s supporting organizations, which are similar to private foundations.
The decision to exclude some channels of giving was made because critics’ concerns about lack of transparency have been focused on donor-advised funds, Mr. Carson said.
Grant Recipients
Users can sort grants by cause, fund type, grantee, or location. Rather than reveal any specific patterns of giving, the catalog shows that nonprofits of all kinds receive grants from donor-advised funds, Mr. Carson noted.
“Concerns that only those that are well known get resources, that’s not borne out by the data,” he said. “Concerns that only those that are new get resources, that’s not borne out by the data.”
This is not the foundation’s first attempt to respond to criticism of donor-advised funds. It published a guidebook designed to dispel what it considers myths about the giving mechanism.
The newly released database of DAF grants falls short in the eyes of some. Al Cantor, a nonprofit consultant and vocal skeptic of donor-advised funds, said the catalog “doesn’t answer the key questions” he and fellow critics have about the giving mechanism.
“They’re not saying which funds are providing which grants or how many of their funds are essentially inactive,” he said. “It largely is an effort to show that a lot of money is going out the door.”
Mr. Carson countered that critics have yet to provide an example of a donor-advised fund that operates outside of legal parameters.
“There’s no smoking gun. I’d like the critics to show the examples of abuse,” he said. “They need to put up or shut up.”