Philanthropy This Week

Michael Theis, The Chronicle

Good morning.

In a week when the nation’s eyes are trained on horrific racial violence from Monterey Park, Calif., to Memphis, it’s yet another crucial moment for us to call attention to philanthropy’s response to calls for racial justice.

Alex Daniels took us inside a particularly interesting approach taken by a small family philanthropy in Baltimore.

He explains why last year Adam Holofcener and his family emptied their foundation’s account and gave $1 million to the Baltimore Beat, a free newspaper staffed by Black editors and writers to provide news primarily for the city’s Black residents.

For Holofcener, the bold move was both an attempt to directly respond to the calls for racial justice after the murder of George Floyd by police in 2020 and an attempt to purge the family of gains it had made, which, as Holofcener sees it, came at the expense of Baltimore’s Black residents.

Holofcener’s grandfather amassed his wealth first through his insurance businesses and then through a successful chain of skiing and golfing equipment stores. Decades ago, the Holofceners left Baltimore for the suburbs, like thousands of other white families, leaving the city with a depleted tax base that Holofcener says crippled its ability to provide adequate services for its residents.

Sending the money to the Baltimore Beat, says Holofcener, was a way to counter the idea that “any giving is good giving.” If the foundation had distributed grants over several years to select nonprofits, the philanthropy would still maintain control over the city’s nonprofits competing for the funds, he says.

A better way to give, he says, was for the foundation to give up control of how the money was used and leave those decisions to the newspaper’s staff.

“It was very important that not only were we giving all the money away but that we were losing the money,” Holofcener told Alex. “It’s as important to disempower ourselves as it is to empower them.”

Here’s what else you need to know:

Illustration by The Chronicle; Getty image

Ending all tax exemptions would eliminate the conflict of interest inherent in Big Philanthropy, in which only the wealthy get tax privileges in exchange for their charitable gifts (opinion).

Big Philanthropy is a racket, writes Jeffrey Cain, who has led numerous foundations, nonprofits, and for-profit corporations. And any attempt to level the playing field for all donors has come up against a wall of opposition from the left and right, grant makers and wealthy donors, and even the charities they support.

The tax-exempt laws, policies, and regulations that benefit the rich serve no purpose to further charitable causes. Giving has been 2 percent of GDP for decades, despite boom times of the past 15 years for the wealthy and the swelling number of donor-advised funds.

Even charities use their tax-exempt dollars to fight changes to the 100-year-old system. “In other words,” writes Cain, “philanthropists can use their tax-advantaged funds to advocate for greater tax-incentivized charitable laws through the tax-exempt nonprofits they support.”

Writes Cain: “Removing the charitable-exemption lid will inaugurate a new era of greater giving — and it will allow the independent sector to finally live up to its name.”

Illustration by The Chronicle; photos from Getty Images

Even as Jeff Bezos promises to give away the bulk of his vast fortune, he tempers that promise with the warning that he isn’t ready to open the floodgates yet because philanthropy is “really hard” and he’s “building the capacity to be able to give away this money” (opinion).

The notion that giving is hard dates back to Andrew Carnegie, writes philanthropy historian Ben Soskis, and when invoked too zealously, it can deflect attention from what grantee leaders often find most difficult about philanthropy: a lack of urgency, a failure to deliver resources expeditiously, and the imposition of burdensome restrictions.

The “difficulty of giving” trope can be traced back to the leading industrialists of the Gilded Age and Progressive Era, who received torrents of “begging letters,” as they were known, writes Soskis, who is a scholar at the Urban Institute.

The trope faded when many of those donors died and giving shifted to their foundations, but it has seen a resurgence in recent years as enormous wealth has been concentrated in the hands of a very few, and it is often invoked to justify the philanthropists’ slow pacing of gifts.

“The ‘difficulty of giving’ trope can represent some of the best of philanthropy, reflecting a donor’s dedication to a vocation approached with deliberateness and care,” writes Soskis. “But, as its history makes clear, it can also represent some of the worst, spotlighting big donors’ imperious remove from the problems they seek to address.”

S-S-S, Getty Images

A new dot-giving domain aims to provide a home for online fundraising for nonprofits, donors, social enterprises, and the social-responsibility arms of corporations.

A dot-giving website would complement an organization’s main site, writes Emily Haynes. The domain can serve a variety of purposes, Jon Nevett, CEO of the Public Interest Registry, told Emily. Nonprofits can use it to streamline their fundraising. Individuals can create websites to run their own campaigns — for example, raising money for a charity in honor of their birthdays. And corporations can use it to showcase the impact of their social-responsibility programs.

Nonprofits often own more than one domain name and use them for different purposes.

“Dot-org is the centerpiece and always will be because that’s what people think of when they think of the mission-driven use of the internet,” Nevett told Emily. “But there are opportunities for others who want to have a simpler name.”

The Loss of AmazonSmile

Our colleagues at the Associated Press, Thalia Beaty and Glenn Gamboa, talked to small nonprofits about the abrupt end of Amazon’s effort to direct a small portion of their purchases to charity. We’ve been following the Smile program for years, with two pieces that might be especially worth reading now, one a reported article from Eden Stiffman and the other an essay by our regular contributor Alan Cantor. He published an update to his critique a few days ago you may want to read, too.

Our Sara Herschander also looked at corporate efforts to direct consumers to giving options in a piece worthy of your time.

We hope this weekend gives you plenty of opportunities to read, recharge, and smile.

— Marilyn Dickey and Stacy Palmer

WHAT WE’RE READING ELSEWHERE

The end of the AmazonSmile program is another blow to nonprofits already facing increased demand, staffing shortages, and falling “micro” donations, among other woes. (MarketWatch)

Time’s Up, the high-profile nonprofit that arose out of the #MeToo movement and collapsed amid internal divisions and public embarrassment, is disbanding. (Associated Press)

Even as a stock-market tumble dented the net worths of the country’s richest people, big philanthropists upped their giving in 2022, according to Forbes’s annual rundown of the top 25 givers. (Forbes)

Activists who made their name propagating the lie that the 2020 presidential election was stolen raised funds last year to start a mobile hospital in Ukraine that never materialized. (ProPublica)

As veteran nonprofit leader Ben Jealous takes the reins, the Sierra Club is emerging from a period of self-examination and tumult, pushing for a sharper focus on equity in environmental issues and within its own ranks. (New York Times)

Jeff Bezos’s plans to give away most of his $120 billion fortune raise many questions that he has so far left unanswered. (Vox)

From heaters to scientific research grants, U.S. philanthropists are offering aid to Ukrainians that goes beyond the official support for the military and government. (New York Times and Wall Street Journal — subscription)

A major health-care nonprofit in Los Angeles faces a multimillion-dollar lawsuit over serious maintenance issues at a Skid Row building it owns. (Los Angeles Times)

A nonprofit coalition of groups representing thousands of local newsrooms has launched an effort to save imperiled local news outlets. (Axios)

NEW GRANT OPPORTUNITIES

Your Chronicle subscription includes free access to GrantStation’s database of grant opportunities.

Livable communities. The AARP Community Challenge provides small grants to fund quick-action projects that can help communities become more livable for people of all ages — especially those 50 and older. The focus is in three areas: One is improving public places, transportation, housing, diversity, equity, inclusion, digital connections, community resilience, civic engagement, and community health and economic empowerment. Another is to improve walkability and community gardens. And the third is to the build capacity of transportation systems and to build awareness of new housing options through accessory dwelling unit design competitions. Applications are due March 15.

Patient safety. The Doctors Company Foundation supports projects and activities that develop knowledge, techniques, and tools to reduce or eliminate the risk of adverse events that cause harm to patients while under care. Nonprofit entities and education institutions are eligible to apply. Letters of intent will be accepted from February 8 to March 14. Invited full proposals will be due June 20.