Moments in Philanthropy :: March 2009

In This Issue  


The Value of Long-Term Stewardship
Charitable Gift Annuities – A Charitable Gift that Pays You Back
MCF Supports Basic Needs - First Round Grant Awards
MCF Serves Communities Around Dane County
Did You Know?


The Value of Long-Term Stewardship


MCF's endowment funds will distribute $5.45 million in 2009.

"Our investment policy and distribution formula is designed to cushion the fluctuations of the financial markets and produce consistent distributions from our funds," commented Ann Casey, Vice President, Finance and Planned Giving.  

In 2008, these Donor Advised, Agency and Community Impact funds had $5.59 million available distribute.


Charitable Gift Annuities – A Charitable Gift that Pays You Back



Charitable Gift Annuities (CGA)are planned gifts that provide a donor with a stream of income during their lifetimes and a favorite charity with a stream of income in perpetuity. Although savings, CD, and money market interest rates remain low, and many companies have cut their dividend rates, CGA rates remain robust for charitably inclined individuals who are over 60 years old.  A CGA is a good tool for people who are seeking a steady stream of income for life, and also interested in making a gift to charity.  It offers an immediate tax deduction for the charitable portion of the gift, based on rates prescribed by the IRS.  MCF agrees to make payments to the donor (and a surviving spouse) for the remainder of his or her life, at a guaranteed rate of return.  The donor can choose to receive payments as often as quarterly, and a portion of every payment is tax-free.  Upon the donor’s death, the remaining assets are either added to an existing MCF endowment or used to establish a new permanent endowment.  CGAs can be created with an irrevocable gift of $20,000 or more.

 

Donor Age

Annuity Rate

60

5.0%

65

5.3%

70

5.7%

75

6.3%

80

7.1%

85

8.1%

                                      


                                
If you would like more information about establishing a charitable gift annuity through the Madison Community Foundation, or to see a calculation for your specific scenario, please contact Ann Casey, Vice President, Finance and Planned Giving at acasey@madisoncommunityfoundation.org or at (608) 232-1763.
 

MCF Supports Basic Needs - First Round Grant Awards



Dane County has extraordinary non-profit organizations that are rising to the challenge of the down-economy.  In order to build on those assets and ensure their continued success, The Madison Community Foundation Board of Governors has changed the MCF grantmaking focus area this year to concentrate on such basic needs as shelter, food and energy assistance.  This flexibility allows MCF to creatively tackle some of the most pressing needs of county residents while also ensuring the long-term success of local charitable organizations.  MCF has also partnered with our many donors and with United Way to help leverage local, state and federal funds that will increase the impact of these grant awards.
 
The Board has made its first round of grants, distributing $250,000 to nine organizations.  Seven of the grants are for members of Dane County’s food pantry network, impacting all 46 of the food pantries throughout the county. These grants will strengthen the entire network, resulting in increased efficiency, healthier food and reduction in annual costs. The two grants for shelter include a new transitional shelter and treatment program for homeless veterans, who comprise 10% of the county’s homeless population, and an investment in infrastructure for Habitat for Humanity that will yield annual savings of $150,000.   The grants awarded this round will leverage additional funding or savings of over $1 million for these organizations.

The MCF grant program is nimble and alert to new opportunities, engaging our community’s best leaders and ensuring their programs’ strength, sustainability and success.  A brief synopsis of each grant award follows below.


Grant Synopsis


Community Action Coalition
$27,000 toward the purchase of a larger truck and pallet jack for the CAC site, enabling a larger volume of food to be distributed more efficiently. A combination of utility carts, 2-wheel dollies and manual pallet jacks will also be provided for small pantries around Dane County, greatly increasing efficiency.

Society of St. Vincent de Paul
$25,000 for purchase of a large, three-door freezer and small refrigerated semi-trailer, allowing increased capacity to acquire, store and disseminate frozen food and dairy products. The trailer will also be used periodically to temporarily store overflow stock.

Bethel Lutheran Church
$23,000 for extensive shelving, a freezer, and food-bins needed to equip the soon-to-be expanded facility of one of Dane County’s largest food pantries. These fixtures will allow the Bethel pantry to serve as many as 3000 households in 2009 and up to 3500 households in 2010.

Second Harvest Food Bank
$11,000 will be used for two projects: First, the discounted purchase of GPS and tracking software will save over 40% of the transportation costs of collecting and disseminating over seven million pounds of food a year. Second, acquisition of “high pile” pallet racking will increase storage area by at least 65%.

East Madison Community Center
$5,000 will purchase and install a commercial grade freezer to increase the capacity of the East Madison Community Center. This greatly expanded space increases the volume and quality of food available to over 300 participant families on Madison’s east side.

The River Food Pantry
$15,000 will purchase two commercial refrigeration units to replace existing, inefficient models. Pantry usage increased by 85% from 2007 to 2008. The larger units will allow greater capacity to serve the increased client load, accommodating up to 2000 families per month.

First United Methodist Church
$22,000 will provide an upright freezer and additional shelving to store and disseminate  provisions for a clientele that has increased by 20% between September 2008 and January 2009 alone. FUMC collaborates with a large number of Senior Centers and provides specialized food, personal care and hygiene items for seniors and individuals with dietary restrictions.

Habitat For Humanity (HFHDC)
$75,000 for the purchase of a used excavator and foundation forms to excavate and install foundations for all Habitat homes created now and in the future in Dane County. Formerly contracted to local concrete companies, this function, once brought in-house, will create enough savings to build an additional Habitat house per year. In addition, the HFHDC Excavation and Foundation Training Program will work with local training programs to teach new skills and provide leadership training to apprentices and volunteers onsite. This project will reduce costs, increase capacity, and provide more control over the finished project.

Porchlight, Inc.
$50,000 to renovate a building to create 22 transitional housing units for homeless veterans. The improvements will include a commercial kitchen for the expansion of Porchlight Products program. This grant will help leverage over $500,000 in federal funding the first year and $200,00 per year after. The objective of the project is that 75% of the veterans completing the program increase their employment income and improve skills that lead to job security.


MCF Serves Communities Across Dane County


For over 20 years Madison Community Foundation has been reaching out to communities across Dane County, actively serving those communities by building assets such as libraries, bike trails and community centers. Once created, MCF helps protect those assets by assisting communities to build endowments that provide operating resources for years-to-come.

Currently MCF holds nearly 150 funds for individuals and communities outside Madison.  And since 2000 MCF has granted $1.6 million for those communities - above and beyond the resources provided by their endowment funds.  Communities choose MCF because it provides 67 years of experience, operating efficiencies, investment expertise, broad asset processing. MCF has  a commitment to doing what is best for each community - as advised by people within that community.

If you’re interested in learning more about MCF or creating an endowment to support your community or your charitable interests, contact Bob Sorge, Vice President of Strategic Development at: bsorge@madisoncommunityfoundation.org

Did You Know?


Donor advised funds contribute greatly to the health and welfare of our communities—now and in the future. A new Council on Foundations' report, "Donor Advised Funds Provide the Majority of Grant Funds Awarded by Community Foundations," reveals a host of interesting facts about these funds and their role in addressing societal needs. For example, did you know:
  • Community foundations hold more than half (53 percent) of the estimated $31 billion currently held in donor advised funds.
  • Donor advised funds comprise about 33 percent of the community foundation sector's total assets of over $50 billion, yet make up 62 percent of the community foundation sector's annual grants.
  • The payout rate from community foundation donor advised funds is three times the payout rate from other funds—16.4 percent versus 5 percent.

To get the full report click here http://www.cof.org/files/Documents/Research/08donoradvisedpaper.pdf