Responding to the Moment through Philanthropy
Now, perhaps more than ever, our country faces an unprecedented confluence of challenges that demand the responsiveness of our government, the private sector, and all of us as individuals. As we look inward and consider ways to support causes that move us, those with the means to do so have an opportunity to be particularly tactical in their giving. In this piece, we will explore ways in which philanthropic families and individuals can respond to the crises – and opportunities – facing the nation in this moment.
The CARES Act – the Coronavirus Aid, Relief, and Economic Security Act – enhanced charitable giving incentives for donors in 2020. Specifically, the legislation suspends the 60 percent adjusted gross income limitation for individuals’ charitable contributions for the year, and makes cash contributions to public charities fully deductible. Importantly, this does not apply to contributions to Donor-Advised Funds, in order to ensure that money is directed to nonprofits immediately to address current needs.
With the social and financial incentive to act upon us, where should you begin as you consider how to make an impact with your philanthropic dollars? By identifying causes you wish to support in this moment. Top of mind for many now, which we will focus on here, are racial justice and COVID-19 pandemic-related hardships.
The killing of George Floyd by a Minneapolis police officer is just the latest in an agonizing history of countless crimes committed disproportionately, and often intentionally, against Black Americans. In this moment, however, it has awoken the nation and much of the world to stand up and say “enough is enough,” and to demand structural reform in response to the systemic racism and police brutality that have existed, evolved, and become entrenched in the fabric of our nation since its founding. Never before has complacency been so clearly tied to complicity, and silence tied to violence.
Donors who wish to support racial justice initiatives and the public outcry for change have many nonprofit organizations to consider. Before identifying specific grantees, it is important to determine the area(s) where you seek to make an impact: victim memorial funds, bail funds, community restoration, community enrichment, policy reform, political organizations, police reform, incarceration reform, legal defense funds, mental health organizations, and others. This is arguably the hardest step in the process, since your philanthropic budget is limited and there are so many worthy causes.
At Lake Street, we have been reviewing and compiling resources to support clients with these difficult but important decisions. A few are linked at the bottom of this post.
As the world continues to understand, control, and eventually recover from the COVID-19 pandemic and the ensuing economic recession, the philanthropy community has taken several steps to respond and has provided donors with many opportunities to make an impact. At an institutional level, some of the largest private foundations in the country are taking the unprecedented step of issuing debt so they can give more now to support nonprofits responding to the pandemic and recession. With challenge comes opportunity, and there is no shortage of either at this time.
For donors, the decision of where to direct grants is particularly hard, because COVID-19 knows no bounds and has impacted every community in the world. To that end, it is important to not waver in your support of existing grantees or necessarily stray far from your long-term strategic philanthropy plan in order to respond to the current crisis. However, there are communities disproportionately impacted by COVID-19 that need more support now. Hundreds of COVID-19 response funds have been established, whereby grant management is overseen by professionals and donors can make a single grant, knowing that their dollars will go to vetted nonprofits in communities where they seek to make an impact. This interactive map, compiled by Giving Compass and the National Center for Family Philanthropy, provides a comprehensive list of vetted funds. Additional resources are linked below.
Lake Street Advisors collaborates with clients and our partner philanthropy advisors to continually assess and evolve philanthropic endeavors by being nimble and responsive to the moment without wavering on fundamental principles or long-term strategy. Now is one such time that demands renewed and refreshed analysis of how best to support the causes and communities that are facing extraordinary challenges in this moment.