Leveraging Donor Advised Funds to Provide Critical Support
We’re digging deeper into the roles of donor advised funds (DAFs) at Michigan community foundations, sharing examples of DAFs in action around the state to learn more about their role in communities.
We’re highlighting how several community foundations across the state leveraged DAFs in response to the COVID-19 pandemic.
As the pandemic unfolded in Michigan, some foundations created COVID-19 Relief and Response Funds to support local nonprofit, governmental and educational organizations that provided services to their communities in need amid the pandemic. CMF tracked over 50 such funds active around the state, either led by Michigan philanthropy or supported by philanthropy in collaboration with partners such as the local United Way.
Many community foundations saw their donor advisors eager and willing to support.
Throughout our conversations with community foundations over the course of the last several months we heard from many leaders about the ways their DAF holders stepped up immediately as the pandemic unfolded.
“DAF holders are folks who are trying to support their community and during COVID that became so clear, and it rang true in every need, from helping our arts organizations to survive, to food pantries, those partnerships gave continually throughout COVID,” Lisa Cripps-Downey, president of Berrien Community Foundation said.
DAFs also provided the necessary infrastructure to get spendable dollars into the community quickly to support rapid response efforts.
“The fact that they already have their money committed to charitable causes, they don’t have to write a new check, they can simply say that this money is available now for urgent needs and we want to support it,” Dennis Fliehman, president and CEO of Capital Region Community Foundation, said. “That was their response when the pandemic began.”
Fliehman and his team shared that their DAF holders were “able to make larger gifts, potentially more than they could have with just their checkbook.”
At the Grand Rapids Community Foundation (GRCF), their COVID Recovery Fund helped the foundation pool resources and quickly dispatch dollars for crisis response and long-term recovery.
GRCF has shared the critical role DAF holders have played in their COVID-19 response efforts to continue advancing toward recovery and reimagining the community’s future, with DAFs increasing the amount of grant dollars distributed to nonprofits by 23% in 2020 alone.
Cripps-Downey shared that through their COVID relief fund, the community foundation was able to make grants every week and DAF holders were crucial in supporting those efforts.
In addition, the Berrien Community Foundation created a fund to support businesses and DAF holders supported that initiative, as well.
“We partnered with our local economic development organization and created a fund for our local small businesses through which they could get a loan to pay their rent and when businesses started to open again we were able to forgive those loans with DAFs support,” Cripps-Downey said.
In northern Michigan, the Petoskey-Harbor Springs Area Community Foundation (PHSACF) received contributions from DAF holders for their Essential Needs Fund which supports nonprofit partners who have experienced financial hardship in their operations due to COVID and who are also providing emergency relief to families and individuals affected by the pandemic.
“When COVID hit, our DAF holders made a conscious effort to trust the community foundation with where these dollars went,” David ‘DJ’ Jones, executive director of PHSACF, said.
The community foundations say that DAF holders became impactful partners in supporting COVID relief efforts within their communities and were able to respond quickly to the needs of their community foundations for immediate and long-term recovery.
We invite you to read more about DAFs at Berrien Community Foundation, Petoskey-Harbor Springs Area Community Foundation, Capital Region Community Foundation and Grand Rapids Community Foundation.
CMF released phase 3 of our payout rate research series, Analysis of Donor Advised Funds from a Community Foundation Perspective, focusing on the payout rates of donor advised funds (DAFs) within the context of the philanthropic sector, specifically the payout rates of DAFs administered by Michigan community foundations. CMF has also crafted a comprehensive FAQ on DAFs and Payout Rates to help our community of philanthropy and sector partners navigate phase 3 of our payout rate research series.
New State Budget Now in Effect: Focusing on Working Families and the Economy
Governor Gretchen Whitmer has signed a $70 billion budget into law for the 2022 fiscal year. The budget, which went into effect on Friday, includes an emphasis on families and boosting the state’s economy.
“This is a budget that puts Michiganders first,” Whitmer said in a press release. “We are coming together to grow the middle class, support small businesses and invest in our communities.”
This year’s budget makes significant investments in child care, education, job training and infrastructure. It also supports the environment and adds $500 million to the state’s Rainy Day fund.
We’re sharing details of the budget in several key areas of interest for philanthropy.
• Increasing eligibility: $108.1 million to make 105,000 more children eligible for child care by increasing income eligibility to 185% of the federal poverty level through 2022-23 and 160% thereafter.
• Supporting child care workers: $158 million for a 30% pay increase for child care providers with an additional $222 million for a temporary increase.
• Staff bonuses: $30 million for a one-time $1,000 bonus for all child care staff.
Education and Job Training
• Tuition costs: $55 million for the Michigan Reconnect program that provides tuition-free education and training.
• Support for frontline workers: $25 million to the Futures for Frontliners program, covering tuition costs for frontline workers who worked during the pandemic.
• Job training: $40 million for the Going PRO program that provides employer-based training grants.
Public Health and Safety
• Nursing home staff support: $460 million to make a $2.35 per hour raise for direct care workers in nursing homes and other facilities.
• Corrections: $7.3 million to train new corrections officers.
• Police training: $7.7 million for a State Police trooper recruit school.
Economic and Infrastructure Investments
• Increased revenue sharing: A 2% increase in statutory revenue sharing.
• Bridge infrastructure: $196 million to maintain and repair local bridges across the state.
• Unemployment insurance: $150 million to the Unemployment Insurance Trust Fund.
• Budget stabilization: $500 million to the Budget Stabilization Fund, bringing it to a record $1.4 billion.
Whitmer emphasized the role of the budget in supporting families, workers and small businesses all across Michigan.
“The budget is a testament to what we can do when we work together,” Whitmer said. “Now, we should continue in that spirit of collaboration to use the billions of federal dollars we have to help our families, communities, and small businesses thrive."
Read the full budget.
Read Governor Gretchen Whitmer’s budget press release.
If you have any questions about the state budget, please contact Regina Bell, director, CMF's government relations and public policy.
CMF Community Voices
As we look ahead to CMF’s 49th Annual Conference – Connecting Diverse Voices – we are pleased to share CMF Community Voices, featuring a series of conversations and insights from leaders across our community of philanthropy. This curated collection of blogs and Q&As lift up inspiring voices from changemakers who lead efforts in the areas of Equity, People, Practice and Policy are, with equity at the center. This week, we are featuring Transformative Friendships Build Bridges, a blog by Rodney McKenzie, Jr., vice president of ally development at The Fetzer Institute.
Transformative Friendships Build Bridges
by Rodney McKenzie, Jr., Vice President of Ally Development at The Fetzer InstituteIn the early 2000s, I ran
Through this experience, I learned that winning a campaign isn’t only determined by having enough votes. Winning was determined by the quality of relationships we had with volunteers, coalitions and the people who answered the doors we knocked on ─ people who were unlike us but would stand with us. I learned that people can be outrageously different from one another and still connect. People who live in the rural South can be friends with people in the big cities because they have something unspeakable in common. They have a shared humanity. Dynamic relationships based in this shared humanity are what I call transformative friendships.
Transformative friendships build bridges and do no harm. In these friendships, we see ourselves as connected, not separate from each other. Moving towards transformative friendships is our challenge within society at large ─ and also within philanthropy.
As a leader in philanthropy and the vice president of ally development at Fetzer, I often find myself in meetings where I am the only Black gay man. I’m often asked to share my story so that others can gain insight and understanding. At best, this is framed as an opportunity to inspire; at worst it feels performative. One day, as I got onto a call, having shared my story three other times that day, I was feeling particularly frustrated that, once again, I would be the only one telling the details of my life. But behind my disappointment was anger and sadness because I believed that no one in this space of privilege would fully understand me. Because of this, when I told my story that day, I wasn’t extending an invitation to those listening to get to know me. Instead, I was locked in a belief that they would never know me.
After I stopped talking, a man whom I had assumed to be white and privileged spoke up quickly with tears in his eyes. He said, “I get that,” and began talking about how he had been adopted as a child and how, all of his life, he had felt like an outsider.
I remember having a moment of reckoning. In that interaction, I had used my story as a sword to protect myself ─ to show that I was special and different. I had used my story to show how I had been hurt and because there was a wound there, I was willing to wound another. I could have shut him down. I could have told him that his experience was not my experience. But by being vulnerable, this man had disarmed me. By being truly vulnerable, he had built a bridge towards me in that moment of pain ─ he had shown me that although he was unlike me, he was willing to stand with me. The little kid in me who felt alone met the little kid in him and we witnessed each other.
What if the campaigns we need aren’t those that are issue focused, fought during election cycles? What if the most important campaign is based upon our ability to see our shared humanity? What if shared human flourishing, or love as a verb, is the singular most important campaign of our day? I left political campaigns ─ because it just wasn’t enough. I came to Fetzer to do something even more transformative. In this moment, I believe we have an opportunity to share our stories, and see each other, in hopes of winning the most important campaign of our times: the campaign for a shared humanity.
I dare us, this week, to share our stories with someone as an invitation for change ─ not just in philanthropy but in our world. Share your story without expecting someone else to share theirs. Share your story as an invitation to others to see that you have been hurt, that you are human and that you are willing to share that hurt with someone who might just be hurt too.
Rodney McKenzie, Jr. is the vice president of ally development at The Fetzer Institute
Join us for Building Civility Featuring Stephen Henderson and Nolan Finley, that features an interactive workshop on building understanding and acceptance for a diversity of opinions and perspectives. Our second pre-conference main stage event on October 12 features Rodney’s colleague from the Fetzer Institute, Dr. Shakiyla Smith, and their nonprofit partner Teresa Mateus of the Mystic Soul Project for a conversation with futurist Trista Harris on Creating an Equitable Future Together. If you are already registered for the conference you are pre-registered for these sessions and can join via the platform. To register for the conference visit www.CMFannualconference.com.