Weekly Download: June 22, 2020

Monday, June 22, 2020

Michigan Communities Declare Racism a Public Health Issue

With support and partnership from CMF members, several Michigan communities have declared racism as a public health issue — fueling a commitment to address racial inequities that affect the health and well-being of residents.

Genesee, Ingham and Kalamazoo counties—among others— have passed resolutions within the last month to address systemic issues that impact the health of people of color, including police brutality targeting the Black community.

“The most infectious and the most deadliest cancer that we are experiencing in this country is racism,” a Michigan State University researcher told ABC News 12 in Flint. “And until we do that, until we address that, all of these disparities and inequities are going to continue to play out.”

Truth, Racial Healing & Transformation (TRHT) sites in Kalamazoo, Lansing and Flint that are led by or facilitated by CMF members in partnership with CMF, worked with nonprofits, researchers, county leaders and others on these resolutions.

The W.K. Kellogg Foundation leads the TRHT initiative, a national and local effort to bring meaningful change to address the effects of racism in the United States.

“The underlying infection of racism creates persistent systemic and structural barriers that disproportionately threaten the health and lives of Black, Indigenous and people of color,” Sarah Gettel, director of capacity at One Love Global, the organization leading the efforts of TRHT Lansing said. “The resolution names racism as an emergency and a priority for decision making and action in the county, which is an important support for policy and community transformation.”

In Genesee County, the Community Foundation of Greater Flint (CFGF) facilitates TRHT efforts in the area, with two members of the local TRHT Task Force authorizing the county-wide resolution. CFGF and TRHT are planning racial healing circles with the Flint Police Department and the city of Flint to strengthen the impact of local initiatives addressing racial equity.

“This is only a beginning of CFGF's commitment to jettisoning the hierarchy of human value,” Isaiah Oliver, president and CEO of CFGF said. “Ultimately, our hope is that TRHT becomes a way of doing and being that is incorporated into what we do as a community.”

The Kalamazoo Community Foundation (KZCF), which hosts TRHT Kalamazoo, supported the local resolution in Kalamazoo County. TRHT Kalamazoo attended the virtual county commission meeting last week in which two resolutions were passed: a declaration of racism as a public health emergency and one to address and condemn police brutality towards people of color.

“We would like to continue to partner with the county and other government and non-government entities in the community towards healing and transformation,” Sholanna Lewis, TRHT director at KZCF said. “We have been growing this work across Kalamazoo through design teams with broad community participation and have launched several projects.”

Among those projects is a partnership that includes TRHT Kalamazoo’s Cultural Experience Awareness Program for local police cadets to help build positive relationships between law enforcement and communities of color, as well as the Virtual Healing Project to develop and deepen relationships, share resources and support the community collectively during the COVID-19 pandemic.

All of these efforts are designed to address racism as a systemic problem that negatively impacts the lives of communities of color.

“Recognizing that racism is a public health crisis acknowledges how racism is deeper than individual feelings, but a systemic issue that has deep physical and mental health implications for people of color, especially Black people,” Lewis said.

Want more?

Learn more about TRHT.

Connect with TRHT Kalamazoo’s Virtual Healing Project.






Leveraging Loan Programs to Support Nonprofits and Businesses

Throughout the pandemic, foundations have been rapidly responding to community needs in a variety of ways. We have seen an emerging theme across the funder landscape when it comes to relief efforts: the use of loan programs to support nonprofits and small businesses.

The Community Foundation for Muskegon County announced on Thursday that it has partnered with Grand Rapids Opportunities for Women (GROW), a nonprofit focused on supporting entrepreneurs, to create a loan program for businesses in Muskegon County that have been directly impacted by COVID-19. The Muskegon County Recovery Loans will provide $1,000 – $10,000 loans at a 4% interest rate.

“This program will provide critical, flexible funds to those small businesses impacted by COVID-19,” Todd Jacobs, president and CEO of the community foundation said. “The program is designed to keep small businesses afloat and to reopen with confidence.”

Funders across different regions are seeing the success of low-interest loan programs to further their impact in addition to their grantmaking and other pandemic response efforts.

The Ann Arbor Area Community Foundation (AAACF) recently announced the first recipients of its short-term cash flow loan program. The program provides short-term (up to 180 days) cash flow loans of $5,000 - $50,000 as part of the community foundation’s response to the COVID-19 health and economic crisis. AAACF shared on its website, “We plan to keep launching new ways to support the nonprofit sector with philanthropic capital.”

The Saginaw Community Foundation (SGF) used social impact investment funds to create a loan program for small businesses impacted by COVID-19. The community foundation recently told CMF it was looking to do the same for businesses impacted by flooding in the region.

In the early stages of the pandemic, Michigan Women Forward (MWF) launched its COVID-19 Entrepreneurship Program to provide entrepreneurs with loans to ensure their businesses can continue operating during this time. MWF later went on to partner with the Michigan Economic Development Corporation (MEDC) in the creation of the Michigan Entrepreneur Resilience Fund. The Michigan Entrepreneur Resilience Fund, has since been funded by several CMF members and provides microloans and recovery grants to small businesses.

In March, the Midland Area Community Foundation (MACF) announced a $1 million pledge across two funds, the COVID-19 Response Fund and the COVID-19 Impact Investing Fund to provide relief to nonprofits, individuals and small businesses. The Impact Investing Fund will provide a total of $250,000 in 0% business loans for small businesses, with a loan maximum of $5,000.

The New Economy Initiative (NEI), which is housed within the Community Foundation for Southeast Michigan, launched NEI’s Small Business COVID-19 Loan Relief Program to provide six months of loans for 300 borrowers in Detroit, Hamtramck and Highland Park to help preserve their businesses during the crisis.

In her recent impact investing blog, Jennifer Oertel, CMF’s impact investing expert in residence discussed how impact investing can be an effective tool for economic recovery amid COVID-19.

“Impact investing, such as low-interest and patient capital loans, can get even more capital to individuals and businesses in need to help them bridge this crisis,” Oertel writes. “As opposed to the 100% financial return of a grant, lenders can expect a return of, and on, their money and we know that on an overall basis, such loan programs typically have very high repayment rates.”

As for the latest effort led by the Community Foundation for Muskegon County, the community foundation shared that “the loan program will support a breadth of area businesses in a variety of industries - from retail and daycare providers to manufacturers and restaurants - as they prepare to navigate a new normal.”

Want more?

Learn about the Community Foundation for Muskegon County’s new loan program.

Connect with Jennifer Oertel, CMF’s impact investing expert in residence.

Read Oertel’s blog: The A to Z of Impact Investing.






The State of Impact Investing

The Global Impact Investing Network (GIIN) has released its 2020 Annual Impact Investor Survey, providing an update of the impact investing landscape. The report features data and insights from 294 leading impact investors—the largest group of respondents ever—who collectively manage $404 billion of impact investing assets.

As part of this 10th edition, GIIN highlighted several of the most influential impact investments made within the last decade. The Ford Foundation, a CMF member, was highlighted for its 2017 commitment of $1 billion to mission-related investments (MRIs) to reduce poverty and injustice.

The report shares that since then the Ford Foundation has committed $174 million to 12 fund managers and its affordable housing portfolio has preserved more than 16,000 units of affordable housing in the U.S.

“We need to expand our imaginations and our tools if we want to tackle the large-scale problems facing the world today. We can’t neglect the tremendous power of markets to contribute,” Darren Walker, president of the Ford Foundation said.

The Ford Foundation was one of three CMF members that participated in GIIN’s 2020 survey, in addition to The Kresge Foundation and JP Morgan Chase.

Highlights from the report:

  • Motivations for Impact Investing: Nearly all respondents (87%) consider both ‘impact being central to their mission’ and ‘their commitment as responsible investors’ as ‘very important’ motivations. Furthermore, 81% believe that impact investing is an efficient way to achieve impact goals and 88% of respondents reported meeting or exceeding their financial expectations.

  • Impact investing has grown in depth and sophistication over time: It’s clear that the market has evolved over the past decade; 69% of respondents describe the industry as growing steadily. GIIN only had 24 survey respondents in 2010 compared to the almost 300 this year.  

  • Impact measurement and management practices have matured, but opportunities for refinement remain: Impact measurement and management (IMM) practices have evolved over the past decade and now reflect an increasingly strategic use of tools. In 2010, 85% of respondents used their own proprietary reporting systems whereas today, 89% of respondents use external systems, tools and frameworks for IMM. While 88% of investors believe they have increased the rigor of their IMM practices, 23% don’t compare their performance with peers, so GIIN believes opportunities for growth remain. According to the report, GIIN and Harvard are both developing methodologies to interpret and compare results.

  • COVID-19: GIIN shared that the survey was conducted in February and March, with responses coming in as the pandemic began to unfold. However, GIIN was able to capture how investors were thinking about their 2020 investments. According to respondents, 57% said that they were unlikely to change the volume of capital committed to their 2020 investments, while 20% stated they are likely to commit less and 15% plan to commit more.

“The intent of respondents seems to be to respond to the crisis with flexibility and patient capital, which is a trend we’ve seen in Michigan and nationally, as I previously shared in an impact investing blog,” Jennifer Oertel, CMF’s impact investing expert in residence said. “In fact, impact investors are well-placed to support the marginalized communities that have been the most negatively affected by the pandemic and resulting economic downturn.”

In addition, GIIN reported that most respondents do not expect to change their targeted United Nations Sustainable Development Goals (SDG)-aligned impact themes over the next five years as a result of the COVID-19 pandemic.

The data shows that within the SDG impact themes, 71% of respondents target “decent work and economic growth,” 61% target “no poverty” and 59% target “good health and well-being.”

“Racial justice and inclusive communities that work for all are integral to those goals and impact investors in Michigan and beyond are providing innovative capital to help remediate some of the inequality that was built into the fabric of our country and its financial system,” Oertel said. “Community foundations are providing bridge loans to small businesses in marginalized communities. Charitable organizations and CDFIs are providing capital and technical assistance to excluded entrepreneurs. Impact funds are funding businesses so that they may pivot to meet the new reality or develop PPE and vaccines to protect against it. Several private foundations, including CMF members, have courageously stepped up to issue bonds thereby creating liquidity that will permit them to protect their endowments while significantly increasing their grantmaking.”

Want more?

Read the 2020 Annual Impact Investor Survey.

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