Minnesota Foundations Step Up Grantmaking to Area Nonprofits Hit by Economic Downturn

Minnesota Foundations Step Up Grantmaking to Area Nonprofits Hit by Economic Downturn

Minnesota foundations are bending their grantmaking guidelines and otherwise scrambling to make good on commitments to hard-hit charities that are experiencing unprecedented demand for services, the Minneapolis Star Tribune reports.

Even as many foundations are reeling from the double-digit declines in the value of their endowments, some are attempting to boost their grant support to help nonprofits faced with lower fourth-quarter donations. According to Wendy Wehr, vice president of communications and information services at the Minnesota Council on Foundations, about a third of the grantmakers in the state are making adjustments in their grantmaking so as to fund community needs in 2009, while many corporate donors are doing more to provide employee volunteers and technical assistance to nonprofits.

Cargill, a Minneapolis-based producer of agricultural and financial services, and its foundation, one of the largest in the state, recently made an emergency grant of $5 million to Feeding America and other wholesale food distributors who stock community food shelves and kitchens. Meanwhile, the McKnight Foundation, which has seen the value of its endowment fall by some $700 million, about 30 percent, has announced that it will pay out more than its usual 5 percent in 2009, although the dollar amount may be less than the amount it donated in 2008 because the higher percentage is coming off a smaller asset base.

Although these and other efforts will help, they are unlikely to close the need gap caused by massive layoffs at companies such as Best Buy, Pentair, and Caterpillar. And if the economy doesn't start to recover in the new year, things will only get worse.

"It's unlikely that there will be a [federal] bailout for the charitable sector, as there has been for [banks and financial services companies]," said Carleen Rhodes, president of the St. Paul and Minnesota Community foundations. "But we sure hope that this will help lift up our economy and employ people. Because the jobless and disadvantaged come to the charitable sector for help."

Neal St. Anthony. "Charity Funders Feeling Pinched." Minneapolis Star Tribune 12/27/2008.