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The Power of Philanthropy

Community Foundation of Washington County. The Power of Philanthropy. IT MAKES GOOD SENSE. What is a Community Foundation?. Community Foundations Are…. 1. Grantmakers. They support a wide range of community needs- education, health, human services and more.

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The Power of Philanthropy

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  1. Community Foundation of Washington County The Power of Philanthropy

  2. IT MAKES GOOD SENSE What is a Community Foundation?

  3. Community Foundations Are… • 1. Grantmakers. They support a wide range of community needs- education, health, human services and more. • 2. Local Giving Vehicles. They establish and hold numerous funds for a variety of charitable purposes. • 3. Community Leaders and Conveners. They act as community catalysts focusing on long-term endowment building and sustainability.

  4. #1. Grantmaker • Monitor all community needs… arts & culture, economic development, health, environment, education and more! • Direct grants and resources to appropriate areas • Re-direct funds as community needs change • Knowledge of community issues, opportunities, and resources • Gather information and track local agencies and programs Making a difference where it is needed most in the local community

  5. #2. Giving Vehicle • Educate donors about charitable giving vehicles • Customize giving approaches to match personal interests and tax planning needs as a partner with professional advisors • Share knowledge on community needs • Offer involvement in recommending uses of a gift • Provide the option to give anonymously • Help people create personal legacies via named funds

  6. #2. Giving Vehicle cont…. • Unrestricted Fund • Field of Interest Fund • Designated Fund • Donor Advised Fund • Agency Endowment

  7. #3. Community Leader/ Convener • Act as a community catalyst • Support high impact opportunities • Governed by leaders with strongties to the community • Foster development of new organizationsand programs • Build endowments to ensure grants are available to support the community Their business is building the local community

  8. IT MAKES GOOD SENSE Iowa Communities Growing Endowments in

  9. YEAR 25 YEAR 1 YEAR 15 YEAR 50 Establish a Named Fund $95,000 in cumulative grants and services $164,000 balance $193,000 in cumulative grants and services $234,000 balance $662,000 in cumulative grants and services $570,000 balance $100,000 gift Initial gift has been invested: 1 TIME 2 TIMES 6+ TIMES One gift, many generations LOOKING AHEAD assumes 4.5% annual payout and 8.5% rate of return

  10. Surprising wealth transfer in 50 years $41 trillion in United States $531billion in Iowa through probate estates alone $6.1 billion in Washington County $ 274,425 per probated estate in Iowa… $314,186 per probated estate in Washington County.

  11. YEAR 10 YEAR 50 $45.2 million charitable gifts $10.9 milliontotal grants $53.3 million community endowment $304 million charitable gifts $646,.6 milliontotal grants $783 million community endowment If 5% of estates transfer to endowment funds… A Washington County Example Many gifts, many generations What could be accomplished in your community…

  12. IT MAKES GOOD SENSE The Endow Iowa Tax Credit

  13. WHAT IS Endow Iowa? • Encourages Iowa Taxpayers to Contribute to • Endowment Funds at Qualified Community • Foundations • Permanent Endowment Fund • Has to be held at and receipted by the • Community Foundation • Iowa Charitable Purpose • (scholarships, agency endowments, donor • advised funds, etc.) • No more than 5% spending/granting policy

  14. WHAT IS Endow Iowa? • THEN donors can be eligible for... • 25% state tax credit for contribution- in addition to normal federal charitable deduction • Limits each year • per taxpayer (up to $227,590) • statewide (approx $4.5 million in 2011) • Tax credit paperwork has to be completed • Awarded on a first come-first served basis • Tax Credit Letter/# sent by IDED once awarded • Can be carried forward up to 5 years

  15. Endow Iowa Tax Credit Example Surprising wealth transfer in next 50 years With Endow Iowa, donations to community foundation endowments cost donorsless. For example, a $10,000 gift could cost just $4,000. Gift: $10,000 Tax Credit: $2,500 Federal Deduction: $3,500 Total Tax Savings: $6,000 Total Cost of Gift: $4,000 *Based on 35% marginal federal tax rate $41 trillion in United States $531billion in in Iowa through probate estates alone $XXX billion in [County] Calculate for yourself and see the charitable impact at http://www.iowacommunityfoundations.org/resources.aspx $XXX,XXX per probated estate

  16. YEAR 25 YEAR 1 YEAR 15 YEAR 50 Establish a Named Fund $9,000 in cumulative grants and services $16,000 balance $19,000 in cumulative grants and services $23,000 balance $66,000 in cumulative grants and services $57,000 balance $10,000 gift Initial gift has been invested: 1 TIME 2 TIMES 6+ TIMES nonprofits The Impact to assumes 4.5% annual payout and 8.5% rate of return

  17. Surprising wealth transfer in next 50 years $41 trillion in United States $531billion in in Iowa through probate estates alone $XXX billion in [County] $XXX,XXX per probated estate

  18. Surprising wealth transfer in next 50 years $41 trillion in United States $531billion in in Iowa through probate estates alone $XXX billion in [County] $XXX,XXX per probated estate

  19. Endow Iowa… Proven Results! • In 2010, approx $3.4 million leveraged $13.9 million in giving. (processed by 3.15.11) • 125 contributions were from businesses. • 27% of donations were for donations less than $30,000. • Awarded to donors to approximately 71 different community foundations/affiliates. • Since inception, more than $75 million leveraged through 7,834 separate donations… and its growing! Surprising wealth transfer in next 50 years $41 trillion in United States $531billion in in Iowa through probate estates alone $XXX billion in [County] $XXX,XXX per probated estate

  20. What has this all done for Iowa? • In 2005…. • Approximately 13 community foundations operating within National Standards for US Community Foundations • Estimated $206 million in total assets • In 2011…. • Approximately 130 community foundations/affiliates operating within National Standards for US Community Foundations • Estimated $523 million in total assets… growth of $317 million since 2005!

  21. IT MAKES GOOD SENSE Questions & Comments

  22. Thank you. Angie Dethlefs-Trettin, Executive Director- Iowa Council of Foundations www.IowaCouncilofFoundations.org www.IowaCommunityFoundations.org

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