Presented by Maxine Moul to the Iowa Philanthropy Academy February 4, 2008 nebcommfound

1. Using Philanthropy to Build Rural Communities by Supporting Entrepreneurship An Example from Nebraska Presented by Maxine Moul to the Iowa Philanthropy Academy February 4, 2008 www.nebcommfound.org

2. Outline for Today’s Presentation • About Nebraska • Transfer of Wealth Opportunity • About the Nebraska Community Foundation • Community-Based Endowment Building • Endowment for What? • HomeTown Competitiveness (HTC) • Public Policy to Help Community Building

3. About Nebraska • Nebraska’s strengths • Civic capacity and pride • Educational system • Work ethic • Nebraska’s struggles • Out-migration of middle-class youth • Lack of diversity in rural economy • Large geography/many frontier counties (418 of 532 (80%) of communities < 1,000 pop.)

5. Special Challenge Engaging rural leaders in defining new opportunities for their communities to build a positive future and stem the tide of out-migration

6. Intergenerational Transfer of WealthAn Unprecedented Opportunity for Nebraska “Millionaires in the Millennium”Havens & Schervish, 1999, Boston College“Wealth in Nebraska”Don Macke, 2002, Nebraska Community Foundation

8. County-Based Transfer of Wealth Peak of Transfer Group 1 – 2000 to 2014 Group 2 – 2015 to 2039 Group 3 – 2040 and after

9. Transfer of Wealth: A Unique Opportunity • To build philanthropy and endowments • To prove that capital is not the limiting resource to community development • To build sustained community development strategies (by using Asset Based Community Development, or ABCD) • To break out of a cycle of dependency

10. Transfer of Wealth Studies

11. The Nebraska Community Foundation:Incorporated in 1993 Statewide Board of 18/Staff of 11 199 Affiliated Funds(98 Community, 58 Organizations, 29 Donor-Advised, 14 Gift Annuities)MissionThe Nebraska Community Foundation exists to help concerned individuals mobilize charitable giving in support of the betterment of Nebraska communities and organizations. 3

13. NCF Philosophy • Locally-controlled/decentralized • Do not replace local capacity; all services from “mothership” must add-value • Reciprocity • Build community capacity through empowering local leadership • Convene & build partnerships • Build endowments to support core mission • Belief in power of Hometown

14. Affiliated Fund Responsibilities • Governed by Local Fund Advisory Cmte. (FAC) • FAC Responsible for: • Setting Local Priorities & Agenda • Endowment Building • Engaging the Community • Building/Expanding Relationships with Donors and Financial Planners • Donor Targeting & Visitation • Grant Making

15. Community Affiliates Model

16. NCF Provides • Corporate Umbrella • All Accounting, Legal & Investment • Comprehensive Insurance Coverage • Website (including on-line giving) • Community-Based Education/Training • Peer-Learning Network • Customized Endowment Building Assistance with Strategy, Fundraising & Gift Planning

17. Community & Nonprofit Fundraising What’s been successful? • Events • Annual Operating Campaigns • Capital Campaigns What’s been lacking? • Endowments • Endowments for community economic development

18. NCF Partners with Communities and Nonprofits to Build Endowments • Board Engagement • Goal Setting & Campaign Development • Build Skills & Confidence to Engage Donors • Communications & Marketing • Gift Planning • Financial & Investment Management

20. 2007 Rural Philanthropy Conference • Goal: To teach rural community foundations about the transfer of wealth and how they can adopt strategies to move their own rural community development initiatives forward using the transfer of wealth as a case statement. • Speakers from Nebraska, South Dakota and Wisconsin • Keynote address by Dr. Rick Foster of the W.K. Kellogg Foundation • Attended by 93 individuals from 13 states and the District of Columbia. (Idaho, Indiana, Kansas, Michigan, Minnesota, Missouri, Nebraska, New York, Ohio, Pennsylvania, South Dakota, Texas and Wisconsin)

21. Impact of Decentralized NCF System • Empowers Community/Builds Capacity • 2,000+ Fund Advisory Committee Members • $34 Million in Assets (35% year-over-year growth) • $23 Million Endowed (39% year-over-year growth) • $28 Million in Expectancies (124 confirmed gifts) • 29,608 Donors in Past 5 Years • $65 Million in Total Reinvestment

23. Community Endowments Affiliated FundPopulation30-Jun-07 Total* Ord/Valley County 4,647 $6.9 million Bassett/Rock County 1,756 $2.6 million McCook 7,994 $2.3 million Shickley 376 $1.8 million Nebraska City 7,228 $1.6 million Brown County 3,525 $1.3 million Spencer 541 $1.2 million 45 community-based affiliated funds now have over $100,000 in combined endowment, expectancies and pledges *total includes endowed assets, expectancies and pledges

24. Community-Based Endowment Building Efforts Endowed assets plus expectancies (in millions)

25. Endowment for What? Strategic Grant Making Now that you have an endowment, what difference is that going to make in the future of your hometown? These new assets must be invested in ways to build a better future for your hometown!

26. HomeTown Competitiveness Framework for Effectiveand Sustainable RuralCommunity and EconomicDevelopment

27. Four Pillars to Build Community Leadership Youth Charitable Assets Entrepreneurship HomeTown Competitiveness

28. Heartland Center for Leadership Development HTC Strategic Partnership Partner Communities

29. Nucleus of HTC Communities

30. HTC as a Case Statement HTC helps Communities to: • Start and Grow Small Businesses • Provide Better Local Economic Opportunities • Expand Leadership Capacity • Attract More Young People to Live and Work in their Hometown HTC is a Better Case to Prospective Donors

31. HTC has become a National Model: • 2004 Innovative Program Award from the International Community Development Society • 2005 HTC Awarded $2 Million Entrepreneurship Development Systems Grant from the W.K. Kellogg Foundation (one of six selected from 180+ proposals) • 17 HTC Academies completed in 8 states (787 participants) • HTC training/technical assistance now being provided in 12 other states (HTC developing affiliation model)

32. Entrepreneurship Leadership Youth Entrepreneurship Charitable Assets HomeTown Competitiveness

33. EntrepreneurshipExpected Outcomes • Strategy in place for increasing local entrepreneurial business development • Increased entrepreneurial activity within the community in private and public sectors • New jobs and wealth being created within the community • More current businesses retained and growing

34. EntrepreneurshipHow does it support the HTC strategy? • Business development creates jobs and new wealth in the community • Assists in retaining existing businesses • Sustains population with manageable growth • Creates career opportunities for young people • Entrepreneurs can provide leadership and new ideas for the community’s development

35. Entrepreneurship in Valley County • Focusing on building business plans for both start-up and existing growth-oriented businesses • Business coach hired to provide one-on-one assistance • 73 new businesses, 10 expansions and 21 business transitions since 2000 • These 104 businesses have created 332 new full time jobs and nearly $90 million new investment • Linked people recruitment; redesigning Web site • Youth Entrepreneurship Fair

36. Charitable Assets Charitable Assets Youth Entrepreneurship Leadership HomeTown Competitiveness

37. Charitable AssetsExpected Outcomes • Community-based endowed assets • Greater knowledge about charitable giving tools and resources • Grants awarded to specific activities that will improve economic prospects for individuals and/or technical assistance and business coaching to entrepreneurs and small businesses • Grants awarded to specific activities that will improve the likelihood that young people stay or return to their hometown

38. Charitable AssetsHow does it support the HTC strategy? • Community endowments provide a new revenue stream to underwrite HTC efforts • Pool of local assets needed to leverage external private or government funding • Break out of cycle of dependency • Endowments create a margin of excellence for communities to build their competitive advantage

39. Andy and Geri Anderson Endowed Gift of $346,341to the McCook Community Foundation First year grant of $13,500 for: • McCook HTC Youth Task Force • Entrepreneurship training for teachers • 4-H ESI Entrepreneurship curriculum • Youth-led community project “To us it is important to give while we are still alive. We want to see the benefits our gift makes to the community.” - Andy Anderson

40. Examples of Strategic Grants • Non-Traditional Scholarships • High-quality affordable child care • Microenterprise business development • Build Leadership with a Purpose • Capitalize Youth Foundation • Retaining and recruiting volunteers • Value-added curriculum for K-12 school

41. Young People

42. Young AdultsExpected outcomes from HTC • Champions group recruited and involved • Linkages: Leadership and Entrepreneurship • Stronger, sustained connections with alumni • Increased number of young adults returning

43. Sampling of Youth Survey Results Survey of all high school (9-12) students, 2005-06

45. Youth Attraction Formula • Based on actual U.S. Census population data • Factors in rural county marriage rate • Calculated using average children per family • Adjusts for current number of youth in county • Formula helps determine annual youth goal • Goal used to open dialog and engage youth

46. Garden CountyYouth Attraction Goal 1990 Population 2,460 2000 Population 2,292 Percent change -6.8% Loss Per Year in 1990s 17 Persons Total Youth (18 and under) 529 Persons Youth as a Percent of Total 23% Average Graduating Class 29 Persons Annual Youth Attraction Goal 6 Persons 19% Youth Attraction Goal

47. EntrepreneurShip Investigation (ESI) Partnership Venture with UNL Extension Focus upon Middle-School Age Youth Builds on Local 4-H Infrastructure Links with Local ED Resources Flexible Delivery Methods

48. Leadership Leadership Youth Entrepreneurship Charitable Assets HomeTown Competitiveness

49. LeadershipExpected Outcomes • Increased diversity in community leadership • Enhanced leadership knowledge and skills • More volunteer engagement in community projects and activities • More people willing to run for public office

50. LeadershipHow does it support the HTC strategy? • Expands the pool of volunteers and emerging leaders to work on community priorities • Assists current and new leaders in developing their leadership skills • Encourages community members to participate in community planning and development projects