Community Foundation of Washington County

The Power of Philanthropy

IT MAKES GOOD SENSE

What is a Community Foundation?

• 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.

Community Foundations Are…

IT MAKES GOOD SENSE

Iowa CommunitiesGrowing Endowments in

Surprising wealth transfer in 50 years

$41 trillion in United States

$531 billion 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.

Many gifts, many generations

If 5% of estates transfer to endowment funds…A Washington County Example

YEAR 10

$45.2 million charitable gifts

$10.9 milliontotal grants

$53.3 million community endowment

YEAR 50

$304 million charitable gifts

$646,.6 milliontotal grants

$783 million community endowment

What could be accomplished in your community…

7

Ps a revenue source that allows for enhancement or expansion of programs during successful years, and that provides some security in more challenging financial times.

Definition: Endowment

Permanent, persistent resource

Provides a revenue source that allows for enhancement or expansion of programs during successful years, and that provides some security in more challenging financial times.

6+ TIMES

One gift, many generations

YEAR 15

$95,000 in cumulative grants and services

$164,000 balance

YEAR 25

$193,000 in cumulative grants and services

$234,000 balance

assumes 4.5% annual payout and 8.5% rate of return

Initial gift has been invested: 1 TIME 2 TIMES

YEAR 50

$662,000 in cumulative grants and services

$570,000 balance

YEAR 1

Establish a Named Fund

$100,000 gift

LOOKING AHEAD

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Tax CreditThe Endow Iowa

Endow Iowa?WHAT IS

•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

Endow Iowa?WHAT IS

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

Surprising wealth transfer in next 50 years

$41 trillion in United States

$531 billion in in Iowa through probate estates alone

$XXX billion in [County]

$XXX,XXX per probated estate

Endow Iowa Tax Credit Example

With Endow Iowa, donations to community foundation endowments cost

donors less.

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

Calculate for yourself and see the charitable impact at http://www.iowacommunityfoundations.org/resources.aspx

6+ TIMES

nonprofits

YEAR 15

$9,000 in cumulative grants and services

$16,000 balance

YEAR 25

$19,000 in cumulative grants and services

$23,000 balance

assumes 4.5% annual payout and 8.5% rate of return

Initial gift has been invested: 1 TIME 2 TIMES

YEAR 50

$66,000 in cumulative grants and services

$57,000 balance

YEAR 1

Establish a Named Fund

$10,000 gift

The Impact to

Surprising wealth transfer in next 50 years

$41 trillion in United States

$531 billion in in Iowa through probate estates alone

$XXX billion in [County]

$XXX,XXX per probated estate

Donation Amount

2010 2009 2008 2007 2006 2005 2004 Total

$1000 or less

1452 1069 1297 656 424 213 83 3,803

$1001 - $30,000

443 386 485 319 177 181 93 1,954

$30,001 - $100,000

36 34 69 45 36 37 10 239

$100,000 +

40 15 30 20 18 18 13 115

Total Donations

1,971 1,504 1,881 1,040 655 449 199 7,834

In 2005….In 2005….

• Approximately 13 community foundations operating within National Standards for US Community Foundations

• Estimated $206 million in total assets

What has this all done for Iowa?

In 2011….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!

IT MAKES GOOD SENSE

Questions & Comments

Thank you